IMAGE EVALUATION TEST TARGET (MT-3) V // A r/> v, ^ 1.0 I.I '.T *" lllll 21 141 1^ 1.8 1-25 i 1.4 1.6 <^ A '/ Photographic ScieDces Corporaticn 23 WEST MAIN STREET WEBSTER, NY. 14580 (716) 872-4503 s V «\^ m 1^ ri> CIHM/ICMH Microfiche Series. CIHM/ICMH Collection de microfiches. Canadian Institute for Historical Microteproductions / Institut Canadian de microreproductions historiques Technical and Bibliographic Notes/Notes techniques et bibliographiques The Institute has attempted to obtain the best original copy available for filming. Features of this copy which may be bibliographically unique, which may alter any of the images in the reproduction, or which may significantly change the usual method of filming, are checked below. -/ n v\ 7 □ D Coloured covers/ Couveiture de couleur I I Covers damaged/ Couverture endommagee r1 Covers restored and/or laminated/ . Couverture restaurde et/ou pellicul^e Cover title missing/ Le titre de couverture manque □ Coloured maps/ Cartes g6ographiques en couleur CCo En Coloured ink (i.e. other than blue or black)/ ere de couleur (i.e. autre que bleue ou noire) □ Coloured plates and/or illustrations/ Planches et/ou illustrations en couleur Bound with other material/ Relie avec d'autres documents Tight binding may cause shadows or distortion along interior margin/ La reliure serree peut causer de I'ombre ou de la distortion le long de la marge int^rieure Blank leaves added during restoration may appear within the text. Whenever possible, these hdve been omitted from filming/ II se peut que certaines pages blanches ajoutdes lors d'une restauration apparaissent dans le texte, mais, lorsque cela dtait possible, ces pages n'ont pas dt6 filmdes. Additional comments:/ Commentaires suppl^mentaires; L'Institut a microHIm^ le meilleur exemplaire qu'il lui a 6t6 possible de se procurer. Les details de cet exemplaire qui sont peut-dtre uniques du point de vue bibliographique, qui peuvent modifier une image reproduite, ou qui peuvent exiger une modification dans la mdthode normale de filmage sont indiqu^s ci-dessous. n -/ D y n D This item is filmed at the reduction ratio checked below/ Ce document est filmd au taux de reduction indiqu6 ci-dessous. Coloured pages/ Pages de couleur Pages damaged/ Pages endommag6es Pages restored and/or laminated/ Pages restaurdes et/ou pellicul^es Pages discoloured, stained or foxed/ Pages d6colorees, tachet6es ou piqu^es Pages detached/ Pages d^tachees Showthrough/ Transparence Quality of print varies/ Qualite inegale de I'impression Includes supplementary material/ Comprend du materiel supplementaire I I Only edition available/ Seule Edition disponible Pages wholly or partially obscured by errata slips, tissues, etc., have been refilmed to ensure the best possible image/ Les pages totalement ou partiellement obscurcies par un feuillet d'errata, une pelure, etc., ont 6t6 film6es d nouveau de facon d obtenir la meilleure image possible. 10X 14X 18X 22X 26X 30X y 12X 16X 20X 24X 28X 32X The copy filmet^ here has been reproduced thanks to the generosity of: University of British Columbia Library L'exemoliiire film6 fut reproduit grAce d la g^nirositd de: University of British Columbia Library The images appearing here are the best quality possible considering the condition and Segihility of the original copy and in keeping with the filming contract specifications. Les images suivantes ont 6t6 reproduites avec le plus grand soin, compte tenu de la condition et de la nettet6 de I'exemplaire film6, et en conformity avec les conditions du contrat de filmage. Original copies in printed paper covers are filmed beginning with the front cover and ending on the last page with a printed or illustrated impres- sion, or the back cover when appropriate. All other original copies are filmed beginning on the first page with a printed or illustrated impres- sion, and ending on the last page with a printed or illustrated impression. The last recorded frame on each microfiche shall contain the symbol — »> (meaning "CON- TINUED"), or the symbol V (meaning "END"), whichever applies. Les exemplaires originaux dont la couverture en papier est imprim^e sont filmds en commenpant par le premier plat et en terminant soit par la dernidre page qui comporte une empreinte d'impresslon ou d'illustration, soit par le second plat, selon le cas. Tous les autres exemplaires originaux sont film^s en commenqant par la premidre page qui comporte une empreinte d'impression ou d'illustration et en terminant par la dernidre page qui comporte une telle empreinte. Un des symboles suivants apparaitra sur la dernidre image de cheque microfiche, selon le cas: le symbole — »> signifie "A SUIVRE", le symbole V signifie "FIN". Maps, plates, charts, etc., may be filmed at different reduction ratios. Those too large to be entirely included in one exposure are filmed beginning in the upper left hand corner, left to right and top to bottom, as many frames as required. The following diagrams illustrate the method: Les cartes, planches, tableaux, etc., peuvent dtre film^s d des taux de reduction diffdrents. Lorsque le document est trop grand pour dtre reproduit en un sf>ul clich6, il est film6 A partir de Tangle superieur gauche, de gauche 6 droite, et de haut en bas, en prenant le nombre d'images nicessaire. Les diagrammes suivants illustrent la m6thode. 1 2 3 1 2 3 -4 . 8 6 '- 976 SCHEDULE. 9 10 11 12 13 14 Tlio Eurl of Dufforin. 3 Miiy, 1873. To tlio Eiirl of Dufforin. 27tli Juno, 1873. To the Eiirl of Dufforin. 30 Juno, 1873. The Earl of Dufforin. 15 Aug. 1873. The Earl of Dufforin. 18 Au.'. 1873. To tho Earl ofDuffcrin, 9 Oct. 1873. Tho Earl of Dufforin. ■1 Oct. 1873. Tho Earl of Dufforin. 23 Oct. 1873. To tho Earl of Dufforin. 7 Nov. 1873. The Earl of Dufforin. 3 Nov. 1873. (Rocoivoil 19 Nov.) To tho Earl of Dufforin. 13 Nov. 1873. To tho Earl of Dufforin. 22 Nov. 1873. The Earl of Dufforin. 7 Nov. 1873. (Roccivod 26 Nov.) To tho Earl of Dufforin. 29 Nov. 1873. Enclosing Bill fi>r tlui Exainiuation of WitiiosH(!H on Oath, and explaining tho circuuistancus which gave riHo to it - Tolcfiram — Oaths Act ia disallowoil ------ Tninsmitting Order in Council disallowing tho above Bill Reporting that ho had prorogued Parliament on tho 13th ; giving an account of tho circumstances cunnoctiid with tlio Prorogation, and enclosing documouts relating to tlio grant of tho Pacific Railway Charter, and a Report of a meeting on tho Prorogation - Reporting that ho had issued a Royal Conmiission to throe Judges to inijuiro into tho matters connoctod with the issue of the Pacific Railway Cliarter, and onclo.sing u copy of tho conmiission, with other papers ---- ...... Acknowhdgiug tho Govcrnor-Genoral's Diispatch reporting tho cirenmstancos connected with tho rocont prorogation of the Dominion Parliament, and fully approving of liis having acted in these matters in aecordauco witli cuastitutiuual usage Requesting instructions for guidance in the event of an Act being passed by tho Dominion Parliament purporting to authorize tho issue of a Commission of lutpiiry ato tho Pacific Ituilway Question, and to take Evidence upon Oath - . - - Acknowledging the above Enclosing copies of tho Report of the Royal Commissioners, with tlie evidi;nco talcon by thoni ; with observatidiis as to tho proceed- ings before tlio CommiBsioners, and their results - . . Stating that iu tlie opinion of tlio Law Officers of tlio Crown it would bo beyond the powers of the Parliament of the Dominion to pass such au Act for the issue of a C(mimission of Inquiry to take Evidence on Oath as contemplated in No. 9 of series - in reply to the above i Reporting tho proceedings on the opening of tho Dominion Parliament — tho resignation of Sir .Tolin Macdonald, and that ho bad called upon Mr. Mackenzie to form a Ministry . . - Acknowledging the above Despatch, and convoying Tier Majesty's entire approval of the manner in which Lord Dufferiu had acted in circumstances of uo ordinary difficulty - - - - 7G 81 81 Speech of the Governor-General on tho opening this day of tho Dominion Parliament --------85 8G 87 2G2 2G3 263 265 CORllESPONDENCE Page. nnd 1 6 - 6 ;iviug ation, 'iicifio tion - 7 'uciflo , with 7G 84 81 85 8G 87 2G2 2G3 2G3 2G5 ^-M nELATIVE TO THE CANADI^VN PACIFIC RAILWAY. No. 1. The EauIv of Dufferix to The Eakl of KiMitEitLRr. My Lorp, Canada, INIay 'S, 1873. 1 HAVE the honour to Ibrwartl to your Lordship a certified cojjy of a Bill, entitled " A Bill to provide ior tlie Examination of Witnesses on Oath by Committees of the " Senate and House of Commons in certain cases," which has passed both Houses of the Canadian Parliament, and to which 1 have th's day given my assent. The introduction of this Bill into the House of Commons arose out of the following circumstances : — On the 2nd April, the Hon, Lucius Seth Huntington, Memljcr for Sheflbrd, in the Province of Quebec, made the following motion : — " Hon. Mr. Huntington moved that Mr. Huntington, a member of this House, having stated in his place, that he is crediljly informed and believes that he can establish by satisfactory evidence,^ — " That in anticii)atiou of the legislation of last Session, as to the Pacifio Railway, an agreement was made Ijctween Sir Hugh Allan, acting for himself and certain other Canadian promoters, and G. W, McMullen, acting for certain United States capitalists, whereby the latter agreed to furnish all the funds necessary for the construction of the contemplated railway, and to give the former a certain percentage of interest in con- sideration of their int(;rest and position, the scheme agreed on being ostensibly tliat of a Canadian Company with Sir Hugh Allan at its head, — " That the Government were aware that negotiations were pending between these parties, — " That subsequently an understanding was come to between the Government and Sir Hugh Allan and Mr. Abbott, M.P., that Sir Hugh Allan and his friends should advance a large sum of money for the jjurpose of aiding tlie elections of Ministers and their supporters at the ensuing general election, and that he and his friends should receive the contract for the construction of the railway, — " That accordingly Sir Hugh Allan did advance a large sum of money for tlie purpose mentioned, and at the solicitation and under the pressing instances of Minist^n's, — " That part of the moneys expended by Sir Hugh Allan in connection with the obtaining of the Act of Incorporation and Charter, were paid to him by the said United States capitalists under the agreement with him, — it is " Ordered, That a Committee of seven members be appointed to inquire into all the circumstances connected with the negotiations for the construction of the Pacific Railway, with the legislation of last Session on the subject, and with the granting of the Charter to Sir Hugh Allan and others; with power to send for persons, pajiers, and records; and with instructions to report in full the evidence taken bel'ore, and all proceedings of said Committee;" which was negatived on the following division: — Yeas, 7(i ; Nays, 107. As your Lordsliij) will perceive, this motion charges my present Advisers with a very infamous proceeding — with no less a crime than that of having sold Canada's most precious interests to certain American speculators, with a view to debauching the Canadian constituencies with the gold obtained as the price of their treachery. In making his motion, Mr. Huntington did not accompany it by any stater A Canada. .nient as to CORRESrONDEXCK RELATIVE TO THE Canada. t|,j. jrroimds on whicli lie IbiiiKlcd his charge, or by the prodiutioii of any evidence in sujiport of it; and neither Sir Jolni iMacdonald nor any of Iiis coHeagues having risen to address tiie House, " vote was J'orthwith taken witliout (U;hate, wliieh resulted in a majority ol'.'H in favour ol' the Cjovernnient in a House of iH;j. The next day Sir John Maodonald himsell' gave notice that he would move the ap))oii!tnienl; of a Committee for tl'.e purpose of investigating Mr. Huntington's charges, and it being further suggested, as I am informed, l)y some of the Opposition members, that the evidence; should be taki'n on oath, a IJill lor that purpose was introduced by The Hon. John Hillyard Cameron, an eminent lawyer of Ontario, and the Chaii-mau of the ])roiiosed Committee. This Bill was accepted by the Government, and passed with scarcely any disjussion in the House of Commons. It was introduced into the Senate by Mr. Camj)bell, the Postmaster-General, and gave ris(! to some dilTerence of opinion as to whether its enactments were within the compe- tence of the Canadian Legislature. [n the I8th clause of the Union Act of Canada, it is provided that " The privileges, " immunitii's, and powers to be held, enjoyed, and exercised by the Senate, and by the " House of Commons, and by the Members thereof respectivtdy, shall be such as are from " time to time defined by Act of the Parliament of Canada, but so that the same shall " never exceed those at the passing of this Act held, enjoyed, and exercised by the " Commons House of I'arliament of the United Kingdom of (Jreat Britain and Ireland, " and by the Members thereof," and the critics of the measure observed that inasmuch as the I3ritish House of ('ommous did not acquire the general right of examining witnesses on oath until a date subsequent to the passing of the Union Act, the Dominion Parliament was precluded by the terms of the foregoing clause from investing the Canadian House of Commons with the powers in question. It strikes me, however, that the 18th clause of tlie Union Act was not framed for the purpose of restricting the legislative action of the Dominion Parliament, but that the terms '' immunities, i)rivil('gos, &c.," refer to those immunities and privileges which are inherent in the British House of Commons as a separate branch of the Legislature, and this view seems to be confirmed by the use of the word "defined." The manifest purpose of the Act was to endow the Canadian House of Commons with a status analogous to that enjoyed by the House of Commons at home; and for obvious reasons it was necessary that the attributes of this status sliould be distinctly specified in the manner provided for by the ISth clause, but it could scarcely have been intended to preclude either branch of the Canadian Legislature I'rom acquiring, by Act of Pari..".- ment, such other ])owers as experience might prove to be necessary, providing these powers were constitutional in themselves, and did not infringe the prerogatives of the Crown. That this view was held by my predecessors as well as by the Imperial Government may be deduced from the following circumstances : — The Canadian Senate is also endowed by the IBth clause of the Act of Union with the same privileges and attributes as the Imperial House of Commons, but these "privi- " leges," &c., are confined by an identic formula within the same limits as those which restrict the powers of the Canadian House of Commons, and which are supposed to render the present " Oaths Bill" ultra vires, viz. to such as were possessed by the British House of Commons at the passing of the Act. Yet one of the first acts of the Canadian Legislature was to invest tlie Canadian Senate with a general power of examining witnesses at its Bar — a power which was not possessed by the British House of Commons until long after the passing of the Union Act. It is possible that this Act may have been assented to by the Governor-General, and acquiesced in by the Imperial Government through inadvertence, in which case it could not be appealed to as a precedent for sanctioning an obvious illegality, but there are no corroborating circumstances to justify me in acting on so unlikely an assumi)tion. Under these circumstances, I trust your Lordship will consider that I have done right in giving the assent of the Crown to the Canadian " Oaths Bill." Had I deferred doing so, very prejudicial results would have arisen. The investigation of a charge of the gravest nature, affecting the honour of my Constitutional Advisers would have appeared to be indefinitely postponed, while it Avas being loudly asserted and widely credited throughout the country that the delay had been contrived at the instigation of Sir John Macdonald and his confederates, who were seeking by these devices to defer the exposure of their guilt. But for this circumstance 1 might have been tempted, as the point raised is a purely legal one, to have reserved the Bill for your Lordshiji's consideration, and the CANADIAN PACIFIC RArLWAY. 3 evideiKH! in hiiviiif; risen jsulti'd ill a il move the )n's cliarf^cs, III m( mbi.'i's, trod I iced by Jhaii'maii ol' iisjussioii ill ul, and gave the compo- 10 privileges, , and by the 1 as are Iroin I' same shall jised by the and Ireland, lat inasmuch examining le Doininiou iivesting the imed for the but that the 3S which are ;islature, and mmoiis with I Jbr obvious ' specified in intended to t of ParL.\' iding these atives of the Government ion with the lese "privi- those which sujjposed to \l the British le Canadian examining 1 House of leneral, and case it could there are uo tion. e done right investigation nal Advisers dly asserted rived at the iig by these raised is a ion, and the Pavaba. noimrtrnont (if Jimtido, ;iOth Aiiril, 1873. more so because, ns you will iicrccivc by the oiulosed Minute, Sir John Macdonnld is inclined to share the inisgivinf;s of those who question the competence of the Caiiatlian I'arlinmeiit in this matter; but as the issue is one not ol ('olonial Itut of Imperial concern, anil as .Sir .loliii tendered his opinion merely for my information, and not as my Adviser — indeed he intimated that he would lie glad if I saw my way to asseiilingto the Bill — I felt at liberty to consult my own judgment, more especially as it may be pre- sumed that my (lovernment would not have ])romoted the " Oaths Bill " in the House of Commons and lathered it in the Senate, had the Minister of Justice entertained a decided conviction of its illegality. My conclusions have been further fortified, not only by the opinion of many legal authorities whom I have consulted, but more especially by that of Mr. Alpheus Todd, the author of 'Parliamentary novernment in England,' who, as your Lordship is aware, is exceptionally ciualilied to j)ronounce upon (|uestioiis of this description, and who has i»tMiiy, i'-;3, been good enough to discuss the case in a short Memorandum, of which I (inclose a copy. I have, iVc, The Earl of Kimberley, (Signed) DUFFERIN. &c. &c. &c. Enclosure 1 in No. 1. Ottawa, September 8, 1873. I, Robert Le Moine, Esq., Clerk of the Parliaments and Custodian of the Statutes of the Parliament of Canada, certily the subjoined to be a true copy of the original enact- ment passed by the Senate and House of Commons of Canada, in the first S(!ssioii of the Second Parliament, held m the thirty-sixth year ol Her Majesty's reign, and assented to in the Queen's name, by the Governor-General, on Saturday, the third day of ^lay, one thousand eight hundred and seventy-three, and afterwards, on the twenty-second day of May of the said year, was disallowed by her Majesty in Council, and proclamation thereof made by his Excellency the Governor-General on the first day of July following. ROBERT LE MOINE, Clerk of the Parliaments. An Act to i^rovide for the Examination of Witnesses on Oath 1)y Committees of the Senate and House of Commons in certain cases. Her Majesty, by and with the advice and consent of the Senate and House of Commons of Canada, enacts as ibllows : — 1. Whenever any witness or witnesses is or are to be examined by any Committee of the Senate or House of Commons, and the Senate or House of Commons shall have resolved that it is desirable that such witness or witnesses shall be examined upon oath, such witness or witnesses shall be examined upon oath or affirmation, where affirmation is allowed by law. 2. Such oath or aflirmation shall be administered by the Chairman or any member of any such Committee as aforesaid. 3. Any witnqss giving false evidence upon any such examination, shall be subject and liable to all the pains and penalties of perjury, as fixed by the criminal law. 4. The oath or affirmation aforesaid shall be in the following form : " The evidence " you shall give on this examination shall be the truth, the whole truth, and nothing but " the truth. So help you God." Enclosure 2 in No. 1. " Department of Justice, " Ottawa, April 30, 1873. "The undersigned, to whom has been referred, by your Excellency, the Bill passed during the present Session by the Senate and House of Commons, intituled ' An Act to • provide for the Examination of Witnesses on Oath by Committees of the Senate and ' House of Commons, in certain cases,' begs leave to report : — A 2 4 CORRR^rONDENCK RKLATFVR TO THE Canada. " « 1 . 'I'lint by the 1 8th Chiuso of " The British Nortli America Act, 1 8(17," it is provided ■ as IbUows ;— - "'Th(! privih'^cs, iminiiiiitics, mid junvers to he hehl, ciKoyed, and exercised hy the Senate and hy tli(^ House of Coninions, and l)y th(! niemhers thereof respectively, shall ho such as are I'roni lime to time definecl hy Act of the I'arliament of Canada, hut so that the same shall never <'xceed those at the [mssini; of this Act held, enjoyed, and exercised i)y the Commons House of I'arliament of the United Kingdom of (Jreat Britain and Ireland, aiul hy the memhers thereof.' " 2. That snhsequently.on the 'J'Jnd May, ISdS, the C^anadian Parliament, hy the Act IJlst Victoria, chap. '2.">, in pursuance of the authority so ;j;iven l)y the Union Act, defnicd the privileges of the Senate and House of Commons respectively. The clause doing so is as follows: — "The Senate and the House of Commons res])ectively, and the memhers thereof reHj)ectively, shall hold, enjoy, and exercise such and the like privileges, immunities, and ])o\vers, as at tlu; jjassjng of ' The British North America Act, 18(>7,' were held, enjoyed, and exercised hy the (^onunons House of Parliament of the United Kingdom of Great Britain aiul Iridand, and by the memhers thereof, so far as the same an; consistent with and not repugnant to the said Act. " At this time neither the JJiitish House of Commons, nor any (^ommittee thereof, had ])ower of examining witnesses on oath, except in certain specihed cases, such as in Private Bills. That ])ower was only conferred on the British House of Commons and the Com- mittees in 1871, by the Act o i and ?,') Vict., chap. 83. " The Bill now referred to thi! undersigned seeks to confer this power upon any Committee of the Senate or House of Commons, when either House shall liavc resolved that it is desirable that Avituesses should be examined upon oath. The empowering section of the Bill is as follows : — " ' Whenever any witness or witnesses is or are to he examined hy any Committee of the Senate or House of Commons, and the Senate or House of Commons shall have resolved that it is desirable that such witness or witnesses should be examined ujion oath, such witness or witnesses shall be examined upon oath or affirmation, where affirmation is allowed by law ' " The questloii has been raisied whether it is competent for the Parliament of Canada to confer thih power on a Coi.nmittee of the Senate or House of Commons h ••'!, as it is a power which was not possessed or exercised by the British House of Commons at the time of the passing of * The British North America Act, 18G7.' "The undersigned has come ;o the conclusion, although not without doubt, that this Bill is not within the competency or jurisdiction of the Canadian Parliament, and that the attention of Her Majesty's Government should be called to its provisions, and to the doubt that exists with respect to its validity. " All which is respectfully submitted. (Signed) " JOHN A. MACDONALD." Enclosure 3 in No. 1. " Opinion in reference to the Meaning op tue ISth Clause of the British North America Act of 18G7. " This clause is as follows : — " • The privileges, immunities, and powers, to he held, enjoyed, and exercised by the Senate and by the House of Commons, and by the members thereof respectively, shall be such as are from time to time defined by Act of the Parliament of Canada, but so that the same shall never exceed those at the passing of this Act held, enjoyed, and exercised by the Commons House of Parliament of the United Kingdom of Great Britain and Ireland, and by the members thereof.' " A Bill having been introduced into the Dominion House of Commons, in the present Session, intituled ' An Act to provide for the Examination of Witnesses on Oath by ' Committees of the Senate and House of Commons in certain cases,' a question has been raised as to whether the Dominion Parliament were competent to pass this Bill in view of the restrictions imposed by the 18th clause of the B. N. A. Act aforesaid. " In my opinion that clause was intended to restrain the claims of either House to CANADIAN PACIFir RAILWAY it is i)rovidfd •rcised l)y tlic irtivi'ly, sliall aiiiida, Imt iso (Mijoycd, and (ircatBrituiu it, l)y tlic Act 1 Act, dcliiied ausc doiiijj so ibors tlierool' nniiiitics, and lu'ld, enjoyed, lorn ol" Groat )nsisti'nt with ' thereof, had as in Private nd llie Com- ;r upon any lave resolved empowering committee of s shall have amiiied ui)on ition, where lit of Canada h ""';, as it is imons at the ibt, that this nt, and that ;, and to the Indefinite privileges and immunities, l)y providinj; that such privileges shall never exceed those enjoyed hy the imperial Mouse of Commons at a i^'iv • .lute. The privilefjes and immunities herein referred to are those that mi;;lil reasonably or unr'.'asonal)Iy he claimed as iniierent in, or necessarily attacliiuf.'' to, tlie Houses of tlie Canadian Par- liament, ])ursuant to the maxim that 'all things necessary ]mss as incident.' By limiting such ])rivileges and i)owers to tiioFi; ]M)ssessed by the Imperial House of Commons in l^i(i7, it j)revents, on the one hand, an inidue encroachment or extension of privilege, and on the other hand secures to the two Houses and the members thereof respectively, the ])rivileges, immunities, and powers ai)propriate to them as component })arts of the Canadian Parliament. "It has been urged that the Act to authorize the examination of witnenscs on oath by Committees of the Senate and House of Commons of Canada, is an extension of their ])rivileges, beyond those sanctioned by the IJ. N. A. Act, inasmuch as Select Committees of the Imperial House of Commons (not l)eing Private 15111 Committees) did not jwssess such ])ower in 18(t/, or until, by tlie Imperial 'Parliamentary Witnesses Oaths Act 'of 1871,' such jiower was for the first time conferred upon them. "It is to be observed, however, that the power so conferred upon Committees by the i'iiiglish House of Commons was not claimed as a 'privilege' inherent in that body. It was merely a power conferred by statute, to facilitate legislative inquiries, similar to that which has been repeatedly conferred upo i Statutory Commissions; and in being so conferred it did not trench upon any iirerogative of the Crown, or enlarge the constitu- tional rights of the House of Commons. "The Dominion Parliament were therefore clearly com])etent, in my judgment, to confer a similar power upon Committees of the Senate and House of Commons, pursuant to the authority conveyed to thai y.rliament by the .">lst clause of the British North America Act, 'to make laws for the [i. ice, order, and good government of Canada.' "In a word, the restrictions contiiiiied in the I8th clause of the aforesaid Act are restrictions upon claims that might Le urged on behalf of the two Houses of the Canadian Parliament, or the members t'l rcof r: pectively, io inln'rent or e.ro'ssirc priviki/cs, and are not intended to prevent tnu exercise of leijislativc poicerK by the whoh; Parliament, provided that the same are exercised within approj)riate constitutional limits. (Signed) "ALPIIEUS TODD. "Library of Parliament, 1st May, 1873." Canada. )NALD." No. 2. Telegram receivkd i\ Quebec, June 27Tir, 1873. The Eari, of Kimberley to Earl of Dukferin. " Oaths Act is disallowed." British ised by the iively, shall ada, but so joyed, and [•eat Britain the present )n Oath by 3n has been Jill in view r House to No. 3. The Secretary of State for the Coloxies to the Goverxor-Gexeral. " My I^rd, " Downing Street, June .SO, 1873. " I HAVE the honour to transmit to you an Order in Council disallowing the Act passed by the Parliament of Canada, 'to provide for the Examination of Witnesses •on Oath by Committees of the Senate and House of Commons in certain cases,' and also the Certificate, as required by the 56th Section of the British North America Act, 1867, stating when the Act was rL.;eived in this Department. Belbre tendering any advice to Her Majesty upon this Act, I referred to the Law Officers of the Crown, and I was advised that the Act was ultra vires of the Colonial Legislature, as being contrary to the express terms of Section 18 of the British North America Act, 1867, and that the 6 CORRESPONDENCE RELATIVE TO THE Oahada. Canadian Parliament could not vest in themselves the power to administer oaths, that being a power whicli the House of Commons did not possess in 1867, when the Imperial Act Avas passed. The Law Officers .also reported that the Queen should be advised to disallow the Act. t " My attention has been called to the fact that by an Act of the Canadian Parliament, cap. XXIV. of 18()8, provision is made by the first section for examining witnesses upon oath at the bar of the Senate, and that the Act has been allowed to remain in operation. It appears to have escaped observation both here and in the Colony that though such examination of witnesses is in accord.mce with the practice of the House of Lords, the powers of the Senate of Canada are limited by the British North America Act, 1867, to such powers as were then enjoyed by the House of Commons, and that the first section of the Canadian Act of 1868 was therefore in contravention of that Act. "But though the Act of 1868 was not disallowed, I have to point out to you, that under the second section of 28 and 29 Victoria, cap. 63, this first section is void and inoperative, as being repugnant to the provisions of the British North America Act, and cannot be legally acted upon. "So far as regards the powers given by the Act of 1868 to Select Committees upon Private Bills, they would appear to be unobjectionable, as like powers had, before the passing of the British North America Act, been given to the House of Commons by 21 and 22 Vict., cap. 78." '* I llclVC &c. (Signed) '" KIMBERLEY." Governor-General The Right Hon. The Earl of Dufierin, K.P., K.C.B., &c. &c. &c. Cal *cl Del At the Court at Windsor, the 26th day of June, 1873. PRESEXT : THE QUEEN'S MOST EXCELLENT MAJESTY, Lord President, Earl of Kimberley, Earl Granville, Lord Chamberlain, Mr. Gladstone. " WHEREAS by an Act passed in the thirtieth year of Her ^Majesty's reign, entitled ' An Act for tlie ITnion of Canada, Nova Scotia, and New Brunswick, and the Govern- ' ment thereof, and for i)urposes connected therewitli,' it is, amongst other things, enacted, that where the Governor-General assents to a Bill in the Queen's name, he shall, by tlie first convenient opj)ortunity, send an authenticated copy of the Act to one of ller Majesty's Principal Secretaries of State, and if the Queen in Council, within two years after receipt thereof by the Secretary of State, thinks fit to disallow the Act, sucli disallowance (with a Certificate of the Secretary of State of the day on which the Act was received liy him) being signified by the Governor-General, by Speech or Message to each of the Houses of tlie Parliament, or by Proclamation, shall annul the Act from and after the day of sucli signification." "And AVhereas on the 3rd day of May, 1873, a certain Bill, jiassedby the Parliament of the Dominion of Canada, entitled ' An Act to provide for the Examination of Witnesses ' on Oatli by Committees of the Senate and House of Commons in certain cases,' was assented to by ihe Ciovernor-General of the said Dominion of Canada : and whereas the said Act of the Parliament of Canada has been laid before Her Majesty in Council, and it is expedient that the said Act should be disallowed by Her Majesty : " Now, therefore, Her Majesty, in pursuance of the said Act of the Imperial Parlia- ment, and in exercise of the powers thereby reserved to Her Majesty, as aforesaid, doth by this present Order, by and with the advice of Her Majesty's Privy Council, declare her disallowance of the said Act of the Parliament of Canada. And the Right Honourable the Earl of Kimberley, one of Her Majesty's Principal Secretaries of State, is to give the necessary directions herein accordingly. "ARTHUR HELPS." " Colonial Office, Downing Street. " I, John, Earl of Kimberley, being one of Iler Majesty's Principal Secretaries of State, do hereby certify that the Act passed by the Senate and House of Commons of II Hi- i ir oaths, that the Imperial 3e advised to I Parliament, itnesses upon in operation. though such af Lords, the a Act, 1867, e first seotion out to you, n is void and rica Act, and mittees upon d, before the amons by 21 EHLEY." gn, entitled tlie Govern- ;hcr things, ae, he shall, : to one oi' Avithin two ic Act, sucli ich the Act Message to 3 Act from Parliament f Witnesses cases,' was vhereas the iniucil, and ial Parlia- esaid, doth cil, declare the Right !s of State, ELPS." Str.-et. retaries of mraons of CANADIAN PACIFIC RAILWAY. 7 Canada, intituled, ' An Act to provide for the Examination of Witnesses on Oath by * Comm'ittees of the Senate and House of Commons, in certain cases,' was received at tliis Department on the 22nd day of May, 1873. " Given under my hand and seal, this 1st day of July, 1873. ^T,,„T^„r i-v " Canada. No. 4. The Earl of DuFFKiim to The Eahl of KiMin-RLKY. My Lord, Canada, August 15, 1873. I HAVE the honour to state, for your Lordsliip's information, that at half-past three of the afternoon of Wednesday the 13th instant I prorogued Parliament. As this event is likely to be regarded with dissatisfaction by one of the great political parties in this country, and has been already animadverted upon in no measured terms by a portion of the Canadian press, I i)ropose to give your Lordship a full account of the circumstances under which it has taken place. Although I have already acquainted your Lordship from time to time with everything which has occurred in connection with the grant of the Pacific Railway Charter, as well as with the proceedings in and out of Parliament to which it lias given rise, it may be well to preface my intended statement by a brief recapitulation of its previous history. The scheme of a Canadian line of railway I'rom the Atlantic to tlie Pacific first acquired a practical character in 1871, when its construction within ten years from that date became one of the conditions on which British Columbia covenanted to enter into confederation. The first move towards the realization of the project seems to have been initiated, not by a Canadian, but by an Englishman of tlic name of Waddington, who, after broacliing his proposals in Toronto and elsewhere, a])parently without success, eventually succeeded in obtaining the co-operation of a numljor of capitalists in Chicago and New York, most of whom, tliough not all, were interested in the "Northern Pacific Railway," a United States line, connecting at Lyndon with the continental --ystem, which it is intended to carry across the iiortheriiiiiost States of the Union to a port on the Pacific, and which will consequently run parallel^ — though at a lower latitude and over a wider arc — with the proposed Canadian line. A deputation from these gentlemen seems to have visited Ottawa in the autumn of 1871, and to have had an interview with some members of the Canadian Government, by whom they were informed that the time for entering into negotiations for the construction of the railway had not arrived. For several months no other proposition was received by the Government; but it is stated by Sir Francis Ilincks, in a letter of which I append a copy, that, being in Montreal in tlie month of July of the same year, he met Sir Hugh Allan, and, giving him the names of some of the Americans who had made these advances, expressed his regret that a work of such importance should fall into the hands of foreigners. Acting upon this suggestion, Sir Hugh Allan turned his attention to the matter, and eventually, in conjunction with these American gentlemen and some Quebec friends of his own, formed a Company for the prosecution of the work. Rut as the Session of 1872 apjiroached, it became evident that the admission of parties connected with the American Pacific to a share in the contract for the Canada Pacific was become unpopular, and, Parliament appearing to share this feeling, it was announced by the Government to Sir Hugh Allan that no proposals emanating from an American Company would be entertained. On this intimation, Sir 11. Allan appears to have addressed himself to the organization of a purely Canadian Company, and gave to the Government the most positive assuranres that he had entirely dissociated himself from his American friends. In the meantime another Company had been formed in Toronto, called the " Inter- " oceanic Company," of which Mr. Alacpherson, a gentleman of very high standing and character, and a Dominion Senator, was Chairman. During the ensuing Session— that is, in the Spring of 1872 — both the Companies, the " Interoceanic " and "Canada Pacific," as Sir Hugh's was now called, obtained Acts of Incorporation, and, at the same time, an Act of Parliament was passed enabling the Grvernment to enter into a contract with one or other of the above-mentioned Companies, 8 CORRESPONDENCE RELATIVE TO THE Canada. or with an amalgamation of the two, or, if they should see fit, to grant a royal charter to anew and altogether distinct Company, in case an agreement should be found impossible with those already in existence. The terms which Government was authorized to grant to whatever Company undertook the contract were settled in the last Parliament, and will already have been communi- cated to your Lordship by my predecessor, Lord Lisgar, who, up to this time, was still in office ; but it may be convenient to mention that the principal concessions consisted of a grant, under certain conditions, of 50,000,000 acres of land, in alternate blocks along the line, and of a subsidy of $30,000,000 (say 0,000,000?. sterling). Of this sum the interest of 2,250,000?., which, by the transference of the fortification loan to the same account, became eventually .3,800,000/., was guaranteed by the Imperial Government. The Session closed on the 14th June. Parliament was dissolved on the 8th July. On the 25th June I arrived in this country, and became personally cognizant of many of the events I now jiroceed to record. From the L5th of July to the 1 2th of October the elections were being held. As soon as they were concluded, Sir John Macdonald returned to Ottawa, and the Canadian Pacific Railway became a frequent tojjic of conversation between us. My Government never seem to have favoured the idea of giving the contract to either of the rival Com- panies, who wore then competing for the i)reference. In Senator Macplierson's Company an Ontario interest was very strongly represented. In Sir Hugh Allan's a Quebec interest predominated. The contemplated undertaking would evidently tax the resources of the country to the utmost. It would be undesirable, therefore. Sir John argued, that any Canadians desirous ol' putting their shoulders to the wheel should be excluded, and a fusion of the two Companies — as provided lor in tbcir Incorporation Acts, and contem- plated by the Act of Parliament — was the object to be attained. Into the intricate and somewhat obscure negotiations which then ensued between Mr. Macpherson and Sir Hugh Allan, at the instance of my Government, I need not enter. They are sufficiently displayed in the Blue Book which I subjoin, and Avhich I have marked for reference. It suffices to say tliat, notwitlistanding Sir John Macdonald's efforts to bring the parties to an understanding, the negotiation altogether failed, principally, as it was alleged on the one side, because Sir Ilugli Allan had not really broken off his connection with the American interest ; and on tlie other, because Mr. Macpherson was not willing to recognize the claims to the chairmansliip of iSir H. Allan, whose pretentions my Govern- ment were disposed to i'avour, in consideration, as they stated, not only of his influential position in tlie Province of Quebec, but as having been the first Canadian in the field to associate himself with the onteriu'ise. In reference to this i)oint, I may observe that, although I have no means of knowing eitherwhen or to what extent my Ministers riiay have pledged themselves to favour Sir Ilugli AUan's election to the chairmanship, the selection of sucii a jjereon, the originator of the Oceanic line of communication iietween Great Britain and Canada, a gentleman who might fairly Ijc regarded as the representative capitalist of the Dominion, and who would be more likely tlian any other to make an impression ujjon the English money market, was a choice which, at that time, few seemed disposed to question. Baflled in their ellbrts to efiect the amalgamation tljy desired. Sir John Macdonald and his colleagues announced their intention of promoting tiie formation of a new and independent Company, out of wiiatcver elements of strength were to l)e found througliout the Dominion, and shortly before the meeting of the new Parliament in March, a Board of Directors was constituted, which included not only some of the leading promoters of the two defunct Comjjanies, l)ut representative men from each of the Provinces of the Dominion. Of tliis Board Sir Hugh Allan seems to have been elected chairman as a matter of course, and to the Company it represented the Charter was eventually it-sued. In previous Despatches I have already described to your Lordship the iirecautions which were taken to jji'cvcnt any American interest or foreign capital ever obtaining control over the concern. 1 am not sufficiently conversant with railway financing to assert, on my own authority, that the restrictions introduced into the Charter with this view are sufficient for tlieir purpose. Money, like water, has a very narrow shoulder, and will find its way wherever it is likely to fructily,— but as far as I can judge, every reasonable precaution seems to have been taken. All the Directors must be British subjects. The I'resident and the majority of the Directors must reside in Canada, and though the shares are transferable, no transfer can be made lor the first six years without the consent of the Government, nor alter six years without the consent of the Directors — the transfers in both cases being registered in the books of the Company. Another subject which seemed constantly to i)re-occupy the mind of my Prime I individual, or any one interest sity ol preventing any ( I'i 4 CANADIAN PACIFIC RAILWAY. il charter to d impossible ly undertook 11 communi- , was still in )nsisted of a ks along the . the interest me account, h July. On many of the d. As soon lie Canadian Government ; rival Com- n's Company ebcc interest urces of the ed, that any iided, and a and contem- ntricate and son and Sir e sufficiently elerence. It le parties to leged on the on with the t willing to my Govern- influential the field to of knowing o favour Sir e originator gentleman pu, and who ;Iish money Macdonald a new and throughout ch, a Board romoters of nces of the lirman as a Uy issued, precautions r obtaining ng to assert, lis view are r, and will reasonable jects. The hough tlie the consent xtors — the my Prime one interest or com1)iiiation of interests, wliether represented by Sir lliigli Allan or anotlior, from acquiring a predominant influence on the Directory. Here again 1 am not sufficiently familiar with the arcana of Board-rooms to know wlietlier the adjustments on whicli Sir John relied were as effectual for the ])urpose as tliey appeared to me to be, but I may observe, that although the scrutiny of Parliament was directed under the light of subsequent events to tliese especial points, neither House has expressed dissatisfaction Avitli the provisions of the liailway Charter, or the personnel of tlie governing body. On the contrary, up to the last moment of the Session, on repeated occasions Parliament continucu to manifest its confidence in those wlio framed the one and constituted the otlicr. If therefore, as is alleged, a corrupt modification of the Pacific Railway Charter to the advantage of Sir Hugh Allan and his American friends was the con- sideration for whidi these personages squandered the enormous sums asserted to have been spent, it would seem tliat they have scarcely obtained their money's worth, a result, I should imagine, foreign to tiie experience of such shrewd men of business. But though the Parliament of Canada thus unmistakably ratified the railway policy of my Ministers, its verdict on the subject was not destined to pass unchallenged. On the 2nd of April, Mr. Lucius Seth Huntington, a distinguished member of the House of Commons, startled his immediate auditory, as well as the whole political world of Canada, by the unexpected introduction of the following motion : — "Hon. Mr. Huntington, moved, that Mr. Huntington a member of tlie House, having stated in his place that he is credibly informed and believes that he can establish by satisfactory evidence, — " That in anticipation of the legislation of last Session as to the Pacific Jiailway, an agreement was made between Sir Hugh Allan, acting for himself and certain other Canadian promoters, and G. W. McMullen, acting for certain United States capitalists, whereby the latter agreed to furnish all the funds necessary for the construction of the contemplated railway, and to give the former a certain percenta. , ing been r prorogation, e 2nd July as their Report. ilso settled as vent has been ship with the get the exact miunicated to informed me ig the 13th of s proposal, he eader of the t Parliament Avould be prorogued on the 13th August, stating, as he affirms, in the most distinct terms, tliut tlie " re-assembly of Parliament on that day would be pro forma, that no " business would lie done beyond the reception of the Report of tlie Committee, which " could then be printed with the evidence, and go l)eforc the country ; that the members " would not be required to return, and that only the Speakers of the two Houses need " be in their places." The only observation elicited by this announcement proceeded from Mr. Ilolton, an Opposition member, who remarked " that to do any business there " must be a quorum, and that he and a quorum would be there;" to which Sir John informs me he replied, that " if a quorum was necessary, a sufficient number of members " would be found in the neighbourhood of Ottawa," — a quorum consisting of the Speaker and nineteen others. It was upon this understanding. Sir John assures me, tliat the House consented to adjourn, and in confirmation of his assertion he has communicated to me the subjoined letter from Mr. Palmer, the member for St. John : — " Sir, " St. John, August 1 1, 1873. " In consequence of statements that I understand have com i from some niembers of the Commons to the effect that there miglit be an actual Sessioi. of Parliament at the adjouT-nment on the 1.1th, to ycu, as tlie leader of the Government, I beg to make the following statement by way of protest, " I have to remind you tliat the House of Commons only consented to adjourn to that time on your pledge openly given in the House that no business should be transacted, nor would the attendance of members be required, as there would be enough around Ottawa to make a_quorum ; that Mr. Speaker would receive the Report of the Committee on the Huntington charges, so that it might be published, and that then Parliament would be at once prorogued. >•' ' ^ " If this promise had not been made, I do not believe the House would have consented to any such adjournment. I certainly would not have given my consent to any adjourn- ment that would have put the country to an expense of a quarter of a million dollai-s by- bringing the Legislature together again. " At all events, be that as it may, I feel that it would be dishonourable for rtystUf ^6 attempt to do business at an adjournment of the House, at which my colleagues had been told that no business would be done, and that they need not attend, and therefore I itiujit decline to do so ; and I protest at any attempt to do business, and I require the Oov(?l'n- ment to fulfil the pledge made to me and to every member of the House, th.it ParliaiA^nt; would be at once prorogued. '■'"■ " While I do this, I do not wish to interfere in any way with the right of the Govern- ment to call Parliament together whenever they think the exigencies of the tximntry require it; they must be the judges of that, and be responsil^le for it; but let that be done in the usual way, that all may understand that it is their duty' to ?ittend ; ttlid when I, together with all my colleagues, am so called upon, I trust thoit I shall be fdund' in my place, and I shall then feel that whether or not all my collea^iiftS attend, they will not have been kept away by a ])ledge that they Mould not be required, and I could there- fore honourably join in doing anything that the House might ■Consider iot the inttirests of the country. * v v iww -ii . ■■-,,,' " I have the honour to be,'&c., I'-iri^oH hnrw x-'t 'U, " Sir John Macdonald, "A. L. PAf.MiJR, ' ' '<< " Minister of Justice, Ottawa." " Member for the City and tJoUlitT of St. Johii?' J' As far as my opinion is concerned, I am quite clear thVit it IvftS' the af^feire'arid'exjiec^ta-' tion of Parliament that prorogation should take place ftt the timte' tn«1tiede the Com- ly before the ould not have nd would not have done so, and that you could not ex]H;ct any fair play at our hands. This alone should be a sufQcient reason why I hunil)ly believe I sliould not be called upon to accept a Commission from the (iovernnicnt of which you are the head, alter your public declaration, made in my aijsence, of my unlltness to perform what the Connnission would impose on me. " I have the honour, &.C., (Signed) "A. A. DORION. "To the Right Honourable Sir J. A. Macdonald." Canada. " Sir, " ^lontrcal, July ."}. " I have the honour to acknowledge the receii)t of your letter of the 2nd inst., enclosing a cojjy of a letter addressed by you to the Hon. Mr. Cameron, as Chairman of the Pacific Railway Inquiry Committee. I cannot agree in your statement that the acceptance of a Royal Commission would enable the Committee to proceed with the inquiry and the examination of witnesses on oath. The Committee is, I believe, unanimously of opinion that the acceptance of the Commission would not enable the committee to make ])rogress, and that the action of the Commissioners (whether or not they be the same jicrsoiis as those who constitute the Committee) would lie entirely disconnected from tlie action of the Committee. Sharing tlieir opinion, I am called on to consider whether I should accejit the offer made by the Government, of a Royal Commission addressed to the gentlemen who happen to be members of the Committee, calling on them to inquire into the matters of charge preferred in the statement of Mr. Huntington. I believe that it would 1)e of evil consequence to create the jirecedent of a Government issuing a Commi-ssion of Inquiiy into matters of a charg against itself, the Commissioners being, as they are, suliject to the direction and control of the accused. I believe that the acceptance of such a Commission would b(! ojiposed to the sense of tlv! House of Commons, as manii'ested by its action last Session, and ^vould, under present circumstances, be calculated to jirejudice the incpiiry ordered by the House, and to impair the full and eflicient exercibc of its most ancient antl important powers. The House of Comrnons does not, I think, expect tliat the Crown or anyone else, least of all the members of its own Conniiittee, will interpose between itself and the great inquiry which it has undertaken. Apart from these and other difliculties, you have yourself interposed a barrier to my acceptance of your offer. During my absence from the House of Commons last Session, you stated in your i)lace that I had done wrong in not declining to fulfil the duty of Committeeman, which bad been imposed on me by the House; that English statesmen in my jiositioii — which, however, you misstated — would have scorned to do as I had done, and that my speeches during the Session showed that your Govern- ment could not expect fair i)lay from me on the inquiry. I shall not condescend to reply to these statements, but I have to say that, although I reluctantly came to the conclusion that I was not free to decline to serve the House of mIhcIi I am a member, I do iiot think it consistent with my self-respect to accept the Commission here offered oy a Minister who has chosen to so characterize my conduct. I have sent a copy of this letter to Mr. Cameron, for his information as Chairman of the Committee. ^' 1 lltlVC iSuC (Signed) " EDWARD BLAKE. "The Right Hon. Sir Jno. A. Macdonald." I do not presume to question for a moment the propriety of the course adojited •by these gentlemen. As Members of the House of Commons, they may have had a more acute appreciation of their Parliamentary obligations than had occurred to my ai)pre- hension,— but I trust that your Lordship will not consider that I acted wrongly in thus endeavouring to forward the inquiry by what I considered an opportune expedient. 1 he Committee being thus precluded from swearing in their witnesses, a motion was made by Mr. Dorion, supported by Mr. Blake, that they shou' 1 content themselves with unsworn testimony, but the majority considering themselves debarred from this course by the express mstructions of the House upon the point, they determined to adjourn until the 13th of August. i i ^ j j < ivJ^"^ resolution was taken on the 3rd of July. The day after there appeared in the At M Hr ^^*''^^^'^'' ^ series of letters and telegrams written by Sir Hugh Allan to a Mr. McMullen, and to a Mr. Smith of Chicago, and to some unknown person in the United States m reference to the Canadian Pacific Railway. The day following a long statement 10 CORRESPONDENCE RELATIVE TO THE C.vNADA. on tho same Hulyi'ct in the form ol" an ullidiivit was issueil by Sir IIuf;h Alliin in another newspaper. 1 liave already had the Iionoiir ol' I'orwardinji; to your Lordsliip hoth these H0.3&N0.4. doeunients, hut I tliinii it well to append tliem to tliis Despatch for convenience of refer- ence. It is not necessary for my i)resent pur[iose that I should either analyze or contrast the conllicting assertions ohserval)lc in tiiese iiroductions. It will he suHicient to note that not only does Sir llu{j;li Allan admit upon oath that tiie language of his letters is "inae- " curate" hut he also denies in the most jiositive maimer tlie correctness of the inferences sought to be deduced from them. On the whole, as far as I could gather from the tone of the press, and from conversation, these revelations rather improved than otherwise the position of the Ministry. On tlie one hand, Sir Ilugli Allan's letters accounted for and justified Mr. Huntington's pertinacity; on the other, his allidavit — or rather, Sir .lohn Macdonald's telegram quoted in tlie allidavit — satisJ'actorily proved that so far from yielding himself or allowing his colleague. Sir George Cartier, to yield to the pressure put upon him l)y Sir Hugh Allan in the height of the election contest, my Prime Minister had required the immediate and comi)lete cancelling of an arrangement favour- able to Sir Hugh to which Sir (ieorge had evinced a willingness to subscribe. In illus- tration of this point, I subjoin Sir George Cartier's letter as well as Sir Hugh Allan's reference to Sir John Macdonald's telegram concerning it. " Dear Sir Hugh, "Montreal, July 30, 1872. " I enclose you copies of telegrams received from Sir John A. Macdonald ; and with reference to their contents I would say that in my opinion the Governor in Council will approve of the amalgamation of your Company with the Interoceanic Company, under the name of the Canadian Pacific Railway Company, the Provincial Board of the amal- gaihated Company to be composed of seventeen members, of whom four shall be named from the Province of Quebec by the Canada Pacific Railway Company, four from the Province of Ontario by the Interoceanic Railway Company, and the remainder by the Government ; tlie amalgamated Company to have the powers specified in the tenth sec- tion of he Act, incorporating the Canada Pacific Railway Company, &c., the agreement of amalniagation to be executed between tlie companies within two months from this date. " The Canada Pacific Company might take the initiative in procuring the amalgamation ; and if the Interoceanic Company should not execute an agreement of amalgamation upon such terms and within such limited time, I think the contemplated arrangements should be made with the Canada Pacific Company under its Charter. "Upon tlie subscription and payment on account of stock being made, as required by the Act of last Session, respecting the Canadian Pacific Railway Company, I have no doubt but that the Governor in Council will agree with the Company for the construction and working of the Canadian Pacific Railway with such branches as shall be agreed upon, and will grant to tlie Company all such subsidies and assistance as they are empowered to do by the Government Act. I believe all the advantages which the Government Act empowers the Government to confer upon any Company will be required to enable the Avorks contemplated to be successfully carried through, and I am convinced that they will be accorded to tlie Company to be formed by amalgamation, or to the Canada Pacific Company, as the case may be. " 1 would add, that as I api)rove of the measures to which I have referred in this letter, I shall use my best endeavours to have them carried into effect. " Very truly yours, (Signed) " GEO. E. CARTIER." Extract from Sir H. Allan's Affidavit of July 5th. " On the same day that I received the above letter from Sir George Cartier, I informed Sir John A. Macdonald of the contents of it, and asked for his sanction of the views Avhich it contained. But he declined to concur in the terms of Sir George's letter, telegraphing to him that he would not agree to them, and that he would come down to Montreal and confer with him respecting them. Thereupon, I immediately informed Sir George Cartier that I should consider the letter addressed to me as being withdrawn ; and to my knowledge Sir George telegraphed Sir John that he had seen me, and that as he (Sir John) objected to Sir George's letter it had been withdrawn. I also telegraphed to Sir John on the same day (July ;!lst) to the effect that I had seen Sir George Cartier, CANADIAN PACIFIC RAILWAY 17 Ian in another liip both those lionce of relor- y/.i' or contrast LMit to noto tluit utters is " inac- r the inferences • from the tone u otherwise the ounted for and ither, Sir .lohn it so far from to tlie pressnrc test, my Prime igement favour- cribe. In illus- [• Hugh Allan's uly 30, 1872. lacdonald ; and .•rnor in Coinicil Company, under u-d of the amal- shall be named y, four Irom the [•mainder by the in the tenth sec- •., the agreement lonths from this amalgamation ; f amalgamation d arrangements ', as required by pany, I have no the construction be agreed upon, are emi)owered Government Act jd to enable the id that they will Canada Pacific red in this letter. CAETIER. H. irtier, I informed ion of the views George's letter, d come down to tely informed Sir leing Avithdrawn ; I me, and that as also telegraphed r George Cartier, and that lie (Sir John) niijiht return my letter or regard it as waste paper, and that I Canada. was satisfied witli the telegram of the 2Gth as expressive of the views of the Government," Ihit any reaction in favour of the Government which might have thus set in was more than counterbalanced l)y the ni)i)earance of another scries of Iett(TS, which 1 also re-n])pend, and which are now generally known as tlie RIcMullen correspondence. Amid these productions tiiere have been introduced documents of a very compromising character, the one a letter from Sir (icorge Cartier asking for twenty thousand more dollars (!?'J0,0{)(» = 4,()(H»/. sterling), and the other a telegram ihmi Sir John Macdonald demanding an addi- tional ten thousand dollars (!? 10,000 = 2,000/. sterling). These latter I subjoin :— " Montreal, Aug, 21, Ifi72. " Dkai: Ml!. Aiiiio'i r,--In the absence of Sir Hugh Allan, I shall be obliged by your 8up])lying the Central Committee witb a further sum of twenty tliousand dollars upon the sanK! conditions as tin; amount written by me at the i'oot of my letter to Sir Hugh Allan of the 30th ultimo. " (JllOKGE K. CARTIER. " P.S. — Please also send Sir John A. Macdonald ten thousand dollars more ou the same terms." " (InaDcilint,; Prirnt,:) " Toronto. Aug. 20, IST-i. " I must have another ten thousand : Avill be the last time of calling ; do not fail me ; answer to-day. " JOHN A. M.VCDONALI). " To the Hon. J. J. C. Abbott, St. Amies."' Rut for the apiiearance of the foregcing documents, I doubt whetlier so great an imi)ression would have been jjroduced on the public mind by the statement of Mr. McMullen. 1 myself have no knowledge of the gentleman, and have no rij;ht to impeach his veracity, but it is manifest that many of his assertions are at variance with Sir Hugh Allan's sworn testimony, while otliers have been contradicted by gentlemen whose credibility it would be difTicult to impugn. lOven with regard to the documents them- selves, it is to be observed tliat they were neither addressed to Mr. McMullen nor to any one with wlioni he was associated, and that they could scarcely have ctmie into his possession by other than surrei)titi()us means. They do not therelbre necessarily coiuiect themselves with those nelarious transactions to which Mr. McMullen asserts he was privy. It is further contended by the fiiends of the Govennnent that the sums nten- tioned or even rel'erred to were not very largi — about 12,000/. sterling in all -an amount which would go but a little way to defray the legitimate expenses of the 150 Ontario and Quebec Elections, and that there was nothing to show whetlier they had been lirod'ered as a subscription or as a temporary loan from a wealthy political ])artisan. Their sinister significance resulted in a great measun; from their factitious juxtaposition with Mr. McMuUen's narrative. Under these circumstances, though without attaching too much importance to mere conjectural pleas of this kind, I was unwilling to jum[) to a hasty conclusion on a matter involving both the private and the public honour of my Ministers, and above all things I felt bound not to allow my judgment to be swayed by the current of popular suspicion which this concatenation of documents would naturally pi'oduce. I happened to be at Prince Edward Island when the McMullen corrcsi)oiidencc reached my hands, whither two of my Ministers— Mr. Tilley, the Minister of Finance, and Dr. Tujjper, the Minister of Customs — had also come for the purpose oi' settling certain details consequent on the recent confederation of the Island. 1 immediately sent for these gentlemen, and the strcMuious assurances I received from each of them confh-med Bfly hope that matters might l)e satisfactorily (;xi)lained. But, however that might Ijc, I teiew that our original programme I'or the indefinite jirorogation of Parliament could no longer be adhered to, and that my presence at Ottawa on the l.'Jth of August was italierative. Understanding, however, that preparations were in progress i'or our public reception at Halifax, I thought it better to proceed thither, and to make no announcement Of my subsequent intentions until the last moment. At the same time I wrote to Sir John, and intimated to him that tlie position of affairs had changed since we parted— that a recess for the usual period was no longer jjossible, and that it was necessary Parlia- ment should be provided with as early an ojjportunity as circumstances permitted ol" f ronouucing upon the points at issue between himself and his assailants. C Ih 18 COT^T^ESrONDKNCE RELATIVE TO TFII-) 4 I Canapa. On rcnrhiiiR Halilax, on t\\v 'J'.ltli July, I found the popular cMitomcnt all over tho Dominion was intonsi', and that my supposed views, sympatliies, and inti'iitions were l)ecomiii}j; not nicrcly the suhjcct olcoiijt'cturc, hut of assertion and conuncnt in the rival newspapers, — tiie (iovcrnnient prcNS stating;-, as il'npon authority, that my course would he so and so, — announcenirnts which were met hy tlie Oppositicm prints with stronj; admonitory or rather minatory artichs. As, at this time, 1 had hy no means made up my mind as to tiie i)ropcr course to he pursued, and I'elt that no decision was possihh: until 1 had seen my Alinislcrs, I determined to take an early opportunity of deprecating the introduction ol' tin; (ks to do his duty — (cliei-rs)— to whom the interests of Canada are as precious and her honour as dear as his own— (imnienso cheering) — who steers unmoved an even course, indin'erent to praise or blame, between the political contentions of the day — (cheersi — can never appeal iii vain to tlu; confidence end generosity of the Canadian i)eo])le. (Iirmense ajijilause.)'' But though keeping my final deeisio:-, in suspense, my mind was nnich occupied, as your Lordship may imagine, with the consideration of the various courses open to me. On one point 1 was (piite dear— namely, that it would not be right forme to eonntouancu the settlement of the serious issues raised between my Ministers and their ojiponents — involving, as they did, the jiersonal honour of the most eminent men in Canada, the fate of my Ministry, and the imlilic credit of the country — exeejit at the hands of a full Parliament, in which the distant Provinces of the Dominion wen- as Avell represented as those of Ontario and Quebec. As I have already described to your Lordship in the earlier ])art of this Despatch, before Parliament adjourned on the 2.'h'd of May I had caused it to be announced to both Mouses that Prorogation would take place on the lIUli of August. This arrange- ment, I have no hesitation in saying, was agreeable to what were then the views of the majority both in the .Senate and in the Houses of Commons. On the faith of this pledge many gentlemen were gone to so great a distance that it was jiliysically impossible for them to be recalli'd, and it so happened, from causes to which 1 have already referred, that by far the larger proportion of these absentees wer(> supporters of the Government. All the members from British Columbia, except Sir P. llineks, were on the wrong side of the Rocky Mountains. Some ]\Iinisterialists were in Europe, as 1 was informed, others in the States, and even to those in the Maritime Provinces, a return to Ottawa, though not physically impossible, as it Avas to their colleagues, would prove a great iri^onvenience at such a season. On the other hand, I learnt that the Opposition were mustering their lull I'orce, an operation for which they possessed certain geographical facilities. Were therefore the 1 louse of C^ommons to meet fiir the transaction of i)ublic business, it was evident that important votes might be passed, and diH'isions taken, contrary to the real sense of the country, and that my ^linistcis might justly complain that they were being unfairly treated, and their late determined by a packed Parliament. But apart from these practical considerations, a grave question, of ju-inciple si-omed to me involved. The Imperial Officer representing the Crown in the Dominion is the natural protector of the federal rights of its various Provinces as secured under an Imperial Act. The sanctity of the rights of any one of these Provinces is not aflected by the number of its representatives or the amount of its population. In this view it is especially necessary that, in a country of such enormous distances, ample notice should be given of the times and seasons when Parliament is to sit; but if it be once admitted that the official "fixtures"' which regulate the opening or closing of a Session and ths C •-' Oanadi. 20 ("ORR]<:SPONJ)KNf'E RELATfVK TO THE Canada. conduct of public l)usiness are to be capriciously tampered with, and changed at so shoi* a notice as to ])rccludo the distant representatives from being present, it is evident mucli wrong and inconvenience would result,and the door be opened to a great deal of trickery at the hands of an unscrupulous Minister. The foregoing considerations pointed ])retty distinctly to prorogation as an inevitalde necessity of the situation. Only one other alternative indeed either suggested itseli" then, or has occurred to me since, and that was anotlier adjournment of tlie House to such a date as would suit the convenience of the absentees. At iirst, I confess this course appeared to me fairly practicable, but further reflection disclosed difficulties I had not at once seen. In the first place, this was an arrangement which I had not the j)o\ver of enforcing, and I was confronted by the obvious reflection, that if the Gov rnment made a motion to that effect, it might be defeated or met with an am-judment .autamount to a vote of want of confidence at the hands of the majority in presence, and I should then find myself landed in the very ])osition which I was quite satisfied ought to be avoidisd. P^ven if the opponents of the Government were to reirain J'rom taking so unfair an advantage of their numerical sujieriority, it was evident that in view of the adjournment preliminary issues would croi) up of vital importance relative to the fresh instructions to be given to the Committee ; for instance, whether the evidence was to be sworn or unsworn, and if the I'ormer, how the oath was to be administered — all of which would necessarily be decided in amamicr unduly adverse to the Government, and in the absence of those who had an undoubted right to make their voices heard on the occasion. I was so anxious, nevertheless, to find some way of avoiding a course which I foresaAV would be denounced, however unjustly, as an undue exercise of the Queen's ju'erogative, that I thouglit it desirable to make a suggestion in tiiis sense to Sir John Macdonald, ofl'ering at the same time to become the channel of communication by which an understanding between liim and his opponents might be arrived at. Sir John's reply was very much in the sense I had anticipated. He insisted upon the injustice of his Govern- ment being given over, bound hand and foot, to the tender mercies of their opponents in th(! absence of his sujjporters, whom he had dismissed to their homes with my sanction and with the acquiescence of Parliament. He called my attention to the fact that the Opposition organs, far from hinting at any compromise. were insistuig on the fact that a quorum of Parliament could do anything that Parliament itself could do, and were evincing by unmistakable signs that they would show no quarter; that both Messrs. Blake and Dorien had endeavoured to persuade the Committee to content themselves with unsworn evidence, and that if Parliament met for lousiness they would be in a position to pass an instruction to the Committee to that effect, that no man would be willing to risk his life, still less his honour, m the hands of witnesses released from tlie consequences of perjury and finally ; that he would not feel himself safe in entering into any arrangements dependent upon the bona fides of those with whom I had suggested he sliould treat. Unfortunately in this country party animosity is intense, and the organs of each side denounce the jjublic men ojiposed to tiiem in terms of far greater vigour than those to which M'e are accustomed in England, The quarrel at this moment is exceptionally bitter. The one party openly accuse the other of jjcrsonal dishonour, while these regard their opponents as unscrupulous conspirators. As a consequence, a mistrust of each other's fair dealings — which I cannot believe to be justified on either hand — has been engendered, which would render the role of mediator under any circumstances extremely difficult. As it was, the former part of Sir John's representations, though not the latter, coincided too closely wiih what had occurred to my own mind to enable me to deny its cogency. There being, however, no further time for correspondence, I left Halifax on Saturday night, the 9th August, and arrived in Ottawa on the morning of Wednesday 13th. Had I ))cen at liberty to have done so, I should have preferred starting sooner, but the town of Halil'ax had organi;!ed a series of popular demonstrations in our honour for Saturday afternoon, and it would have occasioned great dissatisfaction had I absented myself. Before contiiming my narrative, there is one incident connected with my stay at Halifax which perhaps ought to find mention here. Mr. Huntington sent me a sealed packet covered by an official communication to my secretary, which, as I undei-stood from the gentleman who brought it, as well as from Mr. Huntington's letter, contained copies of the incriminatory documents in his possession. As the matters to which the papers referred had become the suljject o'" a public investigation before a House of Commons' Committee, and as I was still uncertain what turn affairs might take, I did not consider it would be proper for me to take personal cognizance of these papers. I therefore returned the packet unopened to Mr. Iluntington. CANADIAN PACIFIC RAILWAY. 21 nged at so shor^ is evident mucli deal of trickery as an inevitable suggested itself )f tiie House to iifess this course iltios I liad not ot the power of v rument made -antamount to d I should then t to l)c avoided, so unfair an he adjournment I instructions to :o be sworn or )f wliich would i in the absence )ccasion. I was foresaw would n's jn-erogative, Im iMacdonald, I by whicli an John's reply was 1 of his Govern- ir opponents iu itli my sanction lie fact that the the fact that a I do, and were it both Messrs. tent themselves wouhl be in a man would be leased from tlie in entering into ad suggested lie ms of each side ir than tliose to is exceptionally ile these regard listrust of each hand — has been inces extrcinely ^ not the latter, me to deny its lell Halifax, on : of Wednesday starting sooner, s in our honour had I absented ith my stay at ;nt me a sealed nderstood from lontained copies hich the papers e of Commons' lid not consider rs. I therefore The 13th August was not only the day appointed for prorogation, but it was also the day to which the Committee of Inquiry had adjourned, but as far as I can gather from the subjoined Keport of what occurred it came together to very little purpose. Indeed its whole procedure on this occasion is difficult of comprehension, in consequence, I supjiose, of the moagreness of the only Keport of what passed which I have been able to obtain, ^n the first place only four out the five members were present, and eventually another, Mr. Dorion, withdrew in the middle of a discussion, leaving what arc considered the Government members in a majority. One of these, Mr. Blanchet, then proposed tluit they should report their jn-oceedings to tlio House. Mr. Blake, in amendment of this sug- gestion, moved the adjournment of the Committee, which was carried— the result being that whttn the House met at three o'clock, as had been arranged six weeks hi fore, for tiie very purpose of receiving the Committee's Keport, no Keport of any sort or descrip- tion was Ibrthcoming. The Ibllowing is the account of the proceedings referred to : — " Ottawa, Aug. 1 ;j. "The Pacific Committee met at 11.30. Present : Messrs. Cameron, Blanc'^et, Blake, Dorion. "At the request of Mr. Blake, the Resolution passed by the Committee at last meet- ing — that the Committee cannot jn'ocecd without further instructions i'rom the House, was read. " Mr. Blake moved that the said Resolution be rescinded. " Yeas — Blake, Dorion. " Nays — Cameron, Blanchet, ' ' Resolution lost. " After some conversation as to the Committee making a Report to the House, " Tiie Chairman said if Mr. Dorion and Mr. Blake were not in I'avour of making a Report, and witlidrew because they thought no Report should be made, the majority of the Committee would not make any Report. "Mr. Dorion said he wanted a Report to be made, but did not concur with tlu; majority. " The Chairman — All we propose to do is simply to Report our proceedings to the House. If you don't like that Report, we need not make any at all. " Mr. Dorion — If I move any amendment, I would stop the report from being made. " The Chairman — It is imjjossible for me to tell the result of merely reporting our proceedings to the House; but if you don't think any Keport of our proceedings should be made, I have no objection that it be so resolved. My own impression is that as we reported all our former })roceedings to the House, there is no objection to our also report- ing those which have taken i)lace since the last meeting of the House. " Mr. Dorion said he would not interfere with such a step. " The Chairman — Then I suppose it is so resolved, and we have completed our business. " Mr. Blake — No, there is a quorum present, and any amendment is in order. I move that the House be asked to give such instructions to the Committee as will enable them to proceed with the inquiry. "Mr. Dorion here withdrew from the room, and the motion was carried unanimously by Messrs. Cameron, Blanchet, and Blake. " Mr, Blake inquired of the Chairman — Do you propose to give the House communi- cation of this Resolution ? " The Chairman — Not unless you move it to be done. " Mr. Blake — Do you propose to communicate any of the previous proceedings? " The Cliairman — I do not. '' Mr. Blanchet — I think W(! should report our proceedings. I move that the proceed- ings of the Committee since ITtJi May last be reported to the House. "Mr. Blake— I move; an amendment that the Committee adjourn, till eleven o'clock to-morrow. " Carried. " Yeas— lilake, Cameron. " Nay -Blanchet. " The Committee then adjourned." A few hours after my arrival in Ottawa, Sir John Macdonald called upon me by appointment, and ft-.mally submitted the unanimous advice of my Ministers, that Parliament sliould le prorogued according to the announcement made by my authority Canada. i w 22 CORRESPONDENCE RELATIVE TO THE Canada. ,n both Houses previous to its adjournment. Alter some conversation, in which we went over the wliolt; ground, and again examined the suggestion contained in my letter relative to an adjournment, I finally announced to him, that on a due consideration ol' all the circumstances ol' the case, the prorogation ol' Parliament seemed to me inevitable, — that I did not feel niysclf justified in withdrawing my confidence from Ministers, or in concluding that Parliament had done so, and that therefore I was prepared to be guided by tlie counsels of himself and liis colleagues, —but that I must formally insist on one condition as the price of my assent to prorogation, viz. : — that Parliament should be again convoked within as short a period as was consistent with the reasonable convenience of members, and that I considered six or eight weeks was as long an interval as should intervene before the House re-assembled. Sir .lohn Macdonald did not offer any objection to this jiroposition — indeed he had already volunteered a suggestion to a similar efi'ect, — and it was agreed that I sliould meet my Council at two o'clock, in order that it might be ratiiicd in the presence ol' all my INIinistors. At one o'clock, however, I was une.;pectedly informed that a deputation of members of I'arliament was desirous of Avaiting ujion me Avith a Memorial against prorogation. I had not received the slightest intimaaon of the intention of these gentlemen, yet, although I felt the propriety of sucli a step upon their i)art Avas very questionable, I concluded to receive them. In the meantime 1 had repaired to the Council Chamber, as agreed upon, where my Ministers jointly re-submitted the advice they had commissioned Sir John Macdonald to convey on their behalf in the morniug. I ma(l(! the same rejjly to them as to my Prime Minister, and the re-assembly of Parliament within the time specified was agreed upon. It was, however, suggested tliat if ten wcks were named as the limit instead of eight, it Avould be possible to get the preparation of the Estimates fjufficiently advanced to roll tA\o Sessions into one, and disjiense with the usual Spring Session. Although I was scarcely in a position to know how far this proposal was practicable or would be acceptable to Parliament, it would evidently prove such a saving of expense to the country and of fatigue and inconvenience to members, many of whom would otherwise scarcely have time to return to their homes at all, between an autumn and the usual Session, that I consented to the additional fortnight upon the specific understanding, however, that if in the interval anything should occur which, in my opinion, rerpiired Parliament to meet sooner, an ex])ression of my wishes to that effect would he at once acted upon without comment or discussion. These matters being settled, I returned to where the deputation of remonstrant members was waiting for me. They were introduced by their Chairman, Mr. Cartwright, a gentleman for whom I have a great esteem. In presenting the Memorial, iVIr. Cartwright stated that it liad been signed by ninety-two members of Parliament, and that another gentleman had intimated his willingness to have his signature attached to it. I found, liowever, on examining the document, that three of the ninety-two signatures had been affixed by deputy, though, of course, with the full authority of their owners. I note the circumstance, however, as 1 shall have occasion to r(;i'er to it hereaiter. As my interview witn my Council had occupied some little time, it had not been ]iossible for me either to study or to write my rej)ly to the Memorial. I was therefore I'orced to make Mv. Cartwright and his friends an extempore answer, which was afterwards reduced to writing as nearly as possible in the terms actually used. This document, together with the Members' Kemonstrance, I subjoin for your Lordship's information. Mkmouul. " The undersigned members of the House of Commons of Canada desire resp(!ctfully to approach your Excellency and humbly to represent that more than lour months have already elapsed since the Honourable Mr. Huntington made, from his place in the House, grave charges of corruption against your E.\cellency's Constitutional Advisers in reference to tile Pacific Railway contract ; that although the House has apiwinted a Committee to inquire hito the said charges, the proceedings of this Committee have, on various grounds, been postponed, and the inquiry has not yet taken place; that the honour of the country imi)eratively requires that no further delay should take place in the investigation of charges of so grave a character, and which it is the duty and undoubted right and Mrivilegc ol' the Commons to prosecute. " Tiie undersigned are deeply impressed with the conviction that any attemj)! to postpone this in(|uiry, or to remove it from the jurisdiction of the Commons, would create this most intense dissatisfaction ; and they therefore i)ray your Excellency not to prorogue Parliament until the House of Commons shall have an opportunity of taking i CANADIAN PACIFIC RAILWAY. 23 in which wu went lied in my letter lonsideration oi' all a me inevitable, — n Ministers, or in tared to be guided ally insist on one iament should be )nable convenience interval as should id not ofler any jestion to a similar k, in order that it ;ation of members ;ainst prorogation. e gentlemen, yet, ry questionable, I upon, where my ihn Macdonald to 11 as to my Prinii' was agreed upon. iistead ol' eight, it advanced to roll Although I was ould be acceptable I the country and ivise scarcely have lid Session, that I lowever, that it' in rliament to meet ted upon without 1 of remonstrant , Mr. Cartwriglit, Memorial, Mr. iament, and that ittached to it. I vo signatures had tlieir owners. 1 r(;alter. it had not been I was tlierefore wer, which was lally used. This your Lordship's 'sire respectfully bur months have »ce in the House, isers in reference a Committee to various grounds, honour of the the investigation ul)ted rigiit and any attempt to Duimons, would Iscellency not to tunity of taking such steps as" it may deem necessary and e.Lpedient with reference to this important Canada. niatter. . i i ,. ^i '• The number of names signed to this document is ninety, withni ten oi one-liall the House. They are as follows : — " Opposition.— Anglin, Archibald, Bain, Bechard, Bcrgin, Blain, I'llake, Bodwell, Bourassa, Bowman, Boyer, Brouse, liuell, Burpee (Sanbury), Cameron (Huron), Cart- wriglit, Casey, Casgrain," Cauchon, Charlton,* Cluirch, Cockburn (Muskoka), Cook, Cutler, Delorme, St.' George, Dorioii, Dorion, Edgar, Ferris, Findlny, Fiset, Fleming, Fourniur, Galbraith, Geoffrion, Gibson, Gillies, Goudge, Ilagar, Harvey, Iliggiubolhani, Holton, Wood, Young, Young. " MixiSTEiUALisrs.— Burpee (St. John), Coffin, Cunningham, Forbes, Glass, Macdonell, (Inverness), Kay, Schultz, Scriver, Shibley, D. A. Smith (Selkirk), A. J. Smith (Westmoreland)."t Rkply. "Gentlemen-, — It is quite unnecessary for me to assure you thai any rcpresontations emanating from persons possessing the right to spoak on i)ul)lic affairs with sucli authority as yourselves, will always be considered l)y me witli the greatest resjtect, even had not circumstances already compelled me to give my most anxious thought to the matters to whicli you are now desirous of calling my attention. "You say, in your Memorandum, that lour months have elapsed since the Hon. Mr. Huntington ])referred grave charges of corruption against my i)resciit Advisers, in rei'erence to the Pacific Railway contract, and that although the House has appointed a Committee to inquire into these cliargc^s, the proceedings ol" this Committee liave on various grounds been postponed, and tlie inquiry lias not yet taken place. " Gentlemen, no person can regret more deeply tlian 1 do tliese unfortunate delays, the more so as tiiey seem to have given rise to the impression tliat they have been unnecessarily interposed by the action of tlie Executive. " It may be p/remature at this moment to enter into a history of tlie disallowance of the Oaths Bill, l)ut this much, at all <'vents, it is but fair to everyone that I should state, viz. that imiTKHliately alter I Jiad assented to tha' AcL T transmitted a certified copy of it to the Secretary of State, in accordance witi, the instructions by which I am bouml on such occasions. That, leaning myself to the opinion (an o])inion founded on the precedent afforded l)y the Act of the Canadian Parliament, which empowers tlie Senate to^ examine Avitnesses on oatli), that the Act was not ultra vires, T accompanied it by a full exposition of the arguments whicli could lie urged in its support ; but en the i)oiiit being referred by tlie Secretary of State ibr the professional o])inJoii of tlie Law Ollicers of tlie (]rown, it was ])ronounced inconsistent with the Act of Conlederation, and that therefore the iiost])onement of the inquiry, so I'ar as it has arisen out of this circumstance, has resulted wholly by the operation of law, and li.is been beyond the control oi' anyone concerned. "You then proceed to urge me, on grounds which arc very fairly and forcibly staled, to decline tlie advice which has been unanimously tendered to me by my Kesiionsible Ministers and to refuse to prorogue; Parliament ; in other words you require me to dismiss them from my counsels; for, gentlemen, you must be aware' that this would be the necessary result of my assenting to your recommendation. " Upon what grour.ds would I be jus1ili(>d in taking so grave a step? "What guarantee can you adbrd mo that the Parliament ol' the Dominion Mould endorse such an act of personal interference on my part? " You yourselves, gentlemen, do not form an actual moiety of th(! House ol' Commons, and I have no means therefore of ascertaining that the majuiity of that liody subscribe to the opinion you have enounced. "Again, to what should I have to appeal in justification of my co"duct? " It is true grave charges have been preferred against these gent'emen ; charg(>s which * The luuiK'H thus noted wrro Ripiiod by proxy. t Tho iibijvo I'luHsilieiilidii is foimdod i)rel'erai)le of the two. Of course it M-as ilways opcni to me to have disniisstnl my Ministers, and to have taken my chance of I'ar'iament approvini;' my conduct, but I did not feel myself warranted in hazarding such a stej) on tli(> data l)efore me. Indeed, the rashness aiul injustice of the ])roceedinji; would probably have aroused such a feeling- of dissatisl'action in the minds of what I have no reason to know may not ])rove the majority of the constituencies that there would have been a great chance — if Sir ilohn and his friends came at all decently out of the allair — ^of their being borne back into office on the shoulders of the people. If wholly exculi)ated, your Lordship can imagine what my position would liecome in presence of the reaction that would have ensued. At all events, as I told tlu; remonstrant members in my reply, I was not ])repared by jniblicly withdrawing my confidence from my Ministers, to proclaim to Canada, to America, and to Europe that t believed untried men guilty of such atrocious crimes as those imputed to them. It is, however, not necessary to debate this line of conduct, as no responsible person in this country has ventured to recommend it. But though not directly suggesting the dismissal of my Ministers, it has been very generally contended that I should have considered them under a ban, and should have ceased to act on their advice, though still retaining them in olfice. The establishment of a relationship of this kind between the Crown and its Ministers would be a novel fact in constitutional history, and might have proved difficult of execution. I was to go to my Council and say to them, " Gtuitlemen, you state that in your opinion the Crown has " i)ledged itself to Parliament to prorogut; on a certain day ; you assert as a matter of fact " that relying on this pledge sixty or s jnty members are not in their places, and that to "allow the House to proceed to business in their absence would be a gross impropriety, " to which you would not consent, and that in view of this circumstance as my Consti- " tutional Advisers, placed al)out me by the will of Parliament, you unanimously advise " me to prorogue. Well, gentlemen, when Parliament last voted, you possessed a " commanding majority : whether you have lost tlu; confidence of Parliament or not 1 "cannot tell. You say j'ou have not. Others say you have. Your political opponents " have brought grave accusations against you. You are therefore under a ban. You have " forfeited my confidence. I do not intend to take your advice, cxcej)t on mere questions " of administration, but — jiray retain your ploces." To which, of course, these gentlemen would have replied : — " We are highly sensible of your Excellency's forbearance, perhaps "you will favour us with a list of subjects on which you will accept our recommendation, " as Avell as an index expurgatorius of those which are tabooed. The arrangement will " lighten our responsibilities, our salaries will remain the same, and our honour" — I cannot exactly conjecture how the sentence M'ould have concluded. But the suggestion that my refusal to take their advice on j)rorogation would not have been tantamount to a dismissal of them, is too untenable to need refutation. Bel'ore, however, closing this head of the discussion it may be Avell to examine the grounds on which it is alleged I ought to have withdrawn my confidence from Sir John ^lacdonald and his colleagues. In order to answer this question, we must inquire what I had to go upon ? There were Mr. Huntington's statements as displayed in his motion — but these statements were not statements of facts, but of conclusions drawn from facts within Mr. Huntington's knowledge i)er]ia])s, but not within mine;, and ollered no safe foothold. Next there were Sir Hugh Allan's statements, but upon which was I to found myseli",— upon those in Sir Hugh's letters, in which he admits there was a good deal of "inaccurate" language, or upon those in his affidavit ? If upon the latter, could 1 have pronounced the Government guilty ? Then there were Mr. McMulIen's statements, — but these have been much questioned, and many of them have been contradicted. I do not think the people ot Canada would be willing to allow the reputation of any of their representative men to he staked ujion evidence of this nature. , Lastly, there were Sir George Cartier's letter, and Sir John Macdoiuild's telegram. In respect to these documents, I would merely observe that, suspicious as they might appear, no man would have been justified in acting upon any conclusion in regard to them, until it had been shown with what transactions they were connected. There is ns yet no evidence to prove that the sums m CANADIAN PACIFIC RAILWAY. 27 red mcittci-s in nniitti'i" could III tli(!S(! i>oint8 except by the ivorop;ation and mtod that the I toliave taken ir warranted in njustiee oi' the ill the niindj^ oi' stitueiu'ies tliat at all decently i oi' tlic people, imld hecome in the remonstrant [•onfidence from lelievcd untried 1, however, not Ins country has ; has been very uid should have c establishment i be a novel fact I was to go to 1 the Crown has s a matter of fact ices, and that to •OSS impropriety, e as my Consti- uiimously advise ou possessed a iament or not 1 itical opponents mn. You have 1 mere questions these gentlemen earance, jjcrhaps ccomii^endation, rrangemont will 3nour" — I cannot •gcstion that my uit to a dismissal to examine the :e from Sir John a upon? There statements were Mr. Huntington's Next there were pon those in Sir ate" language, or the Government lave been much k the people ol sentative men to George Cartier's iments, I would ive been justifii'd shown with what )ve that the sums referred to were consideration moneys I'or the Pacific Railway Charter; and Sir Ihyh Allan states upon his oath that tliey were not, as will be seen from tiie sul joined extract from his affidavit : — " In tlicse and similar ways T expended sums of money approacliing in amount tliose mentioned in tliose letters, as I conceive I had a perfect riglit to do ; but I did not state ill tliose letters, nor is it the fact, that any portion of those sums of money were jiaid to the members of the Government, or were received by them or on their behalf directly as a consideration in any form for any advantage to me in coniuclion Avith the Pacific Railway rontract." On the other hand, what were the countervailing facts within my knowledge ? The theory of the prosecution " is that the terms ol' the Charter were c()rruj)tly niodiiied to "the advantage of Sir Hugh Allan and liis American confederates." Has th(! bargain been carried out'/ Certiiinly not, as far as the Americans are concerned. Tluir complaint is that they have taken nothing by their motion. I was myself a witness of the pains taken to exclude them when the C'harter was being framed. Have Sir Hugh Allan and his friends been gratified with that control over the concern to attain which Mr. IMcMullen asserts he briljed my Ministers'? Tiiis is a fact less easy to elucidate, but I myself believe that lie has not. At moments when Sir John Macdonald could not have been playing a part he gave me rejieated indications of his desire to prevent Sir Hugh from obtaining any commanding influence on the direction. That direction was framed with a view to a proper representation upon it of every Province in Canada, regard being had to the wealth and pojiulation of each. It numbers amongst its members gentlemen who had been on the direction of the late Interoceanic Company, and it includes the names of men wliom everyone would acknowledge would never willingly associate tliemselves with any dishonourable enterprise. It is difficult to believe that these personages are either the willing or unconscious tools of Sir II. Allan. Hence, wo must arrivi' at the inference that, at all events, if the crime was imagined, it can scarcely have been con- summated. This would not in the least excuse its authors, but if a thing has not been done, the fact afTords prima facie grounds for lielieving that it Avas not iiiteiuUd to be done. Lastly, I have received tlie most solemn assurances from my Ministers, l)oth individually and collectively, on their word as men of honour, and on their fealty to the Crown as my sworn Councillors, that tliey are al)solutely innocent of the things laid to their charge. On a balance of the foregoing considerations, can anyone say that I should have been justified in deliberately violating my first duty as a constitutional ruler on a premature assumption of the guilt of these gentlemen '! But a still more important question remains Itehind. Had I any means of knowing that my Ministers had forfeited the confidence of tiie House of C'ommons,— f'tn-, of course, if this were the case, any inward impressions of my own would cease to be elements of the problem ? ^Vhat were the facts upon which I could rely'? During the whole of the preceding Session tlie Government had marched from victory to victory, as will be seen Iiy the subjoined record of votes taken on test divisions :— C.VNADA. 7th March, majority for Government 18th do. do. do. 2nd April, do. do. 17th do. do. do. 7tli May, do. do. 8th do. do. do. 12th do. do. do. 16th do. do. do. K! 2.') 2(j n 21 They had left oil" with a majority of ;].') at tlieir command. The ordinary presumption •would be that their supjiortcrs still adhered to them. Had anything occurrcid to invali- I'date this conclusion'/ The publication of tlie documents I have referred to'/ Judging Jfrom the process of thought in my own mind, which compelled me to suspend my "Verdict, I could not bring myself to believe that Parliament had jumped to any jn'e- - mature conclusion. Hut 1 had one other indication to assist me. Ninety-two Members .of Parliament declared themselves opjiosed to the views of Ministers on ])rorogation. Where were the other one hundred and seven, and what were tlieir opinions'? Of tiie thirty.five or forty who were in their places, not one took steps to make me aware tlial • Mr, Hunlingtoii's motiyii. D 2 >N w^ 28 C0RRESP0N1»ENCK RELATIVE TO THE Canada, tlioy liad coased to sii]i])ort the (JoviTiimpn*. Tlicir names wore coiispicuniisly absent from the Memorial. Tlie sixty or sixty-five members wlio were away eamiot eomj)hiiii ir 1 liave interpreted tlieir .'>seiice as an indication that they endorsed the policy ol' Government, so I'ar at least as prorogation was concerned. That the memorialists were so many and no more was in itself significant, for it gave tlie measure of the (ilVort made and the maximum result. They were not even a moiety of the House. They were a minority, and therefore not in a position to acquaint mr reference to me in IMr. McMullen's letter is to certain alleged money trans- actions. / siihmnlij di'fliiri' (lint I never asheil and nevev dhtiiiiied, i if/irr hi/ /omi or g\ft, (tin/ KUia of money fruiii Sir Ifiii/k Alhni, or from any pcrnon mi. /il.s heltalf, or f rum any person in connection icith the Pacific Jiaihray ; that I never was sounded by Sir Hugh Allan as to my personal expectations, anel never, directly or indirectly, asked or obtained any money in connection with tlie sch(;me. Mr. McMullen asserts tliat I required not only a sum of money for myself, but a situation for my son at a salary of not less than i?2,()()0 per annum. I never made any sucli demand, but 1 did, on oj>e occasion, casually say to Sir Hugh Allan, as I had done to other I'riends, that if l>o hap])ened to know of any employnu'ut for my youngest son I would )je glad if he would bear him in mind. I had not the least idea at the time of employment under a ('()mi)any not likely to be in existence for an indefinite and certainly a long time. Sir Hugh replied, that no doubt when the Pacific Company was formed, he would have no difficulty in finding him (>mployment, and there the matter terminated. This was long before the disputes which arose between the rival Ccnnpanies, from which time I determined that no one connected with me should have any employment in any such Company, and this determination I communicated to Mr. Abbott. Meantime my son got employment of a different kind, and without any reference to Sir Hugh Allan. I may add, that at the time the conversation took place, my youngest son, who held an appointment in British Guiana, was on leave; of absence, and paying a visit to his liimily. I was anxious that he should resign his a])pointment, and remain in Canada, anel undertook to find him suitable employment. I mentioneel him to several friends in Montreal, where I wished him to settle, and I also mentioned him to Sir llngh Allan. I never imagined that 1 would incur the risk of being charged with bargaining for my sujiimrt to the Pacific Railway scheme. I desire to state, in conclusion, that t/ie Canadian Government wa.t never _ in any urty a party to any arranyement between Sir Jfiiyh Allan and his American associates. From the very first there was the strongest opposition to the introduction e)f the American element on the part of se^veral members of the Cabinet, and for myself, though not unfavourable to Americans being introduced, I always felt that Mr. McMullen Was a source of ^veakness. / further sta:e most jwsitively, that the Government never entired into any agreement to give the Pacific Railway Charter for monetary considerations hf any kind. The various eonditiems and the Charter were discussed on their merits, and Sir Jiugh Allan and his immediate friends were repeatedly obliged to yield points which they desired to press. The Government honestly tried to obtain an amalgamation between .;^ho two Canadian Comjianies to the exclusion of Americans, and, Vailing that, they Incorporated a Canadian Company, in which Sir Hugh Allan's infiuence most certainly does not preponderate. "I am, &c., "F. HINCKS." Canada. ■I 82 rOPRESPONDENrE TIELATTVE TO TTTE Canaiia. '' Enclosure 2 in No. 4. ClIAllTER FOR TIIK C\ PTUUCTIO.V Or TIIK PaCIKIC HaII.WAY,* WITH PaITUS AM) Coiun;nro\nKNCi;. "Silt, "Montreal, June Slsf, iHTl!. " I have (lie honour to inlbrni you that th(! Provisional Directors ol' the Canadian Pacific ('oin])any held a meeting;, attcr due notice, on Wednesday, tlie IKtIi ol' June Instant, at which Sir IFuf;h Allan was appointeil President, Mr. Donald Mclnncs Vicc- presichnt, nnd niysell' Secretary ol' the J'rovisional Hoard. "I have also the honour to state, by direction ol' the IJoard, that the Canada Pacific Railway Company is desirous of enteriiii; into an af^reenient with the (iovernment under the statute res])ecting the Canadian Pacific Railway Company recently passed, and will I'cel honoured by any commnnication from the Govorninent on the subject. " 1 have, ttc, "The Hon. .1. C. Aikins, " I]. LK1\ Dl'] BELLEFEUILLE. Secretary. " Secretary ol" .State, &c., Ottawa."' " Canada Pacific Railway Co., "Sin, " .Montreal, ;?rd July, 1872. "I am directed by the President and Provisional Directors of the Canada Pacific Railway Company to inform you that at a meetin;;' of the Provisional Hoard held yesterday, the second instant, in Moi\treal, under the presidency of .Sir Hugh Allan, 1 was instructed to write to the (iovernment of the Dominion of Canada, to inform them that the C!anada Pacific Railway Company is disposed and ready to undertake the building of the Canadian Pacific Railway, on the terms and conditions contained in t\w Act respecting the Canadian Pacific Railway, i)asscd at the last Session of the Parliament of Canada. *' I have >uch assistance as we may obtain from the Government of Ontario, or other assistance that may be given to us, to build another branch railroad from the Nipissing terminus of the Pacific Railway to such a point in the I'rovince of Ontario as will coimect the Pacific Kailroad with the railway system leading to Toronto and other parts of Ontario. " 1 have, Ike, "Honourable J. C. Aikins, (Signed) " HCtJlI .ALLAN, " Secretary of State, Ottawa." " President, Canada Pacific Kailroad. Canada. " Department of Secretary of State, "Siu, "Ottawa, I7th .Inly, 18;2. " I am directed to acknowledge the receij)t of your letter of the '.'lb instant, referring to the communications of the Secretary of the Canada Pacific Kailway Company of the ."h'd same month, advising that the Comj)any was then jjrcpared to aicepl the t,>;itract lor building the Pacific Kailway, and entering into iurther details on the terms and conditions on which tlie Company was ready to take the contract for the construction of said railway. "I have, &c., " Sir Hugh Allan, (Signed) " E, 1»AKENT, U.S.S. "President, Canada Pacific Kailway, Montreal." "SlU, Ottawa, 2iul October, IR-o. " I have the honour to state, in answer to your letter, suggesting that the Canada Pacific Kailway Company and the Literoceanic Kailway Company should amalgamate', that the former Comi)any is willing to make such an amalgamation; and that 1 comnmnicated such willingness to the Interoceanic Kailway Company through its Provisional President, the Hon. Mr. ]McPherson, shortly afti'r reciiving your last' letter. I have I'urther to state, that 1 have not been informed of any action by the Interoceanic Company on the subject, having only received an acknowledgment of the reception of my letter. " I have, kc, '■ The Hon. the Secretary of State, &c., (Signed) " HUGH ALLAN, President, " Ottawa." " Provisional Board, Canada Pacific K.K. " Department of Secretary of State, "Sir, _ "Ottawa, :!rd October, 1872. " I am directed to acknowledge the receipt of your letter of the 2nd inst., in answer to mine of the tth July last, suggestin^nhat the Canada Pacific Kailway Company and the Interoceanic Kailway Company should amalgamate. "I have, &c., " fcir Hugh Allan, Montreal." (Signed) " E. PAKENT, U.S.S. '•Sir, "Montreal, 14th October, 1872. y, 1873. •Hon. J. C. Aikins, "Secretary of Sfate, Ottawa." " I have, kc, (Signed) " HUGH ALLAN, ' President, Provisional Directors. E 34 CORRESPONDENCE RELATIVE TO THE Canada. " Memorandum of the Canada Pacific Railway Company upon the Statement submitted by the Interoceanic Raihvay Company to the Government of Canada. " The undersigned, the Executive Committee of the Canada Pacific Railway Company, have to express tlieir obligations to the Honourable the Privy Council lor the courtesy of a communication of the statement of the Interoceanic Raihvay Company, purporting to set I'orth the reasons which have induced the latter Company to decline tlie 2)roi)osal of amalgamation made by tlie Canada Pacific Company. And they avail tliemselves of the opportunity tlms afforded them, to make some remarks upon the contents of that statement, tliougli they do not feel that any good result would be attained by answering it fully and in detail. "They regard with regret the decision of the Interoceanic Company, but as they conceive tliat it has been brouglit about chiefly by errors upon matters of fact, they are not witliout liope that it may be reconsidered. " In making the proposal of amalgamation, the Canada Company felt iiiat so vast a?i enterprise riicpiired all tlie strength that could be enlisted in it. They believed that the Government aid, with all the advantages wliich the Government are empowered to grant, would not be in excess of the requirements of the undertaking, and :hat there was no room lor attempting to diminish sucli aid or advantages by competiticn. They consider that the Govi-rnment had adojjted a wise policy in endeavouring to create by consolida- tion the strongest Company possiljle, ratner than to attempt to effect some insignificant saving l)y placing the two Companies in competition with each other and tliey IVlt that the only pul)lic-spiriled and patriotic course was to meet th« desire of tlie Government frankly ; and to consent to amalgamation without undue solicitude as lo the terms of it. Tliey believed that the gentlemen who represented the Interoceanic Com);;vny would be prepared, as they themselves were, to lay aside any feeling of rivalry that may have existed, aiul to act vigorously in concert with them for the benefit of l^ie i iidcrtaking. But at the same time tliey were, and are, i'uUy prepared to undertake and c;.rry out the enterprise alone ; as tliey have already ascertained, by negotiation with English cipitalists, that the ])laiis they have lormed fov tlie requisite financial arrangemcpts can, in all [irobability. be carried out. " ■\Vitli resjiect to the propositions which the Interoceanic Con pany seek to estal)lish by the first ])')rtion of their statement, namely, that the organization siiould be pre-eminently national in its cliaracter; and that its means must be drawn first from Canadian, and second and chielly from Britisli sources ; the undersigned have simply to say that any argument for tlie purpose of sustaining such proposition was quite superfiuous, although possiljly lMiro]iean capital may require to be sought for outside of Great Britain — -no one will dispute the advantages of committing the construction and running of tlie Pacili;^ Railroacl to a (."i)inj)any of Canadian origin and composed of British subjects; nor the disastrous results that might lie expected from placing the enterprise under tlic control of the American Northern Pacific Railway Company. The Canada Company have always entertained the opinions enunciated in their statement on this subject: and as proof of that fact, it will appear, on reference to the draft Charter submitted by that Company to tlie House of Commons, that they proposed to make their Board of Directors exclusively British ; M'liile, on the other hand, the Interoceanic Company jiroposed by their draft Charter to create a Board wliich of necessity needed oidy to be British as to the majority of it. And it was only in consequence of the desire of the Cjlovernmcnt and I'arlianieiit that the two Charters should lie identical, and of the objection of the Interoceanic Company to make their Board of necessity exclusively British, that the Canada Coni[)any took from the Interoceanic Company's Charter the clause requiring only a majority to be British instead of the whole. And, moreover, the Canada Company have been actively engaged since their incorporatioi- in negotiations with British capitalists, excliij^ively tending to the acquisition of m<. lis lor tiie toustruction of the railway with every prospect of favourable result, should they be authorized to under- take it. " In th3 face of these facts, it would seem that the somewhat elaborate argument of the Interoceanic Com])aiiy, to prove the expediency of making the Company entirely Canadian and British was not only unnecessary and inapplicable, but possibly might be said to be out of place as coming from that Company. " The Interoceanic Company having however submitted various arguments in suj)port of these jirojiositions, proceed to apply them to the disadvantage of the Canada Company. " They i-.ssert that it is a matter of notoriety that one of the leading nieuibers of the Canada Company, and its Provisional President, has been engaged in negotiation witli gentlemen connected with the Northern Pacific Railway, for the organization of a CANADIAN PACIFIC RAILWAY. 35 cut submitted hy ada. Iway Company, r the courtesy ol' puri)ortiiig to the projjosal of lemselves ol' the )iitents ol' tliat lI by aiisueriiig ly, but as they )i' fact, tliey are iiiat so va&t an elieved that the iwered to grant, t there was no Tliey consider e by consolida- ne hisignificant d tliey felt that he Government the terms of it. ii;:vny uould be that may have ic tndertrtking. d c'.rry out the !;lis'ii cipitalists, I'ts can, in all to establish by ) pre-eminently Canadian, and ) say tliat any uous, although Jrituin — no one of the Pacilio subjects ; nor rise under the lada Company s subject: and mitted by that I'd of Directors >' j)roj)osed by •e British as to e (Government )jection of the itish, that the luise re(j^uiring lada Company with British f)nstruetion of i/id to undcr- argument of pany entirely ibly might be sinsiijiport of I Company, embers of the jcitiation with lization uf a Company for the construction of the road ; and they say that the impression still exists everywhere that his original scheme is unchanged, and that his Company, as they term the Canada Company, is intended to co-operate with })arties in the United States interested in the Northern Pacific Railway. And they declare that the Interoceanic Company share this belief. " That, in reality, is the chief ground stated by the Interoceanic Com})any for declining amalgamation ; and as it is easy to show that this groimd is entirely unsupported by facts, the Canada Company hope that, this erroneous impression being removed, the course of the Oceanic Company may be materially changed. " With regard to the assertion mat a belief ' exists everywhere ' that the Canadian Company still intend to carry out the design of combination with American capitalists, it is only necessary to say that the gentlemen who say so no doul)t s])eaiv truly as to some limited circle with which they are in immediate communication. But the Canada Com- pany emphatically deny that beyond such a limited circle any such belief or even any • idea of such a state of things is entertained. " The Canada Company are aware that a negotiation was commenced during the summer of eighteen hundred and seventy-one, between Sir Hugh Allan and certain Americ n capitalists lor the formation of a Company to construct and run the Canada Pacific Railway ; but they are informed by Sir Hugh Allan, and have satisfied themselves by a full inquiry into the circumstances and details of tiiat negotiation, that it was not initiated by Sir Hugh, and that it was commenced and supported by influential persons in Canada, as being the only combination that offered itself at that time for the construc- tion and running of the road; but they are satisfied that that negotiation never possessed the character attributed to it by the Interoceanic Company, and they know that Sir Hugh Allan would never have consented to embark with foreign capitalists in a Canadian enterprise in which he takes so great an interest without the most perfect securities and guarantees for its control and conduct in the interest of Canada. But the discussion of the negotiation is entirely foreign to the i)ropositioii now l)eing considered. That negotiation terminated when Sir Hugh Allan engaged with others in the lormation of the Canada Com])any, and it has never been renewed. " The Canada Company never participated in that negotiation, and nintr considered or entertained any proposition, suggestion, or intention of asking aid i'roin American capitalists, or of combining with them for the prosecution of tl railway, or for any other i)urpose. The only negotiations tliey have carried on are .lose already alluded to with British cajtitalists, and they have never even communicated on the sulyect of the railway Mith anyone outside of Canada or Great Britain. " The Canada CJomjiany would further remark on tliis branch of the sui)jcct, that they are unwilling to attempt to gather from the terms of the statement of the Inter- oceanic Company any meaning which does not plainly appear upon its face. But they cannot omit noticing that the weight of this objection rests ujion the suggestion, rather implied than expressed, that the Canada Conlpany is prepared to lend itself to the obstruction of the Canada Pacific liaihvay, by placing the control of it in flie hands of capitalists interes^-d in a rival road. Unless tlie objection is taken as having this bearing, it would have no weight, and the Canada C;omi)any are thereiore forced to make u single reman- upon this view of it. They desire expresslv to state that their Company is compos(-d of gentlemen as fully alive to tb..- interests oi' Canada, and as di'cply interested in its welfare, as the members of the Interoceanic Company, or anyone else can be. And they protest formally ..nd energetically against any imputation, whether expressed or impiied, contemplating the possibility of their taking the course which they cannot hut interpret as being imjiuted to them by th(> statement of the Interoci'auic Comiiany. Although probably the Interoceanic Company will accept the ]»ositi\e and uiuiualilied disclaimer whicn the Canada Company now place on record, it may xwi be amiss to remark upon the impossibility of any such course being taken as that whicli is implied 111 the Interoceanic Company's objection. " It will be ol)scrved that the aid in money and lands is onlv to be granti'd hy the Government as the work actually progresses. It is also necessary that tlu' periods for the completion of the various sections of the road should be fixed bv the agri«ement with the Company entrusted with the enterprise. It is also necessary that the Govern- ment should fix a porio(, within which the work should be comnunccd and proceeded witli. And it is reasonably to b;- supposed that there would be a i)iovisioii in any agree- ment made with »he (iovermaent that upon I'ailure in any of these coiuUtioiis the Company should forfeit its rights to the Government aid. Au'ain, in the proposition of amalgamation which the Canada Company made to the Interoceanic Coin]iany it was suggested that the former Comiiany should name a small proportion of the Provisional £ 2 Canaoa. IW Canada. i^jM--' 36 CORRESPONDENCE RELATIVE TO THE Directors, the Interoceanic Company naming a similar number, the intention being that the remainder of the Hoard, constituting a majority of it, should be agreed upon between the two Companies and the Government. " Under these circumstances, the undersigned would observe that the carrying but of any such plan as that implied l)y or imputed to the Canada Company is simply impos- sible. Supposing, for argument's sake, that they entertained the intention of placing the control of the enterprise in the hands of the Northern Pacific Railway Company, the persons named by them on the Board would constitute but a small minority of it. And without the concurrence of the Interoceanic Company's no;ninees and those approved of by the Government, it would be utterly impossible not only to alienate the aid given by the Government, but even to obstruct in any material degree tiie operations of the majority of the Board. And if, which is impossible, the small minority could control the majority so I'ar as either to purj)ort to alienate the aid or obstruct the work, the remedy would be in the hands of the Government, as no portion of the ])roj)osed assist- ance could .actually be alienated from the purposes for which it was intended, and the attempt would only result in the forfeiture of the agreement. " With regard to the assertion of the Interoceanic Company that they ' very generally 'and equally' represent all the Provinces of the Dominion, and „he comparison of importance they draw lietwcen the Interoceanic Company's organization and that of the Canada Company, the undersigned would prefer not to discuss it at any length. At the s\me time, in justice to themselves, they would remark that they have not a word to say af'ainst the respectability of the three gentlemen from the Province of Quebec, whose names ap))ear upon the minuteof the meeting of the twenty-sixth day of September; but they would ask in what sense or from what point of view can these three gentlemen be said to represent that great and flourishing Province? \v.l] ."- lO the other gentlemen from the Province of Quebec, whose names appear in ih' ' i tj" 'lovern- ment, but also because they feel that it is in the interest of the » it. v i^. chat all possible strength should be concentrated upon it. "'The undersigned are desirous of making one remark more as to the oL.sc >• atirms of the Interoceanic Company's statement with regard to ])olitics. The Canada Jor^iany have not in any manner or way interfered in ])olitics, and thcj are at a loss to kuow to what circumstances the Interoceanic Comjjany can refer in their remark on this subject. "The t'anada Company is comjiosed of persons holding diU'erent views in political matters, and those persons have acted in accordance with those views when called .upon in any way to act politically since they joined the Company as they did boiore. and as they probal)ly will contiiuu! to do; and the Canada Company have not in any way resorted to sectional or any other pressure to induce the Government to negotiate with tliem I'or the constnu-tion of the railway. On this point also it will le jierceived that the Canada Company confined themselves to vindicating their owi* , tsition, without assailing or attempting to assail the position or acts of the Interoceaf c "« mnany. "In conclusion, the undersigned respectfully state that the membets ; llie Canada Com])any claim for themselves in every respect a strong sentiment of jiiiii otisni, and as nuu'h pulilic spirit as any of their lellow-subjects, and they consider that their nam«!s and antecedents are a sullicient guarantee tliat their ^laini is well founded. They are as sensil)le of the disadvantages of any ''stn'otl'iu to tiie gigantic undertaking in which the Government of Canada is about to eniliik, as nr i 'icr person or Company can be. They believe themselves to be as compcieut as tlie Interoceanic Company or any other IE ■3 CANADIAN PACIFIC RAILWAY. 37 he intention being that 30 agreed upon betweeu that tlie carrying but of ijiany is sini])ly impos- intention of placing tlie Railway Company, the 11 minority of it. And and those approved of » alienate the aid given e tlie operations of the minority could control obstruct the work, the of the j)roposed assist- was intended, and the lat they ' very generally ,nd .he comparison of lization and that of the at any length. At the have not a word to say 'hue of Quebec, whose day of September ; but 'se three gentlemen be lO tiie other gentlemen . ■ ■" Interoceanic Com- Jiicumstanccs of their 1 exercise any influence Company is submitted irison of them with the 10 not hesitate to assert I the Board constituted Tliey regret the neces- arnestly deprecate any :y arouse any feeling on eir desire, in answering 11 which that Company id they have studiously ut of tlie Interoceanic pted to do sn_ in order II the lin;; .-'.'argument e to car:" o" ib.; wisii L> desire ) ti" ^Joverii- tlie i-.«i,> v> ■;, diat all to the o:. . • ations of ^hc Caiiauii Jev.^iany e at a los« to know to mark on this suiiject. eiit views in political Avs when called -upon ley ilid beibre. and as luve not ill any way eiit to negotiate with vill |.e perceived that )v '* , r.iition, without ai! c "i ninany. mb';!>> '. vhe Canada :tober 2 2n(l, 1872. " I am directed to forward you the oncloscd copy of an (3r Victoria, cap. 71. " JOHN A. MACDONALD." "CorY of a Report of a Committee of the Honourable the Privy Council, dated 31st January, 1S73, and ai)])roved by His Excellency the (jovernor-Gencral in Council on the "jth February following. " The Committee of the Privy Council have had l)efore them the Report of the H(inoural)le Minister of Justice of this date, stating that the agreement mentioned in the Order in Council of this day's date, for the construction of the Canadian Pacific Railway, by Sir Hugh Allan; the Honourable Adams George Archibald; the Honourable Joseph Octave Reaubien; Jean Baptiste Beaudry, Esq.; Egerton Kyerson Burpee, Esq.; Frederic William Cumberland, Esq. ; Sandford Fleming, Esq. ; Robert Newton Hall, Esq.; the Honoural)le John Sebastian Helmcken ; Andrew McDermot, I']sq. ; Donald Mclrnics, Esq. ; Walter Shanly, Esq. ; and John Walker, Esq ; has been duly executed by them. The Committee therefore recommend that your Excellency do ord(!r that a Charter be granted to such persons under the Great Seal of the Dominion, pursuant to the 15th clause of the Act 35 Vict., cap. 71. "Certified, " W. A. HIMSWORTH, '* Clerk, I'rivy Council." " Department of Secretary of State, "SiH, "Ottawa, lltii February, 1873. " I am directed to transmit to yon tlie enclosed Charter of ' The Canadian and ' Pacific i^ailway Company," tlie receipt of which you will be good enough to cause to be acknowledged. '' f have, &c., " Sir Hugh Allan, cl'c, c!72. " His Excellency the Governor-General in Council has had under consiileration your letter uf the 2()th ultimo, ri'i)()rtinf; the jjrovisional organization of ' The Intcr- ' oceanic Railway Company of Canada,' and ex])ressing the desire; to be inlurmeil when the Government will Ih' ])rei)arod to negotiate with the C()mi)any in respect of the con- struction of the Canadian Pacific Railway, and I am directed to inform you that it is the wish of the (Government of Canada that your CJompany and 'The Canada Pacific Rail- • way Company ' should unite and form one Company, in accordance with the tenth section of the Act rcsjut'ting the Canadian Pacific Railway. ', "A similar communication has been made to the Secretary of the latter Company, '.E. Lef de Belleleuille, INloiitreal. " I liave, &c., t (Signed) " E. PARENT, " Under-Secretary ol State. *'IIon. D. L. Rlacpherson, " President, luteroceanic Railway Company, Toronto." Canada. « Sir, " Office of the luteroceanic Railway Company of Canada, "Toronto, 28th September, 1872. " I have the honour to state, for the information of the Government, that 1 convened a meeting of tlu; Provisional Directors of the luteroceanic Railway Comjjany ol' Canada, for the i)urpose of considering the suggestion of the Government, that this Company should Mnalgamate with the ('aiiada Pacific Railway Company. " At the request of the Board, I send herewith a copy of a Rejjort from the; Executive Committee upon the subject, adopted unanimously by the Board, declining amalgamation for the reasons set forth. "I am also requested by the Board to intimate to the Government that this Company is prepared to enter into arrangements for building and working the Canadian Pacific Railway. " I have, Sec, (Signed) " D. L. MACPIIERSON, " Provisional President. ^ To the Honourable the Secretary of State, Ottawa." ^ " luteroceanic Railway Company of Canada, "Toronto, 2fith Sept., 1^72. "At a meeting of tlie Provisional Directors of the luteroceanic Railway Company of Canada held this day, jjresent in person or by proxy : — " Tiie Hon. D. L. IMacpherson, President ; "Charles H. Eairweather, l^sq., Vice-i)resident ; " The Hon. Messrs. VVm. McMaster, Prank Smith, John Simpson, G. W. Allan, Is. Tlnbaudeau, John Carling ; J. W. Cumberland, l^sq., C. S. Gzowski, Esq., J. G. AVorts, Esq., John \Valker, Esq., \V. II. llowland, Esq., David Torrance, Esq., John Boyd, Esq., T. Kemiy, Esq., Edwin Russell, Esq., J. F. Raudolph, Esq., John Starr, Esq., the Hon. |D. E. Price ; •i " A communication was read from the Government, suggesting that the luteroceanic iKailway Com])any should amalgamate with the Canada Pacific Railway Company. The j^foUowing Report thereon from the Executive Committee was also read:— l" To the Provisional President, Yicc-presideut, and Directors of the luteroceanic Railway * Company : ■'"i'our Executive Committee have had under consideration a communication from the overnment, expressing a wish that the luteroceanic Railway Company should amal- Igamate with the Canada Pacific Railway Company, and they now beg leave to report : ^ Ihat they have given their best attention to the proposal, solely with reference to the successful and early completion of the Canadian Pacific liailway. Ihe construction and management of an undertaking involving sucli vast and varied interests must, in their opinion, mainly depend for success upon its complete identification with the public sentiment of the country. F 2 .HI- 44 mT?T?ESPONDENCE RELATIVE TO THE Oakada. "The subsidy in money, though in itself large, is still insignificant relatively to the ■~~~ enormous outlay that must attend the construction of the work. The Company having to rely upon the disposal of their lands for the greater j)art of tlieir expenditure, renders it desirable, nay necessary, that the land should be dealt with so as to enlist the whole energies of the country in their early settlement. " It is tlrerefore of supreme importance that the organization through which the railway is to be Ijuilt should be essentially and pre-eminently national in its character. " The sources irom whence the Comi)any's means must be drawn arc twofold : 1st, Canadian; 2nd (and chielly) British. Success in tlie British money market will, in tlic opinion of your Committee, depend in a great measure upon tlie extent to which the Canadian people themselves became interested in tlie undertaking. "It is perfectly futile to look to the United States for aid in this work, as it is necessarily a rival to the several existing Pacific Railways. While this remark applies generally to its I'uture as a commercial enterprise, it is in the meantime still more apjilicable and weighty in reference to the measures required for the early settlement of the vast regions traversed by the rival lines through the United States. The Canadian Pacific Railway Company must compete in Great Britain and Europe generally for the emigration tlience, and tliiscan never be done advantageously or successfully in association with any of the American interests concerned in tlie trans-continental traffic. The suggestion for amalgamation with the Canada Pacific Company, more generally known as tiiat organized by Sir Hugh Allan, forces upon your Committee the consideration of the matters above referred to. " It is a matter of public notoriety that the original proposal of Sir Hugh Allan, relative to the Canada Pacific Railway, was made in association with the American gentlemen most prominently connected with the Northern Pacific Railway. It is gene- rally believed that the Government are themselves aware of this; and it was mainly owing to tlie ai)preliension that the control of a work, ui)oii whicli the I'uture of the Dominion so mucji depeuds, might pass into American hands, that the Interoceanic Comjiauy was called into existence. " The public of Canada instinctively felt that if the parties interested in the Northern Pacific Railway were permitted to control the Canadian line, that such a combination would obstruct the material as well as political alliance with tlie British possessions on the Pacific Coast, and retard and endanger the successful settlement of the fertile Western Territory of Canada. " From one end of the Dominion to the other, but more especially in the great Province of Ontario (ui)on whose peojde the greater part of the Inirdeii of the cost of the railway must fall), there have come unmistakable indications of public opinion on the subject, and the names connected with the Interoceanic Company conclusively show the general determination to make the work distinctively national and Canadian. It may appear inviflious to institute comparisons between the relative importance of the Interoceanic Company's organization and that of Sir Hugh Allan's Company, but this cannot be avoided when the proi)osal is one for amalgamation. "Your (.'ommittee must therefore remark that the Interoceanic Company is probably the largest and most influential combination of men of cai)ital and position which could be found in the Dominion, not confined to one Province, but very generally and er[ually representing all. " AVitli respect to the other Company, your Committee submit that it is not in any broad or national sense representative of the Dominion. " Its active infiuence is almost exclusively confined to the Province of Quebec, and in that Province to the city of Montreal; but excejjting Sir Hugh Allan himself, and two or three other gentlemen, it cannot witli fairness be designated as representing the capital and enterprise of even that community. " It is no injustice to say that the claims of Sir Hugh'^Allan's Company rest, not upon general public support, but mainly upon the position of Sir Hugh Allan himself Early though it be in the history of the Canadian Pacific Railway, the dangerous character of such ail organization as the Company you arc invited to amalgamate with has already been made apparent by its promoters resorting to the arena of politics for that strength and support not due to its intrinsic merits. " The Interoceanic Company, on the other hand, has relied solely upon general public support, and has in no instance appeared as desirous'of unduly influencing the Government. " If the Canadian Pacific Railway is to be made the subject of undue and improper pressure by one section of the Dominion to the prejudice of others, it will soon acquire CANADIAN rACIFIO RAILWAY. 45 relatively to tlie Uomiiany having i'lulituro, renders enlist the whole hich the railway ractcr. twofold : mmittce, depend mselves become s work, as it is remark applies time still more early settlement The Canadian generally for the llv in association tal traffic. The generally known consideration of ir Hugh Allan, 1 the American ivay. It is gene- 1 it was mainly le I'uture of the the Interoceanic in the Northern h a combination 1 possessions on i fertile Western ic great Province of the railway on the subject, low the general It may appear le Interoceanic nnot be avoided lany is probably which could ly and equally ; is not in any Quebec, and in imself, and two ting the capital rest, not upon limself Early )us character of ith has already that strength upon general influencing the and improper ill soon acciuire a reputation which will destroy public confidence in the enterprise, and occasion either its abandonment or completion at sacrifices far beyond any that the country now contemplates. '' Your Committee readily admit that it would be desirable to secure the united strength of the Dominion in support of this work, and if the Company organized by Sir Hugh Allan really represented Canadiau interests, though local, it would be well to have their co-operation. "Dut, unfortunately, the impression still exists everywhere, that Sir Hugh Allan's original scheme is unchanged, and that his Comjiany is intended to co-ojjerate with the parties in the United States interested in the Northern Pacific Railway, and your Committee sharing this beliel', cannot regard the proposal of amalgamation as otherwise than ill-advised and dangerous to the public interests. , "Your Committee are convinced that such an amalgamation would at once destroy jj^ublic faith in the Company as a Canadian undertaking. ; " They believe that if amalgamation were accomjjlished, the best friends of the enterprise in Canada would reluse their aid, and that in consequence an e.\cuse would be found for ])lacing it under the control of the rival American Company, or of its chief promoters, in the illusory hojie that they Mould carry it through to completion. "Your Committei! iail to luul an adequate reason for asking the Interoceanic Company to part with its individuality. "The i)ublic everywhere evince confidence in it as it is. " Assurances have been received I'rom every Province in the Dominion (except Manitoba), that the quota of stock allotted to each by the Act of Incorporation would be subscribed, and in some of the Provinces much more than such allotted quota would be taken. " In this way all classes of the community would be closely identified with the great national work, and the I'ulfilmcntof such assurances would vastly strengthen the Company in its negotiations in England and on the continent of Europe. " By entrusting the execution of the Pacific Railway to the Interoceanic Company, the Government will, in eflect, be dealing with the representatives of their own people. " They will be assured of the application of every dollar and every acre to the sole object which Parliament contemplated in granting the sui)sidies, and that the lands will not be permitted to pass under foreign control, or be held back from settlement for years, or until those of the Northern Pacific Railway Company are occupied. Your Committee cannot avoid drawing attention to the fact, that the promoters ol' the line •which is our nearest rival route — the gentlemen with whom Sir Hugh Allan has been acting — depend wholly upon the sale of their lands ibr means to construct that railway. It is, therefore, of extreme imi)()rtance to the promoters of that line, the Northern Pacific, to get control of the Canadian lands (which almost equal in area England and Scotland), and to retard their settlement until their own are disposed of. " No more suicidal policy could be pursued by the people of Canada than to allow their rivals to have such an interest in this national undertaking as would virtually transfer to them the ownership and control of .50,000,000 acres of Canadian territory ; would invest them with the direction of the immigration pulicv, vhich must be inaugurated for the settlement of those lands ; confer upon them the iicwer to influence the construction and progress of the railway, and grant to them, in perpetuity, a monopoly of the traffic over the Canadian, which is the shortest and best trans-continental route. " Your Committee firmly believe that amalgamation means the admission of this rival United States interest into the organization of th '.'.nadian enterprise, and that once admitted and wielded for one object, it would speea.ly master the divided and weakened Canadian representation. They consider that this danger far outweighs any possible advantage that could result from union with Sir Hugh Allan and his associates. They are convinced that the jjublic would shrink from committing themselves and their means to the undertaking, and they therelbre respectfully recommend that the Board of Directors (Of this Company inform the Government that they cannot be parties to any amalgamation rWith the Canada Pacific Company, but are prepared forthwith to enter into arrange- Cinents on behalf of the Interoceanic Company for the construction and working of the Xanadian Pacific Railway. " All of which is submitted. Canada. (Signed) " D. L. MACPHERSON. " W. SHANLY. "W. H. IIOWLAND. (Signed) " C. II. FAIRWEATHER. " FRED. CUMBERLAND. f 4*; COKnT'SrOXDKXCK TJKLATTVE TO THE Oamapa. "Alter discussion of tlit- l'()iTi:;()ing Ki-port, the I'oUowiiig Kesoliitiou .., carrieil uiianiinoiisly : — " ' That the llciiorf of tlic I'lxt'ciitivc (Jommittoc, just read, l)o approved and adopted, and that tlic I'rcsideiit \n- i'e<|iicstc(l to traiisniil a (■()))y of the same to the (ioveriiineiit, as settiiiu; i'orth the leivsoiis ol' tliis JJoard lor declining anial,!i;amution with tlu- Canada Paciiic iiailway (.'oni])aiiy.' " A true extract lioni th(! minutes of the Provisional IJoard of tlie Intcroceanic Rail- way C'oniiiany ol' Canada. (Si-ned) "JOHN HAGUE, " T(n-onto, Sept. 28, 1872." "Provisional Secretary. " Sir, " Ottawa, October 7, 1872. '' I am directed to acknowledge the receipt of your letter ol tlie 28tli ultimo, and inelosures, inlorming this Dei)artment liiat tiie Interoceanic liailway Com])any ol' Canada declines its amalgamation witii tiie Canada Paciiic J{ailway Company, asproimsed by the (iovernment, and intimating that the Company is ])rei)ared to enter into arrangement I'or the building and working ol' the Canadian Pacific Kailway. " I have, etc., (Signed) "E. PARENT, " Under-Secretary of State. " Hon. D. L. Maci)lierson, " President, Interoceanic Railway Company, Toronto." " Department of Secretary of State, " SiK, " Ottawa, October 1 C, 1S;2. " I am directed to transmit to you the enclosed copy of a * Memorandum of the ' Canada Paciiic liailway Company," upon the statement submitted by tlie Interoceanic Kailwav Company to the Goyernmenl of Canada. " I have, &c., (Signed) " E. PA' r, 'r-Secretary of State. " Hon. D. L. Macplierson, " President, Interoceanic Railway Company, Toronto." HI " .Memorandum of tlie executive Committee of the Interoceanic Railway Company of Canada, upon the Memorandum suljmitted to the Government by the IvKccutive Committee of the Canada Pacific Railway Company,' dated 12th Octo])er, 1872. " The imdersigned, the Executive Committee of tlie Interoceanic Railway Company, oiler their ackllo^^ ledgments to the Honourable t'lc Privy Council, for communicating to them ll'.e Memorandum of the Canada Pacific Company upon the communication addrcsM'd to the Covernment by the Interoceai ic Company, on the .'Kith September last; seltiiig fortli their reasons for declining amalgamation with the Canada Pacific C'onipaiiy. "Thc! undersigned 1)og to say that when trans nitting that statement to the Govern- ment, the Interoceanic Company had no intentitn of entering upon a controversy with the Canada Pacific Company through the medium of the Government. But they "do not regret tliat tlie (lovernment saw fit to communica.e it to the Canada Paciiic Company. The olijecl of the Interoceanic Company was merely to communicate, frankly, to the (tovi'mnient the reasons which prevented their complying with the request of the Govei iinuut to amalgamate with that Company. " Tiie Interoceanic Company decided against aiiialsramation after mature deliberation, and luider tlie firm ])ersuasion that they were acting in the true interests of the country. The undersigned will now proceed to comment briefly upon the Memorandum of the Executive Committee of the Canada Pacific Comjiany. " Tlie undersigned observe that the Committee of the Canada Pacific Company profess to concur lull) in the opinion which the Interoceanic Company holds, namely, that the importance to Canada of the Canadian Pacific Railway being owned and worked pre- eminently as a Canadian enterprise, cannot be exaggerated. It is matter for regret tliat the Canada Pacific Company, or its chief promoter, did not always entertain this opinion; fcr Di to n CANADIAN I'AC'IFIO IfAlLWAY 47 111 ..-. oarried i and adopted, e (ioviTiuniiit, ith tilt; Canada croceaiiif Rail- al Secretary. ober 7, 1«72. 8tli ultimo, and |)any of Canada [jroposed by the irrauL^emeut I'or tary oi" State. ■ State, ibcr 1(1, IS 72. oraudiim of the the Interoceauic tary of State. ivay Comiiany of lY the HN.ecutive ctober, 1872. lilway Company, [• communicating communication 50tli September ,e Canada Pacific t to the Govern- controversy with But tliey do not 'acilic Company. (, frankly, to the e request of the turc deliberation, ts of the country, norandum of the Company profess namely, that the and worked pre- :er for regret that tain this opinion ; lind they or he done so, it is probable the Interoeeanie Company would never havesouglit ineoi'poration. "The Committee of the Canada Pacific Company seem anxious to eslal)li-.li tli.it the })rom()ters of that Company are more Canadian than the pnimoters of the Interoceauic >mipany, because tbcdralt Charter, as originally submitted to I'arliamen' by the former Comiiany, provided that all the l)ire<'tors should be l>iitisb subjects, wliib; that of the Interiiccauic (.'omjiany oidy required that a niiijority should be so. The undersigned must express surprise that any importance should seem to be attached to what is mani- festly unimportant, if not positively trivial. To maki; the ('ompany really Canadian, it is iu'('ess.uy that the greater part of the stock should be bona (ido held by Canadians and JBritish subjects. % " It was the purpose of the Interoceauic Company to secure that object, and, it once 'secured, tliey saw no reason for excluding any class of their fellow-citizens, wliether .native born or alien, from j)arlicipatiiig in the management of the ('omi)any. "Shareholders have the ]i()wer to control the i)olicy of (companies; Directors are .merely their agents or deputies to carry it out. If Canadians hold bona fide acontrolling amount of the stock of the Canadian Pacific l^ailway, they will see that the Directors, •whatever t!u;ir luitionality, manage the undertaking for the adv uitage of the sharehnldeis ,and of Canada; but if a controlling ])ortion of the stock is held by citizens and residents of the United States interested in a rival railway, they will see that tlu'ir Directors carry out their policy regardless of Canadian interests, even if the law required every member of the Hoard to be a P.ritish sul)ject ami a resident of Canada; under such circumstances if any of the Directors ])rove too ]);itriotic to give eHect to tlie designs of the foreign shareholders, they will be remove(l and more subservient men elected in their stead. " Th(! Committee of the Canada Pacific Company argue at great lengtli, that under their proposal for amalgamation it would be inqxjssible to alienate any jiortion cd' the public subsidies from the purpose for which they were intendeil, and that an attempt to alienate them, if made, would result in a forfeiture of the agri'ement. "The undersigned see no force or weight in this argument. But even if it has some force, as far as it apjjlies, it would !> of little moment; for desirable though it be that the advantages resulting from the construction of the railway should be insured to Canadians, yet tliese advantages are insignificant when c()m])ared with those that would follow the ownership of the road after completion, viz. the possession of a vast territory' in the heart of the Dominion, and the eontrcd of a large trans-continental traflic. "The undersigned regret that the Committee of the Canada Pacific Company, Mhile admitting- tlie respectability of the Directors of the Interoceauic Ccnnpany from the Province of Quebec, should have made three of those gentlemen the subject of invidious attack. The gentlemen referred to are too well known, at home ami abroad, as suceessl'ul merchants of high character and wide infiuence, to require any vindication from this covert and unwarranted attack. They compare favourably with any gentleman ujion the Provisional Board of the Canada Pacific Company, or any other Board of Directors iu the Dominion. . " The uiulersigned do not know what is referred to in the following extract iVom the Memorandum of the Committee of the Canada Pacific Company:—' And as to the other * gentlemen whose names appear in the Bill of the Interoceauic Company, but who did ' not take part in that meeting, tlie well-knoAvn circumstances of their recei)tion into ' that Company prevent the expectation that they will exercise any iullueuce in its * favour.' " If the insinuation is intended to charge that the names of any gentlemen were introduced into the Charter of the Interoceauic Company, either as Provisional Dii'cifors ;0r Corporators, without their knowledge and consent, the undersigned meet that charge by the most unqualified denial. Of the one liundred and seven names which appear in |he Charter of this Company, no name was placed tlicre except at the solicitation or with the permission of the gentleman named; but the undersigned have been given to understand that of the eighteen names which appear in the Charter of the Canada Pacific "Company, more than one, and tliat too of the more influential among them, were used without permission. . " The Committee of the Canada Pacific Company deny, in most distinct terms, that that Company have in any way interfered in politics. "The undersigned can only assume that the Committee desires to state that no inter- ference m politics took place under authority of a formal resolution of the Provisional Dn-ectors of that Company. " Ihe public press has made the whole country aware of pressure having been brought to bear upon the Government by Sir Hugh Allan during the lAIontrcal election. Canada. 48 CORRESPONDENCE RELATIVE TO THE Oahada. " On the eighth day of August last, Sir Hugh Allan tlelivered a public speech, of wliicii a report appeared in the newspapers pu'olished on the following morning. Sir Hugh, then as now. President of the Canada Pacific Company, in tiiat sjieerh, referrin;^ to the contract for that enterprise, declared that he had received pledges iromSir George Cartier which were entirely satisfactory to him. His own words were: — 'I have every • reason to be satisfied with what Sir George has done.' Unless it can be sliown that the Provisional Directors of the Canada Pacific Company disajiproved of and annulled the agreement or arrangement which Sir Hugh Allan, their President, declared he had concluded to Ins own entire satisfaction, the undersigned submit that the Canada Pacific Company must be held to be parties to that agreement. " Tile undersigiied consider that it woU'd liave Ijcen ]iroper in the Canada Pacific Company to have communicated that agreement to the Iiiteroceanic Company when proposing amalgamation. "The Interoceanic Company have at all times studiously avoided everything cal- culated tu arouse sectional feeling, and have always lield that all tralTic intended for the Maritime Provinces and for shipment to Europe via the St. Lawrence, should go by Montreal ; but they have likewise held that the interests of the Railway Company and of the Dominion require that the location of the Pacific Railway shall be as near the settled and tax-paying districts of Ontario as the reasonable directness of the line to tide-water may permit. VVhile the Interoceanic Company have avoided all sectionalism, it wiP be noticed by those who may read Sir Hugh Allan's speech, already referred to, that he unfortunately excites it, and to justify his doing so, advances the extraordinary doctrine, that thos'j for the transport of whose ])roducts and merchandise railways are constructed ' iiave a ]ess direct interest' in their location and economical construction and running than those wlio have .nerely the liandling of the property at a port of transshipment. "Tlie Committee of the Canada Pacific Company admit that negotiations were carried on between Sir Hugh Allan and certain American cajiitalists for the formation of a Company to construct and run the Canadian Pacific Railway, but they say ' that ' this negotiation was not initiated by Sir Hugh, but was commenced and supported by ' influential persons in Canada, as being the only combination that ofltjred itself at the ' time lor the construction and running of the road, and tliey are satisfied that that ' negotiation never possessed the character attributed to it by the Interoceanic Company, ' and tliat tliey know Sir Hugh Allan would never have consented to embark with ' foreign capitalists in a Canadian enterprise in which he takes so great an interest ' witlioiit the most perl'ect securities and guarantees for its control and conduct in the ' interest of Canada.' "If, as may be implied from the above, Sir Hugh Allan ])rovided 'securities and 'guarantees' for the control of tlie railway by Canadians, tlie undersigned submit that the production of the agreement would be the satislactory mode of enabling the Govern- ment and country to judge of their sufficiency. "They must add, however, that in tlie opinion of the Interoceanic Company, nothing short of the ownership of the undertaking by Canrdians would afford real security or guarantee for its control and conduct in the interests of Canada. "'I'iie undersigned are not aware who the influential gentlemen are to whom the Com- mittee refer. Tliey never heard any influential gentleman named as having negotiated with American capitalists except Sir Hugh Allan himself. The Committee of the; Canada Pacific Company declare that their Company ' ncner particii)ated in the negotia- ' tions referred to, and never considered or entertained ..ly i)ro])()sition, suggestion, or 'intention of asking aid from American capitalists, or of combining with them for the 'prosecution of tlie railway or for any other purpose. The only negotiations they have 'carried on are those al>-jady alluded to with Rritish capitalists, and they have never 'even communicated on the subject ol the railway with any outside Canada or Great ' Uritain.' " The undersigned confess that this statement surjirises them, and they have reason to believe the American cajiitalists with whom Sir Hugh Allan has been negotiating would be e(|ually surprised if they had communication of it, but the undersigned assume that the Executive Committee only mean it to lie understood that the Canadinn Pacific Com- pany did not authorize, by formal resolution of the Directors, any negotiations with capitalists in the United States. While accepting the denial made on behalf of the Canada Pacific Company, the undersigned assume, as they h.avt; already stated, that it is not intended to apply to the acts of their President, for the undersigned learn from one ol the promoters of the Interoceanic Company, who has had the opjwrtunity of com- 1 19* CANADIAN PACIFIC RAILWAY. 49 public speech, of ng morning. Sir sj)cech, referring s Irom Sir George — ' I have ev(,'ry n be sliown that of and annulled declared he had le Canada Pacific e Canada Pacific Company when I everything cal- alTic intended for vrence, should go lailway Company r shall be as near less of the line to all sectionalism, ready referred to, the extraordinary disc railways are tiical construction erty at a port of legotiations were lor the formation ut they say ' that and supported by ered itself at the atisfied that that Dceanic Company, to embark with great an interest id conduct in the 'd ' securities and i^ned submit that iling the Govern- ompany, nothing i real security or 3 whom the Corn- having negotiated ommittee of the ed in the negotia- 3n, suggestion, or I'itli them lor the tiations they have they have never Canada or Great ey have reason to legotiating would gned assume that Jian Pacific Com- iiegotiations with on behalf of the ' stated, that it is d learn from one H)rlunity ol' com- municating with gentlemen in the United States who were parties to and interested in the arrangement made with Sir Hugh Allan, that they consider the same to be still in force, but that owing to tlie feeling existing ir. Canada against the Canadian Pacific Railway being owned by Americans, tliey, the Americans, would not in future be known in the project. "Tlie American capitalists had been led to expect that the amalgamation of the two Canadian Companies would have been efiected in Septcniibcr last. "Tlie undersigned are given to understand, through the same source, that the sclieme of the 'American' or ' Allan' comljination for constructing and running the railway, is to coimect at Sault St. Marie; and at Pembina with the Northern Pacific Railway, and ,se tiiat line when built between the two points named; that it is iiitenneJ to send all e traffic between the West, including British C(!luml)ia and tlie Atlantic cities, by the nierican lines of lailway, via St. Paul, and sending throimh Canada only the tralTic llestiued for Eurojie and the Maritime Provinces. ■ " This information was obtained by the undersigned about llic time the Memorandum of the Committee of the C!anada Pacific Company, under consideralion, was written. Tlie undersigned feel bound to communicate it to the Government. It confirms in a remarkable manner the ojiiiiion (>xpressed to tlie Government by the Interoccanic (,'om- pany, and justifies the decision of that Comiiany against amalgamation. " The correspondent to whom the undersigiK-d are indebted for tiiis information uses the ibllowing language in commenting upon it, in which the undersigned fully concur: 'If this (scheme) is carried out, our great national enterprise, instead of being the 'successful rival of the American Company, competing for the Asiatic trade, which is now *m its infancy, and building up the Dominion as no other undertaking can do, will sini})ly *be the Canadian branch of the Northern Pacific Railroad, entirely under its control and 'dictated to by it relentlessly.' "The undersigned beg to say that they do not yield to any Company or individual in the earnest desire to promote the earliest ])Ossible construction of the Canadian Pacific Railway, com])atibIe with its being a strictly Canadian and IJritish enterprise, and the Canadian Pacific Company cannot more sincerely than the undersigned desire to aid the Government in carrying out this great national undertaking. It would, however, be ^oing the (iovernment poor service to agree to amalgamation unless the iiitcroceanic Company believe that tin; Amalganiatetl Company would constitute a distiiRtively Canadian Company of sufficient strength to carry the undertaking to a siicccssl'iil issue. Xhe undersigned are of opinion that amalgamation with the Canada I'acific Company would not lead to this result. They deem it their duty to state to the Government that in their opinion the admitted negotiations of Sir Hugh Allan with gentlemen in the United States, resulting in an arrangenient or understanding \\ liich is considered opjiosed to ("aiiadian interests, and which the undersigned, from information in their iiossessioii and referred to above, have rea.son to believe is still substantially existing, will continue to cause the Canadian i)eoj)le to view with suspicion, and prevent their subscribing stock in any Company in which Sir Hugh Allan and his associatis ajjjjcar coulroUiiig i)arties. Tlie undersigned are of opinion that this feeling, instead of being confined to a limited circle, as the Committee of the Canatla Pacific Company allege, will be found to infhience the peo])le of the whole Dominion. " The undersigned venture to remind the Government that books for applications for etock in the Canada Pacific Comjiany liave been open I r months at the capitals of, and large towns in, all the Provinces of tl:. Dominion. f "The Pacific Company have thus luul the best means of ascertaining the favour Mith ^Hvliich they arc regariled by the ca, 'lalists and pi'ople of Canada. U " It is somewhat surprising that their Committee do not, in their Memorandum, inform •|the Government what amount of stock has been applied for and subscribed up to a giscn day, say to the first day of Octolnir last. Instead of doing so, the Committee's Memo- randum is conspicuously silent in respect to the countenance and aid their Company ^xiicct from Canadian sources. "Prom this silence, were it not for their repeated protestations that their Conijiany .iWould be pre-eminently Canadian and Hritish, it might fairly be assumed that the ['Directors had little or no ex|)ectation of making it so. For the reasons given above, and 'ithose stated in their communication of the 3Utn September last, the nndersigncd. on itchalf of the Interoccanic Comiiany, feel themselvt.'s under the necessity of again declining amalgamation with the Canada Pacific Company ; but they beg to reiterate, that from the assurances they have received from capitalists in this and the other Provinces and iu England, the luteroceanic Company, as an in dependent organization, G Caxada. 50 CORRESPONDENCE RELATIVE TO THE Canada. can undertake to construct and run the Pacific Railway in the full confidence of carrying the work successfully to completion, through the instrumentality of a Canadian any British j)roprietary. "All of which is respectfully submitted. (Signed) "D. L. MACPIIERSON. " W. SlIANLY. " C. H. FAIRWEATIIER. " W. H. HO\VI.AND. "Office of the Interoccanic Railway Comi)iUiy of Canada, "Toronto, 25th Nov., 1872. " I certify that the foregoing is correctly copied from the Minute-book of the later- oceanic Railway Company. (Signed^ " JOHN HAGUE, Provi>ional Secretary. "Toronto, 25th November, 1872." " Department of the Secretary of State, " Sm, " Ottawa, 22nd October, 1872. " I am directed to forward you the enclosed copy of an Order in Council on the subject of the corr-csijondence between the Government of Canada and the Executive Committee of the Provisional Directors of the contemplated Interoceanic Railway Company, relative to the Canadian Pacific Railroad. *' I have int, now, for the first time, brought under tlic notice of the Interoccanic Coni])any. ' The undersigned, with the utmost respect, Ijeg to state ihey gather from the Report of the Honourable the Privy Council, that the Goverinnent impliedly charges the pro- moters of thi' Interoccanic Company with remissness in not communicating with the Government during the summer of 1871, and making a proposition for constructing and running the Canadian Pacific Railway. •' The undersigned submit that they do not see how they could have done so before tiu; Government had announced its readiness to receive propositions. The Committee of the Honourable the Privy Council furni.shes, in the opinion of the undersigned, an answer to this charge, as it apjiears by the Report that when Mr. . W addington and his ns-,ociatcs approached the Government to tender for the construction and riiiining of the railway, they were informed that the Government was not in a position to enter into negotiations. • G 2 pi 62 CORRESPONDENCE RELATIVE TO THE Canai , " Should the refusal of the Interoceanic Company to amalgamate result in excluding it from all connection witli the Canadian Pacific Railway, the undersigned and their associates will nevertheless have the satisfaction of knowing that if that great national undertaking remains in Canadian and British hands it will be due, in no small measure, to their efforts, and that if it sliould unfortunately fall into foreign and rival hands, it will bo through no fault of theirs, but in the face of their most strenuous exertions to avert so great a calamity. " All of which is submitted. (Signed) " D L. MACPIIERSON. " C. U. FAIRWEATIIER. « W. SHANLY. " W. H. IIOWLAND. " Toronto, Nov. 28, 1872. " I certify tha,; the foregoing Memorandum is correctly copied from the Minute-book of the Interoceanic Railway Company of Canada. " JOHN HAGUE, (Signed) " Provisional Secretary." " Department of Secretary of State, " Sir, " Ottawa, Dec. 2, 1872. " I have the honour to acknowledge your letter of the 28t]i ultimo, enclosing a Memorandum from the Executive Committee of the Interoceanic Railway Company, referring to a Report of a Committee of the Honourable the Privy Council, dated IGth October last. " Yours, &c., (Signed) " E. PARENT. " The Honourable D. L. Macphcrson, Senator, Toronto." Enclosure No. 3. " CORRESPONDENCE BETWEEN SIR HUGH ALLAN AND HIS AMERICAN PARTNERS. (From the ' Moxtukal Herald.') " The following portion of the documentary evidence, showing the corrupt nature of the negotiations between Sir Hugh Allan and the Governmen*, in connection with the granting of the Pacific Railway Charter, has come into our possession. {Telegraph.) " ' Father Point, October 8, 1871. " ' Send me by mail, care of Allan Bros. & Co., Liverpool, the names of the parties engaged with us in the railroad enterprise. (Signed) '"H. ALLAN. " ' To C. M. Smith, of Chicago, Metropolitan Hotel, New York.' " {Letter.) " ' Dear Mu. Smith " ' Ix)ndon, E.C., Nov. 4, 1871. " ' 1 find a considerable interest manifested here by moneyed men in our scheme of a Dominion Pacific road, and if we desire to raise funds here to carry on the work, I have no doubt they can be obtained. 1 have not heard anything from the Government on the subject, and I i)resume nothing will be done till I go back. I propose to sail some time this month. " ' Yours truly, (Signed) "'HUGH ALLAN.'" {Telegraph.) " ' Montreal, Dec. 7, 1871. " 'I do not think the Governmi nt at Ottawa will be prepared to deal witli us sooner than the 18th inst. Sir F. Ilincks is here, and hints at necessity of advertising for tenders to avoid blame. (Signed) " ' HUGH ALLAN. " ' To C. M. Smith, Banker.' " i CANADIAN PACIFIC RAILWAY. 53 result in excluding ersigned and their that great national no small measure, nd rival hands, it nuous exertions to CPIIERSON. IIWEATIIER. LY. WLAND. , Nov. 28, 1872. n the Minute-book E, onal Secretary." ,ry of State, 'a, Dec. 2, 1872. ultimo, enclosing a iailway Company, ouncil, dated lOth &c " e! PARENT. IIS AMERICAN corrupt nature of )nucctiou with the )ctober 8, 1871. [Ties of the parties "II. ALLAN. ;., Nov. 4, 1871. II in our scheme of ry on the woriv, I n the Government I propose to sail III ALLAN.'" ,1, Dec. 7, 1871. :;al with us sooner of advertising for JGIi ALLAN. '(Teleqraph.) " Montreal, Dec. 8, 1871. Canada. • " ' I have seen Sir Francis lo-day. He says they have determined to advertise, and that it is no use to visit Ottawa at present. I write you by mail. . „ . ^, (Signed) " ' HUGH ALLAN. «• ' C. M. Smith, Banker.' " (Letter.') ,, , ^ „ _. •• 'Dear Sin, " ' Montreal, Dec. 8, 1871. "'Sir Francis Ilincks called at my olTicc this day. and said that, while ho was as «nxii,v;s as ever to arrange with us about' the railroad, the feeling of the Government is |hat if they closed an agreement with us without advertising for tenders, they would be Attacked about it in the House. 1 think this may be true, and in view of it I see no use ^fnour going to Ottawa at present; but I think we should meet and arrange i)reliminaries Ourselves and decide on a course of action. If, tlierefore, you could come lii're about the ^5t]i instant, I would go on to New York witli you on the 18th, and we could then put the afl'air in shape. Please advise me if this suits you. i " ' Yours truly, «• ' To C. M. Smith, Esq., Chicago.' " (Signed) " ' HUGH ALLAN. " ' Dear Sir, " ' Montreal, Dec. 29, 1871. " ' I have your note from Pictou, but I have not heard from New York since I left there. A good many rumours are afloat regarding railroad matters, and I have good reason to believe that Mr. Brydges is using all the influence he can with Cartier to thwart our views, not that he has any proposal to make, but he wants to stop the Pacific Railway altogether. A party in the interest of the Hudson's Bay Company, consisting of Donald A. Smith, D. Mclnnes, G. Laidlow, G. Stephen, Daniel Torrance (of New York), and one or two others, have given notice in the ' Official Gazette' that they will apply for a Charter to make a railroad irom Pembina to Fort Garry. That is the only one that alTects us. I go to Ottawa on Wednesday, and will return liere on Saturday. I will find out there what is going on, but I think we are sure of Cartiers opposition. " * Yours truly, (Signed) "'IIUGII ALLAN. " ' To G. W. McMullen, Esq., Pictou, Ont.' " ♦' ♦ Dear Mr. McMullen, " ' Montreal, January 1, 1872. " ' I saw Mr. Brydges yesterday, and found out pretty nearly what he will require to join our railway project. His terms are very high ; but as they possibly include more than himself, we may have to concede tliem. He thinks, however, that the Government will not have the courage to go into the scheme at all, and Avill shirk it till after the elections. I go to Ottawa on Wednesday, and will see what they propose to do. 1 will write you as soon as I find out. I intend to return back to here on Saturday night. Wishing you the compliments of the season, " ' I am, yours truly, (Signed) "'HUGH ALLAN. " ' P.S. — I have a telegram from you this moment, advising me that you arc going to t New York ; I therefore send this letter to the St. Nicholas Hotel there.' " " 'Gentlemen, " ' Montreal, January 21, 1^72. ' "'My subscription of $1,450,000 to the stock of the pro])oscd Canada Pacific Railway Company includes the sum of $200,000, furnished jointly by you and myself, to be transferred, in Tvhole or in part, to Mr. C. J. Brydges, on condition of liis joining the organi^^tiov:, and giving it the benefit of his assistance and influence. In case he refuses or neglects to join before the loth day of April next, I will transfer at once thereafter to you jointly $100,000 of the before-named subscription, and in case Mr. B.'s influence and co-oi)eration can be secured lor a less interest in tlie Railway Company than the before-mentioned amount, then I will transfer to you one-half of any residue that remains of the said §200,000 after Mr. Brydges' accession to the Company lias been secured. It is, however, understood that any residue, or portion of the $20O,('0(l named, may be used to secure any other influence deemed by myself and you desirable or important, on the same terms as is proposed in regard to Mr. Brydges, and may a])ply to othei-s in addition to liim. " * Yours trulv, (Signed) "'IHIGH ALLAN. " ' To Charles M. Smith and George W. McMullen.' " 64 CORRESPONDENCE RELATIVE TO THE Cakada. " ' Dkaii Ml!. Mi'MuM.KN', " ' Montrcii], Feb. 5, 1873. " ' I rcturiird yesterday Irom dtawa. Evcrytliing looks well up till the present time; i)ut I may tell you in strict confidence that tliere are symptoms of coolness between Sir Jolni A. and Cartier, arising irom the coquetting of the latter with Blake and Mackenzio to form an alliance and carry tlie elections next summer, with a view to leave Sir John A. out in the cold. Tliis would not be quite so well for ns; but I am KO'"S to Toronto on the 7th instant to look after our interest. We are all right witli tlie ' (ilobe.' You have not yet sent me the articles of agreement signed I y the ])arties. Send it immediately, as I need it in my negotiations. 1 will re(iuire you to come down luM'c, by and by, to arrange the construction of tlie Company, ant. consult about other matters. In the printed Bill is there not a mistake about the land and taxation ? Lot)k at it. " ' Yours truly, " 'To G. W. INIcMuUen, Chicago. (Signed) " ' MUGII ALLAN. " ' P.S. — I wrote you, but have not received iiny answer.' " " ' Dk.vu Sir, " ' Toronto, Fel). 23, 1S72. " ' I find that Mr. Brydges is making a st/ong attempt by exciting national feelinj;; to get up an opposition to us in our Pacific schemes. lie is endeavouring to get up what he calls a purely Canadian Company, on the represe.itation that we are going to make enormous profits out of it, the most of which will go to parties in the United States. He lias written to influential men here, and in other ))arts of the country, urging them to subscribe stock merely as security, for they never will he called on to pay anything, and he says the Government must give a preference to a Canadian Company. I do not know to what extent he has been successful. " ' Yours truly, " ' To C. M. Smith, Cliicngo.' " (Signed) " ' HUGH ALLAN. " 'Dkah Sir, " ' Toronto, February 24, 1872i " ' Since writing to you yesterday, I have seen Mr. D. L. Macplierson, of Toronto, who is a member of the Dominion Senatt", and rather an imi)ortant person to gain over to our side. He has been ajiplied to by our opponents, and uses that as a lever by which to obtain better terms from us. lie insists on getting $'i")(),OUU of stock, and threatens oi)position if he does luit get it. You will remember, he is one of those I proposed as Directors. I will do the best I can, but I think that MclNIullen, you, and myself will have to give up some of our stock to conciliate these parties. " ' Yours truly, " ' C. M. Smith, Esq., Chicago.' " (Signed) " ' HUGH ALLAN. " 'Dear Sir, " ' Montreal, February 28, 1872, '"It seems pretty certain that, in addition to money payments, the following stock will have to be "distributed :—D. L. Macplierson, 5*100,000; A, B. Foster, $100,000; Donald A. Smith, slOO,000; C. J. Brydges, $100,000; J. J. C. Abbott, $50,000; D. Mclnnes. s'jO.OOO ; John Shedden, .^.lO.OOO ; A. Allan, $.")(),000 ; C. S. Gzowski, $jO,000; George Brown, $')0,000 ; A. S. Ilincks, $•'30,000; H, Natlian, $50,000 ; T. ?.'cGreevv, $50,000— total, $850,000. To meet this I propose that we give up of our stock as follows :—C. M. Smith, $250,000; G. W. McMuUen, $250,000; Hugh Allan, $;!50,000— total, $850,000. Please say if this is agreeable to you. I do not think we can do with less, and may have to give more. I do not think wc will require more tluin $100,000 in cash, but I am not sure as yet. Who am I to draw ci for money when it is wanted, and what proof of payment will be required ? You are aware I cannot get ixveipts. Our Legislature meets on tlie 11th of April, and I am already deep in pre|)aration lor the game. T^very day brings up some ne"' '..iiculty to be encountered, but I hope to meet them all successfully. ^Vrite to me immediately. " ' Yours truly, (Signed) "'HUGH ALLAN. " ' C. M. Smith, Esq., Chicago. " ' P.S. — I think you will have to 70 it blind in the matter of money — cash jMyments. I have already paid $8,500, and have not a voucher, and cannot get one,"^ " ' Mv PEAR Mr. McMlt.lex, " ' Mr. Macpherson, of Toronto, and Mr, "'Montreal, March 4, 1872. Brydges here, have both notified me to-day that thoy decKne ^0 join us in the Canadian Railway scheme. Their reasons are that the Compuny is too largely American, und that they want to see it in the hands of Can ^oin inte abo M(1 CANADIAN PACIFIC KAILWAY, i)b I, Feb. 5, 1873. the present time; iiess between Sir ce and Mackenzin leave Sir John A. ig to Toronto on I lobe.' You have t immediately, as I', by and by, to matters. In the at it. Gil ALLAN. Feb. 23, IS 72. ;; national leeliii"; ig to get up what e going to make iiited States. He urging them to ay anything, and , I do not know Gil ALLAN. nary '2i, 18/2; rson, of Toronto, son to gain over V lever by wliich k, and threatens se I ])roi)oscd as nd myself will GII ALLAN. ary 28, 1872. i, the following A. B. Foster, J. C. Abbott, ^50,000; C. S. H. Nathan, )se tliat we give len, $250,000; to you. I do think we will 11 I to draw ci ed ? You are Lpril, and I am "..iiculty to be iiediately. I IH ALLAN. cash payments. reh 4, 1872. h notified me ;ir reasons are n the hands of Canadians. They tried to detach me from the Company we have formed and get me to join tlieirs, which of coui-se I declined. I don't know what they can do against us, but I iotend going to Ottawa on Monday, the Uth inst., and will try and find out something about it! Twill be in Ottawa most of the week. " ' Yours truly, (Signed) "'HUGH ALLAN.'" Canada. «" Dkau Mr. McMuLLEy, " ' Montreal, April IG, 1872. " ' I must remain here to-niglit to write my letters for the English mail, which I ive been rather neglecting of late. You might make use of your time in seeing such J the Ministers as you can reach, but I wish esi)ecially that you would arrange that you Id I together should see Sir John A. at 1 1 o'clock on Thursday. Telegraph me to fescott Junction to-morrow if you can do this. I enclose a letter which came enclosed tt me from New York this day. What can be the matter there ? I ought to arrive at ^tawa at 4.30 to-morrow p.m. (Wednesday). ,, " ' Yours truly, ,: (Signed) " ' HUGH ALLAN.' " •'♦Dear Sir, '"Montreal, June 12, 1872. " ' I have this day received a telegram from you, dated New York, asking me to meet you in Ottawa to-morrow on important business. I am unable to go, and if the important business refers to the Pacific Railway scheme, I do not think it necessary I should go. I believe I liave got the whole arranged through my French friends, by means you are aware of, and we have now a pledge of Sir G. that we will have a majority, and other things satisfactory. I have told you all along that this was the true basis of operations, and anything dse was powder and shot thrown away, and I think so stUl. You should come here and see me bcl'ore you carry out any important transaction or pay any money. I want you to get a correct copy of the Government Bill and our own Bill, because we have first to consider how far they will suit our friends, and we may have to go to New York to consult them. I will be in town to-morrow and B*riday. I will be absent on Saturday, but will return here on Monday and be here till Friday. "'Yours truly, " 'G. W. McMullen, Esq., (Signed) " ' HUGH ALLAN. ' ' Kussell Hotel, Ottawa.' " «« My PEAR Mr. McMullen, " ' Montreal, July IG, 1872. " ' I feared you had got entirely lost in ihe depths of matrimony, but I am glad to notice by your letter dated 11th instant that ;vou have got safely back. Since I saw you the Pacific Railway " Canada " scheme had gone through many phases, and its S resent iwsition is difficult to be described. Sir Geo. Cartier has been in town for some ays, and I have had several interviews with him. He now tells me that he does not Bow, and never did, intend to deal with either Macpherson's Company or ours, and that he only allowed them to get incorporated as a matter of amusement, but he says he always intended that the Government would Ibrm its own Conii)any, would carry on the Work under the orders of the Government, according to the views of the Government engineers, and with money furnished by the Government. He says that he and Sir John A. Jnade up their minds to this long ago, but did not tell any of their col' "agues. A kind p' negotiation is going on with 5lacphcrson and myself, relative to the composition of ■'|his Government Company, but it has not come to anything as yet; meantime, the period |f the elections is drawing near, and unless the matter is arranged satisfactorily to Ijower |)anada, Sir George Cartier's prospect of being returned is very slim indeed. I cannot i|)resee with any certainty the ultimate result, but the decision cannot be long put oil'. I |rill advise you as soon as anything is positively known. I " 'Yours truly, I (Signed) «' HUGH ALLAN.'" 7? The following is addressed to an American gentleman in a \c\j high position in % New York, whose name has Ijcen given to us, but which is for ti.e present with- I held:- ' * 'My iiE.ui Sir, " ' Montreal, July 1, 18/2. " The negotiations regarding the Canadian Pacific Railway are now approaching a termination, and I have no reason to doubt they will be i'avourabh; to us. I have been 56 CORRESPONDENCE RELATIVE TO THE Canada. given to understand by Mr. McMulleii that lie has regularly kept you informed of tlio progress and position of affaii-s, hence I have not eommunicated with you as often as I otherwise would have done. No doui)t he has informed you that, thinking as I had taken up the project there must be something very good in it, a very formidal)lc ojiposition was organized in Toronto, which, for want of a better, look as their cry, ' No ' foreign influence; no Yankee dictation ; no Northern Pacific to choke of!" our Canadian ' Paciiic,' and others equally sensible. So much efl'ect, however, was produced both in and out of Parliament by these erics, that, after consultation with Mr. MeMuUen, I was forced unwillingly to drop ost(nisii)ly I'rom our organization every American name, and to put in reliable ])eoplc on this side in place of them. It will have been a])i)arent tn you that at this point Mr. McMuUen and 1 dilfered a little as to the means to l)e adopted to influence the Government itself. Two oiijiosing Ct)mi)anics, desiring to build the railroad, were formed, the one I'rom Ontario having the greatest number of names, while that from Quebec had the greatest political jjower. Mr. McMulIen was desirous of securing the inferior members of the (rovernment, and entered into engagements of which I did not approve, as I thought It was only u waste of jjowder and shot. On a calm view of the situation, I satisfied myself that the decision of the question must ultimately be in the hands of one man, and that man was Sir (Jcorge E. Cartier, tlii' leader and chief of the French i)aity. This party has lujld the balance of power between the other i'actions ; it has sustained and kej)! in ofluH! and existence the entire Government for the last five years; it consists of forfy-fivc! men, who have followed Cartier and voted in a solid phalanx for all his measures. The Government majority in Parliament being generally less than forty-five, it lollows that the defection of one-hall or two-thirds would at any time put the Government out of oflice. It was tlnu'elbre evident that some means must be adopted to bring the influence of this compact body of members to bear in our favour, and as soon as I made up my mind what was the best course to pursue, I did not lose a moment in following it up. A railroad from Montreal to Ottawa, through the French country, north of the Ottawa river, has long hcen desired by the French inhabitants; but Cartier, who is the salaried solicitor of the Grand Trunk road, to whicli this would be an opposition, has interposed dilliculties, and by his influence prevented its being built. The same reason made? him desirous of giving the contract for the Canada ]*acific into the hands of parties connected with the Grand Trunk Railway, and to this end he fanned the flame of opposition to us; but I saw in this French railroad scheme and in the near a])proach of the general elections, when Cartier as well as others had to go to their constituents for re-election, a sure means of attaining my object, especially as I ])ropose to carry it through to the terminus of the Pacifu'. The plans 1 propose are in themselves the best i'or the interests of the Dominion, and in urging them on the public I am really doing a most ])atriotie action. But even in tlint view, means must be used to influence the public, and I em])loyed several young Frencli lawers to write it up in their own newspa|)ers. I subscribed a controlling influence in tlie stock, and proceeded to subsidize the newspapers themselves, both ediiorsand i)roprietors. I went to the country through which the road would pass, and called on many of the inhabitants. I visited the priests and made friends of them, and Iemi)loyed agents to go among the principal people and talk it uj). I then begun to hold public meetings, and attended to them myself, making frequent speeches in French to them, showing them where their true interest lay. The scheme at once became ])opular, and I formed a Committee to influence the members of the Legislature. This succeeded so well that. in a short time, it had twenty-seven out of forty-five on whom I could rely, and the electors of the ward in this city, which Cartier himself represents, notifled Iiim that unless the contract for the Pacific Railway was given in the interests of Lower Canada, he need not present himself for re-election. He did not belicsve this, but when he came hero and met his constituents, he found, to his surprise, that their determination was unchanged. He then agreed to give the contract, as required, in a way that there would be seventeen Provisional Directors, of which Ontario would liave eight and we nine, thereby giving us the control. We at once proceeded to organize the Company, and they named me President, D. McInnes,of Hamilton, Vice-president, E. L. De Bellefeuille, Secretary, and Hon. J. J. C. Abbott, Legal Adviser. We have advertised that the books lor subscription of stock will be opened on the LOth July, at the difl'erent places named in the Act, and we have notified the Government we are willing to take tin contract for building the Canada Pacific Railway on the terms and conditions prescribed in the Act. The next thing to be done is to subscribe stock, which must be done by British subjects only, and ten per cent, of the subscription must be paid in cash at the time of subscribing. We have the right of subscribing nine-seventeenths at ])resent, and of taking up whatever the other party may not subscribe at the end of the mouth. CANADIAN PACFFK! RAILWAY. ^^1 w informed of tlio yoii as often as I niinkin<]; as I had very formidaljlc ; as their cry, ' No (■ oil" our Canadian produced l)otli in . McMuUeii, I Mas nericaii name, and ! been a])i)arent to cans to l)e adopted iring to buihl the number of names, ullen was desirousi to engap;ements of r and sliot. On a tlie question must •go E. Carticr, tlit I- of ])o\ver between istence tin; entire lio have followed •nment majority in d'ection of one-hall It was tluu-efoic is compact body of wliat was the best oad IVom Montreal s long l)een desired if the Grand Trunk •ulties, and by his drous of giving the h the (Irand Trunk but 1 saw in this ions, when Cartier means of attaining nus of the Paeifit'. Dominion, and in Dut even in tlmt oral young Freneli ing influence in tlic orsand jjroprietors, d on many of the loyed agents to go iblic meetings, and lem, showing them ar, and I formed eeded so well that. ould rely, and the notified him that of Lower Canada, but when he came determination wa< y that there would ight and we nine, tile Company, and L. De Bellefeuille, dvertised that tlio the diirerent places illing to take tlu' nditions prescribed h must be done by )aid in cash at the ths at jiresent, and end of the moutli. I have arranged in the meantime tliat if you will send a ccrtificato of the equivalent of nAVAi)A. |1 (100 000 .^)1.1, having been placed by Jay (Jooke k Co. to the credit of the Merchants Bank of Clanada, Montreal, in their own bank, in New York, it will accept the clu-eks for the sui»scriplion, but no money will pass till the contract is entered mto, and then ten per cent, on the whob; amouiit of stock awarded us will have to lie ]mid into tin; Reccivcr-(ieneral. Ue i)leased, therel'ore, to send me as early as possible jjowers of attorney to'subscribe slock, and JavCooke k Co.'s certificate above mentioned. 1 have had scverarietters from England, ollering to take the whole thing up if we desire to part with it. but it looks to me to be too good to part with readily. If you wish any further Information, I will go to New York next week, if you desire it, and (ommunicate with ^u personally. Please telegraiih if you wish lo see me, and the day. As you may Aipiiose, the matter has not reached this jioint without great expense,— a large jiortion ol IT only payable when the contract is obtained, but I think li Nvill reach not mueli short jjf $:}uu,o6u. . , . „ ^V "'Yours faithfully, rSigned) "'HUGH ALLAN. «' P.S.— I presume you desire that unless we can obtain and secure a majority of the rtock, you would not take any. Hut on this point I wish to be instructed. (Signed) " ' 11. A. " The following is to the gentleman before alluded to : — " * Dkar Sill, " ' Montreal, August 7, 1 872. '" I wrote you on 1st July, giving you a detailed account up till that date of the events and my movements in connection wiili the Canadian Pacific Railway. I have not had any acknowledgment of the receipt by you of that letter, but I suppose it reached you in due course. The question I asked you, however, remains unanswered, and I now proceed to inform you of the progress of the negotiations since the date of my letter. The policy adojited has been (juite successful ; the strong French influence I succeeded in obtaining has jjroved sufTicient to control tlie elections, and as soon as the Qovernnu-nt realized this fact, which they were unwilling to admit and slow to see, they opened negotiations with me. It is unnecessary to detail the various phases through which it passed, but the result is that we yesterday signed an agreement by which, on certain monetary conditions, they agree to form a Company, of which I am to he President, to suit my views, to give me and my friends a majority of the stock, and to give the Company so formed the contract to build the road on the terms of the Act of Parliament, which are §30,000,000 in cash, and 50,000,000 acres of land, with all other advantages and privileges which can be given to us under the Act, and they agree to do everything in their jiower to encourage and assist the Company during the whole courst; of construction. The final contract is to be executed within six weeks I'rom this date, probably sooner. Our ojiponents are to get a minority of the stock, and they regard us with great jealousy and dislike, in consequenee of their defeat, and on that account the Government is obligcul to stipulate that no foreigner is to ajjjiear as a shareholder, so as to avoid the former cry ol' selling ourselves to the Northern Pacific, and succumbing to foreign influence. The shares taken by you and our other American friends, will therefore have to stand in my name for some time. We shall get six million dollars of 4he stock out of the whole capital of ten million of dollars. I again ask you if the —"irties are willing to take the reduced amount of stock in the same proportions, signed r previously. As it is my duty, I offer it to you, but there are plenty tlesirous of itting it; — ten per cent, on the amount will have to be paid up and de})osited in the ands of the Government as security, but will be returned, I think, as soon as the work Is fully begun. The expenses incurred in bringing the matter to this [loint have been >fery great. I have already paid away about $'250,000, and will have to jmy at least f 50,000 before the end of this month. I don't know as even that will finish it, but hope so. Of course this will all have to come from the subscribers to tlie six ,#lillion stock. If you elect to go on with the subscription, I will visit New York about Hhe end of this month, to settle the details with you. Please apply as early as .^nvenient. " ' I am, yours faithfully. (Signed) '"HUGH ALLAN.'" ^ r.R COHI^IlFsrONDKNfU-: TIELATIVK TO TlIK Canapa. '" I)(.:ai! 1\Ii;. McMlllkv, " ' Montreal, August 6, 1872. ~~' " 'I have lu'cn lioi)inj5 from ilay to day tliat sonio conclusion, which I could com- inunicato to you, would lio arrived at, respect iiifj; tht; Pacilic Railway negotiation, hut some obstacle to cause delay always intervened. Tlu' near aiiproach of the (dections, however, ami the stand taken by my French friends, that they would lend us hel]) till I |)ronounced myself satisfied, has at length brought the matter to a crisis, and 1 think the iiixnw I have been playing is now likely to be attended witli success. Veiiterday we entered into an agreement, i)y which the (Jovernnunt iiound itself to form a (.'ompnny of (.'anadians, only according to my wishes. That tiiis Company will make me President, and that 1 and my friends will get a majority of the stock, and that tht; contract for biiil linn- the raib'oad will be; niven to this Coniiiany, in terms of the Act of Parliament. Americans are to be carelnlly exchided in thi' fear that they will sell it to tho Union Pacilic, bnt I fancy we can get over that some way or other. This position has not been attained without large payments of money. 1 have already jjaid over §2O(),()0(), and will have at least !:!l(K),()(lO more to pay. I must now soon know what our New York IViciids are going to do. They tlid not answer my last letter. " ' Yours truly, (Signed) "'HUGH ALLAN.'" " ' Deau Sin, " ' Montreal, September Ifi, 1872. " ' I wanted at this time to have a meeting in New York, to see what our friends tliere were disposed to do, but to-day I have a letter from stating that he is leaving New York for Ohicago, there to join , and the two are going to Pngct Sound, They say, no meeting can be held till ^bc l.'ith of July, Mhich will not do at all. 1 hope in ten days or so to have the contract signed, and would like immediately after to go to England to raise tho money to build the line. I have disbursed !<;M;!,OnO in gold, wliicli I want to get rei)aid. I have still to pay !?lo.50(), which will close everything oil". I will go to New York as soon as the contract is signed, say about the 17th of October, and Mould bo glad to meet you there. " ' Yours truly, " ' Geo. W. McMullon.' " (Signed) " ' HUGH ALLAN. r^nclosure 4 in No. 4. « EXPLANATORY STATEMENT OF SIR IIITGII ALLAN. (FnoM TiiK 'MoxTnEAi, GA/ETTr;.') " In reply to the letters which appeared in Saturday's paper, Sir Hugh Allan has made the following affidavit : — " ' I, Sir Hugh Allan, of Itavenscraig, in the Province of Quebec, Knight, being duly sworn, depose and say; " ' That 1 have for some years past taken a strong interest in the development of railway commimication throughout tlie Dominion of Canada, and particularly through the district of country lying to the westward oi' Montreal, Avith a view to increasing the facilities of communication between the seaboard and \Vestern America, And that amongst other projects, my attention was early directed to the scheme for constructing a railway between Montreal, as the most Westerly Atlantic seaboard, and th(! Pacific Ocean. "'That in the autumn of 1871 I learned, in conversation with Sir Francis Hincks, that certain American capitalists had proposed to the Government, through Mr. AVaddington, to organize a Company lor the ])urpose of building th(> Canada Pacific Railway, but that no action had been taken upon their proposition. That, thereupon, inasmuch as no movement appeared to be contemplated in Canada ibr the ])urpose in (luestion. and I doul)ted if Canadian ca])italists could be induced to subscribe to it to any large extent, I obtained I'rom Sir I'rancis Hincks the names of the jjcrsons who had been (■(niimunicating with Government, and immediately jjlaced myself in corres])ondeiic(! with them, for tlu; ])iiri)ose of endeavouring to form a Pacific Company, in advance ol the measures which were exjjected to be taken by the Government at the then ensuing Session of Parliament. " ' That, accordingly, after a certain amount of negotiation, I entered into an agree- ment with Mr. Smith, of Chicago, and Mr. McMuUen, who was understood to represent -«!;«> 'i Vusiist f), 187'2. lich I could com- { negotiation, Imt 1 ol' tiio ('lections, lend us lieij) till risis, ami 1 think IS. Yosterdny we Ibrm a Company [ike mc! President, th(! contract lor ct of Parliament, 1 it to the Union position lias not d over !i;;:i))O,00(i, v what our New til ALLAN.'" mher 10, 1872. what our friends that he is leaving et Sound. They . all. 1 hope in ely after to go to no in gold, wliicli ^thing oH'. I will 1 of October, and JGII ALLAN. fANADt.A?^ PACIFIO HAILWAY. 69 LAN. Hugh Allan has ght, being duly ; development of ieularly through to increasing the rica. And that for constructing and thi! Pacific Francis Hincks, t, through Mr. Canada Pacific 'hat, thereupon, the ])urpose in rihe to it to any s who had been correspondence y. in advance ol he then ensuing into an agree- 3od to represent A certain number of American cajjitalists -in which I reserved for Canadians as much C,\nada Itock as I thouf^ht I could procure to be subscribed in Canada, thi" reniainder to be takc.i up by the Americans interested and their friends. This agreement contemplated a vigorous prosecution of tlie work ol construction, in eonlormity with the design of the Canadian Government so soon as it should be ascertained, provided the means to be placed at the disposal of tju; Company were such as in the ojiiiiion of the associates would justify th( in in undertaking the contract. And with regard to this agreement. I most distinctly and implicitly declare that neither in tlu' agreement itself, nor in any flbnversat ion or negotiation connected with it, was there any sti|>ulation, statement, or ^pressed plan, wliicli had for its object any retardation of the work, or any other irpose tlian its conijiletion throughout at as early a day as would be consistent th reas(nial)le economy in building it. And more particularly, I declare that there as no intention expressed or iini)lie(l, either in the agreement or in ll;e ni'gotiations hich accomjianied it, of i)lacing it in tlu; jjower of the Northern Pacific Hallway or iby other Company or body of men to obstruct tlie eiiteriirise in any manner or way ii^hatevcr. " 'That no further steps of iin])ortaiiee were taken by myself or associates up to the time of the opening of the Session of I'arliament at Ottawa, in resiiect of the projectea Company, except that I placed iiij:.elf in ((nnmunication with the (lovernment, olleriiig to organize a Company which would iindi rtake the construction of the road, and dis- cussing the (piestioii of the facilities and aid which the Government would ])robably recommend to be furnished by tlie country, and in the coui-se of these discussions and rtegotiations, I endeavoured, as far as ])ossible, to secure for myself the position of l*fesident of the projected Company, which was the jiosition my associates wi-re willing to allow me, and to which 1 thought myself entitled from the active ])art whieb I took in the great national enterprise to which tin; agreement and negotiations in ([uestiou h&d reference. And as to this point I had reason to believe, from the first, that tho (lovernment Avas prepared to admit my claim. "'That when the time for the 1-^essioii of the Canadian Parliament apjiroachcd,' I applied to IMr. Abl)ott to prijiare the rei|iiisite legislation ; and shortly after I'arliament llkd o[)ene(l I proceeded to Ottawa for the puriiosi' of ascertaining how matters were jiro- gtessiiig, and what jirospcct tliere was of a successful prosecution of the undertaking i)y Ittyself and the persons who were then associati'd with mc. That, previous to this time, however, 1 had communicated with a large number of iiersons in Canada on the subject of the proposed Comjiany, retpiestiiig their co-operation and assistance, and endeavouring to induce them to subsiribe for stock to such extent as I thought fair, considering their position and means. And though 1 did not meet with any great measure of success in procuring subscriptions of stock, yet it was quite as great as I had anticiiiated when niaking my arrangements with tl-.e American capitalists. In my negotiations with them, therefore, I provided for the distril)utioii of the stock which those gentlemen were willing to subscribe, or which I bi-lieved they Avould eventually be willing to subscribe, upon tlu; fermation of the Company. "'That, when I visited Ottawa, as staled in the last iiaragiaph, I ascertained, by jier- 80nal o])servatioii and communication with tlu' .Members of the House, that a strong •I'll* prejudice bad arisen against any connection with American capitalists in the formation Of the proposdl Company, the fear e\])ressed with regard to that subject being that such i^pitalists would tiiid it for their interest rather to Obstruct the Canadian Pacilic. and rther the construction of the Northern Pacilic, than to act in the interests of Canada by jressing forward the Canadian Head. And though I did not share this fear, and always lieved, and still believe, thafthe persons who jn'oposrd to be associated with nie would S.VC gone on with the enteri)rise in good faith to the best of their ability, yet I found le feeling for the moment so strong that I judged it expedient and proper to yield to it, ifcd therefore! coiificnted that the legislation fo be iiresented to the House should exclude i^reigners from the tlompany. and that tin; Directors should be I'xelusively Canadian. *v '"That a Hill incorporating the Canadian Pacilic Company was then introduced into me House liy Dr. Grant, who had been a proiiiinent advocate of the Canadian Pacific feheme, and had introduetHl in the last previous Session a similar meajure at the instance •f the late Mr. Waddiugton and others who were then interesting themselves in the roject. ;„ '"That notwithstanding that the Bill wliich was so introduced contempbt"d by its ferins the exclusion of foreigners, 1 did not feel by any means convinced that the Govern- nieiit would insist upon any such condition, believing as I did, and do, that such a ])ropo- pition was impolitic and unnecrs.«ary. I did not, therefore, feel justilied in entirely breaking oft" my coiuiection with the' Anu;ricau asaociates, although 1 acquainted them H 2 (in COURE^JPOXDHXCK IIF^^ATIVE TO TlfM (ANAnA. uitli the (liniciilly uhidi mifflit nvUo if tlic Oovcnimciit took tlic same ])ositioii wliiili llic iiiajority ol' tlic people witli whom I conversed at Ottawa appeared to do. I was aware (!; i< liy tlie terms of llie Hill iiitrode.a'd hy tlie (ioveriii»U'iit, they would have a cimtrolliii;; power as to flu; terms of the eoutraet, and I was williiiij; to aiiide l)y their decision as to llie extent of interest, if <;ny, whieh foreif^ners might he permitti'd to hold. And until that deeision was eomnninieafed to me I felt in honour hound by the aj^nc- nient 1 luul made to leave the door ojien lor the entranee of my Ameriean associates into th(! C-'ompany, unless the eonlin^eney arrived of a distinct i)rohil)ition hy the (lovernmeiit ai^ainst admittin;; them. And in informing; them of the progress in the all'air in ('anadn, as 1 did on certain occnsions as an individual, and without implicating the (.Jomjjany ol which I was a menilier, I considered that [ was only acting fairly by them. And 1 diil not intend tlu'rel)y to hind, and as I conceive, did not in any way bind or compromise to my views the other members of the Canada I'acific Railway Comjiany, with whom I did not think it necessary to communicate at all on the subject of my occasional corrc- spiindence with my American associates, the nu»re esi)ecially as this correspondence was ciifirely private and conddential, and nmreover was written with such inattention, as to accuracy of expression, as might be expected in correspondence intended only to Ih; .seen by those to whom it was addressed. During my stay at Ottawa, I had some communi- cation of an informal character with members of the («overnment, and I found that they were still disposed to recognize the value of my services in endeavouring to organize a Company. IJut in view of the rivalry which appeared to exist in respect of the Pacific .scheme, and the strt)ng array of (!anadian names whicli had been obtr i'l.'d by the Inter- Oceai.ic C-'ompany as associates in its project, nothing delinito leading me to expect any preference for myst If, or for tl e Company which I was endeavouring to organize, or indeed anything defmite relating to the project, was said by the members of the Goyerii- inent with whom 1 communicated. It ajjiieared to me that while their intentions and ojjinions had been freely exi)ressi'd to me when no Comi)any other than that which F was l)roposing to organize was likely to bo formed, the presence of competition amongst Canadians for the contract bad decided them to allow matters to take tht-ir own course until they should have been enaijled to decide after the formation of the Canadian Companies what line ol conduct would be most conducive to tlu; interest of the country. And there was, therefore, very little said or done during tlie Session wbirh gave me any clue to the views of the (lovernment with respect to the course o'' acliciu which they would i)robably ultimately adojjt. '" After the session, the Canada I'acific l^iilway Corajjany, of which 1 was a member, proceeded to organize; and notified the (jfoverinnent that they were prci)ared to take the lontract for building and running the Pacific Railway on the terms and conditions mentioned in the (Government Bill. They caused stock books to \>c opened in various parts of the Dominion in conformity with the Act, and took such initiatory steps and such other proceedings as weri' necessary to enable tliem to act as an organized corporate body. That it soon after became evident to me that the Government would be l)est pleased to see an amalgamation of the two Companies incorporated by Parliament, in order that united action might be secured and the greatest strength obtained in the formation of a Canadian Company. And I therefore opened negotiations with the Inter- Oceanic Comjiany for the ])uri)ose of endeavouring to elfect such an amalgamation, .and at the same time tlii^ Canada Pacific Comi)any placed itself in communication with the Government with ridation to the same subject. It was thereupon intimated that the Government were also desirous that the; amalgamation should take place. That there- upon Mr. Abbott, a member of tlu; ('anada Pacific liailway Company, proceeded to Toronto to meet Senator .Macpherson, and, il' possible, to arrange terms of amalgamation that would be satisiactory to i)oth ('omjianies. And after a discussion of the matter during two or three days, in Toronto, between him and Mr. Maepherson, he reported to the Canada Company that there did Mot a])i)ear to be any material difficulty in the way of our amalgamation, except that the claim which I made to be President of the amal- gamated Company, and to have the nomination of an equal number of tlie members oi the new one to that nominated by Mr. Maepherson could not be acceded to. Mr. Macpherson's proposal was that he, as reiiresenting the luteroceanic Company, sliould liave the nomination of a larger number ol' members in the amalgamated Company than I, and that the (juestion of the Presidency .should be left to the Board of Directors. With regard to the Presidency, Mr. Abbott informed the Company that Sir John Macdoiiald i xprcssed himself as being favourable to my election as President, and that any influence the Government might possess among the members of the amalgamated Company would be exercised for the purpose of aiding in my election to that office, and that probably the difficulty as to the nomination of members to the new Company, in;j CANADIAN I'AriFIC RAILWAY 61 r\v ])osifioii wliirli red to do. I was licy would have a to aliidc l)y tliiir permitted to hold. uikI by the a^jrcc- can associates into )y the Govei'iiineiil e alliiir in (.'aiiadn, «; the Coiiij)aiiy ol liuni. And I (hd or compromise to , with whom I diil ' occasional corrc- irresjmndencc was inattention, as to I'd only to h(! scon 1 some comminii- I found tliat tlicy •iiig to organize a )cct of the Pacilic 'ird hy the Inter- me to exjK'ct any g to organize, or •rs of the Govern- ;ir intentions and that which [ was ipetition amongst th(;ir own course of the Canadian st of the country. l.Ii'li gave mc any L'tioH wiiich they 1 was a mcinhei', pared to take tiic s and conditions )pene(l in various tiatory steps and ;anized corporate it would be best )y Parliament, in obtained in the IS with the Inter- aalgamation, and lication with the timated that the cc. 'i'hat there- ly, proceeded to of amalgamation n of the matter 1, lie reported to culty in the way ent of the amal- tlie members of L'ceded to. ^Ir. ompany, .should I Comjiany than rd of Directors. that Sir John jsident, and that le amalgamated ) that office, and new CompaDy, bftween myself and Mr. Mac|)herson, might be obviated in Home way. In other respects, Oanam. he reported that he could find no divergence of opinion as to the •imalgamatior of the two Coinpanies between myself and Mr. Maci)herson. "'After receiving Mr. Alibott's Heport of the negotiation at Toronto, I felt satisfied that no (lilliculty would occur in bringing them to a successful termination. And as the late Sir (ieoVge t'artier happened to be in Montreal shortly al'terwanls, and 1 was taking considerable interest in his re-election, I met him and had unofficial coiiversations with him on the subject of the Charter on several occasions, urging that the inlluence of the (Government should be used to jjrocure the amalgamation upon such terms as I coii- a^eicd would be just ti myself and the Company over which 1 presided. "'That .■^ir (j'eorge ('artier, was, as [ was aware, communicating with the Premier the subject of the Pacific Railway amongst others; and that at one of the interviews had with him he showed me a communication from the Premier, of which the follow- ing is a copy :— "'July 20, 1H72. i "'Have .en Macpherson. lie has no per.sonal ambition, but cannot, in justice to Ontario, concede any i)referencc to (Quebec in the matter of the Presidency or in any other particular, lie says the ((uestion about the Presidency should be left to the Board. Under these circumstances, I authorize you to assure Allan that the influence of the Governnu nt will be exercised to secure him the jiosition of President. ' The otlier terms to be as agreed on between Macpherson and Al)bott. The whole matter to be kejit quiet until after the elections. Then the two gentlem'"n to meet the Privy Council at Ottawa, and settle the terms of a Provisional agreement. This is the only practical solution of the difficulty, and should be accepted at oiuu? by Allan. Answer. (Signed) " ' JOHN A. MACDONALD. "•Sir George Cartier, Ottawa.' " 'And Sir George Cartier on that occasion gave me the assurance whicli he was by that telegram authorized by the Premier to convey to mc. " ' That on furthei- discussion with Sir George C'artier as to the course which the Government would probably take with regard to the amalgamation and the contract to be granted, I urged uj)on him certain modifications of the terms of the above t-.K.ram from Sir John Macdonald, and finally Sir George came to entertain the opinion that I was entitled to have certain of those modifications conceded to me, and expressed his willingness to recommend it to his colleagues, lieiiig desirous of having as definite an expression of oi)inioii from Sir George, as he felt himself justified in giving, I re(|uested that he would put what he stated verbally to me in writing, and accortlingly, on the 3Uth of July, 1872, he wrote to me the following letter : — (Cop,;.) ♦" Dk.vi! f^in Iliciii, _ '"Montreal, July 30, 1872. " ' I enclose you copies of telegrams received from Sir John A. Macdonald ; and with reference to their contents I would say that in my opinion the Governor in Council will ajjprove of the amalgamation of your Company with the Intcroceanie Company, under tlic name of the Canadian Pacific Railway Company, the Provisional Board of the amalgamated Company to be composed of seventeen memluirs, of whom four ^hall be named from the Province of Quebec by the t^anada Pacific Railway Company, lour ironi the Province of Ontario by the Interoceanic Railway Company, and the remainder by Abe fiovernment; the amalgamated Company to have the powers specified in the tenth iBection of the Act, incorporating the Canada Pacific Railway Company, d'c, the agrce- -ineiit of amalgamation to be executed between the Companies within two months from this date. " ' The Canada Pacific Company might take the initiative in jn'ocuring the amalgamation; and if the Interoceanic Company should not execute an agreement of amalgamation llupon such tcirms and within such limited time, I think the contemplated arrangements •Sliouhl be made with the Canada Pacific Company under its Charter. "^ " ' Upon the subscription and payment on account of stock being made, as required |by the Act of last Session, respecting the Canadian Pacific Railway Company, I liave no |doubt but that the Governor in Council will agree with the Company for the construction s;ai- ' Avorkiiig of the Canadian Pacific Railway with such branches as shall be agreed upon, and will grant to the Comiiany all such subsidies and assistance as tliey are empowered to do by the Government Act. I believe all the advantages which the Government Act empowers the Government to confer upon any Company will be required to enable the works contemplated to be successl'uUy carried through, and I Canada. 62 CORRESPONDENCE RELATIVE TO THE am convinced that they will be accorded to the Conii).iny to be Ibrmod by amalgamation, or to the Canada Pacific Company, as the case may be. I wonld add, that as I approve of the nieasnres to which I have rcl'erred in this letter, I shall use my best endeavours to have them carried into effect, " ' Wn-y truly yours, (Signed) '"GEO. E. CARTIEH.' '• I positively declare that up to the date of this letter I had not any undertaking of any kind or description with the Goverinneut, either directly or througli any other person, than that contained in Sir John Macdonald's telegram of the 2()tli of.Tnly, whicli is given above ; and tliat telegram and the above letter from Sir (xcorge Cartier contains evcrytliing that was ever stated or agreed to between any member of the Government and myself on the subject of the I'acilic Railway project U]) to that date. "On the same day tliat I received the above letter J'roni Sir (Jcorge Cartier. I informed Sir John A. Macdonald of tiie contents of it, and asiied lor his sanction of the views wliich it contained. lint he declined to concur in tlu' terms of Sir George's letter, tek- graphing to him that lie would not agree to them, and that he would come down to ftlontrtal, and confer with him respecting them. " Thereupon I immediately informed Sir George Cartier that I should consider tlu' letter addressed to me as being withdrawn. And to my knowledge Sir George tele- graphed Sir John that he had seen me and that as lie (Sir John) objected to Sir (Jcorge's letter, it had been withdraAvn. I also telegrai)hed to Sir Jolni on the same day (July .'{1st) to the effect that I liad seen Sir George Cartier, and that hi- (Sir John) might return my letter or regard it as waste j)aper, and that I was satisfied with tlie telegram of the 2()th as expressive' of the views of the Government. " 1 jjositively and explicitly declare that, excepting so far as an understandiyg between the Government and myself is expressed in the foregoing correspondence, 1 had no agreement of any kind or description either verbally or in writing by myself or througli any other person in resjieet of the contract for tlie I'aeiiie Railway, or of any advantage to be conferred upon me in respect of it. Tlie terms of the Charier, the composition of the Company, the privileges which were to l)e granted to it, the }n'oportions in which the stock was to be distributed, having been matters for negotiation and settlenu'ut up to the last moment, and were only closed and decided upon while the Charter was being pre- pared in tin; early ])art of tiie j)resent year. And the persons who fnnilly <'omj)osed the •yompany were oidy decided ujjou within a few days of tiie issue of the C^liarter; I myself bein;),' pi-rmitfed to sulv-ribe only a similar amount of stock to that subscribed by other prominent members of the Company. "With reference to certain private anil confidential letters iniblished this day in the 'Montreal Herald,' and to certain statements in (hese letters which may appear to conflict in some (legree with the foregoing, I niMst, in justice to myself, oiler certain explanations. I desire to state with ri'gard to those letters that they were written in the confidence of jirivate intercourse in the midst of many matters engrossing my atten- tion, and jirobably with less car(> and eireiimspeetion than might have been bestowed upon them had they lieen intended fur jjiiblication. At the .same time, while in some respe'cls these letters are not strictly accurate, I conceive that the circumstances, to a great extent, justified or excused the language used in them. " \\ ilh regard to tlie reference rejieatedly made in those letters to the American interest in the stock of the Company, as I have already stated, I had made an agreement with the parties to whom those letters were addressed, assoeiating my.self with them in a Company i)rojected for the constriietion of the I'aeific Railway. I had never bien informed by the Government that it was their intention not to permit the association of Ibreigners with (.'anadians in the organization of the Pacific Company. And in con- senting to the legislation introduced into the House, I thought 1 was only deferring to a preju(licc which I myself considered without foundation. I did not hesitate to intimate that if a suitable opportunity offered, they should be permitted to a.ssume a position in the Company, as nearly liki- that which they and I had agreed upon as circumstances would permit. .\nd as I entirely disbelieved the statenients that were made as to their disposition to obstruct the Canadian Pacific, and considered that they might be of great use in furthering its ctmHtruetion, especially in the event of a failure of the negotiations in England. I had no hesitation in ])laciiig myself individually in the position of favouring their admission into tlie Company, if circumstances should permit of it. It was in that spirit that what is said in my private letters now published was written to the gentlemen to whom they were addressed, and if malteis liad taken such a turn as to permit with propriety of those intentions being carried out, 1 should have felt myself hex wl th< no wh ter % CANADIAN PACIFIC RAILWAY. 63 '. by amalgamation, , that as I approve ly best endeavours urs, E. cartier; my undertaking of hroiigh any other '6th olMuly, which ;e Cartier contains r tlie Government c. Jartier. I informed •tion of th(! views orge's letter, tck- Id eome down to oiild consider tin Sir George tele- eil to Sir (ieorge's e same day (.Inly (Sir John)" might vith the telegrajn rstandii;g between lulence, 1 Iiad no 11} self or through of any advantage !ie composition of ions in which the tlenu'iit up to the ■r was being j)r('- lly composed tlic f the Charter; 1 hat subscribed by I this day in the may appear to elf, oiler certain were written in •ossing my atten- lieen bestowed e, while in some L'umstances, to a the American lie an agreement if with them in had never bivn lie association of And in con- y deferring to a date to intimate ue a position in s K)minent men in the Dominion, could lie induced to join their energies in pressing ^rward the project. '" About this time, however, a memorandum was communicated to me which had been received by the Government from the Interoceanic Company, which ap])eared to destroy the jirospect of amalgamation ; and although the Canada Company endeavoured to remove the objections made by the Interoceanic Company, they tailed in doing so, and the idea of amalgamation was shortly afterwards finally abandoned. Thereupon the (iovernment informed me that it was decided that the contract shr aid not be given to either of the Companies alone, l)ut that the Government would incori)orate a new Gom])any if the prominent members of the two incorporated Companies, and any leading Oanadians who might be disposed to join them, and able to give assistance, could be induced to subscribe the stock in the proportions which] the (Government had decided Son, which projiortions are those eml)odied in the Charter. And from that time the brts of all parties interested in tlu; project was directed towards procuring the lisociat ion together of the most prominent men of both Companies in the newComjiany, to be incorporated under the terms of the Government Act of the previous ^Jession. And it was as the result of these efforts that the present Company was formed, composed in ft majority of instances of gentlemen with whom I had no communication whatever, md not in any respect as the consequence of any understanding between myself and the 0ov " 'That witii regard to the construction wbicii ai)l)ear8 to be intended to l)e plar'cd '||)on the statements in the letter referred to as to the preliminary expenses ei miected "Itb the Cluufer. I state most juisitively and explicitly, that I never made an agreement came to any understanding of any kind or description with the (Jovernnient, or any of meml)ers, as to the payment of any sum of money to any one, or in any way what- Vc\\ in consideration of receiving the contract ibr the Canadian Pacific. I dicUire that Jdid e.\))end consideral)le sums oi money in various ways which appeared to me to be idvantageousto the Company I had organized, and calculated to strengthen my hands m jtodeavouring to ol)tain tlu' contract for that ('oni|)any, but that i iDENCE RELATTYE TO THE Canada, whatever, in oonncction with the Cliarter or coiitrnot. As may be gathered I'rom tlii letters in question, I considered it to l)e my policy to stren-^then my position as Tarn I ])ossil)ly could with my own I'r'.ends and I'ellow-citizcns in llu; Province* of Quebec, niii more especially in so i'nv ivs relnted to the Montreal Northern Colonization Haiiuay, wlii^i I conceived would at some day be the outlet IVom the Canadian Pacific to the Poit i Montreal. And a considerable jiortion of the money referred to in those letliM's was i\ pended by me in furtherance of that project in many ways. I considered it for my inton- alsothiit those members of Parlianu'iit who liad shown an interest in the Canadian Pacili entc!rprise and in other railway enli'r[)nsi.-. in which I was interested, and wlio wcr. disposed to assist ainl further them, should be ..ided in their elections, and I subscrilni some money and 'enl some money to assist the election oi' such persons as were ni frieiuls and in whom I was interested, but without any understand iuT or condition wit' them or any of them as to Parliamentary support or assistance in tlie evi;nt of tlui election. In these and similar ways I expended sums of money approaching in amoiii; those mentioned in those letters, as I conceive I liad a perfect ri;;ht to do ; but I did lu state in those letters, nor is it the fact, that any portion of those sums of money wcr paid to the members of the Goverimient, or were received by them or on their belia! directly or indirectly as a consideration in any form for any advantage tome in eonnectic with the Pacific Railway contract. " ' I desire also to state further with regard to the envedope and the papers which i contains, which were placed in the hands of the ITon. Mr. Starncs shortly before ni de])arture for England with the delegation of the Pacific Railway, that upon bci: informed by me that all negotiations between my former American associati^ a:i mystdf on the subject of tlie Canadian Pacific Railway must cease, large demands wtr made upon me by Mr. McMuUen, based jiartly upon alleged e,\pcnditure by him, an partly upon a claim by him for comi)eiisation for his loss of time and services in tl; promotion of tlie enterprise so long as he and his friends remained connected with i' These demands at first were of such an extensive! character that [ declined altogether i entertain them. I was disjwscd to return to my American associates any money wliii they might liave expended in the matter, and i was ready to compensate Mr. McMiilli for the loss of his time and his exj)enses ; l)ut it ap])eared to me that the sum 1 demanded was much greater in amount than all such disi)ursements and exjijuses coiil possibly have reached. I felt naturally that by trusting to the honour of my corresjioi dents and writing to them in a manner somewhat inconsiderate, I had placed it in tlu: power to annoy me by the publication of those letters, and I feared that the outer which might follow their publication in the columns of certain papers which liav manifested unceasing hostility to the Canadian Pacific Railway, might injure tl prospects of the delegation in E)ngland. I therefore authorized an arrangement i be made with Mr. McMuUen, by which a sum very much less than his original dernaii: should be paid to him; the greater portion at once, but the remaining and a considcrab jwrtion on the delivery of the letters to me after the present Session of Parliamci. should they not be published in the interval. This was accordingly done. M McMullen received the greater part of the sum agreed to with him, and tlie remaiml! was placed in one ol those envelopes in the form of a cheque, the other envelope containiii to the best, of my belief, the same letters which had been published in the ' Aloiitn. Herald" this morning, together with one or two others, whicli do not appear there. In which would have estaldished the rujiture of all negotiations iietween the Americans ai. myself. And thisiu-rangement was made, on my bi'hallj with Mr. McMullen, without t! concurrence or knowledge of any membi;r of the (ioveriimcut,— none of whom wereav/iir that the papers had been deposited in the hands of Mr. S.arnes. " ' And I have signed, '•' HUGH ALLAN "'Svvoru before me at Montreal, this fourth day of July, 1873. '"J. L. Beaudry, J. P.'" i Enclosure 5 No. 4. STATEMENT BY MR. McMULLEN, WITH DOCUMENTS, &c., &o. (FuoM TUB 'Montreal IIkuald.') •"Sin, " ' So much has been of late said about myself, and my connection with the Pacifi Railway negotiations, that I think it better to lay a full statement of my ^wsitioii i gathered from tin ly position as far ;;^ viiu'(> ot'QiielM'c, an ition Hail way, whirl acifir to tl\u l^)^t i tliosf IftttM's w;is ( I'cd it lor my iiiteiv tlie(!anadian Pacili. •stt'd, and wlio wir )iis, and I subscri! ir persons as wcro in ii!r or condition wii' 1 the event of tlui |)roachinj; in amoiii: fo do ; but I did iic nms of money wcr n or on their bclia! a tome inconnectio the papers whicli i IS shortly before nv ay, that upon be::.. ican associates an large demands wcr nditure by him, an ! and services in tl d connected with i' eclined altogetheiM es any money wliir nsafe Mr. McMiilh: no that tha sum I s and exjjjnses coul 3iu' of my corresjwi ad placed it in the ired that the outer pai)ers which ha' might injure tl: an arrangement i lis original dernaiic ng and a considenib ssion of Parliamcii iingly done. M 1, and thi! remaiml! I'livelopecontaiiiiii. led in tlie ' Montn. lot appear there, In n tlu; Americans ai. Mullen, without t! of whom wereav.ii: HUGH ALLAN sn'S, &c., &o. lion with the I'atit: )t of my jJOsiticHi r CANADIAN PACIFIC RAILWAY. 65 tegard to it before the public than to longer allow myself to be placed in so many wrong situations by those who are of necessity ignorant of many important facts. I have chosen, therefore, to place it in the form of an historical narrative, embracing the incidents that came under ny own knowledge irom the time I first engaged in the matter until the granting of the charter by the Government to its present holders. *'" I visited Ottawa in March, 1871, on a Chicago delegation connected with tlie enlargement of the canals, and while there met the late lamented Mr. Alfred ^^'addington and Mr. Wm. Kersteman, who were agitating the sul)ject of a Canadian Pacilic U.K., d who introduced the matter to my notice, with a view to organize a coni])any to ild the pro])osed road. After looking at the surveys and explorations of Mr. addington, who was well informed on the physical nature of the Pacilic coast, I included to take the subject before some friends with a view to its serious consideration, a few weeks, at my request, Mr. Waddington and Mr. Kersteman visited Chicago, Id the result was, on tlieir re])resentations, that with my friends I projjosed to organize dS; Company which would undertake to ?'nild the road, on terms api)roxiinating those ^hich current rumour reported th(> (iovernmentas willing to reconnnend to Parliament. I^c visited New York and Philadcl])hia sliortly afterwards, and in about six weeks later (heing early in July, 18/1) we visited Ottawa witli an informal i)roposal from parties of the highest respectability for undertaking the work. The only members of the Government whom we met were Sir John A. Alacdonald and Sir Francis Ilincks ; and it speedily became ajijjarent to myself and associates tliat Mr. Waddington had been over sanguine in his ideas tliat the formation of a Company would be entrusted to his hands. After sonu! conversation which tended to make tl:is clear, and which intimated that the Gfoverinnent would wish to incor])orate jiromincnl: Canadian names in any ('omi)any undertaking the work, Ave left our address witn the two Ministers, with the understanding that if occasion for it arose wc were to hear from them, Some few weeks afterwards Mr. ('has. M. Smith, of Chicago, wlio was my colleague in tliis matter, received a letter from Sir Hugh Allan, stating that Sir Francis Hincks had requested him to communicate with us in order to cilect a union of t.'anadian and American interests in the Pacific Itailroad Comjiany that was to be formed. " ' I afterwards found that Sir Francis Ilincks had visited New York in the early part of August, 1«7J, and at interviews with two jjromiuent railway bankers, whose names will readily occur to him, had advised them and their associates to cease negotiations through Messrs. Smith and myself, and open them directly with Sir Hugh Allan, who being a lea-iing Canadian was looked upon by the Government as a i)ro])cr ])ersoii to figure ])rominently in the matter. As the gentlemen applied to were both unwilling and unable to change I'xisting arrangements, Sir [''rancis, on ids return, seems to have given the address left with him in July to Sir Hugh Allan, and his letter to us followed. The Msult was an interview in Montreal, early in Se])teml)er, 1871, at which preliminaries were settled between Sir Hugh Allan. Charles M. Smith, and myself, by which Sir Hugh Was to receive a large personal interest in the stock, and an amount for distribution awiong persons whose accession would be di'sirable, and that the cash instalments on such rtocA should be advanced and carried by others in interest. An interview was held by mys^'lf witli .Sir John A. Macdonahl, at the St. Lawrence Hall the day before we met 4ilJaii, at which he expressed th(> approval of the (iovernnunit at the proposed meeting, Mid nHpiested me to meet him at Ottawa, alicr it was over, to let him know the result. I^ccordingly went to Ottawa, and explained to him that Sir Hugh had entered into Wrbal arrangements, which would soon assume a more i'ormal shape, and that we had iroviiied for the easy accession of such other Canadian gentk-men as would be of advantage. He seeme(l quite ] (leased with it, and promised, on communication with Allan, to set an llrly day for entering into i>reliminar> arrangements with the (Jovernment, in order that the whole matter might be in shape for an early presentation to Parliament. Shortly Wlerwafds. in accordance with this understanding, Sir Hugh notified Mr. Smith and l^yself to come, and we three met the Cabiuel at Ottawa, October nth, Is"!, to settle, 1^ we supjiosed, the general h-alures of the scheme. There were present feir John A. acdonald, Sir J'^rancis Hincks, Sir G. K Cartier, and Messrs. Tilley, Tupi)er, Mitchell, orris, Aikiiis, and Chapais. It was at once apparent that thev were not fully in accord ong themselves, in consequence, as Sir F. Hincks informed me, of ti rand Trimk Jalousy ol Allan, rei)resented by the imp)rtant personage ol' Sir (ieorge Cartier. The *ttlement of matVero, had, therefore, to be postponed until the return of Sir Hugh Allan ^m Kngland, he sailing on October 7th, and returnin:; the istof December. Mr. Smith jtod ! ])rocee(l<-d to New York, to inform our friends of the state of atlairs. It was then |bat we In-st learned of the visit of the Finance Minister, which 1 lu-.^e lieretofore iiarrateti, 'I I - Canada. 6G rORRESPONDENCE RELATIVE TO THE Canada. yi! and it was also then that Sir Hugh's ' first telegram of the published correspondence was received. "'After the return of Sir Hugh Allan from England, he telegraphed to Mr. Smith, ol Chicago, that Sir Francis llincks had called and suggested that tlie Government would he obliged to advertise^ jbr tenders in order to avoid Idanie, so that the conclusion of an agreement would have to be ])ost])on(Ml for several weeks, but suggesting that we have a meeting in ^lontreal, and afterwards in New York, to execute the contract which was to I'oUow our verbal understanding. Mr Smith and myself accordingly lelt Chicago on December 15, 1871, and after visiting Montreal and closing all])reliminaries with Allan, we went with him to Ncmv 'i'ork, where tlic contract was signed by all the parties, under date of DecemlKU' L'.'Jrd. ISTl. A variety of topics were discussed at iutervi(?\vs and by correspondence, during the winter, and the delays of the Government ex])]ained by the I'xigencies of the political situation. \Vhile at first Sir Hugh had announced that no money would be required for such purposes, yet he soon professed to discover that it would be necessary to ])r<)viile some, toaid in procuring the closing of the arrangements. He at one time announced to Mr. f^niitb and myself that tiie >::.s,.")()U, of which he speaks in one letter, had been lent to Sir .lohn A. Macdonald and Sir Francis llincks in sums of !? 1,000 and ii4,.")00 res])ectively, " with very good knowledge that it was never to h' rei)aid." 1 le also explained tliat tlie Finance iMinister was taking a great deal of interest in the matter, and that In- had .sounded him on llie extent of his personal exi)ectatioiis, when it reached an assured conclusion. He said Sir Fi'ancis liad rejjlied that at his timu of life an absolute payment would be preferable to a jjercentage of ultimate jn'olits, and thought he should have s."i(),()0(), and in addition the ])osition of Secretary to the Com- pany for his son, at a salary of not less than S"2,U00. My reply was, that 1 supposed, as we were into tlie matter, W(! would have to meet, in some way, such demands, if we I'Xjiected to proceed, but that large amounts could not be disbursed on uncertainties. As the Session approached, however. Sir Hugh made application for money, and on March 'JSth. 18/2, a si\i>j)leinentar\ contract was entered into by whicli a committee o! five wen appointed, Sir Hugh being chaii-man, who were authori/ed to ])ri)vide funds. This con- tract also covered a change in terms to meet the views, as Sir I high rejiresi'iited, of the (lovi'rnnieiil, and em|)ovi-ered this (Committee to agree to the acceptance of $.'iO,0(tO,0()0 and .")(),0()0,000 acres ot land, exactly the amount the Government recommended, ami exactly the amount he tln-n told us they would recommend if we would accept. A levy of !^.")0,O00 Mas made oe liie American ])artie:;, April ist, 1^72, and the amount ])lacc(l to the credit of Sir Hiigb.. He drew ^40,(100 as follows : $1. '),()()() by check, dated May 2nd. 1ST2, and i)aid ]\!ay tth, 1872; and s2.'».0(»0 i)y check, dated Alay .'ird, 1S72, and ])aid .Tune (Itii, 1.S72. The only explanations which he made to me of the expenditure of this sum were the payment of ?? 1,000 to ' La Minerve ' newspa])er. and S'"i,000 each to three other I'rench ]>apers, whose names I cannot j)ositively remember ; St!,()0() to Attoriun- General Ouimet for aid ri iidered at Ottawa, and an indefmitt lo.m of ?;2OO,000, he becamed alarmed, and told Cartier that he must stoj) paying the drafts which were coming in so rapidly unless the whole Government would sanction the bargain. He then stated that Sir George sent to Ottawa and received a telegram from Sir Jo!m A. Macdonald confirming his action. After this Allan said he proceeded baying until iic bad advanced .■:<'!.")S,00() in addition to ?^ l(),OO0, drawn from New York. 1 promised to submit his statement to my friends, in New York, and leave the matter for them to decide. " ' The next word I had was that he thought he must dissoh e all connection with Americans, in a letter dated October 2'lth. I replieil in a i'cw days after, ])rotesting strongly against such action, and in return received a brief letter dated November nth, in which he stated that he was in entire ignorance of the whole intention oi the Government. ^ " ' In December I got an urgent lettiu- and telegraph, retpiesting me to meet him at .oronto or Montreal, Init not stating the object. I went to Montreal and had ,- York, to the effcict that he could not continue his arrangements, and must break them entirely off. I j)rotested strongly against such conduct, referred to tlu; contracts we had »'ntered into, and the long as,ociation existin-'-, '-s well as the uniform good faith evinced by our party, stating th .t I deenu;d it only onourable in him to insist on the original agreement, ov else to re* ire himself from the roposed Company. When this was refused, 1 announced niv iiitention of goiii'- to ttawa to lay the matti'r before Sir .lohn A. Macdonald. On tlv .'Mst December, 1 had >lan interview of some two hours' duration with Sir John, and Maced him in posseJsionof ;|ill file facts, and showed him the letters which I had Iron: .Sir Hugh in regard to the fatter, as well as the original contracts, and the letters to th ; New Yor!: U.K.'' President, ^Jvhich were recently published in connection with other co •res[)oiidenee. T pointed out ■to Sir John the allegations made by Sir Hugh as to his agreements with the Governmeut, .^,and narrated to him all the leading facts I have given here. He strenuously .lenied that ftlie Government had iieen bribed, :ind 1 pointed out that if not. then our Canadian associate must be a swindler in attempting to get refunded nearly 5;I(K),(I(I0, which he had never laid out. 1 then rapiested him to do one of two things- either to allow our foriginal arrangements to be carried out, or else to leave Sir Hugh out of thelJovernment I Company, since we did not ])roi«)se to be a steiiping-stone for bis personal advancement Bir .lolm said the Government arrangements had gone so far thai be fear( .s. — Please also send Sir John A. Macdonald ten thousand dollars more on the ftfiac terms.' " " Montreal, August 26, 1«72. I' Received from Sir Hugh Allan by the hands of Hon. .1. J. C. Abbott twenty lusand dollars for General Election purposes, to be arranged hereafter according to the IS of the letter of Sir Cieorge E. Carticr, of tlii' date ;]Oth of July, and in accordance |th the request contained in his letter of the 2tth instant. (Signed) f'For Central Committee. " L. BETOURNAY." " J. L. BEAUDRY. " HENRY STARNES, " P. S. MURPHY. " ' {Immedinte, Private) " ' Toronto, August 26th, 1 872. " ' I must have another ten thousand ; will be the last time of calling ; do not fail me ; answer to-day. wrp ,u TT f T n Au ♦* «f A „«n'c ' " "'JOHN A. MACDONALD. •* To the Hon. J. J. C. Abbott, St. Anne s. " * Draw on me for ten thousand dollars. «» « Sir John A. Macdonald, Toronto.' " " ' Montreal, August 2G, 1872. "'J. J. C. ABBOTT. " « Toronto, August 2fi, 1872. '* * At sight, pay to my order, at the Merchants' Bank, the sum of ten thousand dollars tot value received. " ' JOHN :\. MACDONALD.' " ** ' This draft was endorsed thus : ^* * Pay to the order of the Merchants' Bank of Canada. ...I' IT T ir- All . " "'JOHN A. MACDONALD. " ' lo Hon. J. J. C. Abbot. ••My dear Sir, " Montreal, July 1.'), 1873. , "I submit for your perusal a statement I propose publishing to the people of Canada fp to my connection with the Pacific R.R. My reason for doing so is, that I have been fljlbjected to the vilest slanders at the hands of the Ministerial press, of which you arc aUrarc. The abundance of such abuse makes it imperative that I should show what Ithe real I'acts w ere, and as you and I have had a friendly association in the matter, id you are personally cognizant of many facts, I ask you to give me a letter relating ireto, and containing whatever may be within your recollection as to the circumstances the case. I think I am justified in asking you to do this, when my character has been so ionsly assailed. ' Your reply will be gratefully received by me, and put me under lasting obligations. " Very truly yours, on. A. B. Foster." " G. W. McMULLEN. ' )eau Sir, "Waterloo, July IG, 1873. " I have had an opportunity to look over the statement you make in regard to your inncction with the Canada Pacific Railroad, submitted to me for the purpiDse mentioned your letter of the l.'ith, and I have this much to say in regard to it. With the first Irt of your history of the matter I am personally unacquainted, as our intercourse did bt begin until the opening of the Session of 1872, when we were introduced by Mr. T»bott. My negotiations on the subject of the Pacific Railway previous to that time had en with Sir H. Allan and Mr. Abbott, though from the commencement I had been rare of the arrangements made with American parties whom you represented. I was Delated during tiie Session of 1872 with Allan, Abbott, and yourself, in all the stages w T'OHRKSPONDENrE RELATIVE: TO THE Canada, ofpi'ocuriiij; tlic Clmrtcr ol" the Ciuiada PacilU' Hnilroud Compniiy, and in all the cnim. madi! to socuif to that Company tin; contract to hiiihl the road, and as a const'cuuiut was lamiliav witli many ]ioints naturally arisinj; thtTofrom. I discussed with you in; ptn-sonal position under tlie projmsed arran-^ements and witli yourself, Allan, and Abboli all the main i'eatures ol" the lef;islation jjroposed, and such as were deemed necessary In; the ohject. As yon sfati-, there were diniculties in the way ol" closing matters, and I \v,t aware of the agreement with ^Nlr. Langevin to which you rel'er, as it was I'requently di- cussed between us and Mr. Ahhott. I was also aware I'rom the first of Sir (ieoi;, Cartier's ijjjposition to Sir Hugh Allan, and of the means hy wiiich Sir (Jeorge was forci\ to forego his o])position. " In regard to the ]myment of money for cdection ])urposes, I was informed of th arrangement with Sir (»eorge C'artier, and was also shown a confirmatory telegram Iron Sir .lohii A. IMacdonald. I understand the ailair to he substantially as you have relatoj and I have reason to believi- that large sums of money were actually expended for cln tion purposes under the arrangement. " Yours truly, &e., " G. W. McMullen, Esq." (Sigiuul) " A. li. FOSTER. Enclosure f> in No. 4. MEETING OF MEMBERS OF PARLIAMENT IN OTTAWA. FrOJI TllK • MOXTRKAL IIkIUI.D.' " The gentlemen opposed to iirorogation held a meeting in the Railway Committet room, immediately after prorogation. " Hon. L. II. llolton said he thought it would he |)roper for the deputation who liivi carried (he memorial to the Governor-General to report the result. That memorial ha: heen signed by ni>uty-threc members, which were a clear majority ol' members who wcr usually in attendance in the House. It was a memorial only praying him to stay In hand so as not to prevent the House of (^ommons from iiupiiring into the most stiipcii' dous political and electoral frauds which had ever hitherto bei-ii heard of. (Loiii cheers.) The practical result was that in the rejily this memorial had been scorned h\ the representative of the Crown. The worst j)ossible insult had thus been put upur Parliament by a Governor-General, acting on the advice oi' men who were themselvc under inijieachmeiit for crimes whicli almost amounted to trea.son. " -M r. Cartwright said, as Chairman of the Committee, that the memorial had bcor received by the (rcvernor-General in a very courteous way, and with the remark that i: was drawn in a very proper manner, and that he also sympalhiied very much with tli. feelings of the gentlemen of the deputation, hut that he was obliged to act upon th advice of the members of his Government. He said also that he had named a Royal Commission, consisting of three legal gentlemen, and would summon Parliament to iimt again in the course of about two months. With respect to the Oaths liill, his Exeelleiin stated that his Ministry were not to Idame for its disallowance;. He also said that In had to di:cline to accede to the jirayer of the ))etition, because, unless he did so, In must first dismiss his Ministry, which would imply a conviction of their guilt, lit Excellency, however, had expressly requested that there should be no formal publi- cation of his reply until he had delivered it in writing. Mr. Cunningham had stated to his Excellency that the di'putation considered that the prorogation would be an infringi- meiit of the jirivileges of Parliament, i)ut that point, of course, his Excellency did iw; discuss. " Mr. Cunningham (ISIanitoba) said that when his Excellency s])oke of dismissiii; his Ministers, he (.Mr. C.) stated that the ninety-three members who had signed tin memorial considered that the accusations against the Minislry were before the Ilouscoi Commons, not before his Excellency ; and that until they were brought before him, In had no right to issue a Commission, or to take any other step in connection with them. " Messrs. Rur[)ee and Church confirmed these statements. " Mr. Paquet also added that his Excellency had made an exposure of facts exattly as they had been made in the Ministerial journals, and had said nothing l)Ut what liaJ been said there, except that the advice he was going to adopt was given by his adviser* unanimously. He had also remarked that it was impossible for Parliament to jiroccfil to business, since, in consequence of the understanding arrived at, neither the members from Manitoba nor those from British Columbia were present ; and he was answered by CANADIAN PACIFIC RAILWAY. 71. uid in all the ofTort. md as a cousoqui'iu, inissfd with you nii ", Allan, and Abboli Iconic'd nccL'ssai'y In; <; matters, and I \v;i t was IVequcntly di;. ; first of Sir (ieoii ir (icorf^cwaslbm,: ras informed ol' fli. atory tcl(>grani Iron. as you have relatid y cxjjendcd for oln \. a FOSTER. OTTAWA. Railway Committet [Icpiitation who Iiao That memorial hac memlx^rs who wcii ing him to stay hi the most stu|)('ii' 1 heard ol'. (Loin: ad been seorned In ;hiis been put ujiui ho were themselvc ni'inorial had bm. 1 the remark that i: very much with tin ed to act upon tlu lad named a Koya! Pari lament to mid Bill, his Excelleiu) .' also said that In nless he did sojn r their guilt. Hi- L- no formal publi- gham had stated to juld l)e an infringi- Excellency did iiu! ijjoke of dismissiiii; ho had signed tin )ei'ore the House cl ght before him, In ection with them. ire of facts exactly thing but what liail ven by his adviser? liament to ])roceeil ither the members e was answered by Tginting to Mr. Cunningham, and by the assurance that Manitoba was fully reprosontcd. There was, however, no difTiculty about seeing on which side his Excellency leaned. " Hon. Mv. Cauchon said that, although at the end of the meeting of tlu; House Mr. McKenzic bad invited those ojjposed to prorogation to assemble here, he understood there were numbers on the other side who would have gladly been here to ])rotest against the course pursued, i)u1. that they were afraid of their party. He disclaimed the idea that thk was in any way a party meeting. (Hear, hear.) Every member had been invited tobe jtresent, and act in unison on the subject. They would all get a fair hearing, and might express themselves as they I'elt. (Cheers.) In whatever way the mi-eting might divide, the feelings of all would l)e respected. (Applause.) ^Mr. Jjallannne, rtho was loudly called for, said he did not thiidi i^ his \)\;wc, to aijjdress them on the subject ; it was more fitting that older politicians shoulil do it. All ||pst feel the outrage whii'h had bi;en ])er|)etrated. (Hear, hear.) It Wiis no cpiestion of lUrty. The (luestion now was, whether free government and free inquiry really existed, Moh as they knew wvU was eini)raced within the IJritish C'i)iistitutioii, On this account, t^ question being so vast and important, he should leave it to older i)oliticiaiis tiiaii hfeiself to discuss. He (U'nied that the Committee could not proceed with the investiga- tion, and alUrnu'd that ni'ither the i)eople nor their re})resentatives woubl submit to Ijeing dejprived of the rights, liberties, and privileges which belonged to them as IJritisli subjects. (Ajjplause.) As far as he knew, a Uoyal C'onnnission was altogether unne- cessary, as the question before them was one which involved the ])urity of Parliament. As he had before said, this was a proper sulyect for tlu; older members to discuss. As for himself, he had to-day felt like a l''rcnchman, as his blood fairly got up at the outragi' and insult which had been peri)et rated on the people and their representatives. (Hear, hear.) He should defer from further speaking, in order to nudve way for the h-ader. (CHe.s of ' Hlak(! and McKenzle.') " Mr. Blake urged that it would be well that ]\Ir. McKenzie's speech, which had been 80 rudely interrupted in the House, should liist be eomi)lete(l. " Mr. McKenzle .said be had so nnu'h dirTiculty in the House in olfering his motion, ho had almost lost his voice. In addition to what Messrs. Cauchon and Lallamme had swd, Ih! would remark that ninety-lour members of tiie House had signed the memorial oi'remonstrance to tlieCiovernor-lieiuM'al. (Applause. A voice : 'It is now ninety-live! ') Iq addition to those who had thus declared themselves, there were numbers of c;onser- vatives who lelt just as strongly as they did, that this prorogation was an imi)roper act uuder existing circumstances, "if tlu'y had not signed this petition of remonstrance, it was because they had themselves sent a remonstranci'. (Hear, hear.) It was well under- stood that some of the Conservatives who had sl<;iied the larger i)etlllon Iiad acted more gr less with us; but those to whom he had previously referred, were outside of that ^Ipnber. No one could confemi)late the recent high-handed proceeding w Ithout feeling ^to be a gross outrage, which must not be permitted. (Hear, hear.) He was ((uite ire that in times like these, when outrages were consummated by (Government, that sons sometimes expressed themselves more strongly than prudmice and the circum- •nces justified ; l)ut in this case an attempt had been'made to sap the very foundations #the independence of Parliament. (Ap])lause.) Since he hail sat in Parliament, he miA ever kept in view all legislation which should have a tendency in the direction of rliamentary independence; but in this instance, to screen Ministers from a charge of grossest corrui)tl()n, of which a good prima facie ease had In-en made out, it was empted to violate that indei)eiidence. (Applause.) He had no doubt that, from bis ^nt of view, tlie (iovernor-Cieneral was right when he said that he was bound to take advice of his advisers; but we had one English writer— an authoritv both on law history -who had said otherwise. This writer (Cioldwiu Smith) said plainly in a sr ni the 'Witness,' as well as in an article in the 'Canadian Monthly," that the ibei-s of the Committei; of Inquiry were right in refusing to allow it, without the Ihority of the House, to be turned out of doors by a Royal l!ommission ai)polnted by B parties accused. He takes the ground that tlie Ministry are not in a i)ositlon to Irise his Excellency us to a in'oi-ogalion or Commission, but must take the prerogative his own hand. (Hear, hear.) It must be borne in mind that Parliament had pomted a Conmiittee, whose operations were frustrated by agencies which \\ere eon- Iled by the Administration. (True, true.) He i>xi)lained that a majority of the Immittee were appointed by the Ministry themselves— the accused jiarties, who clnied to take evidence without oath, whilst the majoritv were perfectly willing to ve all the witnesses, even were they Ministers themselvi!s, to be examined without this, mb It'aring that they would tidl a lie. (Applause.) Matters were in this jiosition when ipe Parliament met, as it had done to-day ; constitutionally there was no necessity for Canada. mmr 72 COllT^ESPONDEXCE RELATIVE TO TITE Canaija. sM'i'nriii}; witnesses, merely to brins tlit"'" under the ])unislimcnt due to perjury if thi coniniiftcd it : this was, hj-causc the I louse could olitician, and gave his money to support his i)arty. (Laughter and cheers.) Do the letters show that he was an ardent politician ? Yes, they do ; but, Mr. fioldwin Smith has said, it was in the politics of steamboats and railways — (great cheeriim and bis party was Sir Hugh Allan. (Laughter.) However, we have Sir Hugh -Mian's testimony on this matter; debased as these letters show him to be, he has not told us that he lied in writing them. He only committed a few little inaccuracies, such as he and you and 1 make in private conversations, since we are only exi)ected to hetrutbfid when we speak in public. (Uoar^ of laughter.) It is, therefore, true that he s|)eiit his money to get the contract. It has In-en pretended that Mr. ILmtington was bound III prove every member of the Government to be directly concerned in this matter,— he (.Mr. Plake) supposed thi'y must ])roduce an Order in Council where every- thing w IS formally agreed to. (Laughter.) But those who w, le acquainted with Courts of Justice knew that frauds did not usually thus discover themselves. Such things were tjgiially cloaked, and men were often found to say, and even to swear, that simulated kpers were genuine; but Courts will jjiit these two things together, and when they find lan with documents, assuring him some great benefit in 'one band and a lot of checks the- other, they take them together. (Cheers and laughter.) The business-like receijjts kd drafts had something to do with this idea. Sir Ilu-h kiu-w that he was dealing with |ppery customers, and therefore he made his terms, and put everything down in writing. V' principal actor in the afl'air, no doubt, to-day regrets this extreme precaution, but ie cause of truth and justice has been well served by it. A remark, not unfre([uently tard, is to tin- effect that politicians are alike, and that if one Ministry is ejected the Bxt will do something. He was glad, however, to see that i)ublie virtue was not jet so jw as to permit anyone to assert this in public. It nevertheless received much ])rivate Vrency, and it should, therefore, be frowned down by all who believed that Canadians Ve entitled to the responsibility and the happiness of self-government. Men may sav fou will britic too,' but have we not on our side of the House been endeavouring lor bars to make bribery difficult, if not imjxjssible'/ Have we not been pressing for an fection law which will give us means of obtaining cheap and searching justice in these irtu-ulars? and have we not been told that there was a doubt if this system is suited to Je circumstances of the country ? (Cheers.) What fair-minded man can now doubt ^at this allection was only made for the jnirjiose of continuing the system of bribery and jDiruption which has hitherto prevailed'/ Who that reads the decisions on electoral J|efitn)ns could help being ashamed of them'? He did not blame the Si)eakcr of the Mouse lor these things— for he was inclined, like Mr. Mackenzie, to shut his eyes as -Ilucli as possible to that officer's failings— but he blamed the law. Because an illiterate laii wrote Ins name Robertsen instead of Robinson, the petition against J. II. Cameron ^ns thrown out, and there were many more similar decisions bv which election ])etitioiis /fk'ere prevented from going before even such a wretched tribuiial as the present Parlia- K 74 fOinitSPONDKNCK nELATFVIO TO THE li Cajiada. nionlary Comiiiittcc. Vet that infamous law the Ministry had refused to rectify. What ~ would have lieeii the result if the Allan ^old had not lieen scattered broadcast through the country? It was well known that there were everywhere venial j)ersous, indid'ereiit persons, ai\il men with local interest to sell for money; and in counties where opinion was not very decidtd it was easy to chauf^e the expression of it, hy i)urchase of tlu; venial, indill'erent, and these local undertakers. Without the (uitlay of Allan's money no one could douht that the complexion of this Parliament would have been very dillVrent. Among the luemlu rs, every man may not he as deeply dyed in this iniquity as the Ministry ; some may not have known that they added to the crime of corrupting constituencies that of selling their country, i)ut those who did know will resist investigation to the last, as their crime is only a little less than that of those who perpetrated it; hut when he saw that Avith a Parliament, even thus «'l((t((l,oue half of thememl)ers shouhl take the decided step that liad heen taken to assert the rights of the (.lommons, he felt confident yet in the iudej)endence of representatives of the people. Parliament might hereafter resume the investigation, and might re-estahlish the Parliamentary tribunal. The motion which liis friend had made he might then renew, and it would meet with a very dillerent receptioa from that which it had had that afternoon. He hoped now that those who had thought it was the wish of a tactions opjjosition to desire Parliament should sit while the Com- mittee was silting, would consider that, of what had taken place all that had occurred since would have been aljrogatcd, and that investigation would now be complete. He hoped ihere would now l>e an investigation, not i^y men chosen by the accused, not by men named by gentlemen in the dock — (laughter) — hut hy those who should l)e chosen by Parliament, indillerently to try the question of iunocence or guilt — (cheers) — and try an exhaustive examination of evidence. To such a tril)unal he was willing to bow, but not to three persons, whoever they might be, ajjpointed by those on whose innocence or guilt they were to decide. He was not ready to abandon the right of Parliament to try this case. He went for maintaining the course of Justice entered on by the House of Commons, which must not be interrupted and should be resumed at the earliest moment. (He sat down amid tremendous cheers.) ''Mr. Huntiuiiton said there were occasions that inspired eloquence, great occasions, which made great men, such as the result of tiie large measure that had to be discussed, and of the warmth of I'eiling that was elicited. He would pay a poor compliment by making a lengthy speech ; but however they might feel, this was a great question. He looked on it as a question, not whether a contract had been sold, but whether this country should or not l)e governed by Parliament. He desired to speak with reverence for the Crown, but he did not want to go back to the time rd" Nero, when the depository of ])ower could fiddle while the city burned. There were times when issues were so great that the cause of truth was far greater than any man, however highly he was placed. He had told them in Parliament what he could prove of these terrible charges, if he had an opportunity afforded him. He felt that he could prove these charges then; without that he would not have jeopardized his fair fame by making them ; but when he stood up at that time to do his duty, to state when he asked that means might be taken to prevent witnesses from being tampered with, and documents from being made away with, if ho had then fold them that, failing to wriggle out of the net into which they had betrayed themselves, the Ministry would appeal to the prorogation ; if he had told them this, antl had suggested that these important papers might, iwrhaps, be floated away, that Mr. Abbott, wlien asked about the draft upon him, might assert that lie is the attorney of tlu; Pacific Railway Company, and Sir John A. Macdonald himself might assert that he cannot be made to divulge the aflairs of State ; he might have been laughed at. (Cheers and laughter.) " If he had half an hour of oral tcsttimony he could explain and confirm, in the most incontestable maimer, all the documentary evidence which had been already published. It had been said that he had gone into a mean business because he had got hold of secrets, and therefore could not be tliought fit to sit at the table of a knight. (Cheers.) He supposed he ought to have got a certificate from the men who were guilty, in order that they might prove their own guilt. (Laughtci.) What must be thought of men who argued in this manner in the press. Having, however, done his duty with the aid of men of all parties who said that he should not be crushed, what more or less could be asked than that the matter should be thoroughly prosecuted by the House of Commons itself? (Cheers.) He never believed that so long as the Ministry could prevent it, there would be any inquiry permitted. (Cheers.) He never thought that Sir Francis Hincks would testify that being advanced in life, he would prefer cash to prospective profits. (Laughter.) "When Sir John A. Macdonald called himself a man, and' when, laying his hand on his heart, he declared th- liere was no truth whatever in the charges which had been m h ti ii n C( ni ■c IK CANADIAN I'ACIFIC KAHAVAV. n to m-tify. What mmlfjist flinni;;!! rsoiis, iiulin'cruiit •s wlicro opinion purchase; ol" flic Whin's nioni-y no ■ti very (liM'tTL-nt. as tilt" Ministry ; iistitucncies tliat the hist, us tlifir Ik'ii hi! saw that tlic (Ic'cidfd step dent yet in the liter resume tlie otioii whiih his lerciit reception ho Imd thought while the Com- it hud occurred complete. Ho iccused, not by Juld 1)0 chosen leors)— und try ng to I)o\v, but e innocence op rliainent to try y the House ol' it tlie earliest real occasions, o be discussed, "inpliment by question. He whether this ith reverence the depository ssues were so ,'hly he was •riljle charges, charges then ; ni ; but when ans might be n being made it into which )n ; il' ho had ps, be floated ssert that lie nald himself ht have been in the most y published, dd ol'secrefs, 'heers.) He in order that of men who e aid of men lid be asked mons itself' there would incks would (Laughter.) his hand on ;h had been made, was it likely ho would have appeared before a(!(>ini)iittee and baves.iid that there were im])ers in the hands of another jiarty which would prove all the ciiarges against Jiini, ami which lie had sought to destroy. ((Cheers.) Was it likely that he would have told them of that telegram asking lor another )5! 1 0,(M)() with the assurance that he would, if be gill that last demand, ask for tio more? (Cheers.) (!iicumstaiu"e had, in this mutter of delay, been constantly in favour of the Ministry, but I'rovidii'ce bad, on the contrary, hicn always against them. To-day it wiis a i-ontest of Providence on one side and prorogation on tlit; other ; and if they would stand by their own rights, they would find that Providence would gain the victory. (Cheers.) He then returned thanks to fevcral al)le men who had assisted him in carrying on this jjroscciition men who were not all of tlie pnrty to which he belonged, but who had firmly lent him their support. There were, indeed a^ many ('onservutives as there were Liberals who would feel deeply humiliated at the reilcction that the ])rerogative of the Crown hail been to-day trampled in the (lust, for the sake of screening mi'ii who had rindereil themselves guilty of the worst crimes against the liherly of the people. Tbc Hon. Sir.Idhn A. Macdonald always showed himself in favour of a Royal Commission, but that project did not take with the House. The honourable mcmliers, however, have the promise of this blessing being shell ii| on them, and Sir .lobn A. Macdonald would now, no doubt, be most anxious to jn'ove his own guilt. (Cheers.) They might, however, see that Sir Francis Hiiicks did not rush to till! front with much alacrity when bis evideni'c was called for; yet under this blessed Commission, this great alacrity will, of course, be exhibited by him. He did Tiot liclieve it. Sir Hugh, according to bis judgment, when called into the witness box, would say that hi- cannot criminate bimsi'If. The ('ummissioners would say certainly not, and the right bononrable gentleman would then rul) his hands and say he never thought of that, and tliat he is inex])ressibly sorry. (Cheers.) He had in Parliament told the House that he could jn-ovc these ciiarges which be bad made, and told them now that although temjjorary contumely bad been thrown on I'arliament, it would at least be before Parliament that they wcmld carry ibis prosecution to its rightful close. (Immense cheering.) " Mr. Dorion said that instead of a speech he would suggest an adjournment till seven o'clock, and the apiiointmcnt of a Committee to ])repare resolutions to be ailo])ted. He liad merely to touch ui)on the Oaths Bill. Whose fault was it that the evidence bad not already been taken on oath? It M-as the fault of those who had, in an unusual manner, sent this Oaths Hill to JMigland, even before I'arliament was adjourned, for he was informed that Bills bad never, for many years, been sent to England until three months after the rising of Parliament, and when all the Acts of the Session had been printed and bound and sent at the same time; yet there were two Acts, one of our own Parliament, and one of that of Ontario, which, though liabh; to the same olyection, had never been disallowed to this day. The disallowance must, therefore, have been i)rocured by some influence, he would not say by what, to screen men who bad disgraced the na"mi>s of Canadians. The ])rcrogative right was su])i)osed to be emi)loyed to jn-otect the lii)erties of the i)eoi)le ; to-day it has been emjjloyed to destroy them, and this act would create an excitement throughout the country, little expected, he believed, by the Governor- General, who, in proroguing the House, had acted upon advice from persons not at all qualified to give it. " The mei'ting then adjourned till seven o'clock. " In the evening a very large and most enthusiastic meeting of members and otiiors was held in the Railway Committee Room, under the i)residencv of Mr. Mackenzie. The room was crowded to its utmost capacity, and the feeling manifested was that of the deepest indignation against the Ministry, who had trampled on the constitutional rights ofthepeo]de. The Uovernor-Gencral was also spoken of as having over-stretched the Royal prerogative, which, instead of being exercised to shield the Ministry from inquiry, should have been used to hasten and second the proiMjr conduct of an inquiry. "J)j^^^'"s moved by Mr. Cauchon, seconded by Mr. Mills, and resolved : '" Ihat in the opinion of this meeting, the prorogation of Parliament without giving the House ol Commons the opportunity of prosecuting the inquiry which it had undertaken, IS a gross vmlation of the i)rivilegcs and independence of Parliament, and of the rights ol the people. 1'^ Moved by Dr. Forbes, seconded by Mr. Cartwright, and 'Resolved—' That, in the opinion of this meeting, the I louse of Commons is the proper •body to mstitute and prosecute an inquiry into the pending ciiarges against Ministers; and that the action of the accused Ministers, in removing the inquiry from the Commons, and appointing a Commission under their own control to try themselves, is a gross violation of the rights, privileges, and independence of Parliament; and it will K 2 Oa«*pa. mm Canada. '« d 76 CORRESPONDENCE RELATIVE TO THE ' bo the imperative duty of tin; House of Commons at the earliest moment at wjiiili it is 'allowed to meet, to take action lor the vindication of their rights ; and lor the resumption 'of a Parlianuntary inquiry .' "IvicKiuent and stirrnig addresses were delivered l»y Ahtssrs. Cauehon, Mills, Forbes, Carlwri;;])!, Hun. A. J. Sniitli, Isaac Burpee, McDonald (Inverness), Cunningham, (JofTin, fJoudge (Hants), Fisi't, .Senators liCtellier de St. Just, Christie, Rymal, Hon. John Young, .lett(', Anglin, and Mackenzie. "Tlie meeting hroke up about 10..'];> r.M. " Altl;ou;,^h many gentlemen who had previously been identified with the Government were present, not one oi' them expressed dissatislaction with the proceedings, or in any way indicated their dissent. Each member proposed to bring the matter belbre his constituents at the earliest possiljle moment, and there is little doubt that there will be a tremendous agitation throughout the length and breadth ol' Canada." No. The Eaiu. 01' Dri'FEiux to The Eaui, op Kimukri.ky. Mv Lonn, Canada, August 18, 1S7.3, ^i^,_.^, Iv my |)revious Desj)at.'h of the ir)th of August,* I had the honour of informing your Lordship of the circumstances under which Parliament was prorogued on the l.itii. As a conse(iucnce of that event, the Pacific Railway Committee of Inquiry became extinct, and, as I have already mentioned, an interval of eight or ten weeks was to elapse before the rc-asseml)ly of Parliament. A question consecpieritly arose as to whether, during this short recess, anything could be done to forward the hitherto abortive impiiry touching the Pacific Railway Charter. ^Vluii 1 was at Prince Edward Island, and in communication with my two Ministers, Messrs. Tillcy and Tupjier, shortly after the publication of the McMullen correspond- ence, — I had intimated to them that, should the Committee of the House of Commons find itself unable to i)rosecufe the investigation, the truth must be got at sonu'how, and that i)crhaps an inquiry coniiucted before three .lodges of the land might prov»; a satis- factory issue out of the difiicully. In making this suggestion I was actuated by a doul)le motive. In the first place, 1 was deeply distressed at the embarrassing relations which e.xisteil b"tween my Ministers and myself. These gentlemen were being assailed by irresponsible newspaper correspondents with accusations t)f the most injurious description. Docunu'iits which perhajis in themselves proved nothing, had Ixu'ii brought into an alleged connection with a narrative tliat invested them with a very sinister sigiiilication. The Parliamentary Comniiltee that had underlaken to discover the truth appeared to lie jiaralyzed, and the accused were thus shut out from all means of vindicating their characters. Yet it was to these jiersons I was bound to recur for advice in all matters alTectiiig the administration of public airair.s. Again, as an Imi)erial ofTirer, it was my duty to watch with especial care over Imi)erial interests. The allegations current against my .Ministers and others, was that they had frauilulently dealt with certain monetary trusts, voted indeed by the Parliament of Canada, but guaranteed, to a considerable extent, by the Imperial (lovernment. This being so, I was evidently bound, apart from any action of the C!anadian House of (Commons, whose ])owers of scrutiny seemed for the present of small av.iil, to obtiiin satisfaction in regard to thi-se matters by any constitu- tional methods within my reach. Indeed, from this point of view, it was not the .Ministry of the day — who are but an evanescent Committee of Parliament -but the Parliament of Canada itself that was responsible to Cireat Britain in respect of any mal- \ersatioii which might bavi; occurred, as having confided the disiiosal of these inl crests to imjiroper agents. At the same time, as long as the Parliamentary Committee was in existence, even though it had ceased to act, tin? resort to any other instrunu'iit of investiagtion was not desirable. Beyond, therefore, the casual suggestion to which I hove referred, nothing further was volunteered by me in this sense. When, however, the prorogation of Par- liament being decided upon, and the Committee of the House of Commons being aboui ronse(^uently to iiecome extinct, my Govermnent undertook, on its own rcs[)onsibility, to « ■:n CANADIAN PACIFIC RAILY^AY, 77 L'nt at whidi it is jr the rt'suinptioii n, Mills, Foibi's, uiinghain, tJolTin, Ion. John Voung, tlio Govornmont cdings, or in any latter hrloic liis liat thori! will be ^ust 18, 187.% till- honour of ; was i)roroguiHl Inquiry became ks was to elajise as to wlietiier, ibortive in([uiry f two Ministers, en corresponil- se of Commons somehow, and t prove a walis- ed by a dmiljle •elalions whicli injj assailed by DUs deserij)tioii. roui^lit into an er sif;ni(ieafioii. Ii appeared to iidieatinfi; their in all matters vY, it was my current airainst tain morietary derable extent, \rt from any eemcd for the my const! tu- nas not the n<'nt -but the el of any mal- ihese interests xistencc, even if;tion was not I'ned, nothing ;ation of !*ar- is lieing abouu ponsibility, to * advise the issue of a i'omniission to three .Iudj;es of character, standing, and acknow- kih'cd intcj^rity, I liad no diiru ulty in ac(piiescinj; in tlieir recuuimendation. I have now, therefore, to inform your Lordslnp tiiat on the i4th of Au^!;u t I siy;ned a Conuuission at tlie instance of my Kesp()MsiI)h' Advisers, and by virtue of ti)" powers vested in the (!overnor-(ieneraI by tlie C.inadian Act of ;il Vict., can. 3S, to iie llonouralde Judge Day, the Honourable tludge I'olette, and .Iiidf;,o (iow.m, i' .nori/in-^ them tx) inquire into the various matters connected with tiie issue of the Pacific Railway Charter. A copy of the Commission I Iiavc tlie honour to apjieiKl. On rcfcrrinj; to it, your Lordship «ill observe lliat the purview of the Commission is very wide and inquisitorial, and that tlure is notiiinj; to restrict its reception o!' anytbiiij; ithat may ajipear to deserve the name of c. idenci'. The professional antecedents ul these peiitlenien are set forth in the accomiiaiiyinj; document, which has been prepared for ine by my Ministers. Only one of tlieni is personally knouii to me, viz. .lud^e Day. who, as Cliancellor of the Mcfiill University, riceived me on my visit to that Institution. Since that \\v hav(! impi'oved our at(iuaintance, and I have no hesitation in statin^:, liotli from what I know and have learnt, that I have every conlidence in .ludge Day's high sense of honour, cajiacity, and (irmn'-ss. 1 have also considered It i.Ty duty to s<'lti^■i\ myself as to the (pialificatioiis of the two other gentlemen with \\b(i;ii lie is associated, and I am in a p(>sition to inform your Lordship, tliat they are generally regarded as jiersons of unblemished integrity, sound ju(igint;nt, and ])roli'ssional al)ilit\-, while the length of time all three have been reinoved from politics frees them from the suspicion of poliliial partisanshij). Notwithstanding tlie creditable antecedents of these personages', they have been 8har|)ly assailed by the ( Ijiposition press, lor wiiieb the praises of the Ministerial organs is scarcely an adequate consolation. Perhaps, however, it may not be amiss that 1 should append two or thrie articdes frcnn newspapers bitti'rly opposed to the (jicvirn- meiit, who, nevertheless, are compelled to bear a scant aiul niggard testimony to tiie high (pialities of these genllemen. Uialer ordinary circumstances, I should have thought it suflicient to have terminated my Despatch at this point, but as matters now stand, it is necessary that I should describe to your Lordship the chief features of the controversy to which the issue of this Com- mission has given rise. The objections urged against it seem to be three in number. 1st. That the present investigation is not of the kind contemplated by the Act. This jioint is so entindy a question of legal interpretation that I can only be guided in regard to it by my law ollicer. ■Jnd. That the issue of tlu; Ccmimissioii is an invasion of the privilege of Parliament ; that Parliament being seized of the matter, no other authority lias a right to concern itself in the investigation. i pin-ehend that this view cannot be sustained. The powers with which tlie Com- mission is vested bfing h'gal, and granted by Parliament without limitation, it is ditiicult to b«dieve that their exercise; can be held" an interfervuce with the privileges of I'ar- liament. It is not a criminal suit, but a simple in([uiiy that has been instituted by the House of Commons at the instance cd my Ministers. Moreover, Parliament has ceased to conduct this inquiry. Tlu' Crown jiossesses no absolute guarantee that it will be renewed, or that when reiicuid it, will be ellectual. If .Ministers liill on a vote of want of confidence on the .Vddress, it might jn-ove the interest of so many persons to let the matter droj), that the Committee may not be re-appomted. Unless conducted under oath, the investigation will certainly prove inellectu.-'i, and 1 am advised that it is doubtful whether any device exists by which a mere Committee of the House of Com- mons can he enabled to swear its witnesses. If, tbercfore, an immediate invistigaliou will promote tlu- "good d'overnment of Canada," to ijuote the words of the Act, I ilo not apprehend that Parliament can denounce the Commission as a breach of jirivilege. The House of Commons may declare the issue of the C\jmiliissii)n to be inopportinie and unadvisable, and may visit with its displeasure the Ministers w ho counselled its appoint- ment, but it can have no locus standi as against the Crown itself. Moreover, it must be reiiunibered that the Commission can in noway interceptor supersede the jurisdiction of the House of Commons, it v ill be quite compeU'Ut for Parliament to ignore the fact of its having t;xisted. Its inlluence on the present situation will entirely depend on the way in which it discharges its functions. If the public is ((invinced that it has elucidated the truth— no matter wiih what result -its position will be unassjiilable; if it fails to do so, it will not require the action of i arhainent to proclaim its decheance. Ihere is yet another wiiy of looking at the matter. Jew iicople will deny that Ca.wad'. fi'*** T8 rORRESPONDENrE RELATIVE TO THE Gakada. inilividiially I li ivc tlu' rijj'it to require an oxplanafion from my Ministers in rej^ard to these traiisacti iis. Hut it is evident tliat in resjiect ol' so i-om])lieated a business I have neitlier the tiin ■, nor tlie knowledge, nor tlie prolessional aeutentss ncressary to unravc;! the tanfxU'd wet) ol' inerimiiiatory matter jjrevented to me. II' tlicn 1 ])()ssess the lej^al powi'r, and if, by undortaiiing; to answer lor tlie Aet, my Ministers eunw me with the eonstitwtional ])ower, ean Parliament ( )m|)lain il" I take advantafj;e of these eircumstances to sniijeet my Ministers, throu.gli the C'l.nmiission tliat represents me, to sueh an inteTo- Liatory as 1 may deem advisaliie, or if i order tlie eoUection of sucii other evidenee as niay he forllieumin'^-, and is ealculated to throw light upon the i)usiiiess? Nor h;>s Mr. llnntington hims(df any grounds to dispute my riglit to take eognizancc of tliis aifair. Wliik' the Parliamentary C'ommittee was still in existence, he approaehed me oirieially .".iid direetly with communications incriminating sworn meml)ers of my Privy Council. It is true I returned him the documents he forwarded, and declined to take personahMgnizance of a matter then before a CoiTimittee of tlie Mouse of ('ommoiis, I)ut 1 retain his covering letter, and it is scarcely com]H'tenl for him — the IJommittec having ceased to exist — to decline the jurisdiction of the (.lommission so far as it is «'()ncerncd wilh what he hiniM-lf brought to my notice. l>y liis own act he has invite(l my intervention, and submiited the matter to tiie direct eognizaiieu of the Crown. Thirdly. Tiie " persoi'.nel " of the Commission is complained of as jiartial to the (JovcrmiKnt, and as having been chosen by the accused. Into the j)ers()nal ersonal grounds he could not consent to act on a Commission appointed under the advice of Sir John Macdonald. As there was no reason to sup|)o.se that these gentlemen had changed their minds in these resi)eet, it did not ajijiear advisable to rc-approacb them on the subject. I'ndi'r tlu'se circumsl.inecs it was evident if th<' interval that must elapse before the re-assembly of J'arliament was to be utilized — that any inquiry which miglit be possible must be confided to fresli liands. That my Ministers should desire an oiiportunity of making themselves licard, ean he well understood. The language used on their Ixdialf is something of this sort : — "For " months jiast we have bien the objects of the vile.st calumnies,. Our most confidential " «locnments have been purloined by an informer, and dishonestly connected with a " narrative which is itself untrue, ilitherto we have had no opportunity of rebutting " these accusations. The instrument aj)pointed by tin; House of Commons to do justice ters ill regard to I business I have ssary to unravel |)ossess the legal nv me ;rith tlie so circumstances such an inte To- L'vidence as niay take coguizanco ', he approached nenihers of my and (ieclinod to sc orc'ommons, -the Oommittee I so far as it is )\vn act he has ni/ance of the ! partial to the sonal (juestion I Duld hav(.' heen at ion of all'airs ; tliat tl.ey sit in under the eyes only stimulate II sucli an event I do not think. ■^t- til Commons cannot l)e pro- iry C^ommittees ration than a It would, more- I as a willing' jurisdiction of e that he fears nd through the it lie as long as uM disjiose of; indeed I trust, d of the stick," is well advised fter ;U1 he has e, and such an laking a second • gentlemen in led iheiiiselves ; of status, — an it fui'thermore •Mr. I Make. I to act on a there was no resjiect, it did i|)se before the ^lit be i)ossiblc lieanl, can be IS sort : — " For ist confidential nccted with a y of relnittiiig H to do justitc CANADIAN PACIFIC RAILWAY. 79 "between is and our traducers has jirovcd pouer'e.ss for that object. Considering '.litli " whom we have? to deal, we require the evidencj agai'ist us to be sultstanti.ited by an oath. " ^^'e are not willing to place our honour at fiie mercy of our accusers unless protected " against perjury. ^Ve ourselves arc anxious to be heard upon our oaths. \V\; doubt ♦* wdii'fher a Committee of the House of Commons can acciuire the power of swearing in " its witnesses without an Imperial Act. \Ve think it but fair before Parliament re- *• assembles that we should have an opportunity of answ«-ring fully, point I)y point, tiio •• injurious allegations brought against I'.s. This cannot be done by mere statements. \Vc .*• desire therefore to subject ourselves to as searching an interrogatory as a skilled tribunal or our most liittcr opponents can apjily. I^nless we have this oi)porfuiiily we shall meet Parliament at a disadvantage. Our enemies have possessed themselves of the ear of the ll" jjiibiic lor months. We have had no opjiortunities of counteracting these influences. w" Let at least our story be heard before a premature decision is snatched from Parliament, '"" saturated as it may have become with these calumnies. Wv do not « ish to escape from " the scrutiny (d" the House of Commons. We know we could not do so, — did we so " desire, — but since its action is for a time suspen Pii'airs, I feel I can count upon your Lordship^s indulgence to put a favouralde construction on my intentions. Trained in the liberal school of jiolitics under the ausjiices of a great champion of Par- liamentary rights, my jxilitical instincts would revolt against any undue exercise of the Cn wn's prerogative. Yet it is of this I liiid myself accused. I trust, however, that .-elU 'lion will dissipate such impressions, and that the people of Canada will ultimately Ihd t4>at it is A r their iiormanent interest that a (lOveriior-Geiural should unflinchingly nainti in the principle of Ministerial responsibility, and that it is better he should be too lardy i i reliiKpiishing this jjalladium of colonial liberty, than too rash in resorting to acts of personal interference. Consi(leriiig how I'ager has been the controversy, I cannot hope to escape criticism, but any '"■.itation thus engendered will jierhaps be softened by the reflection that coming to this country full of faith in its people and its destinies, I was naturally slow to believe that widespread jniiilic and personal corruption should exist nmong its most eminent pul lie men. If it sh )uld turn out that I h;.ve been deceived in my estimate of Canadian purity, the error is one which Canada may aflbrd to pardon. If, as 1 trust will be the cas<', the integrity of her chief statesmen is vindicated, I shall be well content if the fact of "my not having despaired of the Republic"' is forgotten in the general satisfaction such a result will produce. He that as it may, there is one circumsfanc(> which we can regard with unmitigated sat i faction. The alleged revelations which have taken place have ])rofouiidly moved the w liole po])ulatioii. Apart from the section of society " within politics " whose feeling may b<" stimulate " ca]»italists under the a|.'reement with him. '"That a Committee of seven nu'ini)eis be a))pointed to inquire into all the cireum- " stances connected with the negotiations for the construction of the Pacific Raih\ay will' " the legislation of last Sessii.-n on the subject, and with the granting of the Charter to Siv '• Hugh Allan and others, with ;)ower to send for persons, jiapers, and records, and with " instructions to report in full the evidence taken before, and all jjroceodings of, the said " Committee," which said Kerior Town of liiirrie, of the County to all to whom Grkktino : of Montreal, in of Comjnoiis of 1 the year of our ijj; Resolution :— l)elieves that he ■f!;islatiou of last Sir lluj^h Allan. , \V. MeMullon, o furnisli all the luid to give the est and position, f with Sir Hugh ling between the crnment and Sir le the House of mce a large sum jupportiTs at till' contract for the ' for the j)urpose Ministers. wiM» the obtaiii- lid United State- all the circum- if Hallway witli 10 ('haitt-r to Sp ei'onls. and \vitli lugs of, the said , w as lost : , Knight, also ;i •liaim-nt, did. on vnig : — " That :i lall not be onel ral iiiatti'rs eon- of April instant, onl, n-lalinc tc , and rword->. to , and if need do K«'Solulion was he third day "t liree, and in tl' ninution of X\ I certain cain> . " Whenever any witness or witnesses is or are to ])c examined l)y any Committee of Canada. the Senate or lIous<' of Commons, and the Senate or House of Commons shall have resolveil that it is desiralde that such witness («• witnesses shall be examined upon oath, auch witness or witnesses sliall be examined ii[)on oath or allirmation, where ailirmation is allowed by law :" And whereas, the Honourable John Hillyard Cameron, also a member of the said House of Commons of Canada, in his place in Parliament, did, after the passing of the Mid above-named Act of Parliament, and on the tliird day of IMay albresaid, move a csolution ill the following words: — "That it be an instruction to the said select Committee, to whom wns rel'erred the luty of inquiry into the matters meiifioncd in the statement of the Honourable Mr. buiitington relating to the Canadian Pacific Railway, that the said Committee shall pcamine the witnesses brought before it u])oii oath," which was carried : j\nd wlu I'l'as the said Act of Parliament has since the passing thereof been disallowed by Her Majesty : ''^ And whereas no jiower exists whereby the said Committee, so appointed as aforesaid, can legally julminister oaths to witnesses brought before it, whereby one of the objects 'dcsircnl by the said the House of Commons cannot be attained : And wlu Teas it is in tlie interests of the good government of Canada, not omy that full inquiry should be made into the several matters contained and stated in the said above recited resolution of the ."^tli day of A])ril aforesaid, Inil that the evidence to be taken on such iiKjuiry should be taken on oath in the manner prescribed by the said resolution of the Mrd of May aforesaid, and the Ciovirnor in Council has deemed it exjiedient si.ch inipiiry should be made : — Now know ye that, under and by virtue, and in jtursuauce of the Act of the Parlia- ment of Canada made and jjassed in the thirty-fir.st year of our reign, intituled "An Act *" respecting iiuiuiry into Public Matters," and A' an order of the (jovernor in (Council, Tii.ule on the l.'Jth day of August, in the year of our Lonl one thous.uu! eight huiulreil and seventy-three, — \Ve, reposing especial trust and confidence in the loyalty and fidelity of yuu, the said Charles Dewey Day, Antoine Polette, and James Robert Gowan, have ■commanded and a])pointi'd you to be our Coinmissionei's for tin- ])ur))ose of making such inipiiry as aforesaid, of whom, you the said Cliarles Dewey Day, shall be t'hiiirinan. and Av(! do authorize and reipiire you, as such Commissioners, with all con\enii'iit dcsjiatch, mid by and with all lawful ways and means, to enter upon sncli iiKpiii-y and to collect evidence, and to summon before you any parties or witnesses, and to re([uire them to give evidence on oath, or on solemn affirmation, I' they be parties entitled to aflirm in civil matters, and to produce such documents and things as you may deem reepiisite to the full invi'stigation and rej)ort of the matters and statements aforesaid. And we do hereby order antl direct that the sittings of yon, the said Commissioners under this our Royal Commission, shall lie held at the City of Ottawa, in our Dominion 'of (aanada. ^ And we do require you to communiiate to us through our Secretary of State (/f Canada, aiiil also to the Honourable the Sju^aker of the Senate, and to the Honourable the Speaker of the House of Commons of Canada, as \\t II the said evidence, as any opinions which jroii may think (it to expnss thereupon. And we do strictly charge and cojiimand all our ofTiceis and all our faitldiil >iubjects, and all others, that in their several places, and iicc(Uiling to their respective powers and op[u)rtuiiities they be aiding to you in the exeeu- tiiin of this our Commi.ssion. An testimony m hereof we have caused these our letters to be mad(- patent, and the (ireat i Seal of Canada to Ix l-ereiinto affixed. Witni'ss our right truaty and well-beloved ;i cousin and couiKJllor the Right Honourable Sir Frederic Temple, Karl of DnU'erin, Viscount and lUroii ('laiidebo\e ol Claiidel)oye, in the County I 'nvn, in the Peerage .^, "t the Cnited Kingdom, Paron DuU'erin and Clandeboye ol Pallyleiily and Kille- leagh, ill the County Down, in the Peerage of Ireland ami a Baronet, Knight cd' cnir ^ .Most Illustrious Order of Saint Patrick, and Knight Commander of our Most Honourable Order of the Path, Cioveriior-General of Canada, and Vice-Admiral of the same. 4At our Government House, in our City of Ottawa, this fourteenth day of August, in the ' vearof our Lord one thousand eight hundred and seventy-three^ and in the thirty- seveaih year of our reign. I3y command, (Signed) J. C. AIKINS, Secretary of State. 82 CORRESPONDENCE RELATIVE TO THE Q*"*"-^- Enclosure 2, in No. 5. (Fhom the ' Montreal IIkuald.') " The Uovat, Commission'. — Wc are in formed tliut tlie Koyal Commission, who are appointeil to investij^afc the iliari^cs niadi; l)y Mr. Iluntini:;ton af^aiiist tli« Ministry, is to consist flj' Mr. Jiistiio Day as President, Mr. thistico Polettc, ol' the Superior Court for the district of 'i'hree Rivers, and Mr. .lustiee Gowan, a country Judge, we believe, oi Ontario. If tliis be tlie case, apart from the outraii;e of takinj; out of tlic luuids of the House of Commons, an aH'airof wliieli that body has taken cognizance, there is nothini; in the distinguislicd character of the men composing the Commission, with the siiii;;lt excei)tion of Mr. Justice Day, whicli can at all atone for the insult put upon the repie- sentntives of the ])eople. Judge Polette is a very respectable member of the Bench. A^ to Judge (iowan we know nothing." (Fhom rirr; 'Montrkal ITkkat.p.') " Tin; 1'i;r.«o.va[, Composition' of tui: Royal Commission. — Of the Chairman of tin Royal Commission, Mr. Justice Day, we of course speak only in terms of respect. He i- a man of great capacity and learning, and he occupies a position which ought to make hin. independent. AVe cannot, however, we confess, imagine by what eccentric freak of judgmeii; he has been induced to take a position, the assumption of which no one better than him- self must know to be a direct breach of the privileges of the House of Commons — ar. assumption which the Commons of England would })unish, which has already been coii' demned by the majority of our own House of C'ommons in the most formal manner ii: which they were a!)le to express an opinion, and 'whose ol)ject is nujrely to enable llu leaders of a bndceii party *o shelter themselves from the necessity of appearing before tlk constitutional tribunal. As to Mr. (iowan, we are also ready to award him the jiraise o: being a highly respectable magistrate, but not one whose distinction, as we beion remarked, could lessen tlu? insult olVercd to Parliament by his employment in this nid-' improj)er task. There is, however, one circumstance whieli, if we are rightly informed, makes his api)oinlment exceedingly indecent on a C'ommissioii, not like the Pariianiiii- tary Comniittie, composed of opposing forces, but of men whose single merit, if men: they have, is their imi)artiality this is his well known friendship, amounting almost ti afTection, for Sir John A. Macdouald. ^Ve are sorry to say that we nuist speak in ([uite; dillerent manner of tbj third associate in this ('ommission, Mr. Justice PoIette,&c. ^c. \i.. (From 'Lk Jolunai, de Quebec.') " La commission royale, suivant Ic telegraplie, sc composerait, du juge en chef Drain ' de IVx-Juge Day et du juge Polette. '• M. Draper I'tait ajjpele 'the artlul Dodger,' ct, avcc sou incontestable habilete, n"cu jamais la confiauee, ineme de son parti. " Nous n'avons rien ;i dire, contre MM. Day et Polette, et nous avons seulemeiit regretter ipi'ils aieiit accepte celte commission, qui est im outrage aux droits du jkuK ment." Ijidosure .'5 in No. .'3, MEMORANDUM. For His Excki.lknty tiik Ctovkrnor (iknkrai.. Ji POR Day, Was, in 1S42 and for some years. Solicitor General for Lower Canada in a Coalitioi Government. In Is-lOhewas appointed a .ludge of the Superior Court of Tiower Tanada by tH Reform Governnu-iit of Haldwiii and Lafontaine. \Vhile on the Reiieh he exhibit'^ high qua ities as u .hulge. Ill Js'iC he was selected )ty the CJovernmcnt as one piculiarly qualified and appoiuti" Commissioner to revise and consolidate the Statutes relating to Lower Canada. He w • engaged at that work about seven years. Feeling a distaste for returning to the Bern; alter so hmg an absence, lie retired on the statutory provision. TANADFAN PAriFIC RAILWAY. s;j imission, who are tli« Ministry, is fo Miperior Court lor ge, Avc believe, oi the liiuuls ol' the e, tiiere is nothing' >n, with the sini;le Lit upon the repie- of tlie Bench. As : Chairman ol' tlii ol" respect. 1 Ic i- jught to make liin. clreakorjudgnuii' le better than iiim ' ol' Commons — ai i already been eon formal manner ii erely to enable tlu )pcariiig before tiit lI him the jiraise m tion, as we k-l'oii yment in this nw-' :! rightly inl'orniid, ike the rarlianiiii- gle merit, il' nuTi: nouiitiiig almost ti i,st speak in quiti,'. Polette, &c. i^e. \i ige en chef Draper able habilete, n'ti. avons seulement IX droits du iwrli liula in a Coalition ver Canada by ' encli he exhilnii ficd and appoints ' Canada. He "• ling fo the i>ii:' * Since his retirement from the Hencli he has been very much engaged as an arijitrator r.u«Ai.A. —chosen because of his high rejjutation for judicial and moral (lualities. Shortlv alter ConfederatiDn, .hidge Day was ap])()intcd arbitrator l)y tlie Government of Queixr, to act with .Senatin- .Macpherson and Colonel (!ray, chosen by the (iovt-rnnient of Ontario and the Government of the Dominion resi)ectively, to adjust tlie relative debts of Qiieliec and Ontario, arising out of their former union, .bulge Day is Chancellor ^the !\Ic(iill I'niversity. .Irne.K (tow.w, then at the Bar, was jiartner in business of the late Hon. James E. Small, who was [)licilor-Cieneral for LpjuT Canada, in the Reform Government of IMJ-i, when Mr. lobert Haldwiii was Attorney-(ieiieraI. Mr. Small was considered an extreme Jtel'ormer, Ir. Gdwan a moderate oiu'. " TIk y practised Law at Toronto. Mr. (Jowim's re]mtation . a lawyer was sjtcedily established and rose high. In I.SI.S, he was appointed Judge of iie Conntv Court of the County of Simcoe, by the Uel'orm (iovernmeiit of lialilwin and E^afontaine. I le has held that jiosilion ever since, and exhibited therein the best (pialities <»f a Judge, while his cliargi's to the (irau.l .luries have frequently commanded respectful lltteiition liiroughout the Trovince of Onl.irio. •J Aiiout the year 1S|<,), Mr. (iowan was api'ointed by the (Jovernor in Council, a Coni- inissioner, in "association with tlie late Judge Harrison (an Iviglish barrister), O'lteilly, Campbell, and Mallocb, for llie drawing up and estaldisbing of the rules regulating the procedure of Division Courts in llj)pcr Canada. He was afterwards api)ointed by the Governor in Council, in a.ssociatioii with the jjirsent Chancellor Spragge and the late Judge Ihirns, of the Court of Queen's Bench, a Commissioner to regulate the practice and procedure in the Surrogate Courts of Up}ier Canada. After the jjassing oi" the Common Law Procedure Act, in L^^.'it!, the Judges of the Sujierior Courts of llpjier Canada were em])owered to dra\v \\\^ rules of procedure for the County Courts, and being empowered to associate with them one County Court Judgo for that ]nir[)ose, they selected Judge (iowan. ' When the County Court Judges of Ontario held their Convention at Toronto some years ago, to consult about matters connected with the County Courts, with a view to Recommending changes, Mr. (Jowan was unanimously chosen as Chairman, notwithstand- ing tin- fact tliat several of the Judges present were senior to him. In 1S.")7, the late Sir James Hnclianan Macaulay having retired from the Chief Justiceship of the Common I'leas in Upper Canada, was asked to accept the appointment of a Commissionershij) with others, to consolidate the Statutes of Canada and of Upper Owada ; he declined to accept the position unless Judge Gowan were associated with lam. Mr. (jlowan, however, declined to accept an appointment, hut agreed to assist the €5ommis^-oners and +7 to 185S. a member of the Parliament of Old Canada, when he eom- liKided aiXiition and respect. In 18(10, he was appointed Judge of the Superior Court <» Lower V anada, and in that capacity he ajipears to Iiave won the unanimous respect of Ju brctb. 1 Judges of the bar and of the public. He was recommended to Sir John A. Ipocdonaid by Chief Justice Meredith, of the Province of QueU-c, as a man who is »culiarly fitted by reason of his ability, his integrity, and his thorough independence ol cjjaracter to act on the jnesent Commission. The C;hief Justice M'as asked to act, but he declined, and recommended Mr. Polette iu i stead. L 2 mm Canada. ., 1 1 I,' I 81 COimESPOXDENCE RELATIVE TO THE No. G. Tho Kaul 01' KiMiimLEY to The Eaul of Di-fferiv. My Lonn, Downiiif!; Street, October 0, 187.'). i iiAVK received and liii", he death of one of of Commons, but • Mr. ]}lakc to be isidcratiou of the ve in consetiuenco law adviser, ^ir ic raises a further 'xpressed Ijy my osition, show that lament attempted to proceed to tlie despatch of l»usinesa on the 13th of August, more especially if tho pro- Samme of the Opposition, as implied by Mr. Blake's speech, included tho reconstruction of ('onimitlee of In(|uiry, and the possibh' selection of new members to serve upon it, under the authority of an Act which it would have been alleged Parliament was not com- petent to {>ass. fi. It is obvious that with seventy members of tho Ilotise of Commons iil)sent, and not a JAaeii Senators in their places, no arrangements relative to the reconstruction of the Coin- littec, especially if llicy reipiired any legislative sanction, couKl have been entered upon ■ tbe l.'Jlli of August with ailvantago to tho country, with justice to the unrepresented ^d imperfectly represented Provinces, or with any show of fairness to my Ministers. I have, &c. ^c Karl of Kimberlcy, DUFFERIN. &c. (te. iie. Canada. 'I h.'nclosurc in No. 7. 'f- OITico of the Minister of Justice, " Ottawa, October .'{, 187:5. "With reference to tho suggestion made by Mr. Blake, that an Act might be passed by the Parliament of Canada authorizing tho issue of a Ifoyal Commission of ln(iuiry, and giving such Commission power to take evidence on oath, I am of opinion that it would be within the comi)etoiico of I'arliainent to pass such an Act, and that tho Courts must hold it to bo valid. It may be doubted, however, whether a measure of this kind sliould be entertained by Parliament, excipt at the insUuice of the Crown. The J^talutory Commission on Naval Accounts, which resulted in the impeachment of Lord Melville, is cited by Mr. ]{lako. The Act authorizing that Commission was introduced at the instance of tho Admiralty. Objection was taken to it on the ground that tho Atliniralty or Navy Board had power sullieiont for the purpose. Tlu' Act was, however, considered necessary by the Crown, in order to enforce the alteiuhuico of witnesses, and to enable the Commission to take evidence on oath. Tho Commiss oners were named in the jBtatuto, but selected by the Crown. I would suggest that your l']xcellcncy should ask lor 'instructions, in anticipation of a measure of the nature indicated being pas.sed hero next Session. (Signed) JOHN A. MACDONALD. No. 8. The b;.\RL 01'' Dci't'iaiix to The IIaki, ok KiMUKiiLEV. : (iovernmoiit House, Ottawa, October L';!, 1 87:5. My I.OIiD, (Received Itli N(,veinl)er). I iiAViO the honour to transmit herewith a copy of the Speech with which I this day opened the Session of the Dominion Parliament. I have, etc., jThe Karl of Kimberlcy, (Signed) DUFFERIN. ■% &c., ite. &.C. Enclosure iu No. 8. I, Chamlter of the Senate, I' Ottawa, Thursday, October 2:i, 1873. I Ills hxcellency the fJovornor-Gcncral, at throe o'clock i-.m. this day, proceeded in state ito the Chaniher of the Senatoj and having t;iken his scat upon tiio throne. His Fxcrllencv commanded tho attendance of the House of Commons : and that House! being present, Ins iLxcellcney was pleased to o[)en the Second Session of the Second Parliament of tiie jDominioa of Canada, with the following Speech from the Throne:— ;^ Honourable (Jentlemcn of the Senate, (.ieiitlenicn of tho House of Commons, 111 aeconlaiico with the intimation given by nic at tho close of la.st Scs.-ion, I have caused 1 arlianieiit to be summoned at the earliest moment after the receipt of the Reiwrt of the -i 8(1 COUUKSi'ONDKNCK HMI.ATrVK TO THH ('(iiiiinisHii)iifrs iippniiitctl liy nic to iiHiiiire into ocrliiiii matlcrs ciiiinrctotl with the ("utuuliiin Pacilic Itiiiiwiiy. Canapa. 'I 1i,. fvitlcnco olitaint'd iiiidcr l\v ('Dtmiiis^ioii deserves curcriil coiisiilcnitifiii. The Ift'port will lie liiiti iicloiv I'arliaiiR'iit, ami it will lie t'orvoii then to (Icteniiiiic wlictlicr it cuii Ijc of any assistaiico to yon. A l'>ill for the Coiipolidatioii ami Aiiioiiilinciit of the Laws in foni' in the several rrovinci's ivlatinir to tin' li'i'itrcscntalion of the IVoplo in l'arliain tin; advantai-'o of iii('lu(lin;j; in its provisions the Trovinre of J'rince Mdward Island, now happilj u.iitt il to Canada. TIk; Canadian rauil'ic I'ailway Company, to whom a 1 loyal Charter was jrranted, have, I vr'Sri'l to say, hccn niialilc [n make the linaiieial arranLi'i'incnls iicersstiry for the constrnelidii ol that irnal nndi'rtakiiitr. 'I'lu'y have tlwrclorr exeenteil a surremier of llieir Charter, wiiifh has lieeii accepted iiy ine. Von will, I trust, feel yourselves ealled niion to take steps to soenri' the early eoinnicncc. nicnl and vipiroiis priHi'cntiuM of the ((instruction of that IJailway, and thns to carry out, in ••' ill (lio soTiTal ill ajriiiii ho siili- I'M! will liavc thij laiiil, now liappilj s jrraiiti.'il, liavi-, I r llio coiistnictiuii of ilicir Charter, early coinniciKc. It! Iliiis to carry •li Coliiinbia. A IK iiinrasc in the iameiit as well aj I. stablishnicnt of a nil 1)(! laid Ijclbro lire. ur attention. ion to onconifi^:!' rs has Ivon a(l(li'(| to this iinportaiit 1 licloro you. Tiio ullicient to meet Itceii propariil ice; and 1 trust c(^ to the pcojjk'. 'its committed to advantage and iiijer 7, 1873. I's l'esj)ateh of von opened the MHKHLEY. No. 10. The Eaul of DuI'FKUin to The Earl of KiMni'.iu.KV. Canada. Nov. 3, 187S. Mt Lord (IJecfived !'.• Noveinher.) I MAVi: the liononr to forward for yon r T.onIship's iidorniation six copies of the eyidcnce taken liefon^ the l{()yal Coinniissioii appointed to incpiire into the recent issue of the Canadiiin I'aeilie Kailway Charter. , 2. IVelixed to this evidence will l>e fmiiid the Coniiiiissioners' Tfeport of the nnmher iiiul j(|mes of llie witnesses they Hiiininoiied, jis w(dl as of those who tailed to appear, to'jcther ith a record of other facts eonnected with their proeeedin^^s. 3. The A|)pcndix eonfaiiis, anion;.,' other dociiinents, a letter from the lion. Faiciiis rteth (unliiitrtoii, in which he stales the grounds upon which he declined (he Jurisdiction of the jnuiiission. 4. All these papers having now passed under the consideration of the Mouse of Commons iod of the Senate, it may Ih; premature as yet to address your Lordship upon them, hut a.H Ao Commissioners allinle to a communication 1 made to them when ahont l(t enter upon Ihcir lai)Ours, it is litliiiLr I should ac(|uaint your birdship with its exact nature. f). When my Mini-leis originally advised the issue of the Conimissioii, altliouLrh I did not myself cniertain any misgiviiijjis as to the eoiisliditi'iiial riulil I'f ihe Crown in the IDatter, I considered that t«M) niiieh pains could not be taken to prevent t\w proeeedinp haviiip oven the appearance of an attiMiipt to withdraw the case h'om the ultimate control and cognizance of the House' of Commons. With this view 1 had alrca any future a(lion which it might please llio House of Commons to take. ti. Acting upon this recommendation, or rather in harmony with il, as they state in their Eeport, the Commissioners have very properly confined themselves to llit> eolleetiou of the evidence, and have not sought to anticipate the verdii't of Farlianient l>y th(> expression of any opinion of their own upon the facts they have elicited. They add, however, that they are prc|)arcd to do so if rc(|uired. 7. 1 was the more iiiilueed to take the above step on learning that ^fr. Huntington would proiiably decline to appear a.s a witness, or in any way to further the prosecution of the iiicpiir}'. V 8. Of course, it was evident — if Mr. Huntington would consent to act either in person or by counsel — that with Sir .lohn .Macdonald, Sir Hugh .\llan, .Mr. Ahliolt, and others in the witness-box, no concealnient woidd lie possible, for in the eirciimstaiu'es in which they were placed the refiisal f»f these gentlemen to answer any question would prove more fatal to tlieir cause than the most damaging admissions; but in default of .Mr. Huntington's assis- tance, il was equally evident that a far greater burden would 1m' thrown upon the ('ommi.s- Sioncrs than had been originally contemplated, and that the chances of an exhaustive investigation wouhl he projiortionalely curtailed. "?•. 9. It was, therefore, with regret I learnt that Mr. Huntington had finally decided ot to put in an appearame. Satisfied as ! was, notwithstanding this gentleman's remark- bly aide argument to the conti-.iry, that the appointment of the Commission was — whelher Ssailable or not on other groumls — both a legal and a constitutional act, and, to use the nguage of the Law Ollicers of the Crown, in no sense an interference with Ihe privileges of parliament, it appeared to me an unfortunate circumstance that the conscientious, but, as I BOW apprehend it will he admilled, the unfounded scruples i>f .Mr. Hnntingto?i and his friends upon the point, should have (h'prived the inquiry of that complete and thorough character it wouhl otherwise have pos.sesscd. ji _ 10. It is triK! the diligence of the Commissionei-s in meeting the additional responsi- *^ilities thus imposed upon them, has remedied the defect so far as circumstances permitted, and I am glad to see signs of their services in this respect having at last obtained a tardy recognition at the hands of those who were at first most uulavouraldy disiwsed towards tile in ; for there ha.s, perhaps, been no more disagreeable feature in this Inisine.ss than the CM laordinary amount of personal abuse which lias been heaped upon the heads of these /imoU'ending gentlemen. ('.\NA1)A, '^^, ^^ o.A'^. IMAGE EVALUATION TEST TARGET (MT-3) / O 1.0 I.I ■^ !■■ IIIII2 2 IM 2.0 1.8 1.25 1.4 1.6 •• 6" ► Photographic Sciences Corporation 23 Wfc'.l MA'r STREET wta5:e«,N.Y. msso (/16) 872-4503 V t/j fA 88 CORRESPONDENCE RELATIVE TO THE Canada. h. In England many of our Judges have passed straight from the arena of politics t;. the Bench, and to these high functionaries has now been assigned an extensive jurisdictios over delicate and hotly contested political issues ; but no matter what tlio verdict they render, it would never enter into the minds of any of their countrymen to question for a monicni their professional honour. As far as I have observed the judiciary of Canada occupy as high a moral and intellectual level in relation to the other classes of society in the Dominion, as their brethren in Great Britain. They hold their appointments on the same terms,— their tenure of office is as secure, — nor \\ould it ever have occurred to mc that a taint o! suspicion could attach to the National Ermine. Yet it seemed to be taken for granted that because Judge Day, Judge Gowan, and Judge Polettc liadbeen nominated, — as of necessity was the case, — on the advice of the Government, these eminent personages must therefore be ready to sacrifice their personal honour, their professional reputation, their sense of duty to the Queen, and to their country, in a transparent and inclfectual attempt to screen from justice a ^^inistry of whom they Avere aljsolutely independent. 12. Happily as tim-^ vent on, a better feeling began to evince itself, the language of tlic hostile press became more moderate, and although occasional complaints were made that this or tliat line of interrogation was not followed u|) with sufficient pertinacity, it came to be admitted that some of the main purposes for which the Commission had been appointed were being promptly and fairl}- accomplished. 13. These anticipations have Ijcen now fulfilled by the acceptance on the part of tlie House of Commons of the Commissioners' Report, and of the body of evidence placed l)y them at its disposal, — a result which has found its final consummation in Mr. Mackenzie having founded the vote of censure he is now pressing " on the facts " — to quote the word: of his motion — " disclosed in the evidence laid before us." 14. Although I should be unwilling to refer to the appointment of the Commission in any other terms than those I have already used in my original Despatch of August 18th, in which I state that although "I do not apprehend that Parliament can denounce " the Commission as a breach of privilege, it would l)e perfectly competent for the House " of Commons to declare its issue inopportune and unadvisable, and to visit with its " displeasure the Ministers who counselled its apppointment." 1 cannot help observiiip that in several respects the practical result obtained can hardly be said to have been unsatisfactory. 15. On the 13th of August last, althougd four months had elapsed since the inquiry into the Pacific Railway scandal had been first initiated by Mr. Huntington, the investigation had not advanced a step ; since then scarcely ten weeks have i)assed away, yet the whole matter has become ripe for adjudication, and in a day or two a final verdict will have been pronoimced. IG. Had no commission been issued, the interval between the 13th of August and tlic 23rd of October would have remained unutilized. A political crisis most detrimental tn the public service, and entailing the most distressing relationships between the Crown and its Ministers, would have been indefinitelj' i)rolonged, and at this moment Parliament might probably be still discussing the conditions under which its Committee was to k' re-constituted, and what steps were necessary to enable it to obtain sworn evidence. 17. Considerations of this kind however caimot be expected to mitigate the resentment of those who have all along been disposed — I do not say with justice — to regard the appointment of the Commission merely as a tactical device interposed by the accused to clog the course of the inquiry. But with this part of the controversy I have no concern, nor in making the foregoing observations do I wish your Lordship to understand me ns undertaking to justify the Commission, or as accepting any responsibility in regard to it It would not be a convenient practice for the Representative of the Sovereign to indicate the degree or respects in which he may approve or disapprove of any course recommended to him for adoption by his responsible advisers. 1 issued the Commission at the instaute of those whose counsels I considered myself bound to follow, and I did so with the greater readiness, as it enabled me to obtain from my Ministers in an open Court those explanations in regard to their conduct which circumstances had rendered necessary, and which I had a right to require; but the vindication of their procedure in tendering the lulvice on which I acted does not lie within my province. 18. In conclusion I may observe that, although the Comniission has acted as an effectual solvent of the political dilliculty, and appears to have elicited all the facs .icccssarj to dis- play the main features of the story, it remains to lje seen whether a further prosecution of the Inquiry will be thought advisable by those whom it principally concerns on cither side. I have, &c., (Signed) DUPFERIN. c arena of politics to :>xtcnpivc jurisdiction 10 verdict tlicy render, iiestion for a moment of Canada occupy as icty in the Do)ninioD, 1 the same terms, -- to mo tiiat a taint cf aken for granted that itcd,— as of necessitv aages must therefore n, their sense of duty tempt to screen froni the language of tlie ints were made tLal ■rtinacity, it came to had been appointed on the part of the evidence placed by »n in Mr. Mackenzie -to quote the word- of the Commission Despatch of August iment can denounce 3teiit for the House id to visit with its rinot help ol)serviiii.' i said to have been nee tlic inquiry into m, tlie investigation nvay, yet the whole rdict will have been of August and tk nost deti'imcntal tn 'een the Crown and noment Parliamoiit )mmittec was to be )rn evidence, gate the resentment tiee — to regard tlie by tlie accused to I have no concern, 3 understand me ns ity in regard to it. )vereign to indicate 3nrse r-ccommendcd sion at the instance so with the greater , those explanations and which I had a ) advice on which 1 icted as an effectual 'is .-iccessary to di.^- rther prosecution of :erns on either side. ), &c., DUPFERIN. CANADIAN PACIFIC RAILWAY, S(t Enclosure's in No. JO. HE POUT 01' ruv UOYAL COMMISSIONEES Aj'poink'd b>i Commission, addressed to them uinl, r the Great Seal of Canada, bearinr/ date Auffii."/ 14, LSTo, v:htch Cominisslon n-ill be found printed as Enclosure 1 in No. '>. 4 M no (.OimESPONDENC'I-: ]{ELATIVE TO THE Canada. REPORT. To the Riglit IIoiunuaMc Sir Frrdorick Tcni])lo, Earl of Duffcrin, Viscount and Baron C'landehoye of Claiidcbove, in the County of Down, in the Peerage of tin United 'Xingdoni, l^aron Duflerin and (.'landehoye and Bailyleidy and Killi^ leau'li, in tin- C!ounty of Dommi, in tlie Peerage of Ireland, and a IJaronet, Ki)ii;lii of the Most Illustrious Order of Saint Patrick and Knight Commander « the most I lonourahle Order of the Bath, Governor General of Canada, and Viie- Admiral ol the same: May it jjlease your Excellency : The undersigned Commissioners, aitpointed by Royal Commission addressed to tlinn under the Great Seal of Canada, bearing date the fourteenth day of August, a.d, IST.!, Have th(! honour to report — 1. That tluy met at Ottawa on the; eighteenth day of August last for the purpose oi making preparations for the discharge of the duties imposed upon them by the Com. mission. 2. The course of proceedings was then settled, and the fourth day of September last was a])poin!e(l lor entering u}H)n tlie examination of witnesses. 3. The Commissioners on undertaking the inquiry they were enjoined to make hiiil lioped that the entire conduct of it wouhl not have been left in their hands, that tin lion. Mr. llunlington or some one who believed that the charges specified in the Cora- mission could he established by evidence, would have conducted the incpiiry before them, and tliey had resolved in such event, not only to accept such aid in the investigatioi; l)ut to allow to the promoter at least the same latitude in the mode of proceeding as the i-ecogniz(xl ofTicers in courts of justice are allowed in ordinary judicial investigations, and also to give to the nuMubers of the Government a like latitude for defence. This course appeared to the Commissioners to l)e just, and in accordance with what they believed to be your Excellency's wishes and ex})ectations. 4. In the prosecution of their work the Commissioners have called before them such ]!ersons as they had reason to believe could give any information on the subject of it, or otherwise I'acililate Ibc investigation, and especially the Hon. .Mr. Huntington, to whom a letter annexed to this l'ei)ort,* was addressed on the "2 1st August last past, requestin: him to i'urnish to the Commission a list of such witnesses as he might wish to examine, an. I'd Fleming. !^at1ian, jun. N. Smith. nncs. .. Camj)bell. ct( r Mitchell. , F. C. ovv, Hon. Thomas s, i). leii, (ieorge \V. len, liov. D. Ion, Danl. Y. 11, lion. Peter. U P. S. Jan., George. , Hon. G. , John A. ckson, Charles M. , Hon. Henry. Jan., Thomas. rson, Hon. D. L. F. C. . D. en, Ilev. D. en, Danl. Y. Hon. Peter. P. S. Hon. G, vson. Ion. Ilenrj'. Thomas, jun. nlges of the Suiic- iLKiTK, one of the llOHEKT GOWAN, the Province ol id to them, under ;ust, A.D. 1873, at D.C.L., Secretary. PROvivfK 01 Ontario, ) jp^ '^yy^ MATTER OF THE COMMISSION City of Ottawa. J Appointing CirAni,KS Dkwky Day, Antoixk Poi.kttk, and Jamks Rorkut Gowax, Commissioners to inquire into and re])ort upon the several matters stated in a certain Resolution moved by the Hon. Mr. HuxTixaTOX in the House of Commons on the second day of April, a.d. 1873, relating to the Canadian Pacific Railway. Present : — Thk Commissioner.". ■On this fourth day wf September, in the year of our Lord one thousand eight hundred and seventy-three, personally came and appeared before us, the above-named Com- missioners, The Ilonblc. HENRY STARNES, of the City of Montreal, Banker, who being duly sworn, dcposeth and saith : I received a Sulipiena dxiecs tecum to appear before the Commissioners and produce the papers described therein, and I hereby produce them to be filed in this matter. The said papers were placed in my ])ossession for safe keeping by Mr. Abbott on behall' of Sir Hugh Allan and Mr. McMullen. In producing them in compliance with the orders received li-om the Commission, I beg to state that I object to their being opened without the consent of Sir Hugh Allan. I think it my duty to make this objection, as they were placed in my possession for safe keeping. They are returned as they were placed in my hands as they were when I first received them. The sujierscription " Henry Starnes, Sir Hugh Allan, G. W. McMullen" was put on by myself; they were placed in my hands a day or two before Sir Hugh Allan's (lei)arture for England, to be left with me. Tliere are three distinct parcels, one to Mr. McMullen, one to Sir Hugh Allan, and one addressed to myself They were handed to me by Mr. Abbott on behalf of Sir Hugh Allan, Mr. McMullen was also present at the time I received them from Mr. Abbott. I have no knowledge of what those papers contain. I have no objection to the package being opened providing Sir Hugh Allan's consent is obtained. (Hon. Mr. Abbott hereupon produced a written consent that the said ])ackage of papers be oj)ened by the Commissioners.) Question — Have you any knowledge in relation to such negotiations as are described in the charges mentioned in the Commission in this matter, as being carried on i)etwcen Sir Hugh Allan and Mr. McMullen lor the purposes designated in this Commission? A7isioer. — I have no ])ersonal knowledge. Q. — Were you a meml)er of an Election Committee in 1872, in conjunction with Mr. Boudry and Mr. Murphy? A. — I was requested to go upon that C'ommittee, but did not attend regularly. I am aware that money was received for election ])urposes. I might state that I was requested by the late Sir (ieorge E. Cartier to act on tiie Committee, as he felt that the elections would be hotly contested and that he was aware that his opponents were well furnished with ample means, and, it -would be necessary to fight them with money. I objected, as I did not .vish to take iuiy part. He, however, felt that there was a desire to make the elections by means of railways, and he was determined to have nothing to do with that, as he wislied to make his election upon his own merits, and it would be ttpcessary for me to get friends to subscribe and to get as much money ^s we possibly C^uld, I went round and got subscrii)tions. He then told me that Sir Hugh Allan #Duld subscribe liberally, and I believe Sir Hugh Allan did subscribe very largely, but subscription did not come exactly to my knowledge. ,1 cannot say how all the money came, but it was deposited with me, and by what n|eans I do not exactly know. It was placed in the Bank of which I am President, YAY. 03 tlicsc letters. The; about it till it wj •ular undertaking. ; l)elieve there were, suhseription, exo; lount was. )()k after Sir Geor. lie eontrol of electiu: <)1)jeet of this inciuii the elections, hut ] as raised by way package having h\ ! written on the iiiiit nent, the Hon. Ilciir Alhxn, and envelui r Hugh Allan to 1 3 himself and act Ttll ALLAN, AV. MciMULLEN, Mr. aiclNIullcn. T! to open the packas: Commissioners.) eappeared and niiv: ice I Slated that t! mO,0()0 — on refercii ng been read to hie lY. STARNES. DEWEY DAY. airman. E, iERT GOWAN, onimissioners. ^MMISSION ES ROHKRT G0W.\\ ral matters stated!: ■)N' in the House >: lug to the Canadia: lusand eight hundn. above-named Coiii' sworn, deposeth ain: :ircumstances begin- commence from tli I believe the firi: subject of the Pacifr Railway was Mr. Cyril Graliaiii, a gcutK'nian wiio actcil as Commissioner for tlie lludsj-i Bay Comiiany, in tl'ie vcars ls7() and JsTl. On his rctnrii Iroiii tlic Tniti'd States, lie told me tliat he liad l)ieii in comniiinuation with seveial influential gentlenien, and that he thought satisfactory arrangements could be made, by which great economy would be jiroduced with regard to the construction of the Pacific Railway. That be believed the Americans would be jn-epared 1o almndon the Western sectioii of the Northern I'acific Koad. carrying it through ( 'anadian territory, if the Canadians would aljandon their Eastern Scclion and carry it through rnilcd States territory by the Sault Ste. Marie. I heard all that he said upon the sul),ject, and I must m that it produced some imju'cssion upon my mind. i About the month of May, 1S7J, Sir John Rose sent me a cojjv of a letter which be bad addressed Sir John A. Macdoiiald, iu which heinrorninl me, that persons in London l»d sjiokcn to him very much in tlu' same terms that 1 have mentioned that Mr. Graham bad represented to me,"and suggesting in the letter either that we sbouhl a])proach these gfcntlemen in the United States, or let them understand that they might ai)i)roacli us. and lUltlie same time ollering that if lie could be of any service in l.,ondon. that he wouiil be happy to be so. In consequence of these statements, I certainly formed a pri'tty strong idea that satis- fcctory arrangements could be nuide with ca]iitalists in the liiited States. The next circumstance that 1 would mention, was the arrival in Ottawa of a nunil)er of gentlemen of whom Mr. MeMullen was one; ^!r. Smith oJ' Chicago, wa^. a second ; James Beaty, of Toronto a third; and Mr. KerMeman and Mr. Waddington, and I think there was another whose name 1 cannot I'c'collect, but I thiuk lu- was a I'oronto gentleman. They asked an interview with members of tlie Government. The only numbers in Ottawa at that time were Sir -lohn A. Macdoiiald and myself. I think 1 was the jjcison to whom tliey were first introduced, and Sir John A. Macdoiiald eonseuted to ,i;ive tluTii an interview, which they had. We heard what they had to say ; they iiroduciil a docu- ment signed by stmiesix, seven or eight gentlemen of standing in the t'nited .-nates, and of known wealth. I forget their names now, but there was (ieiieral Cass. Mr. Ogdeii was another, and I think Mr. Scott, of Philadelphia, was another. The ilale was in July, 18/1, probably about from the tenth to the thirteenth of July. They were told distinctly that it was not in the jioAver of tlie Governmem to enter into any negotiations with them. I think that ^Ir. Smith and Mr. .Mc.Mull. n had an interview with me in my own room, and we had some little conversation 'nit did not amount to anything. It was simply an understanding that it was inipossi])'e ibr us to enter into negotiations at all at that time. After they had returned to Toronto, I got a letter from a gentleman who had accom])aiiied them there, and who I understood was tiieir jirofessional adviser at the time, and I had some corresjioiulence with him. 1 refer lb JNIr. Beaty. In the course of that correspondence, he mentioiu'd his intention of going to Montreal to induce Sir Hugh Allan to join the scheme. He had not ul that time been spoken to. I wrote very discourafiingly to Mr. Beaty in rejily, sim])ly on the ground that I did not see how it was jiossible to talk about a scheme which the Govern- ment had not come to any conclusion upon, as to what assistance they could give. I did not see that the matti'r was in such a stage as aduiitted of its being discussed at all. Alter that I saw Sir Hugh Allan in Montreal, but as I felt that the suggestion of his name came from Mr. Beaty entirely, writing with the sanction of Mr. McMullen, I there- fore inferred that the suggestion of Sir Hugh Allan came from them, and as 1 had been te means of preventing their opening communication, I thought it was only fair to give m the list of names wiio were willing to engage in the building of the Pacilie Railway. '^ That conversation with Sir Hugh Allan must, I think, have taken place about the ■Biginning of August. I cannot recollect the day exactly, but I do recollect that 1 told bim tiiat Sir John A. Macdonald would be iu town I think, either that evening or the next evening. Sir John was passing through to a watering place, and intended to go from the Ottawa boat to the Quebec boat without stopping in Montreal. Sir Hugh did see him. I Mas not jireseut at the interview, but Sir Hugh told me that he had had a. discouraging reply from Sir John, as he did not think the Government was in a position to enter into negotiations. I afterwards went to the Maritime Provinces, and in October pir Hugh Allan came with these same gentlemen, Mr. McMullen and Mr. Smith liaving been in communication with him, with another proposition. At that time there was a ^nsidcrable number of members of the Government present. I have seen Mr. l!c^Iullen's statements, and he gives the names of nine of these persons, and I j)resurae be gives them correctly. On that occasion what passed was this : The gentlemen were fotroduced, Sir John A. Macdonald then asked Sir Hugh Allan whether he had a propo- ■? N 2 Caiiai».\. 96 CORRESPONDENCE RELATIVE TO TilH Canada, sitioii to make to the CJovcriimciit. Sir llun;h Allan's reply was — " If I make a iiropo- ' "^ilioii arc you prcparcil to ciitrr into ncf^otiatioiis on tlie subject." Sir John answer^ i that" lie was not prepared to do so," i.nd Sir llu<;h Alhui rejoined " Tiien 1 am no; " prepared to make any ])roposition.' That was tlie wiiole conversation on the sulyect thai took place at that interview. Sir Uwf^h Allan went shurtly afterwards to Enfj;land, aiiii returned very early in Deeemher. VVhen he returned I had a conversation with liiin 1 must iiave been in Montreal in December, although I have no very special recollection of it. Whenever we met, lie was always talking; of the Pacific Railway and inasmuch as j great luiniber of conversations took jjlace of this kind, I think I oun;ht to state, \\\\\, regard to evidence of this kind, that where two persons have diU'erent interests, and noti:, a iH)silion to understand what is passinj; in each other's mind, that very often there \\\.. be misund(a'standings in regard to what passed at these conversations. My tlesire was to be as reticent as possible. 1 had no i)roposition to make on the par of the (.iovernment. lie, on the other liand, was most an.\ious to get the (lovernnient t agree to some proposition, so as to enable him to make progress with his arrangement- 1 say this, because 1 oi)serve by letters wbicli have been i)ul)lished, that it is allegi;d tb: I said something about advertising for tenders, with the vii;w to avoid the Governnm incurring blame. Now, I have no doul)t whatever that I did jioint out to Sir llu^'' Allan that it was wholly impossible for the Government to come to any arrangemci; without the sanction of Parliament, and it is not imiirobable that 1 may have discusse, the (piestion about advertising lor tenders, but 1 could scarcely have told him that V' were determined to advertise for tenders, heeausc no such determination was ever arrive; at. Several conversations took place, and dillercnt jiersons will have diil'erent views. 1 may have suggested to advertise for tenders to find out whether there was any otlic person besides Sir Hugh Allan, who would come forwanl and undertake the building o; the road. W'c, as a tJovernnrent, had pleilged ourselves to])rocure the construction of tli Pacific Railway, and we Iiad also determined to try to do it by the instrumentality ol'i t'hartered C'omi)any. ^\'e were anxious to find out what persons there were in the Dominion who wouLi undertake the building of the railway, and upon what terms they would be willing to coi;- struct it. A number of unauthorized conversations took place with Sir Hugh Allan, bi;: Sir Hugh knew perl'eitly well that these conversations were unauthorized, and that I wa- not speaking the sentiments of the (iovernment. 1 simply stated what occurred to my own mind in the coursi' of the conversations. Sir 1 high also knew jierfectly well thatniv views with regard to the construction of the Pacific Railway harmonized a great deal more with his own than any other member of the (jovermneiit. He knew that 1 ua; not opjiosed individually to the admission of American cajjitali.sts. He was well aivareci that from tiie first. He was well aware that my views were in favour of coming to soiiu arrangements with the Americans, as there would be economy in the postjionement of a certain section to a later jieriod so as to get one complete road through. We had a gowi many conversations, and lie was also aware that some m<;mbers of the (jiovernment wcti much ojiposed to admitting Americans into the scheme at all. All these eonversatioib took place long bel'ore the Session of Parliament — long before any scheme was deter- mined upon by the (jovernment. They were had with a view to my getting all tlio information I could with regard to the best scheme for constructing the road. The next circumstance I would advert to was the final arrangement tint the Govern- ment came to with regard to the railway, which was submitted to Parliament. Thai scheme was decided ujjon by the Government, after the most careful consideration, with- out any conference with any outside jiersons at all, as to the exteni of land and moiuy they would give. When Parliament met, I would say that during the whole of IsTl, there was a great coolness in the jirincipal parts of Ontario with regard to the scheme. No propositions were made such as those that emanated from Sir Hugh Allan. Nothing was done until just about the time of the meeting of Parliament, it then liecame evident that then would be a proposition made to Parliament for the chartering of more than one Company. The (rovernment did not think it desirable to oppose any of the Charters but to let tlioni take their own course, taking power to establish a separate Company if they should deem it necessary to do so. I may observe that during the Session of Parliament, it becami' more and more clear, and I was very reluctantly convinced, that it was absolutely necessary to exclude the Americans entirely from the Company, and from that time I may say this became the settled policy of the Government. Qtu'ulion. — Whatdate do you give to that ? Aitsicer. — The meeting of Parliament. CANADIAN rACIFIC RAILWAY 97 -" If I make a propo. " Sir Joliii aiiswerci ncd " Then 1 airi in: ion on the subjirl, tk ards to Eiif^laud, aini invi'isation witli liim ry si)ccial rccollccticn y and inasmuch as 3 . oii|;ht to statu, witfi nt iiitcri'sts, and noti: very oiten there \vi, IS. 11 to make on the par ;ot the Ciovernnient t ith Ills arrangonuiit' tliat it is alU'i^cd lb- void tlif Governnn; lint out to Sir ]lu|;i ; to any arranf^^onK;; I may liave discussc: avc tohl him tliat «■ it ion was ever arrive: ve dill'erent views. 1 tlicre was any otiu: [M take tile liuildin^ 0; the eonstruetion ol'tli' " instrumentality ol',: )ominion who wouli )uld be willinj; to coi;- Sir llugli Allan, bi:; orized, and that I \\i- ivhat occurred to iir. iirl'ectly well that 111; monized a great dual He knew tliat 1 \u- Ho was well aivairci ur ol' coming to soiiit le postponement of a u:li. We had a good le (jiovernment \\vi<: 1 these conversation! )' scheme was dctfi- a my getting all tk the road. ,'nt tint the Govern- ) Parliament. That consideration, with- of land and momy 1 , there was a great le. No })ropositioii5 tiling was done until e evident that thcri than one Company, rters but to let tlieni if they sliould deem rliament, it became t it was absolutely rom that time I may Q vVas that previous to the passing of the Act ? ^ During the time the Act was under consideration, and before the jiassing of the Act." It was Then perfectly understood by all tin; members of the Government that the Americans would have to be excluded. After the Session of Parliament broke uj), aliout the ritii or the l.'itli of June, 1 think, I went to the West and was engaged in tlie election, and I'had no communication with Sir Hugh Allan for a great many weeks, proi)ably months— I must have left Ottawa very early in July, and I was not in Montreal after the Session to tlie best of my recollection. I do not recollect seeing any one, and no arrange- ment of any kind was made by tlie Government about the Pacific Railway. Nothing was tUr be done until after the elections. The next action taken by the (iovernment was, I dHnk, in the month of Scptcni!,cr or October, l.s7U, after the elections were entirely 0er, when negotiations were commenced with a view of jirocuring an amalgamation of t^e two Companies— the Interoccanic and the Canadian Pacific— Sir Hugh on behalf of Ms Company wrote accepting the jiroposition cf the Government, that the two Companies djould be amalgamated on condition of tlici; being united on fair terms, taking the prin- djial gentlemen of both I'ompanies. T"1k; Committee of the Interoccanic Company, of wnich Mr. Macphersoii was Chairman, gave reasons why they could not Join. One of their principal reasons was that Americans were still in the Company. T'liat document was sent to Sir Hugh Allan for his Company to report upon it, and they did rejiort upon it. About the lOtli of October, I think, a Minute of Council was ])re])ared, and that Minute gave a full and faithful narrative of every Miig connected witli the Paciiic Rail- way and the negotiations u]) to that time. It was hoped that that Minute of Council, as it pledged the Government toiircvent the Americans coming in, and stated that the (jiovernment would take adequate means of doing so, would induce the Interoccanic Com|)any, as it was called, to join in this amalgama- tion. They still refused, however, and on tlieii final refusal it became necessary ibr the Government to see what course they would have to take under the circumstances. Sir Hugh Allan had been very anxious, and my own opinion is that it would not liave been an unreasonable demand after the refusal of the other Company to amalgamate, that the Charter should be given to the Comjiany of which he was Chairman. However, the Go- vernment, upon a full consideration, determined to adopt a dillerent course ol' jiroceeding. I have no doubt they were impressed a good deal by some views of Mr. Macphersoii which he put forward very strongly in his corres])on(lence with regard to amalgamation, that no iiersons from British Columbia were includi'd in the scheme as i)ut forth, and that Sir Hugh had stated that if British Columbia were introduced the maritime Pro- vinces \, ould also require a representation. Mr. Macphersoii thought lliey should be represented, and I have nodoui)t these arguments had as great a weight with the other members of the Government as they had with me. Finally it was arranged that a Com- riy should be incorporated containing thirteen members, divided into fair proportions letwcen the difl'erent sections of the Dominion ; from Ontario, five ; from Queliec, four, and from each of the other l^rovinces, one, making thirteen in all. ^Ve gave a great deal of consideration to the whole scheme, and finally agreed u[)on names after a good deal of negotiation. Some names were suggested and withdrawn, others were s2)okcii to but refused to act, and finally these names were agreed upon, certainly without the concur- pence of Sir Hugh Allan in any way whatever. On the contrary, it is within my own knowledge that he objected to many of the names. The names were taken as fairly as possible from the Province of Ontario, one of thorn the Vicc-Chairman of the Inter- Oceanic Company, another who had no connection with either, but \vhom it was desirable that we should select, namely, Mr. Sandford Fleming, and there was only one name tiiat Jlad been originally in the Canada Pacific Company, a gentleman of large means and high itanding, Mr. Donald Mclnnes, of Hamilton. He was the only one from Ontario at all (dbnnected with Sir Hugh Allan. From Quebec one name was taken against the most Urgent remonstrances of Sir Hugh Allan, Mr. Hall, of Sherbrooke. The gentlemen had tkich of them the same interests as Sir Hugh Allan, who had only a thirteenth the same 0e the others. He had no controlling power in the Company whatever. He got no benefit of any kind throughout the whole course of these negotiations. I state most posi- tively that it was impossii)le for any undertaking to be got up with a greati'r desire to promote the interests of the country than the Pacific Railway. Every detail was con- Sideied with the greatest possible care, and as far as my own iiulividual opinion goes, although 1 had very little personally to do with the Charter, I think that the Company — I do not refer to Sir Hugh Allan iiarticularly — were treated with less liberality than the Government ought to have shown them. My opinion all along \vas that it was an enter- prise which to be successful the parties going into it must be treated with the greatest possible liberality. I should say further that there was a stipulation made when these Canada. " p^^ 08 ('()I?^]•;^!F^xl)KX('r: t^mlativk t(^ tiik Canapa. lliirtccii i;rnflrmi'ii \vi rr allnwid \o siil)>icril)i' stock tluit tliry wcro to ofTur it with thf oxccjitioii (il'ii smiill rcsci'ViitioM to iMcli, on the saint" li'i'iiis to tlic pulilii' as licy \\vvv\, got it, tlu'insclvi's, and olTu'cs were to In- oiiciicd in Ontario, (^iicln'c, and llic otiicr I'ro vinci's lor the sniiscrii)tioii of stork. I think that is as tar as I can go with irj^ard to tlit transaction altoL^ctlicr. (2.- In vonr rcl'iMrncc to July, 1^71. have you stated all you recollect that passed tlia — your statctncnt was that tliat was an unimportant interview wliieh led to eonversutioii and discussion, i)nt no results? .1. — No results. \\v listened to what they had to say, I mentioned that an inform.! ]>roposal was made, signed hy a nuniher of ijentlemen. I cannot at this moment recolUv the exact numher of acres jier mile tlial was pro]»osed, Imt I re.'(dlect that it was iin' hased npoii a lumj) sum, hut upon u;rtlinu; a honus of sl'i.iKlO a mile cash, and a certaii numher of miles on each side of the railway, which I do not oxaitly recollect, likclv twenty. (). — Ho you rememher whetlier there was any expression of the \vish or intention u; the (Government, that prominent Canadian name'i should l)e amonj;' the menihers of tin. Company; was there any thinf;- insisted upon of tiiat kind? A. — S^)thin;.; at the meefiuL; of Sir .lohn A. IVIacdonald and myself with these f;eiifli. men. I think it is jirohahle in private conversation that 1 may have said that it wi: unfortunate there were no Canadian nanu's in the Company. It was my fcejini;' at tin time, and knowin;j; that it was so, it is prohaldi' that I minht have expressed it. Q. — I understood juu to say distinctly that anterior to the le^islal' )n on the sul)joct in IST'2, there were no negotiations hetween Sir Hugh Allan and .Mr. iNIeAInllen, as repri' seuting the United States ca})italists, for the jmrpose of putting this enteri)risL' into tin hands of an American Company, with Sir Hugh Al'iu at its head? A. — Of course I was perfectly aware iivnn the fact that Sir Hugh .Mian came to < Ittaw; with these gentlemen, that he was corresi)onding with them, an his friends should swear witli regniil lent and Sir llu!.'li th the Pacific ]{ail- not given with any iVeen these gentle- ■nment ? hose of the other A, — I sliouM think ahout the siinie, very much uhoni the same. Q_ — Have you any knowledge that any money was Jhrnished hy Sir Ilngli AHan for tlie iupport of the ehrtions? ^, — AVell, [ su]ipose I may say I liave that knowledge now, luit if I refer hack to fho period of the eleclioiis, \o. I am now aware from ciicu' isfanccs I have heard, and which I suppose the whole puldic have got, that Sir Hugh Allan was a liijcral contri- butor to the election fund. 1 am aware of this from circumstances that have come since to my knowledge. Q. — Had you any knouleilge of that at the time or lieforc the elections? ^Ji. — No. Not until long alter the elections, a coiibideraldi' tinu' alter. AQ' — I^" yn know for who.e elcilion an} [jarticnlar Mums were contributed ? TJp.4. — I eaimot say that I do. I liavi' reason to believe that there was a very hirgc Mnount contributed for tlie Montreal elections. (^. — Von slate tluit Sir Hugh .\!laii was not to have any controlling influence in the Company; was it not uiuhrstood that he was to be President? A. — I do not know that it was so understood. Of course memliers who went in were perl'ei'tly free, I presume, to vote for whoever they jjleased. I did not take any part in the communication that passed betv.cen any of these genth'nien, and I really do ■ot know what passed. I don't know whether they were caiivassi'd by any member of tlie ((overnment on behalf of Sir Hugh Allan, but 1 would not be surprised if they were. Q. — Can yon slate any certain sum of money that was contrilmted by Sir lliigli Allan? A. — No. I cannot slate of my ciwii knowledge. I cannot give hearsay evidence. ^.— Have you any knowledge that any sum of moiic} ' , oil'ercd to any member of the(iovernment for the purjiose of inlluencing him in connectii'ii with tiie Pacilic Haihvay ? A.— I am perfectly convincecl there w.is nothing of tlie kind. Q. — Or any other inducement or advantage? A. — None. This may be a proper time to explain a circumstaiue whicli ha been referred to in the papc'-'^ '\ ,ich seems to imply that I desired some inducement of some kind. Refer- ence was niado to my having stipulated for a situation on t'le r,u ifie Railway for one of Ti'' sons. Now I desire to exjilaiti exactly what p.assed. ^\■hen I wrote my letter very hastily, I at the moment really had forgotten the circ'imstanci- which made very little imiiression upon my mind, but I afterwards distinctly recollected it. My youngest came in October, LS/l, to pay a visit to his friends. He llieii held an ofilce in Pritish (Juiana, and came lion; on leave of ab.sence. I was anxious to keej) him in Canada, ana to esta- blish him in business. Sometime during the fall of isji, and while Sir Hugh Allan was absent from the enuntry, a friend in Montreal suggested to ine the idea of pur- chasing out a forwarding business, which was likely to become vacant in consecjuence ui the death of a gentleman, who died in the latter part of November, 1.S71, and it was supposed that his business after his death would be disjioscd of. This matter had been brought under my consideration, and I took the opportunity of Sir Hugh Allan's being in Ottawa, to consult him on the subject. He was on a visit for three or four days a\ Kideau Hall, in January, eighteen hundred and seventy -two (1S72), after his return from England. The cause of my having any conversation with him, was simply to ask liis advice with regard to this I)usiness, as I considered him more competent to give an opinion than any one that I knew of. He strongly advised me to have nothing to do with it, and at the end of the conversation, I simply said. If you hear of any oiiening for ty son, I would ])e glad if you would bear him in mind. He made the remark that hen the Pacific Kailuay is started, there will be plenty of opportunities, and so little ., iportance did I attacli to the conversation that I never mentioned it to my son, and it never crossed Sir Hugh Allan's mind or mine that there was anything corrupt one way or the other, with reference to the conversation. If it was wrong at all, I am alone responsible for it. for no other member of the Government knew anything about it, nor did I attach importance to it. Of course I have seen Mr. .McMullen's narrative, and if there is anything I have not noticed, I would like to have an opi)ortunitv cd' adding to iJhis statement. ■ji^ I say most distinctly that no such conversacion was had with me that a round sum of llnoney down would he preferred hy me at my time of iife. I swear most posit ivelv that no such conversation ever took place. No such thing was ever mentioned b»' mi; 'to Sir Hugh Allan or hy him to me. There is a statement that I said something of Sir Cieorge ;. tart ici- s jealousy with regard to the Grand Trunk to the Pacific. Mr. McMullen ■thought I had a conversation to that effect with him. I can only sav that I have no recollection of any such conversation. I don't think that ii i? at all likely that I had Canada. 100 CORRESPONDENCE RELATIVE TO THE 1 1: Canada, spoken to him about Sir George Cartier's views on tlie subject, but it is quite correct t say that Sir George was very strongly opi)Osed to the Americans having any interest i: the scheme. Mos«^ unquestionably the Americans never received any pledges of any kind c description, as stated by Mr. McMullon. Q. — Did you not mention a Memorandum, of which you had taken a copy, given yo. by the Americans? A.—\ took I copy of the names, but not of the Memorandum, and these I handed t Sir Hugh Allan. There was no money received or paid by the Government for or in consideration c: giving tlie contract. There is mention made in Mr. McMullen's letter that I received a specific sum o: $4,800 from Sir Hugh Allan. I deny this in the most positive terms, I received ii; sum of money whatever. Q. — By Sir John A. Macdonald through tlie Chairman. Can you state when the elections commenced generally, and when they ended ? A. — My impression is that they commenced about loth July, or perhaps the beginniii: of July, and I should say from memory that they ended about the middle of August. Q. — Up to the time of the return of the writs of the elections which took placi in September, was there any policy suggested to the Government, or before the attem|); of the amalgamation of the two Companies ? A. — None. Q. — During all that period was it or was it not understood that a strenuous attenip; should be made to olTect an amalgamation of the two Companies? A— Certainly, and much later I had reason to believe that there was good ground t: exjjcct that an amalgamation would take place. During the whole period tlie elections were going on, and until long after, perhaps a; late as tlie beginning of October this was the case. Q. — In October, were or were not the efforts of the Government renewed to effect at amalgamation of the two Companies? ^.— Yes. Q. — Was there any suggestion from any person to the Government that you are awan of, or was it tlie jjolicy of the Government to issue a Charter under the Government Ail till after tlic failure oi' all attempts at amalgamation? A. — Certainly not. Q. — Then tiie Ciiarter which was issued and is now in existence is based on a policy which was only adopted by tlie Government in October or November after the attemit to anial^amate had proved a failure? A. — Yes, I should be inclined even to put it to a later period. The arrangement pi the new Company took a considerable time. I presume that it was about the latter ciii of Novem1)or that the jiolicy of the Government to work by means of a Company of tliat kind was decided upon. And farther, for the piesi-nt, deponent saith not. And on this fifth day of September, 1873, reappeared the said witness who desires to give some explanation of his answer to the question on a preceding page of his deposi- tion, and gives tlie following explanation : I wish to answer this question at greater lengtli. I never heard of any suggestion to the Govci.inient to issue a Charter under the General Act, and the Government iievir contemplated issuing such a Ciiarter till they became satisfied that it was impossible ti effect an amalgamation betweeii the rival Companies. The corespondence alluded to in my foreging deiwsition is in the words following:— Letter markkd " B." ( Confidential.) Dear Sir, Toronto, July 17, 1871 I liave been thinking over the suggestion about the introduction of some of our Canadian cajiitalists into the Canadian Pacific Railway Company, and thought it proper to write to you for the jnirpose of having your views ujion the matter, and especially to have the names you would suggest. Our American I'riends have no objection ; on the contrary, they arc anxious to meet the reasonable views of yoursell or the Government on that jioint. You will oblige, therefore, by naming such persons as you think proper to have associated in the matter, either from personal or jiolitical considerations. Those who have already done anything in the way of a formation of a company, or ..ith that object in view, we would be specially glad to deal with. We have authority, to a certain R CANADIAN PACIFIC KAILWAY. 101 t it is quite correct! laving any interest i: idges of any kind o: ken a copy, given yoi md these I handed t 3r in consideration o: ved a specific sum o: terms. I received ik II they ended ? perhaps the beginniii; middle of August. ns which took placi 3r before the attemii; t a strenuous attenip; B was good ground t: ong after, perhaps a; renewed to effect ai it that you are awari the Government Act is based on a policy 3er after the attemjit The arrangement oi about the latter omi ■ a Company of tliat itness who desires to page of his deijosi- of any suggestion to L' Government iicvvr t was impossible ti vords following :— to, July i;, 1871. tion of some of our d thought it pnipcr :r, and especially to o objection ; on the or the Government s you think jiropcr siderations. Those ipany, or ,, ith that hority, to a certain extent, to distribute some shares in the concern, which if they would not be of any jjrofit, Canjlda. would'iiot be any loss to the holdei-s, and no money is required. If you could make it convenient to write by return mail, it would be convenient that we might consult with one of the American gentlemen now here. Yours truly, Sir Francis Hincks, Ottawa, Ont. (Signed) JAMES BEATY, juu. Lkttj:i{ makked "C." [Co!ifide7itia/.) pkarSir, Ottawa, -iOth July, 1871. ;,. I have been almost constantly confined to the house since I received your letter of the seventeenth, and having at once sent you a telegram, that would enable you to 888«i'e your friends that no such arrangement ;is you suggested woidd be jiracticable, I pqt ofi' writing until I could do so more satisfactorily. It strikes me that you i'ail to appreciate tlie suggestion relative to Canadians being induced to interest themselves in the projected railway to the Pacific. I am inclined to believe that some Americans oi' capital and iiirtuence might be induced to take hold of the scheme, init in my judgment they will find it expedient, if not al)solutely necessary, to associate themselves with Canadians of equal j)osition and means, i)y whose instrumentality this very gigantic scheme can l)e brought i'avoural)ly bcibre Britisii capitalists. Any scheme requiring large aid I'rom Government will be viewed with great jealousy by the public. It is not the business of the (Jovernment to name parties nor to suggest to anyone tliat they would like jjarticular persons brought into a scheme. Tlie Government have to consider ])ropositions Itrought before it on their merits, and v.ill be expected, I think, to see that tlie Canadian promoters of any scheme are not only ablo, l)ut willing to put money into it — a most indispensable condition, whieh you seem not to attacli any importance to. 1 fear that you are going altogether too fast when you refer to an authority to distribute shares in a Company whicli has not even been formed, and the projectors of wiiieh are not yet in a position to take the most initiatory step. I inferred JVoin what I heard from the American gentlemen who lately visited Ottawa, that they bad come under a complete misaj)prelieiisic)ii of facts, and that they believed that Mr. Waddington and Mr. Keistcman had bad some previous understanding witli the Government. You may rely on it that one of the niain difficulties in the jn'csent scheme is, that Canada is, as it were, represented by Mr. Kersteman chiefly, who is looked on by those with whom 1 have conversed, as a " man of straw." It is clear that men of this type would only be taken hold of by capitalists on the ground of their having infiueiice of some khui, for wliich they must be paid, and if paid, the payment must come from the public chest eventually. The American gentlemen who have means expect, and have a right to expect, a good contract, but it is clear that if they have to subsidize Canadians, their demands will be higher. J^ great mistake lias, I fear, been already made, and your letter induces me to think that you conteinj)late proceeding further in n wrong direction. The first stej) will be for the Government to determine what aid they will give in land and money, and things would have gone much smoother if that had been decided before any ap])eal had been made to capitalists on the other side. ^Vilcn terms have been agreed to, then the names to be inserted in a Charter will become a matter of considi-ration and negotiation. Tiiis is the V,iew which I take, but you will understand that 1 am merely giving you my own ideas and without consultation. I know, however, that there is great anxiety tliat this work Aould get into fi.st-rate hands. i Yours faithfully, (Signed) F. IIINCKS. Liri'TKU MAUKKI) " D." ( Cvnftdential.) l>KAi! Sir, Toronto, 'Jlfh July, 1871. 1 am much ol)liged to you for your last letter and tlie ol)servations you make therein. I had a keen appreciation of the ])roprieties and necessities of the case when I Understood the matter. You must notice, however, that I never saw Mr. Waddington Vntil I met him on my way to Ottawa; and I believe I had only spoken to Mr. Kersteman ^boiit two or three times l)efore that Wednesday when I started for Ottawa ui)on a notice lecei', d two hours before in tlie Court House that I was I'Xiiected to go. I learned pretty nearly all 1 knew on my way down. I had jii^,t one conversation tliat amounted to anything before T left, .vitli'Mr.K. I then perceived that the whole matter was disoru:anized and required complete O 102 CORRESPONDENCE RELATIVE TO THE Canada, reconstruction as far as Canada was concerned, but I could not then back out. I was u| to that point only introduced as a lawyer, and of course had to attend to my clients behests. 1 could not do even wliat I thought prudent at Ottawa. The very suggestioni made; pressed themselves upon my attention from the very beginning ; but how to arrangt fheni and how to meet obstacles ol' the present ])osition I could not then determine When I returned home witli the knowledge 1 liad made, I made up my mind both from the standpoint oI' public polii:y and tlie legal standpoint, tliat no Senator or Member c Parliament could be in the Comjtany, much less be on the Board as a Director. Thi settled one question directly, at the same time it opened up new difficulties. The ficli; is very limited lor selection when you exclude the Senators and Members of Parliament and where to appeal was another grave question. Of course we do not now serious], contemplate to have on the Board either Mr. VV. or Mr. K., although they have boll done a kind of service that must be acknowledged. My own view was, and f think iti or will be your view, that names must be lu-i'sented to the Canadian and general publii that will at the least have the appearance of not only being willing but able to commaw the money or cajiital necessary to built the road, and which will meet with the approvi of Parliament. These names aie few and far between in Canada. Taking the cue [ received, 1 at once upon my return entered into negotiation witi Mr. LaidlaM', who 1 now am fully aware has been to some extent in communication witi gentlemen in Montreal, such as Allan, Steplicn, and King, to the same end that wt; Iiavi in view, altliougli nothing substantial has been done. TIu^ probaljilities are, I will u with him to Montreal liefore the end cf a w I'ck or two on this subject. VVliat it niai result in I cannot tell. It must not be imagined, liowever, that the present organizatio: although immatured and incomplete, is to Ix; despised. I assure you that it is not either ii this country or the United States. We do not mean to make any fuss al^out subsidizii); Canadians. Canadians will be cpiite willing to come into any undertaking that thi think .vill pay, and we do not intc\ul, whatever ma)' be the end, to go into anything el"' We liave room for others, and mean to get them, and there are shares still open, and w do not expect men to associate in an important v'nterprise ol'this sort without substantiii inducements. They Mill not do it for amusement, that I have learned in my short lili As to such men as W'addington and Kersteman, being representative men, it is not thougl;; of. They will, however, jjut themselves forward, and no one that I know of can prevt'ir them; but all that will, if it is not already, be satisfactorily arranged. There arc few men to be thought of in this connection in Ontario, (izowski, Luidlaw, Manniii: McOivern, and Adam ]5rown, of Hamilton, Wilson, of Picton, are presentable. The in Quebec, Hugh Allan, Geo. Stei)hen, King, of Bank of Alontreal, and one or two mort that some one else could name would be all that on first sight can lay claim to an; notoriety or availal)ility in this direction. Many business men might be suggested boti here and there if time permitted, but these are prominent, yet after all they are very fen and of others jiow many would be ^villing to take stock with the Grand Trunk belort their eyes. Even some of these names are not the most popular in railroiid connection As the matter now stands, I am t]u> representative of the American gentlemen who arc interesting themselves in the road. And except ibr the waywardness of Mr. W^addingtni \vould be Ibe only medium of communication for the Canada gentlemen. I myself am of the opinion thnt there is plenty of time before the surveys are com])lete or bel'ori Parliament sits to consider all these questions ; still such a C'oni])any as will be necessai) 'or this purpose to aceonii)lish a work so extensive and inqiortant cannot lie arranged i: a month even ; so time had iietter be taken by the I'orelock. There is no doubt vi'i; crude notions have been entertained about this matter, but I think they are now prctt; well dismissed. I am satisfied, however, unless the Government grants are very substantial ivw will be inclined to engage in an enterprise of such magnitude. I remain, yours very truly. Sir Francis J lincks, Otta^ra, Ont. (Signed) .f AAUJS BllATY, jiiu, Lkptki! :\r.\i!Ki:n "10." {^CoiififlentiaJ ,) My ueak Sm, Ottawa, 'i6th Julj-, 18/1. I have received your letter of the '2 1th insi . I note that you had yourself arrivnl at the conclusion, before coming to Ottawa, that " tlie whole nuittcr was disorgaiiiziii "and required complete reconstruction." You mention your intention of proceeding with Mr. Laidlaw to .Alontreal to see certain parties. Mr. Laidlaw is represented to be i shrewd business man, and yet Irom your account he is about to see ])crsons regarding:' scheme the advantages of which neither he nor you can have the slightest idea of; ai least I certniuly am wholly ignorant :i1 Ibis moment what aid in land and money tiu' E CANADIAN PAOIPIf RAILWAY. 103 11 back out. I was m attend to my client; The very suggestion^ g ; but how to arranjt [ not then dctermiiit p my mind both froii Senator or Member c I as a Director. 1\, difficulties. Tlie ficlt i-mbers of Parliament do not now serious] liougli tliey have botl ' was, and I think it i ian and general publi( g but alilt' to commaiK leet with the approvii into negotiation \\\\'i n coniminiiciition wit- ;ame end that W(! Iiav^ abilities are, I will j; iubject. What it mm (> present organizatioi; u that it is not either ii I'uss al^out subsidiziii: mdertaking that the; I go into anything eU. arcs still open, and w )rt without substantia Lirned in my sliort liji ■ men, it is not thous,'!:; I know ol' can prevt'ir ■ranged. Tliere arc i, Luidhnv, Manniii: ■e presentable. The and one or two mori can lay claim to iiii; ht be suggested bot! all they are very I'eiv > Grand Trunk belon II railroad connection, m gentlemen wlio mi 5S ol' Mr. Waddingtm; lemen. I mysell' ;u!: V com])lete or belbri y as ^^•ill be necessan •annot be arranged ii lere is no doubt veiy v they are now pntl) ts are very substantial Ii:S BKATY, jiiii, 1, 'J6th July, 1871. liad yourself arrivnl tor was disorganizi'ii )n of proceeding witli represented to be a ;) i)ersons regarding:' slightest idea of; at land and moncv tin' Government will recommend to Parliament to grant. How anyone under such circum- Btances can look to men of business about being" concerned in a sclieme, I am at a loss to comprehend, and T am persuaded that owing to Mr. Kersteman's premature and most iniudicious proceedings, the greatest injury has been done to a great undertaking. ^ Ik'lieve me, truly yours, James Beatyjun. ,..,-, v f"""V ^^ M T'^ And farther deponent saith not. and this his deposition having been read by him, he d^lares it contains the truth, persists therein, and hatli signed, jrn and taken in part on the i'ourtli of Canada. s September, and taken in part on the fifth September, eighteen hundred and seventy-three, and acknowledged on the sixth instant. (Signed) (Signed) F. IIINCKS. CHARLES DEWEY DAY. Chairman. A. POLETTE, JAMES ROBERT GOWAN, Commissioners. IN THE MATTER OF THE COMMISSION 111 to the th(,' House oi' Canadian Province ok Ontario, ") Citi/ of Ottawa. J Appointing Cuaulks Dkwkv Day, A.vtotxe Polettk, and Ja.mes Rohert Gowan, Com- missioners to inquire into and report upon the several matter's stated in a certain Resolution moved by tin; Hon. Mr. Huntinoton Commons on the second day of April, a.o. 187'^, relating Pacific Railway. Present : The Commtssioxehs. On this fourth day of Sejitember, in \\\c year of our Lord one tliousand eight hniuh-ed and seventy-tlirec, personally came and appeared belbrc us, the above-named Com- missioners, ANDREW ALLAN, of the City of Montreal, who being duly sworn, deposeth and saith : I know Mr. McMullen by sight, but I have never siiokeii to bim. I have heard the charge read, and I have no knowledge of any such agreemenl as mentioned in it having Ibeen made by Sir Hugh Allan and Air. McMullen as representing certain American capitalists. 1 have no knowledge of the subject at all. I liave no knowledge that any (igreemeiit was ever made of the kind between Sir Iliigli Allan and (1. A\'. McMullen relating to the furnishing of funds necessary J'or the construction of the Pacific Railway, tSeorge W. McMullen acting for certain Ignited States caj)italists. Q. — Have you any knowledge nlating to this matter of the Pacific Raihvay and the Miarges that liavc been read to you ? ' A. — I have no knowledge of any kind relating to tlie matter. Q. — Have you any knowledge that any money was advanced by Sir Hugh Allan to promote tlie elections ? ., A. — I liave not. I know nothing personally of f lie matter at all. The only thing I know is from wiiat Ihave learned from reading the newspa]iers. ■ I am a brother of Sir Hugh Allan, and liis partner in business. , Q.. — By Sir John A. Macdonald through the Chairman — ' Have you lieen in the habit of discussing these matters with your brother? • A. — 1 was not. Wo never spoke about it at all until these matters were published in 0le newspajjcrs. And further deponent saith not, and this his deposition having been read by him, he declares that it contains the truth, persists tlicrein, and hath signed. Sworn and taken on the fourth -J.ay of September,~i and acknowledged on the eleventii of Septem- > (Signed) ANDREW ALLAN. ber, eighteen hnnilred and sevent\ -three ) (Signed) CIIAKLFS DEWEY DAY, Chairman. A. rOLETTi:, , . JAMES ROBERT GOWAN, Cominissioners, (■"an.'.iia. ■IB 4 lOi ('()1{H^:^;P()NI)^]N(U<: HKLATINK 'IT) THK Proa'ixck ok Ontaiho,") Cit)/ of Ottawa. J IN THE MATTER OF THE COMMISSION Apiwintinp; Ciiaulks Dkwioy Day, Axtoink Pom-ttk, and Ja:mi:s lionKirr (ioAv.w Commissioners to inqniro into and rcjjort \\\m\\ tlic several matters stated in a certain Resolution moved by the lion. Mr. JIiNTi.N(iroN in the House a: Commons on the second day ol' Ai)ril, a.d. 1873, relating to the Canadiaii Paeifie Railway. Present: The Comaiispioxki:?. On tliis fourth day of Se])teml)er, in the year ol" our Lord one thousand eight hundM and seventy-three, jiersonally came and apjjcared before us, tlie aliovc-named Commi- sioners, E. L. dp: BELLEFEUILLP; of tlie City of Montreal, Advocate, who being duly sworn deposeth and saith : I have heard the charge read. Q. — Have you any Ivuowledge of an agreement between Sir Hugh Allan and Air Mc.MuUen, acting I'or certain American capitalists, witli a view to I'urnishing funds In tlie Americans, i'or the l)uilding of the Pacific Railway? A.- — I have none. Not the least. Q. — Have you any Icnowledge of any negotiations whatever between Sir Hugh Allai; and Mr. McMuUen ? .1. — I know nothing personally, except what appeared in the pul)lic newspapers. I knew nothing of it before it ai)peared in the puljlic prints. Q. — Did you take a part in the late elections ol' last summer 'i A, — I did in some counties, but not in Montreal East. Q. — Are you aware that any sums of money were su])plied from any source whatever for the purpose of carrying on the elections in Lower Canada? .1. — 1 know that Sir Hugh Allan did advance some money I'or the elections, but doii'i know what amount. Tliat advance was made some time in August I think. (I. — To whom was the money paid '( The witness oljjects to W\\< question, inasmuch as he does not see any relation between the question and the accusal ion which the Commission is instructed to inquire into. Objection over- ruled. A, — I know of only one sum ol' money which was paid, and only one person ^vli received money, namely — Louis Beaubien. of llochelaga. It was paid to him lor tli' purposes of his election. (^.— Do J ou kno\v of any money that was paid for the promotion of Sir Gcor, Cartier's ehiction '? A. — I do not know it personally, but I was not a member of the Committee of Si, George Cartier. Q. — Do you know what amount was advanced to Mr. Louis Beaubien for liis election A. — He got a cheque for seven thousand dollars from Sir Hugh Allan. I have n( personal knowledge of any further sums being advanced by Sir Hugh Allan. This siiii; advanced to Louis Beaubien was made in September, I think, and I can now remember that he was paid this amount after he was elected. I am positive of that now. Q. — Why was it given to him then ? A. — To i)ay the expenses made in his election, and I now well remember Mr. Beaubien gave his note for it. I think he had to refund it. I don't know what delay he would have given him to jiay it. I could not say i'rom what source this money was derived, I only saw the cheque of Sir Hugh Allan. I don't know where the money came from. Q. — Have you any knowledge whether this money was advanced at the request of any member of tlfe Govermnent 't A. — No ; I think that 1 was the first person and only one to ask Sir Hugh Allan to assist Mr. Beaubien. Q. — Have you any documents in your possession which would throw light on tlie subject of the inquiry before the Commission 'i A. — I don't see that I have. I was acting as Secretary of the Canada Pacific Railway. and the documents I have are docunients regularly filed. A good deal of correspondence took place between the Canada Pacific Company and the Interoceanic Company in 1872, which is in my possession as guardian. They niay have some bearing on the accusation in relation to its first part as regards its connection CANADUN ]»A(!JFr(' IIAILWAV. 105 ;OMMISSION Mi:.'^ HoitKIl'l' (»OWA\, il iriiitters stated in j ns ill the House ol ing to tlic Canadian ousand eiglit hundred Ijovc-iiamed Comnii- ho lieing duly sw nrii llugli Allan and Mr ) i'urnisliing I'unds hi iVecn Sir Hugh Alia blic newspapers. any source whatev(i le elections, but doii': , I think. any relation between to inquire into. )nly one person wK paid to him lor th' otion of Sir (Teor, he Committee of Si. lien for liis election 1 Allan. I have iii' ;h Allan. This sum I can now remember ' that now. ember Mr. Beaubicii vhat delay he would y saw the cheque of \t the request of any L Sir Hugh Allan U throw light on tlu" ada Pacific Hail way. 'acific Company ami lardiati. They may gards its connection trfth the Americans. Hut so far as the Pacific Hallway Company is concerned, I deny most positively any such coiniection. I have not got the said correspondence with me, but all the documents contained in it must be in the hands of the Government and have been laid before Parliament. To Mr. Abbott, through the Chairman. ' I was Secretary of the Canada Pacific, of which Comjjany Sir Hugh Allan Avas Presi- dent^ and under the instruction of the President and the Board, I published an advertise- ment in the newspapers in all the principal towns in the Dominion stating that stock hotks had been opened and anybody who wished to subscribe could go to such places ao^ do so. The jjublic were invited to subscril)e for whatever amounts they would (iiiire to take in the stock of the Canada Pacific Company. That was during the summer orl872. I was named Secretary in June. I attended to that business in July, 1872. These books \vere opened in the towns of the difl'erent Provinces of the Dominion. The advertisement was published and the books were sent liy me, and they remained there for I think thirty days to enable any person desirous of subscribing in them to do so within the delay mentioned. The books were returned to me with a certificate of the agents, stating if shares had been subscribed and to what amount. The whole stock was thrown open to the public. There was no reservation of the stock. Sir Hugh Allan is President of the Montreal Northern Colonization Kailway Company, and Mr. Louis Beaubicn is its Vice-President; and I know that for two and a-half or three years they were very intimately connected in order to ensure the success oi" that railway ; and it may be, so far as I know, in consequence or in consideration oi' the friendship existing and such relations between them — Mr. Beaubien and Sir Hugh— that Sir Hugh made this loan of money to help ^Ir. Beaubien in his election of IHJ-J. \\'heii I asked the money from Sir Hugh Allan, I did not in the least mention any interests of Sir Hugh Allan or Mr. Beaubien in the Pacific Railway. I only considered Sir Hugh as a friend of ^Ir. Beaubien, and I thought that, like some others of his friends. Sir Hugh Allan would help Mr. Beaubien in the election he had made, and which was then comi)leted. I have no papers on this matter except those which came into my hands as St;cretary, except a few letters that can have no bearing on this subject at all. I have had no correspondence whatever with the Americans. And further deponent saith not, and this his deposition having been read to him, he declarers that it contains the truth, persists therein, and hath signed. Sworn and taken liefore me on the fourth of September, and acknowledged on the ninth of September, one thousand eight hundred and seventy-three. CvN.inA, (Signed) E. LEF. DE BELLEFEUILrj], (Signed) CHARLES DEWEY DAY, Chairman. A POLETTE JAMES ROBERT GOWAN. Commissioners. IN THE MATTER OF THE COMMISSION ^oviNTE OF Ontario, ") ^ , ^% ¥ Ottawa. } 4|pointing Charles Dkwky Day, Antoine Poijoite, and James Rokert Gowax, Com- ;■ mis; loners to inquire into and report upon the several matters stated in a certain ^ ' Resolution moved by the Hon. Mr. Hixtinotox in the House of Commons on the second day of April, A.n. 1873, relating to the Canadian Pacific Railway. Present : The CoMJtifcsiovERa. On this fifth day of September, in the year of our Lord one thousand ei<>-ht hundred and seventy-three, personally -ime and ajijieared before us, the above-named Commi.ssioners, VICTOR HUDON, Esquire, of the Citv of IMontreal, Merchant, who being duly sworn deposeth and saith : " o j , I know Sir Hugh Allan. I do not know Mr. MeMullcn. a w VrA/n**"'"^^ knowledge of any arrangement between Sir Hugh Allan and U^ >v. McMuUen, having for object the construction of the Canadian Pacific 106 rOTfT^EPPONDENCE RETiATTVE TO THE Canada. I took some interest in the elertions in Montreal in 1 8"2. I was one of the mclnl((>^ of Sir (ijor,u,e Carlier's Committi'e I'or ^Monti'oal Kast. I am aware that t.liere were sums oi' money snbscribed to earry on tliat election Ordinarily in elections we have a Committee and I'riends who sul)ser:be. I do not kiimi the names of the persons wlut snbscribed at tliis election. I heard that Sir Hugh Alk was to sul)seribe. 1 do not know how much he did sui)scribe. I know some of t[,. members of the Committee ; I think all of them snl)scriijed something. A short tim* hel'ore the election I learned that Sir Hugh Allan had subserilied. Sir Hugh Allan was not a member of tlie Committee. I do not know the amouii' subscribed by Sir Ilugli Allan, nor l)y any other members of the ('ommittce. I liavo no knowledge of anyone having subscribed $2(i,()()() during the elections. I liave not in my jiossession any letter or document bearing uixni this inquiry. r have knowledge of tlie subject of this inquiry only by v*liat 1 have seen in the news. pajKM's, I have no personal knoAvledge on the sul)ject. I have stated all [ know in relb encc to the sums of money sui)scribed for the elections. And further the deponent saith not, and this his deposition having been read to liim, lie declares it contains the truth, persists therein, and hath siji;ned. Sworn, taken and acknowledged on tht fifth of September, 187.'!. (Signed) n V. IIUDON. (Signed) CHARLES DEWEY DAY, Chairman. A POIjI']TTE JAMES ROBERT (JO WAN, Commissioners. "} IN THE MATTER OF THE COMMISSION Province ov Oxtario, City of Ottaira. Appointing Ciiarler DiiAVEv Day, Antoink Polkttk, and .Tames Roukut Goavax, Cora missioncrs to inquire into and report upon the several matters stated in a eertaii Resolution moved l)y the Hoy. Mr. Hi'.vtimiton- in the House of Commons ni the second day of ^Vpril, A.n. IH/li, relating to tlie Caiuidian Pacific Railway. Present: Tin: Coifmissioxers. On this sixth day of Sej)tember, in the year of our Lord one thousand eiglr hundred and seventy-three, personally came and ajipcared before us, the above-namti Coniniissioners, LOUIS BEAUBIEN, of the City of Montreal, a Member of the Honourable The llou-r of (Jommous of Canada, who being duly sworn, deposeth and saitli : I inn a member ol' the House of Commons. I am Vice-President of the Montreal Northern Colonization Railway. I hold no situation or directorship in the Canadiai: Pacific Railway. [ have heard read the charges which the Commission has hm. appointed to inquire into. I know Sir Hugh Allan, and have met Mr. McMulIen. Q. —Are you aware of any agreement or negotiation beii g made between Sir Hugk Allan and ]\Ir. jNIcMullen relating to the matter expr(:ssea in these charges ? A. — I am not aware of any. Q. — Do you know of any agreement made by Sir Hugh Allan with Mr. MeMulleii acting jbr United States capitalists to furnish funds necessary for the construction of tlif Pacific Railway ? A. — No, I have no knowledge of any such transaction. I was one of the Provisional Dii'eetors of the Canada Pacific Company, but I only joined whtni these things ap supposed to have taken place, and have no knowledge of them whatever. Q. — Was your connection with the Canada Pacific Railway Company subsequent to the period referred to and before the legislation of last Session ? A. — My name was included among the Provisional Directors when that Company was incorporated, that was the first time I Avas connected with it. The period I refer to was the Ses..ion before the last. I was not a member of tlif Dominion Parliament then. (>. — Arc! you aware of par*^ies who were expected to take up the stock of the Cniuuia Pacific Com:/any ? A. — No, 1 was not aware. Q. — Do you know whether any American capitalists were expected to furnish monVv for the purposes of the railway ? K CANADIAN PACIFIC RAILWAY. 107 s Olio of tlip mcmlwr rry on tliat i'lection 'v'-.bv. r do not kno« that 8ir Hugh Alk I know somo ol' tlj. 'thing. A short tinif ot know the amouir ammittce. ring tlie eltrtions. I I inr[uiiy. lavo sctMi in the now;. (I all [ know in refer^ ing been read to him, . nUDON. VEY DAY, Cliairman. :t gowan. Commissioners. OMMISSION lOlIKRl' GOWAN, Com M's stated in a ccrtaii [ouse of Commons oi Pacific Railway. one tliousand ciglr us, the above-namei inourable 'J'he IIouh saith : nt of the INIontm! lip in the Caiiadiai: Jinniission has hwr. between Sir Hiigti •liai'ges ? with Mr. McMulleii construction oi" tlif e ol' the Provisional t;n these things a^ ever. iipany subsequent to that Company was t a member of tlif ;tock of the Cniiada I to furnish moiicv A. — No, I do not. ,. Q. -Have you ever, or had you at that time seen any list made out by teir Hugh Allan as to the distribution of stock ? 4.— No, I had not. „ , .• . Q Do I understand you to say positively that you know nothing at all nMatiug to this matter oxjiressed in the first clause of the charge which you have just heard read to jou ? 3l._Nothing at all. . ■jQ I see your name signed to a .Memorandum ol' the Canada 1 acinc Kailway O^pany, upon a statement sulmiitted by the Interoceaiiic Kailway Company to the QOvcrnment of Canada, along with the names of Sir Hugh AUcin and J. J. C. Al)bott. '^lerc vou a party to a Memorandum ol' il> it kind';' '4li/l.— I ivas. It is signed " Hugh Allan," " .1. J. ('. Abbott," " l.ouis Beaubien." Q. — Had you any knowledge of any negotiations concerning the amalgamation of these fifo Companies'!' ' J. —AH 1 know is what is contained in the Blue Book, entitled, ''Charter for the "construction of the Pacific Kailway, with papers and corrcsiiondence." That is all the proposal that I ever heard was made. -1" Q. — Did you take any personal part in any of the negotiations':' A.- I signed all these documents after being named by tiic Company on its Committee, which was termed the Executive Committee. Q. -Do I understand you to say that you signed tliis (iocunieiit,_ and took an active part in the negotiations which took jdace between the Canada Pacific Company and the Interoceaiiic Company '.' A. — I took all the jiart referred to by these documents. Q. — Had you any interviews on the suVgect of the amalgamation? A. — No; I had none that I remember of. ' Q-— Have you any knowledge of tiie agreement or understanding described in the charge between the persons connected with the railway and tlie Government ? A. — None. ' Q. — Have you any knowledge ol' any money having b^ou advanced in any persons Connected with the railway in (Quebec, for the promotion of the eiectious ? A.- A have reason to believe that Sir Hugh Allan advanced a certain amount of money to be used in the elections. Q. — What amount':' A. — I cannot say. Q. — Was it a large sum '! „ A. — 1 have no means whatever of judging. Q. — Do yon know of any specific case in which money was advanced by Sir Hugh aS.llan, for the purpose of aiding tlu; election of Ministers and their supporters at the Aen ensuing elections ':' , A. — Not Ministers. I may mention this fact, a friend of mine and a supiiorter of the Crovernment, some time before the elections wanted rnc to get up subscriptions for his election, to a small amount. I went to ."^ir Hugh Allan, and lie conseatcd to help that gentleman. The (government never knew of it, and the Government don't know (jf it now at this present moment. As this was a private matter between Sir Hugh Allan and ifcat gentleman — for I state under oath that the (Jovernmeiit know nothing about it — I Would not like to give the name of the geu'deman. The amount he received was one thousand dollars. The gentleman who advanced the money was Sir Hugh Allan. ' In my own case, Sir Hugh Allan was called upon by one of my friends about three ll^eeks after my election. My election took place on the oOth of August, and the money i'am going to mention was obtained aliout the middle of September. My friends called poll Sir Hugh Allan, and told him that my expenses had been a little heavy, and asked Sm to advance money to hidp me in paying back the expenses of the election, which Were borne by myself. He consented to do so, 1 received the money and gave him a Mceipt for it. In that receipt it is not stated that the Government would reinil)urse Sir Hugh lor the amount of it. I could not find a copy of that receipt, but I saw it a anoiitli ago when it was mentioned in McMuUen's letter. This morning I was taking it down as Mell as I could remember in my memorandum hook. If there is any change in flie wording of the receipt, 1 can swear it is not a material change. The receijit is as follows : — ; " Kcceivcd fnmi Sir Hugh Allan the sum of seven thousand doUar.s, which I agree to repay him within one \ear, if he be not sooner reimbursed, along with other sums advanced by him in aid of the elections." Cahaoa. '^^s 108 CORRESPONDENCE RELATIVE TO THE 0ak4t)a. This n()t(! is duo now. The amount ol' tho note was obtained at the solicitation of u; friend. The Government never knew of this arranp;emcnt at all. I will correct this answer in so far as I have reason to believe that Sir Ihigli Allj sul)scribcd money to the Central t^ommittee Fund of Montreal, and I was informed th; Sir Hugh Allan stipulated that, if necessary, 1 would be helped out of the fund, understood, also, that Sir George Etieiuio Cartier was opjjosed to any of the funds lieic, u.sed for that purpose; hut I heliive that gentlemen on the Committee, notwithstaiidi;,. this, gave without Sir George's knowledge some money to my friends. 1 will state, al-. that I know that Sir Hugh Allan ludped two candidates who were believed to i. friendly to the Administration. As the (Government did not know that they wtr assisted, and as neither of them are members of the House, and it being a private niiitit between them and Sir Hugh, I did not think it necessary to mention it on Saturdnyi my deposition. I don't think it fair to these two gentlemen to bring their names bclii; the pul)lic. I don't know of any ot'lier sum advanced by Sir Hugh Allan, or by any other pei* on his behalf. I could not say how mucli was subscribed for the Montreal elections; l^ 1 think there was a list passed round, and subscriptions asked from dill'erent gentlemun I don't know anything i'urther that took i>lace. Sir George E. Carticr's Commifo was rather against me. I was not on the; Committee; but my ojjponent, Mr. Hudon.u; President of it, which was suiruient to keep me off. (2. — Did you aj)ply to Sir Hugh Allan yourself to aid you in the payment of yu; election expenses ? .1. — I suppose 1 must have said a word for myself at that time. (2.— Did you expect before, or at the time of your election, that this money was to!, forthcoming Irom Sir Hugh Allan '.'' A. — No, I expected to Ik; elected by acclamation and, if it had not been for fi' George Cartier, I would have been elected by acclamation. Q.—Why did you apply to Sir Hugh Allan for this money instead of some ollu; wealthy gentlemen ? .4.— Sir Hugh Allan was the person more likely than anybody else. Q. — Had you been in particular relations or in business relation with Sir Hugh AUaii A. — I was considered as one of tlie most active parties in the railway, and have been; Director in it from the very beginning, and was one of those who assisted to induce !lag3 vernment candidiitf 3 was opposed to in. all, it was due tott orge Cartier advisi. m1 for Mr. Hudoii. to pay the expensi .u'ument, but simpl; ;. L. De Bellefeuili expected to get tlia: u were going to asi llan likely told him ippeared and made namely : I wish to o diilbrent friend?. ot President of Jir tion. t to him in the city K I never saw tin (UNADIAN PACIFIC PAILWAY. 109 original of the receipt since I gave it. It was not the receipt tlial was signed that I kejit, it was the /iroject or draft whicjj was not signed, as there were some corrections to be made in the draft. I made a co])y of it, and signed this co])y and delivered it to Sir Hugh Allan. I have never seen the receijjt I signed since I delivered it to Sir Hugh. I aaw the draft tliat I kept the next day alter iNIr. McMullen's letter a|)peare(l in tlie papers. I think I can fnid it. The receijjt was not written in Sir Hugh Allan's ollice. It was written in Mr. Abl)ott"s ollice. It was written on ordinasy ioolscap paper. For all I can say, that document is in the possession of Sir Hugh Allan at present. I consider that receipt to be a note. I think I can produce the drafts. rjQ, — You say that in this receipt which you have given from memory, "that unless the **noney was otherwise reimbureed," what do you mean by these; terms'/ from whom was it topected to be reimbursed ? t^.' — I have no means at all of knowing where he expected to be refunded, ,i(k2. — In making use of this expression from what source did you think this reimbursc- wkiit to come ? A. — I had no idea at all, and my opinion is that Sir Hugh Allan himself did not know irilere it would come from. Many a time he said that he did not know that he would be otlierwisc reimbursed. Sir Ilugli told me that all the money he was giving in sui»port of the elections he thought would be a dead loss to him. I suppose he exi)ected to be reimbursed from the profits of the enterprise. Q. — What meaning did you attach to the word "reimbursed" in that respect? A. — I expected that the friends of the Government would subscribe and would help me. Q. — Was there any funds provided ? A. — There was a general election fund that had been established. I had not in my mind then any supposed arrangement between the Government and Sir Hugh Allan. I never knew of any arrangement whatever, and Sir Hugh Allan never told me that there Mas. The Commission desires the witness to preserve the draft of the receipt referred to if he can find it, and enjoins him also in that event to forward it to the Commission. I wish to strike out the following words from my foregoing deposition : " Many a time ** he said that he did not know that he would bo otherwise reimbursed." — Sir Hugh told me several times that all the money he was giving in support ol' the elections he thought would be a dead loss to him. And further deponent saith not, and this deposition having been read by him, he declares that it contains the truth, persists therein, and hath signed. Sworn and taken in part on the sixth of September, IM?,'!, and remainder taken and the whole acknowledged before us this eighlli day of (Signed) LOUIS BEAUBIEN. September of said year (Signed) CHARLES DEWEY DAY, Chairman. A. POLETTE JAMES ROBERT GOWAN, Commissioners. "' I IN THE MATTER OF THE COMMISSION iiPROVIXCE OF OnTATITO, I C//// of Ottaica. Appointing Chaklks Drwkv Dav, Axtoine Polettk, and James Robert Gowax, Com- missioners to inquire into and rejjort upon the several matters stated in a certain Resolution moved by the Hon. Mr. HivrixoTox in the House of Commons on the second day of April, a.o. 1873, relating to the Canadian Pacific Railway. ||resent: The Coj[mippioneus. g On this sixth day of September, in the year of our Lord one thousand eight hnnd ed >mxA seventy-three, personally came and appeared before us, the al)ove-named Com- missioners, lORMAN WILLIAM BETHUNE of the City of Ottawa, Telegraph Manager, who benig duly sworn, deposeth and saith : 4 I resixle in Ottawa. I am a manager of the Montreal Telegraph Compan\ . p C2.— Have you in your possession the original of the telegram dated at Toronto August 20th, 1872 addressed to the Honourable J. J. C. Abbott, Ste. Annes, and signed yohn A. Macdonald ? Canada. no rOR|{R^PONDKN('K HKLATIVE TO THK i Caii^i. _|._i i,n,x' not. es. And further, for the present, deponent saith not ; And on this eighth day of September, reappeared the said witness and continued hi< deposition as iollows : - <2. — Have you examined the books of the Telegraph Company in your office? .1. — I have found it imi)os:;ible to examine them in the period allotted to me. I finj further by the books that Sir .lohn A. Macdonald was absent from Otttiwa for a largo portion of the time named \vithin which the telegrams referred to are said to hav I have examined the books from first .hdy up to si.xth July and for the whole monti; of September. Q. — Have the books been examined for the month of August ? A. — ^They have been examined hy my clerks, and I find that Sir iTohn A. Macdonali was not in Ottawa during the month of August, and therefore no telegrams could havt been left in the Ottawa office as being sent or received by him during that time. (2. — Have you any original telegrams in your office received during August or July, 18/2, between Sir John A. Macdonald and Mr. Abbott? A. — No; I have no such originals in my possession. And iurther (lei)onent saith not, and this his dej)osition being read to him, he dcclam it contains the truth, persists therein, and hath signed. Sworn and taken in part on the sixth day of \ September, IS73, and remainder taken on the eighth day of Sejjtember, and the whole acknowledged on the ninth ol' September of said year. (Signed) (Signed) N. ^V. BETHUNE. CHARLES DEWEY DAY, Chairman. A. POLETTE, JAMES ROBERT GOWAN, Commissioners. 'W CANADIAN I'ACIFIC RAILWAY. Ill ii'3;iist, 1872, (lircctt,; • of tlu'S(! jjartics, ,Si lUgust, and I In; iii(l„i \y,xny to be exiimiiie.; , Macdonald ami Si> ol' August, cot, and will rtHjuir 1 a month al'terwiud, may be able to stai. are not now in exist- II" one year and tin; six months and thn in existence, as it !• ds, in Montreal tlu; the originals ol' aw UigUHt, 1872, but Wf ugust and a moiitli only a ropy of the ss and continued hi: your office ? otted to me. I fiiiii Ottawa for a laij,'e o are said to Iiav^ 3r the whole montl; John A. Macdonali egrams could have that time. ing August or July, to him, lie declan'i \. BETHUNE. EY DAY, Chairman. ' GOWAN, Commissioners, pBoviNn; OK Ontaiuo,') Citi/ of Ottawa. J (ANAPA. IN THE MATTER OF THE COMMISSION ADPointin-' Cihhi.kh Dkwky Day, Antoim: roi.Krn;, anat wealr vas proposed to fix . e had no doubt l[ he i)roj)oscd to plac vhom six, incliidi!. diould be Amcricac: n I Ion. A. B. FostH I A. Smithj Doiial; '^illiam B. Ogdcn, o ; all Directors ol'tfc President and Vice remonstrated again;; tal Railway, wliici: d. I pointed out tt of their own in tlu ?s, for that they liati in constructing tk or ])art ol' the stocl icific Railway; anil to their interests in CANADIAN PACIFIC RAILWAY. 118 the Cnited States, tliat it would give tiuni control of the settlement of th(! large territory Cabada. to l)c granted to thi? Company in our North VV«.'st, and, that they might, and possibly Would, so niiinagc its settlement as to imperil the vi-ry peace oi' (lauada. Sir Hugh diieented frcmi all these opinions, and in expressing surprise; that I should eiitt'rtain such narrow views, said that be took a cosmopolitan view of tlu; ([uestion, that in stipulating Uttt a majority of the Directorv should be IJritish subjects, resident in Canada, he had refliciently gnardcd Canadian interests, lie added that he was unalde to state jjrecix'ly how the stock (|(>,()()0,()0n) would be apjiortioned ; tlwit that was then being determined lliNcw York ; that he exjiected to be fully advised on his return to Montreal, anil would <>(tiHnunicate the inl'ormation to me, I objected also to the (oniposition of the Canadian R)ard, as |)roi)osed by Sir Hugh Allan, and urged that it did not fairly or sulliciently rejircsent the various Proviiu'cs of the Dominion. I said that ]\Ir. .Mdnnes and myself would not be sunicient representation from Ontario, •hd that there was no representative from British Columbia, the Province of all others most il. ''rested in the railway. Sir Hugh said that he considered the Board as proposed a good oi.i . , :>d that if British Columbia were represented, the Maritime Provincea would also exjiect to be represented. . 1 rej)lied tliat I thought they ought to be rejiresented ; tliat the uiulertaking was a Dominion one in the broadest sense; that all the Provinces should have the opj)ortunity of taking an interest in the t'ompany, and of being re])resenti(l at the Board; that I was quite certain Parliament would not assent to, or the country tolerate any scheme which would place the Canadian Pacific liailway and its subsidies in the hands of foreignerji and rivals. Alter Sir Hugh's return to Montreal, 1 received the following letters : — My dkau Sik, ((^"P!/-) Montreal, 'i7th Fob., 1872. Tlu! papers which have come from New York indicate the amount of stock allotted to me as $l,4ot),l)00. This 1 propose to divide in somct.iing like the following shares : — ■ '■w Hon. D. L. Macpherson .... I lion. A. B. Foster I Hon. J. J. C. Abbott Donald A. Smith Donald Mclnnes Andrew Allan John Shedden - C. S. Gzowski (rcorge Brown - Henry Nathan C .1. Brydges T. McGreevy - II. Allan - • 100,000 - 100,000 - 100,000 - 100,000 ■ .50,000 - 100,000 - 50,000 - .')0,000 - r)t),ooo - 1(10,000 - 100,000 - oO,()00 - 500,000 $1,150,000 This may not be the ultimate arrangement, as I have not yet even proposed the matter to some of the gentlemen ; but, if I can arrange it, there will not be much change. /■Please advise me at once if you consent that your name shall ajipear as one of the Pro- '-Visional Directors, as I must send in the list to the Government without delay. I Yours truly, frhe Hon. D. L. Macpherson. (Signed) HUGH ALLAN. I The information iu .his letter is for yourself alone. f Montreal, 2nth Feb., 1872. I My deau Sir,— Since writing to you, I am informed that the Hon. George Brown .jitvill not be a shareholder at present, and I propose to name Mr. Howland in his place. 4tr TT Yours truly, |To Hon. D. L. Macpherson, Toronto. (Signed) HUGH ALLAN. 4t^ {Copy 2rd.) ^.Deau Sni HuGii, Montreal, 20th Feb., 1872. * I have to thank you for your letter of 27th inst., informing me that there /had been allotted to you in New York, shares in the Canada Pacific Railway, for • Canadians, to the amount of $1,450,000, and mentioning how you propose to divide the ^ same. Since you asked me to allow my name to appear in the Charter as one of the 114 CORRESPOXDENCR T^ELATfVE TO THE Cakaba. Provisional Directors, I have rarcrully considorod your schcmi-, and have become ror.. viiiced that Parhamciit will not assmt to it in it^ present shape, or to any scheme whicf. like it, would place our great Transcontinental Railway I'or ;'ver under the absolut, control ol' our rivals, our i\nierio;ni neighbours. This would he I'ftected by giving i them, as you do, seventcen-twenfieths oi" the whole stock oF the Conipan; . \Vhy sluml; this be done? Canada must give the means in money and land to build the railwav Why should we hand over the control and ownershii) of tlu" line, Mith all its inealculabi; advantages, direct and indirect, during construction and Tor ever, to foreigners ? Siul an arrangement is not indispensable to the building ol'th" road, and nothing short oi'tlih in my opinion wouhl jnstily it. Second only in importance to obtaining the railway, is the securing the control el' i; with all its benefits, to our own peo])le. We have in Canada men oi' auflicient abilitv to carry out this great undertakiir successrully, whose character and means would hi' a^iple guarantie to the (Joveriniu:' and the country I'or the I'nllilment ol" their iMigagciacnts. Money would have to !. obtained from aliroad : l)ut tlu- st'curities would be Canadian, and negotiations should 1« (iii'ected by Canadians. The assistance of iMiglish and fori'ign financial agents would be necessary, and lo; their services they would ha\t' to be paid : !)ut they should have no interests rival o: antagonistic to the Canada Pacific Kailway. 1 should be (piite willing that they an; fheir clients should have an interest in tlie road, but not a controlling one. The position o\' the Canadian Directors under your projiosed organi/ation of the (Join- pany would be uncomfortalile and anmnalous, at least so it ap]ieais to me. They woiil! sit at the Board in virtue of being Canadians, but merely as the nominees and the nii'i. agents — of foreign shareholders. The interests of these shareholders might confli v ivith tlio interests of Canada, iiossihl;. very soon. Then, if the Directors stood by tiieir country, 1 apitrehend they would 1, required to surn ader their seats at llie first ensuing idection lor more subservient men, Holding tlu's MJews, which I expressed to you when you first olfered me a Director- ship, and they have strengthened uitli reflect ion: and not seeing my way to occupy, seat at the l»oard with that feeling of independence so essential to usefulness as ,; Director of any undertaUing, especially one of the magnitude of the Canada Pacili Kailway, it is my duty to decline the olRce. I deem it right to give you my reasoii' Iherelbr frankly and fri-ely. Thanking you for inviting m\' co-operation, 1 remain, tkc, Sir Hugh Allan, Knight, iVe both understood till- Governnienl wished the two Companies to amalgamate, ami i; was also uus than Ontario was "ititled to, while icven to si.s. would make the disino- ]iortion still greater. Finally. 1 said that if amalganiation would l)e entertained In the Interoeeanic Company, and if all the other details were satisfactorily settled, i' was possible the Interoeeanic Company would not bri'ak oil' negotiations ujion the iioiiii as to whether the number of Direelors named by each Company respectively should In five and four, or seven and six. ly in our conversation that there would be feeling of unwillini.ness dii the Dart of the Interoeeanic Company to enter into amalgamation at all, many of lo 1 stated vi'ry early in donbtiin; whether the (d)jects ol' the two Cnupaiile:^ weir the same, ours being to nialu the '•■ 1.;-— - :...' .:......,..._■:... ...VM Alh No..,.. ^ ,...., ........,, their hands and under their control. Mr, Abbott assured me that this was not the case, he Company ultimatety organized esssentially l/anat'ian, while we feared Sir llii:;'> ,Mlan and his associates still clung to their (dd alii nice with gentlenuMi interested in flu' N'ortliern Pacific Raihvay on conditions that woulil j)laee the Canada Paeil'ie Railway in and liavo become rot. r to any scheme whicli, •er under the nbsolm, ' t'ftected by giving |- ompany. VV'hy sliouli to l)uihl llic niihvav rt'ith all its incalciilali , to i()n>igners ? Siicf, id nothing short ol'fhi. iring the control of j: :his great underfulcii!; ee to the Covernnur ley would liavi; \o !. negotiations should b, be m-ccssary, and Ik > no interests rival v. Milling that tiny an; iiig one. janization ol' the (.'nni s to nie. They woiil! ominees and the im-r ^ts ol' Canada, possihh •ehend they would i )re subservient men, IVered me a Director- : my way to occupv . ;i! to iisel'iilness as ., >r the Canada Pacili give you my reasoii- ation, 'iNIACPIIERSOX. ito, sth July, 187;!. n. .1. J. C. Abbotl.oi with him resiiectin: ^ompanies. amalgamate, and r lirteen meml)ers (tli' teroceanic Compain la Pacific (.'umpan}, her Provinces. .Mr. olilain an adccpiati' r (Quebec; that the} iuebec seven and six )!' live to lour w.h make the dispio- 1 lie entertained In si'actorily settled, i' ilions upon tiie poiiii spectively should In iof imwillinine.ss nii at all, many of lo Durs !)eing to make e feared Sir Ilii^'i len interested in the I Pacilic Kailwny in is was not the ca-c, <'ANADIAN PAl^IFrC RAILWAY U'y ^I replied that it was a point on Avhich it would be difficult to satisl'y tiie Interocoanic Company. Mr. Abbott then referred to the I'residency of an amalgamated Company, and inquired if I would agree to Sir Hugh Allan being apjwinted to that oflice. In nply I stated distinctly that I would not; that while I did not arrogate any claim myself to the Presidency, 1 shoi '1 not concede or waive any in favour of Sir Hugh Allan ; that, if amalgamation siicnild take jdace, the new Provisional Board should l)e left free tckclect their President, and that it Avas not for Sir Hugh Allan and myself to arrange in a^yaiice wln' should be President. |<^r. Abbott was not satisfied with this, and rei'erred to it again on tl:e Ibllowing day, jrl^fiarkiiig that unless the Presidency Mere promised to Sir Hugh, he was afraid no vjalgamation M'ould take place. Sin the course oi' tiie following Meek, Mhen at Montreal on private i)usiness, 1, in eom- .pgiance M'ith a written request from Sir Hugh Allan, called at his oilice. He at once Jiferred to the Pacific P.aihvay, and said he understood from Mr. Abbott that the only tints of amalgamation on Mhicli he (Mr. Abbott) and I diirered Mcri! the iiumlxn- of rectors 1o be named by each Company, and the question of the Presidency. ■ I rejjlicd that these Averc the only points we had discussed. That I said to Mr. Abbott, speaking for myself only, that if all the other details of amalgamation were settled satisfactorily, 1 thought the Intoroccanic Ccmipany might be induced to consider the lUTcssities of the other Company so far as to make the number ol' Directors to be named by each of us rcsjiectively seven and six. That Mith respect to the Presidency, 1 had told Mr. Abbott that if amalgamation took place, till' choice should b(> l(s ol' Iposc among Mhom this amount of stock was to be divided ? 'I yl.— His letter lo me lontainint;- the list has been published. 1 thought I bad his •rigiiial lettiT with me, but I find ! have it not. It is embodied in mv published letter If the 8t!i July, and is dated L'Tth February, IS7L>. f My reply to Sir Hugh Allan, dated liHth Februarv, 1872, and referring to Ids letter, iPie contentsof which I have just described, is embodied in Exhibit " E." * I am not iK(l for certain United States liapitalisls, but understood that he did. I^Sir Hugh Allan's letter to me indicates that Ihrec-tMiiitieths cd' the whole stock had Been assigned to C.niada, and the remaiiiiig seventeen-twenlieths were to be divided amoiii; capitalists in the United States. Tl is was in l''ebruarv. IH72, before there was any legislation whatever, but in anticipation oi" the ensiiins;' Session. I have no knowledjije except what is stal« d in Sir riugh Allan's letter, and know Canada, imfWWW 116 CORRESPONDENCE RELATIVE TO THE Canada, nothing about the cortaiii percentage of interest, that is stated in the charge I have roa which Sir Hugh Allan was to receive. Q. — Is it in conl'ormity with your knowledge tliat Sir Hugh Allan was to be at tl head of the projiosed Railway Company ? A. — Nothing was said at that time by Sir Ilugli Allan about his being at the heai] the Company, that point was not raised in Sir Hugh Allan's conversation with me tlui no personal iputters or details wen; then discussed, Q. — lliive you any knowledge whetlier tlie (lovernment were aware that these nea;. tiations were pending between Sir Hugh Allan and tin- Americans? A. — I had not an aljsolute personal knowledge ; but I understood that the Governmc, were aware of it, and Sir Hugh Allan himself stated to me that the Government wn aware of it. The knowledge which I had in respect to this matter was obtained from,'* Hugh Allan. Q. — In reference to the following portion of the charge, viz. " that subsequently i " understanding was come to between the Government, Sir Hugh Allan, and Mr. Abbot " one of the members of tlie Honourable House of Govercmeut of Canada, that Sir llu: " Allan and his friends should advance a large sum of m.oucy for tlie purpose of aidii. " the elections of Ministers and their supporters at the ensuing general elections, and tli. " he and his friends should receive the contract for th construction of tlie railway Have you any knowledge relating to that subject ? A. — I have no knowledge relating to that subject. Q. — Do you mean to say that you know of no understanding between the Ciovernmt; and Sir Hugh Allan and Mr. Abbott relating to Sir Hugh Allan's support in t! elections ? A. — No ; I have no knowledge of any arrangements between tlie Government and S Hugh Allan and Mr. Abbott that Sir Hugh was to furnish money lor the elections, have no personal knowledge that the giving of tlie contract to Sir Hugh Allan depeiidt on his furnishing money for the elections. Q. — There was an offer made to you of some of the stock in this contemplate Comjjany, was tliere not ? A. — In Sir Hugh Allan's letter of 27th February, 1872, my name is put down in t! list with others lor 8100,000; but I was no party to that. Nothing of tlie kind w, discussed between Sir Hugh Allan and myself; everytliing lie alleges connected witli tli. is utterly unibuiided. I stijjulated for notliing, and I was offered notbing. I at no tim negotiated in any way for the insertion of my name as a subscriber of any stock in tli: Company. I state tliis most positively. Q. — Did you give Sir Hugh Allan at any time to believe that you felt disposed in an: way to become a party to such an arrangement ? A. — No ; I took exception to his scheme when he first explained it to me, and, in rcj v to Sir Hugh Allan's letter of 27th February, 1872, advising the allotment of stock k New York of the Canada Pacific Company, I, by return mail, declined to have anytliiii; to do with his scheme. Q. — You .,ere, I believe, President of the Interoceanic Railway Company, mt- you not ? A. — I was. Q. — I see in the printed pamphlet, marked " Charter for the construction of the Paci!; " Railway," which was given to Parliament, your name subscribed to a report of a mcetin; of till! Provisional Directors of the Interoceanic Railway Company of Canada, date 26th Sejjtember, 1872. Was that an application to the Government for the contract lb: that Company ? A. — It was informing the Government that the Company was prepared to treat will the Government, and was organized. That was long after Sir Hugli Allan's ajiplication to me; at tlie time Sir Hugh Alias had negotiatioug with me, there was no Company in existence. Had it not been form) objections to Sir Hugh Allan's scheme, and my desire, in the interests of the country, U frustrate that scheme, I probably would not have appeared in connection with tlii Canadian Pacific Railway at all. It was only after I found that Sir Hugh Allan wmilii not abandon his American associates, 'that I proposed to certain gentlemen in Torontn. and elscnvhere, to ajjply for a Cliarter and to be prepared 1o do wliatever might si« best when th "me for action arrived. The gentlemen to whom I addressed iny^ili agreed in opinion with me, and we petitioned for an Act, incorporating the Interomiiiic Company. (J,. — VVas this Interoceanic Company formed with a view ol" defeating tlic originii scheme, with the American capitalists ? IE the charge I have roa Allan was to be at tl lis being at the IickIi ei'sation with mo tliti aware that these iie»;. (1 that the Governnie t the Government wcf • was obtained fromj. " that subsequently a. Allan, and Mr. Abljoi Canada, that Sir llu. tlie purpose of aidii.. loral elections, and tli. iction of tlie railwa} itween the Governmci Ulan's support in ti le Government and S' ;y for the elections. Hugh Allan dependi in this contemplatf tnc is put down in tl hing of tlie kind w, ;cs connected with tli. nothing. I at no tiiii r of any stock in tli: )u felt disposed in an; it to me, and, in r('|il allotment of stock i; ned to have anythiii; way Company, \m. CANADIAN PACIFIC RAILWAY. 117 'A.— Yes. Q, — Were there any negotiations between the Interoceanic Company and the Canada Pttcific Company with respect to amalgamation afterwards ? A. — There was some time afterwards. (2. — Why was that negotiation unsuccessful ? ^. — Because the Interoceanic Company did not believe that the Canada Pacific Company had abandoned their American connections. It is quite true that the Com- mittee of the Canada Pacific Company assured the Government that tlicy never had communication with Americans. The Interoceanic Company, however, looked Sir Hugh Allan as really the Canada Pacific Company, and they had reason to ;eve that the American gentlemen with whom Sir Hugh had been in negotiation still lectcd that the understanding which he had with them would be fulfilled, and for It reason the Interoceanic Company declined to amalgamate with the Canada Pacific llompany. "In the second Memorandum of the Executive Committee of the Interoceanic Railway CJompany, addressed to the Government, they stated " that they deem it their duty to ** State to the Government, that in their opinion the admitted negotiations of Sir Hugh * Allan with gentlemen in the United States, resulting in an arrangement or understand- ** ing which is considered opposed to Canadian interests, and which the undersigned from " inlbrmation in their possession, and referred to above, have reason to believe is still " substantially existing, will continue to cause the Canadian people to view with suspicion " and prevent their subscribing stock in any Company in which Sir Hugh Allan and his ** associates appear controlling parties." I give these reasons from the Memorandum of the reasons on account of which the Interoceanic Comi)any declined to amalgamate. Q. — Was there any other reason than Sir Hugh Allan's associations witli Americans which induced the Interoceanic Company to oppose the Canada Pacific Railway Company ? A. — I think not, except the reasons which are given in the Memoranda contained in the Blue Book referred to, endorsed " Charter for the construction of the Pacific Railway, "with papers and correspondence." Q. — Can you state your grounds for believing in the fact that Sir Hugh Allan was associated with American capitalists ? A.— I had a statement from himself in the conversation which I had with liim at an early period, that his associates were American capitalists. Q.- -Had you any statement from him at a later period? A. — No ; I had a conversation with Mr. Abbott, and he assured me that they had dropped the American connection. I told him it would be very difficult to satisfy the Interoceanic Comjiany on the subject. ■ I have no knowledge at all relating to the elections in Montreal. Q- — Do you remember any other matter which might be of use in this inquiry ? -^ A. — The only additional matter that took place at all between the Canada Pacific pompany and myself was the conversation I have referred to with Mr. Abbott, and what took place then I have also published. It Avas expressing his desire that an amalgama- tion would take place. Mr. Abbott, I believe, was one of the Provisional Directors of the Canada Pacific Company, I)iit is not a Director of the present Canadian Pacific Railway Company. He is Counsel, I believe, of the Company now chartered. This opnversation took place before the Company was chartered ; that is, before the Royal ©harter was issued. Subsequent to the issuing of the Charter, I had no conversation with Sir Hugh Allan. In 1872, two Acts of Incorporation were granted, one to the Canada Pacific (Company id the other to the Interoceanic Company. It was these two Companies which it was ioposcd to amalgamate, that is, the Canada Pacific Company, which Sir Hugh Allan Wished to amalgamate with the Interoceanic Company. I had this conversation with Mr. Abbott I think in July, 1872. In that conversation he urged upon me the desirability of amalgamation, and also asked me if, in the event of the subject being discussed, and favourably considered, would I consent to Sir Hugh Allan's being President. We also spoke of the number of Directors. The only mi.tt'er P all personal to Sir Hugh Allan and myself was the question of the Presidency. Mr. bbott wished that I would consent to the office being filled by Sir Hugh Allan, f Id him I would not assent to it in advance, but I set up no claim to the office myself. thought it should be left to the free choice of the Directors if amalgamation should ke place. efeating the original |. ^^•— Had you any interview with the Government or any member thereof with rela- ,4fo» to this amalgamation? Canada. struction of the Pacil: 1 a report of a meetiii; my of Canada, datd: nt for the contract tor )repared to treat will time Sir Hugh Allac ad it not been for ni) 3sts ol' the country, to connection with tin' ir Hugh Allan would 'iitlemon in Toronto, iViiatever might st« I I addressetl jny^li iting the InteroccanK' mmry^'f^'w '"'i 118 CORRESPONDENCE RELATIVE TO THE Oanada. jI — No personal interview — I had a conversation — or i)robably two or three co; vcrsations — with Sir John A. Macdonald on tlie subject, in wliieh he urged the i,i liortance of amalgamation, putting it on the ground that it was desirable to unite ; much as possible the influence and financial strength of the country, but nothing beyor this general expression of opinion. I objected on the ground stated in the Minutes oft: Interoceanic Company, and because I felt quite certain that Sir Hugh Allan contimi in association with the Americans, and that this would be fatal to the enterprise in l hands, and tliat if the Interoceanic Company joined with the Canada Pacific, it won be involved in failure and disgrace, and I did not wish either the Interoceanic Compa: or myself to be involved in these. To Sir John A. Macdonald : I include the whole of my published letter, dated 8th July, 1873, in my depositic. In this letter there is contained a memorandum of the conversation which took place: July, 1872, with Mr. Abbott ; it is substantially correct. Q. — When was the last occasion on which you had any communication with mjst. on the subject ol' the amalgamation ? A. — I think it was in November last, at Toronto. Sir John A. Macdonald pressed strongly for the amalgamation of the two Companies; that time. I dissented on pretty much the same grounds as those assigned in the Men; randum of the Interoceanic Company, addressed to the Government. The printed copy of the letter above referred to, of the 8th of July, 1873, and whi: is marked " E," contains a full and true statement of all the matters to which it relate And further deponent saith not, and this his deposition having been read to him,t declares that it contains the truth, persists therein, and hath signed. Sworn and taken on the sixth day of September, 1 1873, and acknowledged before us this [ (Signed) D. L. MACPHERSON. eighth day of September of said year. J (Signed) CHARLES DEWEY DAY, Chairman. A. POLETTE, JAMES ROBERT GOWAN, Commissiouer> Pkovixce of Oxtario, Ciiy of Ottawa. '•} IN THE MATTER OF THE COMMISSION Appointing Charlks Dkwkt Lav, Axtoine Polettk, and James Robert Gowj Commissioners to inquire into and report upon the several matters stated in certain Resolution moved by the Hon. Air. Hlntixgtox in the House of Co- mons on the second day of April, a.d. 1873, relating to the Canadian Paci: Railway. Present: The Comjiissioners. On this eighth day of September, in the year of our Lord one thousand eight hundrr and seventy-three, pereonally came and appeared before us, the above-named Comnii: sioners, The Honourable JEAN LOUIS BEAUDRY, of the City of Montreal, one of tt Members of the Legislative Council, who being duly sworn, deposeth and saitt I was a Provisional Director of the Canada Pacific Railway Company, incorporated i; 1872. I have no knowledge of an agreement between Sir Hugh Allan and G. W. McMulk acting for certain American capitalists, for] the construction of the contemplated PaciE Railway, to have funds from capitalists of the United States. I have no knowkd.-: whatever of any negotiations or corresi)ondence having taken place with reference to tt matters stated above. I have no knowledge of an understanding between the Government, Sir Hugh Allaii and Honourable J. J. C. Abbott, tliat Sir Hugh Allan and his friends should advanft money for the purpose of aiding the election of Ministers and their supporters at thi ensuing general elections, and that he and his friends should receive the contract lor tli construction of the railway in consideration ol' such subscriptions. From the sliof duration of the connection I had with the enterprise of the Pacific Railway, I had w means of knowing, and knew nothing of these correspondence. I have no other knof ledge except of what I have stated that took place at the meeting of the BoarJ Nothing took place then that had any respect to the correspondence or negotiations will Americans. IE bly two or three co: lich he urged the it s desirable to unite ; ry, but nothing beyor d in the Minutes oft! Hugh Allan continu to the enterprise in l anada Pacific, it won Interoceauic Compa; 1873, in my depositic: )n which took place: lunication with rnvst! fthe two Companies; assigned in the Men;. nt. July, 1873, and whi; ters to which it relate ;; been read to him, I ;d. L. MACPHERSON Y, Chairman. AN, Commissioner!, COMMISSION .MES RoUERT GoffJ al matters stated m n the House of Coi: the Canadian Pan: lousand eight hundrt ibove-named Comnii: Montreal, one of tt n, deposeth and saitl ipany, incorporated i; and G. W. McMulIe: contemplated Pacifc [ have no knowled;: ! with reference to ti lent, Sir Hugh Allan iends should advan« leir supporters at th 'e the contract for tk )ns. From the slioit Gc Railway, I had w have no other knoit' L'eting of the BoarJ B or negotiations will CANADIAN PACIFIC RAILWAY. 119 The question as to what source the means for the construction of tlie Pacific Railway Cakada. were to be derived was not discussed at the meetings which I attended. I have no personal knowledge whatever that these funds were to be expected from American capitalists. I took an active part in the elections of Montreal East in 1872 ; I was on Sir George Cartier's Committee. When I attended the Committee for the first time there had already been some organization made, and at the meeting which I attended they asked me to preside over the mating. It was about the commencement of August, 1872. I was told by some of the mwnbers of the Committee that they had a list of subscriptions for the object of defray- ing the expenses of the election. T did not see the list of subscriptions myself, but at a certain period of the canvassing I was asked by some of the members of the Committee to go to Mr. Abbott, and I went to Mr. Abbott with two other gentlemen, and then signed a receipt for $20,000 to Mr. Abbott. I did not see the money myself. The receipt was signed in Mr. Abbott's office, in his presence — it was left witli Mr. Abbott. I was given to understand that Sir Hugh Allan was a subscriber to the election funds. The expressions made use of in the receipt then signed by me are the only conditions that I am aware of. The Honourable H. Starnes and Mr. Murphy signed the receipt with me. The only receipt which I signed in connection with these gentlemen is the one above referred to. I have not seen this receipt since. I have no personal knowledge of that receipt having passed from Mr. Abbott's hands, except what I have seen in the news- papers. I am not aware, personally, of any other sums given by Sir Hugh Allan. That receipt refers to the letters of Sir George E. Cartier, dated 30th July and 24th August, 1872. I had not seen those letters when I signed the receipt; but subsequently, the letter of the 30th July was shown to me. It was in the hands of a gentleman who wanted me to state if the article which had a|)i)eared the day previous in the ' Gazette ' was correct as to the nature of the letter. That gentleman was Mr. Murphy. I did write a letter in conjunction with Mr. Starnes and Mr. Murphy. T think this letter was handed to the Editor of the ' Montreal Gazette.' The letter which the Chairman read to me jast now is the letter which I signed, and the contents of it are true. I have taken com- munication of a printed copy of the letter referred to, in the following terms : — Extract from the 'Montreal Gazette,' Jl-lt 23rd, 1873. THE PAC^FTr^ RAILWAY SCANDAL. To tL Editor of the ' Gazette" :■ Sir, — Seeing your Editorial of yesterday, in which reference is made to a letter from Sir George E. Cartier, to Sir Hugh Allan, dated 30th July last, which letter is referred to in the letter of Sir George E. Cartier, of date 24th August, published by Mr. McMullen, We feel bound to state that we have seen the first-mentioned letter, and that your «jflitorial statement that it has no reference whatever to the Pacific Railway Company, or to the Pacific Railway contract, is perfectly correct. (Signed) J. L. BEAUDRY. H. STARNES. July 22nd, 1873. P. S. MURPHY. ^I declare the statement contained in that letter to be true, and I make it a part of my reposition. I don't know, personally, of any other sum of money subscribed for the Montreal elections, for I did not go round with the list; but I have heard there was |pras told by some members of tlie Committee that there was a list of subscriptions. I •n't know what amount was subscribed, and I do not know either what amount Sir Slugh Allan has subscribed. There was a large sum of money paid to the different Election Committees. I was in the General Committee, and there were sub-committees 1 every ward. I had nothing to do with the distribution of the money or with paying la accounts. Considerable sums of money were paid to these sub-committees. Some of ae sums of money paid were drawn from the Metropolitan Bank by cheques. I am not ware of what kind of receipts was given for these sums of money. 1 believe these 20,000 were paid on account of Sir George E. Cartier's letter of the 24th August. Hien I signed that receipt I thouglit that Sir Hugh Allan was a subscriber, and it is the ply inference which I can draw from the wording of the receipt. I had uo knowledge fhatever of any conditions except what is contained in the receipt. 3 I have no knowledge of any other subscription, except that some friends told me thev lad subscribed. Q 2 pp^^f J[Ca»ada. Ill 120 CORRESPONDENCE RELATIVE TO THE ] Idi; The receipt was signed and left with Mr. Abbott, and I did not see the money, not sec the cheque for the drawing of the $20,000 from the Bank. And further the deponent saith not, and this his deposition having been read by him he declares it contains the trutli, persists therein, and hath signed. Sworn, taken and acknowledged on this eighth ^ day of September, one thousand eight > (Signed) J. L. BEAUDllY. hundred and seventy-three. ) (Signed) CHARLES DEWEY DAY, Chairman. A. POLETTE, JAMES ROBERT GOWAN, Commissioners "} IN THE MATTER OF THE COMMISSION Provixck of Ontario, Cifi/ of Ottawa. Appointing Chaijlks Dkwey Day, Axtoixe Poletti:, and James RonEUT Gow.iy Commissioners to inquire into and rejjort upon the several matters stated in i certain Resolution moved by the Hon. Mr. HrxTi.voTOX in the House c Commons on the second day of April, A.n. 187 o, relating to the Canadian Pacific Railway. Present; The Commis.sioxersi. On this eighth day of September, in the year of our Lord one thousand eight hundrcii and seventy-three, personallly came and appeared before us, the above-named Comnik- sioners, PETER S. MURPHY, of the City of Montreal, Merchant, wlio being duly sworn, deposeth and saith : I am a resident of Montreal. Q. — Have you any knowledge relating to an agreemcv between Sir Hugh Allan ami Mr G. W. McMullen, representing certain American capitalists, for the building of tlu Canada Pacific Railway with American lunds? A. — I have not. Q. — Have you had any particular connection with the original Company ? A. — None at all. My connection was with the Montreal Northern Colonization Railway Company. ^2- — Had you any knowledge previous to the passing of the Act of Iucori)oration oftli. Canada Pacific Railway Company as to any negotiations that were going on? A. — No. I don't know Mr. McMullen by sight. Q. — Had you any knowledge of tlie uuderstanding, subsequent to that period, between Sir Hugh Allan, or Mr. Abbott, and the Government, that Sir Hugh Allan and lii> friends should advance a large sum of money for the purpose of aiding the elections o: ^Ministers and their supporters at the then ensuing general election, namely, that of IS?.': and that he and his fric.ds should receive the contract for the construction of the Vani< Railway ; were you aware of any such agreement with the Govermnent or with iiiiy memlier of the Guvernmcnt. Have you any knowledge on this subject whatsoever? A. — I have no such knowledge wliatsoever. Q. — Had you any communication with Sir Hugh Allan, or with the Government, tli;il would have enabled you to know ? A. — I had not. I know nothing except what I saw in the papers. Q. — You were interested in the elections of 1872, and took an active part in them, did you not ? A.— I did. I was a member of Sir George Cartier's General Election Committee lor the Eastern Division of Montreal. Q. — Do you know of money having been furnished for the carrying on of the electioiij there, or in any other part of the city ? A. — Yes. There was a large subscription list passed round, and several gentlcnioi subscribed. The largest amount subscribed was that by Sir Hugh Allan. Hon. Mr. Starnes stated the other day that it was seventy thousand dcdlars. My impression is that it did not exceed sixty-five thousand dollars; that is the gross amount of all the subscriptions. Q. — Do you know of any portion, and if so what jiortion, was subscribed by Sir Hugh \\\m ? El see the money. I dj; ag been read by hiir, r. L. BEAUDRY. , Chairman. N, Commissioners. CANADIAN PACIFIC EAILWAY. 121 MMISSION IIES ROBKRT GOWAN matters stated in i X in the House « ing to the Cauadiaj 3usand eight hundred bove-named Commit- mpany ? hvay Company. Incorporation ol'tlu lat period, betwceii ugli Allan and lii< ing the elections o: imely, that ol" 18?.'; action ol' the Pacili' nment or with any ct whatsoever? ic Government, tlw i'e part in tliem, diJ tion Committee lor on of the elections several gentlenuii Allan. Hon. Mr. My impression i'^ amount of all tin ;rihed by Sir Hugh 5 ^.—Ilis first subscription was ten thousand dollars. I was one of those who signed Tlie next sum was for ten thousand dollars more I think, but I am not sure. It was ibr atleast ten thousand more. ,..,,., Tlien there was the last or third subscription, or at least it is the only otlier one ol which I have any knowledge. It was for twenty thousand dollars more. 1 signed the TCceipt for it. , , i • , i • .^ i- Q.—h the name " P. S. Murnhy," which I see appended to the printed receipt lor l^'_Yes. Mr. Betournay's name was also on the receipt for the $20,000 I believe. Tliis ^ei'pt is signed "J. L. Betindry," "Henry Starncs," " P. S. Murphy," " L. Betournay." ^ Ours was the Central Coniiuittec. . m Q,—Do you know in whose hands the original of the receipt for the 1<20,000 now is .' W ^._The receipt was given to Mr. Abbott. I was present when it was given, and saw the $20,000 paid. The money was deposited in the Metropolitan Bank. : (2.— Have you any reason to suppose that this receipt has passed out of Mr. Abbott's liands ? ' ^._No; I have not seen it since. I think it ought to bo cither in his or Sir Hugh Allan's hands. Q._Do you know whether that money was paid in consequence of any letter from Sir George ("artier? A. — The money was paid in accordance with Sir George Carticrs letter of the 24th August, 1872, and upon the conditions contained in his letter of the 30th July, 1872. I saw Sir George's letter of the 30th July. I saw it in Sir Hugh Allan's hands at the time, and I saw it a month ago in Mr. Abbott's hands. It was a little more than a year ago that I saw it with Sir Hugh Allan. being duly sworn. ^j Sir Hugh Allan ainl r the building of tlk Q, — You jiublished a letter in conjunction with Mr. Beaudry and Mr. Starncs in ation to this letter of Sir George Cartier's of the 30th of July, did you not ? ^.— Yes. Q. — ^A'ho has the original of that letter ? A. — It was sent to the 'Gazette.' Q. — Will you take communication of that letter now, .and state to tlic Commission whether the allegations contained in it are true ? A.— The copy now shown to me is a true copy of the original, and contains the truth. Q. — You state in this letter that Sir George Cartier's letter of the 30th of July has no reference to the I'acilie Railway Company or to the Pacific Railway contract, do you not ? A.- -I do. The statement in relation to this matter, published in the ' Gazette,' is perfectly correct. Q. — Having seen this letter of the HOth July, what statement are you prepared to Hiake ujion it ? yl.— The same statement as is contained in that letter. I state positively that the con- tents of 'hat letter are true. I examined Sir George Cartier's letter of the IJOtii Jnlj-, and it liatl no reference whatever to the Pacific Railway Company or to the Pacilie Rail- Way contract. Q. — \Vere there any other sums than those wliich you have mentioned subscribed for the promotion of the elections? A. — There were. I was a subscriber myself, and there were ?cveral other subscribers, among whom was Sir Hugh Allan, who was the largest subscriber. The aggregate amount was about $1)5,000. ;, We had Committees in all the wards, and the expenses were viy great, but the money was not all spent in the Eastern Division. A large portion Maj spent in elections else- where. I suppose we were robbed, as is general in elections. It was a condition of Sir Hugh , ^Allan's subscription that the expenses of Mr. Beaubien's election should be paid out of the fund if there was a contest. And if we had had a surplus the expenses of Mr. Beau- tien would have been paid, but we were short, and therefore it was not done, and that is the reason why Mr. Beaubien's note remains unjjaid. (I — Did the examination of that letter, which was shown to yon by Sir llugli Allan, purporting to be from Sir George Cartier, leave the impression on your mind which found expression in that letter? .1.— Yes. Q. — Do you know a:iything of any telegrams which passed on the subject of these advances betw(!eii Sir John A. Macdonald and Mr. Abbott? ^1. — 1 saw them in the papers only, and know nothing more about them. Canada. jmwwm^ i^i 122 CORRESPONDENCE RELATIVE TO THE Oahada. Q_ — Was there any application to the Committee for the $7,000 wliich was given i; Mr. Beaubien ? A. — No, I believe not. And furtlier deponent saith not, and this his deposition liaving been read by him, In declares that it contains tlic truth, persists therein, and hath signed. Sworn, laKen and acknowledged on the day, 1 written. J ,, , „ , , .., f (Signed) P. S. IMURPIIY. month, and year first above written. J ^ ^ ' (Signed) (^IIAHLES DEWEY DAY, Chairman. A. POLErrE. JAMES UOBKRT GOWAN, Commissioners. "} IN THE MATTER OF THE COMMISSION PuovixcK OF Ontario, Cit>/ of Ottawa.] Appointing Chahlks Dewey Day, Axtoixe Polette, and James Rorert Gow.w, Commissioners to inquire into and report upon the several matters stated i; a certain Resolution moved by the lion. Mr. Hini'IN'otox in the House ri Commons on the second day of April, a.d. 1873, relating to the Canadia: Pacific Railway. Present: The Commissioxers. On this ninth day of September, in tlic year of our Lord one thousand eight hundni and seventy-tliree, personally came and appeared before us, the above-named Coninii» sioners, JAMES DAKEHS, of the City of Montreal, who being duly sworn, deposeth and saitli I reside in tlie city of Montreal. My occupation there is Secretary and General Manager of the Montreal Telegrai: Company. I know Sir Hugh Allan. I don't know Mr. ^IcMullen. I never saw him. Q. — Have you any knowledge of any negotiation or agreement between Sir Ilu.i Allan and G. W. McMullen, in relation to the building of the Canada Pacific llailwa} ^1. — None whatever. Q. — Do you mean to say that you have no kind of knowledge relating to that matter at all A. — Nothing except what has appeared in the public newspapers. Q. — Have you any knowledge of any arrangement or understanding between tli; Government and Sir Hugh Allan for the furnishing of money for the elections i: Montreal in IST'JI? A. — None whatever except what lias ai)peared in the papers. (>. — Were you in a position to know anything on this subject to which I refer from your office occupation ? A. — Nothing further tlian from the messages which passed through our office, but Lie not see one out of a hundred perhaps, except there is something of importance brought under my notice. I don't see one-tenth of the communications that pass througli the office, and of course I had no means of knowing otherwise. Q. — Have you any knowledge that money was furnished by Sir Hugh Allan for thi elections ? A. — None whatever, except what appeared in the public prints. (2. — Have you in your possession any telegrams whicli passed through your office, between Sir John A. Macdonald and Sir Hugh Allan, or the Honourable Mr. Abbott, ia the month of August, 18/2, referring to the elections, or furnishing money for them? A. — None; the messages of August, 1872, are all destroyed. (2. — Are you able to state whether a message signed John A. Macdonald, dated SJtb of August, 1872, and directed to Honourable J. J. C. Abbott, Ste. Amies, and marked "immediate, private," in these words, "I must have another $10,000. Don't fail mo- " last time of calling," ever passed through your office? " A. — I never saw a message of that kind as having passed through our office. Tlicro was no sucli message that I know of, of the 25th August. Q. — Have you any knowledge whether a message purporting to be sent from J. .F. C. Alibott to Sir John A. Macdonald, directed to him at Toronto, and dated Montreal, 2iit!i August, 1872, in tlicse words, — "Draw on me for $lO,000,"ever passed through your oflin A. — No ; I have no recollection of having seen such a message, nor do I know tlut such a message ever passed over tlie line. Q. — Could these messages have passed through your office without yourbeingawareof it' CANADIAN PACIFIC RAILWAY. 128 I which was given tol been read by him, l,, 3. IMURPIIY. Chairman. !^, Commissioners. )IMMI?SION K.S KonKRT GOWAV al matters stated i: x in the House li ing to the Canadia: usand eight hundrt: )ove-nanied Conimis. , deposeth and saitli Montreal Telegrai: t between Sir IIu.' ida Pacific llailwa} to that matter at all inding between the or the elections ir. which I refer from 1 our ofllce, but I do importance brought it pass through the lugh Allan for th.i hrough your oflRce able Mr. Abbott, la loney for them ? donald, dated 2olh Vnues, and marked ). Don't fail mc- i our office. Tiicri :; sent from J. .1. C ted Montreal, 2(lth ;hrough your olTu'c ^< or do I know tlut irbeinguwareofit' U.— Yes. (2. Are you positive tliat all tlie messages of tliat date, that is the original telegrams of that date, whiili liave passed tlirougli your office liave been destroyed? , _/!. Yes, 1 am positive tliey liave i)eeu destroyed — and up to tiie 1st of January, 1873, they liave all been destroyed. (2.— Is there anything ii: tlie books of the Telegraj)!! Office in Montreal tliat would Wiable you to state if messages in tlie terms I Iiave referred to ever did pass through office? yj—Viider date tlie 2'ith of August, the signature find address taken from a message ftom Hon. J. J. C. Aliliott to Sir .Folin A. Alacdonald, appears on our books, but what •ipre the contents of this message I know not. |i^{2. — Is that the only message wliich is entered in your books, as passing between the one parties ? ,A. — Tliere is anotlier address and signature of a message having passed from Sir John I. Macdonald, to the Hon. Mr. Abbott, and which appears in our books on the 24th of fugust, 1872. Q, — Have you any means which would enable you to state to the Commission what be contents of these telegrams were ? A. — No means whatever. - Q. — Are you enabled to state by what particular operator in your office they were sent ? A. — I could not tell tlirough what ojieratnr they were sent, and I don't think that any operator who received them would be able to tell the contciits of them at this distance of time. Q. — Why are all the originjvl telegrams destroyed ? A. — For want of room is one cause, and anotlier cause is that we don't want, eighteen months, a year, or six months aiter, to have our ojierators dragged up to Court and kept there for a whole day. This is a standing order of the office. To Sir John A. Macdonald through the Chairman : Q. — How long has this regulation existed as to the destruction of the telegrams ? A. — The regulation for the destruction of tiiem has been in existence for a long period. The regulation for tlie destruction of them after six months has been in force since January last. One cause for this new regulation is that there is very little room in which to keep these telegrams. Tills regulation had no connection with the telegrams that passed relative to the elections in 18/2. The recommendation for this six months regulation was made by myseli', and had nothing whatever to do with the elections. It was made before tiiere was anything iknowii of this Pacific Railway matter at all. ;. And further deponent saith not, and this his deposition having been read to him, he ^iJeclares that it contains the truth, persists therein, and hath signed. iSworn, taken and acknowledged on the dayj'i month, and year first above written, > (Signed) JAMES DAKERS. belbre us. ) (Signed) CHARLES DEWEY DAY, Chairman. A. POLETTE, i JAMES ROBERT GOWAN, Commissioners. C AX AD A. IN THE MATTER OF THE COMMISSION RoviNCE OF Ontario,") Citi/ of Ottawa. } 'lAppointing CiiAULKs Dkwey D.VY, Antoine Poi.ette, and James Robert Gowax, Com- ,\si missioiiers to inquire into and report uiioi^he several matters stated in a certain Resolution moved by the Hon. Mr. HuNTiN%rox in the House of Commons on the second day of April, a.d. 1873, relating to the Canadian Pacific Railway, resent : The Commissioxers. , On this ninth day of Sejitember, in the year of our Lord one thousand eight hundred ^11.1 seventy- three, personally came and appeared before us, the above-named Com- issioners, !IIARLES JOSEPH COURSOL, of the City of Montreal, who being duly sr jrn, deposeth and saith : I reside in Montreal, my office is Judge of Sessions of the Peace for the Province ol Quebec, and Commissioner of Police for tlie Dominion. I have held that office for several years. imfl: P'"l 'Iff Cakaoa. 134 rORRE?!pONl)ENr'K RKLATIVE TO THE (^2.— Dili you liold any ofhor offuT in 1^72? .1. — I lu'Id till' (in'icc ol' Mayor ol' tlic city of Montreal. I know Sir Hugh Alln;; I Haw Mr. IMcMuUon onco or twicv in Montreal. (i. — Have you any knowlcdi^i' ol' any a;.jrerment or ncf^otiation hot ween Sir llii.l Allan and INIr. (i. \V. McMullon in relation to tiie eoustruetion of the I'aeilie Kailwav A. — None! whatever. Q. — Have yon never known anything of tliat matter? A. — I liave never known anything: of the kind. Q. — Have you any knowledge ol' any understanding between tlie flovernincnt, or iin member of tlu; Government and Sir Hugh Allan, throiigii the lion. .Mr. Abbott r otherwise, relating to the furnishing of I'unds by them for the promotion of the electioi, of 1872 in Montreal ? A. — None whatever; nor is it likely I should have had either. 1 hojje not. Q. — From your ofiiee would you have been likely to have known anything about tliat A. — No, not through my olliee. Q. — Have you any knowledge of Sir Hugh Allan's having furnished any funds for tlit elections of 1872? A. — No knowledge v/hatever. Q. — Do you know of any subscription having been raised lor the promotion of Si; George E. Cartier's election ? -1. — I heard that there had been a subscription raised for him. 1 know in one cast there was a subscri|)lion raised; but I know of no subscrij)tion except one, which dn not exceed. I believe, two or thre(! hundred dollars. It was given by one of Sir (jcor;: Cartier's friends. <2. — Do you mean to say that you know nothing whatever of the subject of this inquiry; A, — Nothing whatever; I was not a memlxi' o. any Oonnnittee, and did not even vott at the elections, and took no i)art in them whatever. I know nothing at all of tli subject matti-r of tliis inquiry, except what I have read in the newspapers. Q. — Are you aware for what reason your name was put ui)on the list of witnesses oi Mr. Huntington for examination here;? A. — I am not aware; 1 saw my name on Mr. Huntington's list when it was publislu; during the last Session of Parliament. I met Mr. Huntington yesterday in the street, aiii I asked him if he knew why my name was put on there. 1 said to him that if he ii;i: any questions he wished put by the Chairman, I would suggest them to the Chairmiii in order that they might be put to me, and that I might state under oath anything 1 might know in regard to them. Mr. Huntington then told me that my name had hti: put there on his list, as it had been suggested to him by somebody during the Session oi i'arliament, but he did not know or remember what evidence 1 had to give. And further deponent saith not, and this his dei)nsition having been read to him, li declares that it contains the truth, persists therein, and hath signed. Sworn, taken and acknowledged on the "J day, month, and year first above V (Signed) CHS. J. COURSOL. written, before us. j (Signed) CHARLES DEWY DAY, Chairman. A. POLETTE, JAMES ROBERT GOWAN, Commissioners, "} IN THE MATTER OF THE COMMISSION PuovixcK OP Ontario, Citi/ of Ottawa. Appointing Charles Dewky Day, Axtoi.vk Poi.eiti:, and Jamks Roreut Gow.o, Commissioners to inquire into and report upon the several matters stated in a certain Resolution moved by the Hon. Mr. Hi.vtin'Gton in the House of ComraoB on the 2nd day of April, a.d. 1873, relating to the Canadian Pacific Railway. Present: The Commissioxers. On this ninth day of September, in the year of our Lord one thousand eight huudrel and seventy-three, personally came and appeared before us, the above-named Com missioners, CHARLES A. LEBLANC, of the City of Montreal, Sheriff, who being duly swoni, deposeth and saith : I am Sheriff of the district of Montreal, and have been so for nine months. I know Sir Hugh Allan ; I do not know Mr. G. W. McMullen. Q. — Have you knowledge of any agreement or negotiation between these gentlemea relating to the construction of the Pacific Railway, at any time ? CANADIAN PACIFIC UAILWAY. 125 low Sir Hugh Alio;. between Sir IIu.l he Pucitic Hailwav frovormnont, or an lion. Mr. Al}l)i)tt i ution ol' the electioi, I liopo not. anytliiiii^ about thai led any I'nnds lor tlk lio promotion of S; 1 know in one ca- •opt one, which diii )y one ol' Sir Geori;- l)jeot of tliis inquiry; iud did not (?ven vott lothing at all of tli )a])ers. e list of witnesses u: hen it was publislie: day in the street, aiii I liim that if he In: m to the Chairmiii iler oath anything 1 my name had Ijli: luring the Session oi to give. jeeu read to him, li J. COURSOL. Chairman. N, Commissioners, AMISSION . . K3 ROEEUT GOWAS, matters stated in i ! Mouse of Comraoai Pacific Railway. usand eight hundrcl above-named Coni ) being duly sworo, months, eea these gentlemea "^._1 have not had at any time. . Q.— You positively state that you have no such knowledge? ■"yl. — I state so positively. Q._Are you aware of anv understanding between Sir Hugh Allan and Mr. Abbott with tlie Government, that Sir Hugh Allan and his I'l lends should advance moni'y for the jin>ni()tion of the general election in 1x72, and particularly the election of Ministere and their supporters? yl.- -I have no knowledge of any such uuke openly |in the heavin;; ol' all? I.- Yes; l)ut as to the first occasion I am not quite sure whether \hc other gentlemen Iprcsent heard what he said. Q. — Were you on such intimate terms with Sir George that wr\ild have induced him Ito speak more particularly to you than to the others? A. — I sui)pose I was the most intimate with him. I was one ol' his most intimate Ifricnds in Montreal — I mean outside of politics. Ever since we were at eollei;e we have |bceii personal friends. I may add that he [daced great I'onfidenci- in me at many times. Q. — Yon mentioned that tliere was another occasion on which SirCreorge spoke to you Ipursonally on this sulyect ; was it in the same spirit? /I.— Yes. This was alter the 21th June. It was at his own place at Long Point. I was down there, as liis nomination was to J take jilace the next day, and he wanted to see me, and we had a very long conversation that al'ternoon. He repeated tho; l; very words to me, that it was not necessary to look to foreign Companies to build tlu; Pacific Railway, as we had men in the country who could ■do the work, and he added that we should try to have an amalgamation made between jthu two Companies — that of Sir Hugh Allun and thatoi' Mr. Macpherson — and also said I tlut he could not say as to what the Government would do. To Sir John A. Macd'ii.dd, through the Chairman : Q. — AVhen was the nomination of Sir George Cartier? A. — It was on the IDth August, 1872. The election took place on 28th August, 1872. And further dei)onent saith not, and this his deposition having been read to liim, he declares that it contains the truth, persists therein, and hath signed. Sworn and taken in ]mvt on the ninth day of \ Canada, (Signed) C. A. LEBLANC. September, \S7'rKS Rohekt Gowav, Com- missioners to iiKiuive into and roi)ort upon the several matters stated in a certain Resolution moved by the Hon. Mr. Huxtinctox in the House of Commons on tlu; second Jay of April, a.d. 187;!, relating to the Canadian Pacific Railway. Present: Tni: Commission k,;h. On this ninth day of Sei)tember, in the year of our Lord one thousand eiglit hundred and seventy-three, personally came and appeared before us, the above-nanieil Commissioners, J^VCKSON RAE, of the City of Montreal, who being duly sworn, deposeth ami r,ai'b; I reside in INIontreal. My occujmtion there is General Manager of the Merchai'.t.' Bank of Canada. (^.— Who is President of that Bank ? J.— Sir Hugh Allan. (I. — Are you connected with Sir Hugh Allan otherwise than in business by any family relations ? A. — None whatever. Q.— Do you know Mr. G. W. McMuUen ? .1. — I never saw him, and I never heard of him till the recent corresjiondence appeared in the newspaper. Q. — Have you any knowledge of any negotiation or agreement or correspondence between Sir Hugh Allan or any other person in relation to the construction of the Pacifn' Railway, which took place in 1 872? A. — None whatever. Q. — VV^niUVyour relations with Sir Hugh Allan been likely to have enabled you to have known something of this matter? 1^^ .1. — Not necessarily so. Q. — No facts connected with that negotiation came to your knowledge? A. — Nothing ever came under my knowledge connected with any negotiations carried on by Sir Hugh Allan in connection with the Pacific Railway. Nothing whatever. Q,— Have you a knowledge of .any undertaking l)y Sir Hugh Allan, or by MV Abbott. to furnish funds for ])romoting the elections in Montreal in 1872 ? •^^ A. — 'I have no personal knowledge. , Q. — Have you any reason to believe that any such arrangement was made ? A. -Nothing further than mere rumour. (2. —Did you take any part in the elections in Montreal in 1872? A. — 1 did not. P Q. — Are you aware if any sum of money was raised for the purpose of aiding in these elections ? .1. — 1 am not. further than from mere rumour. 1 had no jjcrsonal knowledge of it. Q. — Do you know whetlK-r Sir Hugh Allan ever subscrilted any money or furnislied any sum of money for th:it pin-pose? A, — I have only her.rd tuch reports. CANADIAN PACIFIC RAILWAY. 129 for the election of for that election or those elections ; 'itnesses, and I was n\ read by liim, lie STE BEAUDRY. Jhairman. Commissioners. MISSION KRT GowAX, Corn- stated in a certain r Commons on the i Railway. e thousand cigiit the above-nanii'il osfth and r,ai'h: r the Mercha.-.t; ess by any family ondence appeared r correspondence ion of the Pacific e enabled you to s>'otiations carritnl '^ whatever. r by Ml- Abboit. lade ? f aiding in these lowledgo of it. ney or furnishctl Q. — You have not heard that from him? A. — No, he has not told me. Q. — Have you any knowledge which would induce you to believe that those rumours were true ? yl . — My belief is that the rumours were true, that he did subscribe money. Q. — Would you give the grounds of your beliel", if you please ? A. — Simply from casual remarks of his own, made sometimes to other people in my hearing. Q. — Have you any idea of the amount which ho furnished ? A. — I have not. (2. — Were any cheques drawn upon his account whicli would indicate the amount ? A. — I never saw any. They would not necessarily come under my notice in any way, if such existed. Q. — Would the fact of payment of money for that purpose, he apparent on Sir Hugh Alla!>'s account in the bank? -1. — Not upon .the account itself Whether the vouchers or cheques dra'vn would show it or not, I am unable to state without a personal examination. (2. — You mean to say then that you have no knowledge that would enable you to state what amount was subsi "ibed by Sir Hugh Allan ? A. — I have not. (2- — Do you know to whom the money was paid ? .1. — I do not. Q. — Have you any knowledge whatever of the application of any money, or the mode in which money given in aid of the elections was expended by the Central Committee? A. — Not the most remote. I know nothing whatever about it. Q. — Do you know anything of this printed receipt which has been published in the newspa])ers, signed by Mr. Murphy, Mr. Stariies, Mr. Beaudry, and Mr. Betourncy, purporting to be a receipt for )<20,000 received from Sir Ilugli Allan ? .1. — I have seen it in the new'spai)ers. That is the only place I have seen it or lieard of it. (2- — These telegrams of Sir John A. Macdonald to Mr. Abbott, and i'rom Mr. Abl)ott to Sir John A. Macdonald, have you ever seen them elsewhere than in the newspapers ? A. — Never. (2- — Has Sir Hugh Allan got more than one account in the Bank ; lias he a privo* account dilTerent from his business account? .1. — His general business account is under the name of II. & A. Allan. He has a private account besides, but only one. Q. — Is the condition of that account passed under your view like all other accounts in the bai.iv ? .1 .—It is. Q. — Did you observe at the time of the election of any large cheques passing? A. — Sir Hugh Allan's account is a very large and active one at all times, and I did not notice at the time of the elections anything remarkable about the cheques. (t — Is there any coiniection between your bank and the Metropolitan Bank? -'I. — There is none wliL'evcr. Q. — Is there any account that would show exchanges between the two banks; do you exchange from time to time notes ? A, — We do exchange notes and cheques every day. The banks all exchange every day. Q. — Is there any account that would show the particulars of the exchange each day? A. — ^Ve can see only the figures. The names of the drawers of cheques do not appear. To Sir John A. Macdonald, through the Chairman — My connection with Sir Hugh Allan is altogether through the Bank. 1 am not his political nor his Railway Agent. 1 was not consulted as to liis subscrijjtions to elections nor as to his arrangements about building Kailways. i^ lid further deponent saith not, and this his deposition having been read to him he dec.ares that it contains the truth, persists tiierein, and hath signed. Sworn taken and acknowledged before" us, on the day, montii, and year \- (Signed) JACKSON RAE. Oak ADA. first above written. (Signed) I re "J CILVRLi:S DEWEY DAY, Chairman. A. POLE! TE, JAMES ROBERT GOWAN, Commissioners. 130 COERESPONDENCE RELATIVE TO THE Canada. "} IN THE MATTER OF THE COMISSION PrOVIXPK 01'' OXTAT^IO, City of Ottawa. Appointing CIIAlu,I•;i^ Dewfy Day, Antotxe Pou'.ttk, anil J.nirS Rohert Ooava\, Commissionrrs to inquiro into and Report npon tho several matters stated in a certain Resolution moved by the Hon. Mr. Huntixgtox in the House oj' Commons on the second day of April, A.w.. 1873, relating to the Canadian Pacific l^aihvay. Present: The CojtMissiONEns, On this eleventh day of September, in the year of our Lord one thousand eight liundred and seventy-three, personally came and ai)peared bel'ore us, tlie above-named Cominissioners, Tlie Honourable JOSEPH OCTAVE REAURIEN, of St. Thomas, in tlie Province of Quebec, wlio being duly sworn deposeth and saith : Q. — Where is your ])lace of r(!sid('nce? A. — St. Thomas in the Province of Quebec. Q.- — Were you i'ormerly, and are you now, a member of the Legislative Council of Qui^bec ? A. — Yes, and I am now. I held tlic oiTice of C ommissioner of Crown Lands in the Province of Quebec. I know Sir Hugh All.in, I don't know Mr. G. W. McMullen. Q. — Are you aware oi any agreement or negotiations between Sir Hugh Allan and Mr. G. W. MclNIidlen, or my otlier ])erson, in relation to the construction of the Pacific Railway with funds to be furnished by American capitalists? A. — None wliatevcr. (2. — Do you know anything about any negotiations or agro(!ment between tho:,c ,/,i :it,lt men in 1872, bel'ore the Act of Incorporation was passed relating to tlie Pacific Rai ly '' A. — No, sir. C2.— Had you any relations with those gentlemen that would enable you to knew? A. — No: I had no relations with Sir Hugh Allan before I became a director of the Canadian Pacific Railway. (2. —In relation to the Canada Pacific Railway, the first one which was incorporated, liad you any rclatioi's with Sir Hugh Allan which would have enabled you to know of any such agreement or negotiations. .1. — No; I had no conversation with any members of the Government of the Dominion belong that. The first knowledge with respect to the Pacific Railway, was when the Company was formed last winter and the Candian Pacific Railway Company was cliarterc-d. I was ajjpointed 71>irector of that Company. I was nominated by the present Dominion Government. Q. — Since you have been connected with the Canadian Pacific Company, have you ever had any conversation with any of the Ministers, or any other persons which would cnaljle you to say whether there was such a negotiation as I have alluded to V ^l. — No, none whatever. I never had any conversation whatever. Q. — Do you know Sir Hugh Allan ? y1.— Yes.' (I — Do you know of any arrangement or understanding, between him and the Govern- ment, or any member of the (iovernment, in relation to the furnishing of funds for tl'.c promotion of the elections of Ministers, and their supporters ? .l.-No. Q. — Do you reside below Quebec f yl.— Yes. Q. — How far from Montreal? jX. — It must be sixty leagues — one hundred and «;ighty miles. II. — Have you ever had any communication with any oI" the Ministers or with any person as to the I'urnishing of funds lor the support of tlu^ elections in Montreal in 1872? A. — No, I don't know anything about it. I never received any money from Sir Hugh Allan, or any person acting as the agent or in the interest of Sir Hugh Allan. (I. — AVere any moneys received from Montreal by subscriptions for the support of Ministirs in your neighbourhood ? A. — Not that 1 know ol'. (I- — Do you mean to say that you had no manner of comminiciition^ o. Means ol knowing how the money was furnished for the promotion of tliesi elections '( CANADIAN PACIFIC RAILWAY. 131 [ON RERT G0AVA?f, :rs stated in a he House oj' the Canadian lousand eight above-named e Province of re Council of icbec. ,i;h Allan and of the Pacific I tho;,(: ■^: ; tbc twelfth of September of said year Canada. le (Signed) }- ;ned) J. O. BEAUBIEN. CHARLES DEWEY DAY, Chairman. A. POLETTE, JAMES ROBERT GOWAN, Commissioners. IN THE MATrER OF THE COMMISSION ProVINCK of OnI'AI!IO, \ city of Ottawa. J Ar.,-.oniting Chahi.ks Dkwkv Day, Antoim: Poi.ktti:. and Jamks Rokkkt Gowa.v, Com- iiiissioners to inquire into and ri^port njion the several matters stated in u •ertain Resolution moved by the Hon. Mr. Hi minoto.v, in the House of Coni- ■vions on the second day of April, .i.i). 1873, relating to the Canadian Paeiilc Railway. 1':^.' ■i.t: IjiE Commissioners. Oh Vl,,:) eleventh day of Roptember, in the year of our Lord one thousand eight hundred and seventy-three, personally came and appeared before us, the above-named Com- missioners, Keverend DANIEL MoJMULLEN, of Picton, Province of Ontario, who being duly sworn, deposeth and saith: U. — You are a clergyman, Mr. McMulIen, are you not? /l.-Yes. Q. — Of what denomination ? 4.— Methodist. (I, — Is your residence at Picton? .).— Yes. '<{.— Do you know Mr. George McMuIlcn? yl.— Yes. Q, — In what relation do you stand to him ? A.- — He is my son. Q,. — Do you know Sir llugli Allan? A. — No. I never saw him to my knowledge I 132 COREESrONDENCE RELATIVE TO THE A. — I have no rci uliicli it was dccideu clement from the C'ompi, no share in tin; huihiini Canada. ^2— Have you any knowledge of a negotiation in which Mr, G, W. McMullcn your son was engaged, in relation to the building of the Pacific Railway? A. — I have some knowledge, the most of which I may say I liavc gathered from what has been published in the press. Q. — Have you any other knowledge of a personal character, in regard to this matter, which has t^omc under your personal notice? y\. — None that I am aware ol'. I may remark for the information of the C'ommission, that in *]\v abseiuo of my sons I liave a heavy burden of domestic care on my hands in the (losition which I have occu- pied for a great many years. I have always had great coufidence in the ability of my son to manage any business which he understood. I liave .lever sought inlbrmation from him unless it was under very i)ressing circumstances, and then it was done chiefly to relieve myself of the burden and care whidi at this time of life I was not prepared to bear. Q. — Has your son been in communication with you in respect to this matter? A. — No : I know nothing beyond wliat 1 liave read in the public press. He has calways bee.i very remarkable since early boyliood in business matters, and was always close, and he seldom disclosed any business transaction to the members of my own lamily. (t — lias he been in the habit of communicating or consulting with you? A, — Not in matters of tiiat kind. Q. — Has he communicated to you anything in connection with the construction of the Pacific Railway? 1 ' 'in:' of any communication of that kind except at the period at ■ttled that the Government would exclude the American ind that the gentlemen ibr whom he was acting would have Ol the ]{ail\vay, and siii)posing that he had spent a very large portion of liis time, and that heavy expenses had been connected witli it, which he was not well able to lose, and that money had been expended through him on behalf of the j)ersons for whom he was acting, I felt some anxiety lest he might incur some censure for 'want of energy and fidelity in dealing with the interests of otiiers. I therei'ore took the liijerty — the only time that I think I did make any inquiry into his business matters — of asking him what arrangement was likely to be made for indemnifving liimself, and especially the ])arties for whom he liad been acting, so that lie would not be exposed to any censure, lie assured me tliat lie was iuUy persuatled and was then in jirocess by which the jiarties for whom he liad acted would lie indemnified for the time and expenses he had incurred. I believe that was the only question that 1 asked him. Q. — How did you become aware of the expenditure of money liy him? A. — I became aware of it by supposition ; I sui)|)osed that ho would incur expense in dealing with this matter, but I have no recollection of liim telling me that he did. I inquired of him in order to relieve my own mind, but it is very little I know intimately or accurately, respecting the whole affair, except what I have gathered from what has been published in the public prints. (I. — Did he communicate to you any correspondence during the time that it was going on or hold any communication with you on tin: subject of it? A. — I don't recollect that he described any of iiis correspondence, and I did not ask for any, as 1 thought it would be interfering, and that perhaps he would feel reluctant to communicate to me anything on the sulyect, and I was therefore a good deal cautious on that ground. It might naturally be thought that I would be intimately acquainted with those matters, l)ut I am not for various reasons, especially those that I have stated. I had enough else to inirden my mind and employ my thoughts and attention, and 1 studiously endeavoured to avoid inducing him to communicate anything to me on the subject. Q. — You never saw any of the originals oi' this corresjiondence, did you? .4.— No. Q. — Cai\ you account, Mr. McMullen, for your name being included in the list of witnesses; i^re you in possession of any knowledge that would account for it to your own mind ? A. — The only reason that I am aware of is the clos(; of the speech made by Mr. Huntington at the prorogation. 1 read it, but I could not give it in detail. But he made the remark there, assigning his reason lor placing my name on the list of witnesses. Q. — Can you recollect what that reason was in general terms? A, — I think lie expressed some fear, or suggested to the Committee that perhaps my CANADIAN PACIFIC RAILWAY. ion uction of the it was going son mifi;ht absent himself when ealled ui)on to give testimony, ami lie tlioujjlit it would be butter to sceure some membcu- of the family — his fatlier or some of his brothers — tliat is tlie only reason that I am aware ol'. I am not aware of the reason assigned I)y the Commission by whom I liave lieen sum- moned to appear. If tliere is, I have not seen it. I inferred that tlie reason mentioned by Mr. Huntington had influenced them. Q. — Is there any other Daniel McMullen? .4. — I have ^ son who bears my name that has been some eight or nine years in Par- liament. His name; is Daniel Y. I have but one name. His name is Daniel Yure McMullen. He resides in Chicago. I am a minister of the Wesleyan Methodist Church. I am not in possession of a regular charge. Tlie state of my health obliges me to hold a retired position. My son, Daniel Y. McMullen, is now in attendance here. It bajjiiened that at the time I was summoned to ajjpear here he had come on a visit home to liis friends, and he came with me. I am a stranger in Ottawa. I have resided sixty odd years in C'anada, since ISII. I am intimately acquainted with the western part of the Province, but tliis is my first visit to Ottawa. To Sir John A. Macdonald, through the Chairman: Q. — Do you know where your son, George VV. McMullen, is now? A. — He is in Chicago ; he is there now. He went there some three or four weeks ago. He had beeii in Pictou before that. Q. — Is his residence in Pictou or Chicago? A. — -His residence and domicile is in Chicago. Q. — How long was he in Pictou before he went to Chicago? A.- — Three or four weeks ; I could not tell to the day. < And further deponent saitli not, and this his deposition being read to him he declares it contains the truth, persists therein, and hath signed. Sworn and taken on the eleventh day of Sep-' tcmber, 1873, and acknowledged on the t..;'lfth of said month and year. (Signed) Can.M)A, '] (Signed) D. McMULLEN. CHARLES DEWEY DAY, Chairman. A. POLETTE, JAMES ROBERT GOWAN, Commissioners, 1 IN THE MATTER OF THE COMMISSION PllOVINCE OF OXTAIUO, Citi/ of Ottawa. Appointing Charles Drwky Day, Axioink Poi.ette, and Jami:s Roi!kut Gowax, Com- missioners to inquire into and report upon the several matters stated in a certain Resolution moved by the Hon. Mr. Hi.xti.xgtox in the House of Commons on the second day of April, A.n. 18/3, relating to the Canadian Pacific Railway. Present: The Commissioxers. On this eleventh day of Sejitember, in the year of our Lord one thousand eight hundred and seventy-three, personally came and appeared before us, the above-named Commissioners, DANIEL Y. McMULLEN, of the City of Chicago, who being duly sworn, deposcth and saith : — Q. — Arc you the son of the last witness, Daniel McMullen ? ^.— Yes. Q.— Are you a brother of George W. McMullen ? 4.— Yes. I reside in Chicago. Q. — What business are you engaged in there? A. — Banking. C2. — Are you alone or in co-partnership with any person ? A. — My brothers and myself are together. Q. — Do you know Sir Hugh Allan ? .4.— No. Q. — Have you any knowledge of an agreement or negotiation in which your brother was engaged in 1871, in relation to the construction of the Pacific Railway ? J.— Yes. S m !■ 134 CORRESPONDENCE RELATIVE TO THE Canada. Q, — Wliat is tlic nati o of your knowledge concerning this agreement, is it a personal knowledge or simply derived I'rom what others have told you ? A. — It is both. Q. — Will you state what personal knowledge you have of it ? A. — I saw the original contract between the American j)arties and Sir Hugh Allan. I also saw and read (piite a large nunil)er of Sir Hugh Allan's letters, and I saw nearly all of the documentary evidence that he has or had, tliat is all the personal knowledge I liave; that is the documentary evidence, I saw the original contract that was signed, I believe in New York. The personal knowledge is all documentary, that is with parties directly interested. Q. — Can you specify any letters which you saw from Sir Hugh Allan? -I,— I could not specify any of them so that you would understand what I meant, e.Kcept the first letter that he wrote from Montreal. I cannot specify them by date. They were dat(!d along from some time in the fall of 1871, up to the fall of 1872. Tiiey date from tlie beginning ol' the negotiation in 1871 previous to the elections, till about the first Session of this Parliament. Q. — Do you know Sir Hugh Allan's handwriting? -1. — 1 think I would know it. I have no positive knowledge that the signature I saw was his, but the letters came signed Hugh Allan. Part of letters were addressed to C. M. Smith of Chicago, and ])art were addressed to my brother. Q. — Do you know in whose possession those letters are now that you speak of? -1. — Tile only knowledge that I have as to the i)lace of them is from newspaper reports. Q. — Do you know wOiether they are or are not in your brother's possession ? .1. — They are not in his i)ossession. (2- — Do you know how he disposed of them ? ^l. — I only know what he toUl me. I have no personal knowledge as to how he dis- posed of them. I can only tell you what he said he did with them. (2.— What did he say he did with them? A. — He said they constituted the package in Mr. Starnes' hands in Montreal. (2.- -Did he say that all the letters be had were in that package ? ^-I. — All of the principal were there he said. Q. — \Vhat means have you of knowing Sir Hugh Allan's handwriting? A. — No means at all, only that I know that my ijrother addressed letters to him, and that letters came back signed Hugh Allan, addressed to my brother. Q. — How do you know that your brother wrote to Sir Hugh Allan? .1. — I have seen letters written by my brother addressed to him. (2. — Did you ever see the parcel which your brother said he gave into Mr. Starnes' liands ? J.— No. Q. — Can you designate any particular letters which you believe to be from Sir Hugh Allan, besides the one you have mentioned as the first one? A. — By dates? Q. — In any way they can be identified. ^l. — There were severa' important letters, in one of which he gave a rough sketch of the sums of money he had expanded; and one of the last letters my brother received was in regard to the exclusijn of the American element from the Company; and there was another letter, I don't know whether it was in the package or not, giving the amount of stock to be placed in the different parts of Canada. (2. — What was the subject matter of the first letter to which you allude? .1. — The first letter that I ever saw from Sir Hugh Allan was addressed to C. M. Smith. It merely stated that his address had been given to him by a member of the Government, and that he thought that the time had arrived for the American and Canadian parties to get together. A letter is shown to witness. Q. — Is that the letter to which you refer ? A. — No, this is not the letter, the letter that opened the correspondence was written from Montreal, this is written from London. I think it was in 1871, and previous to Sir Hugh Allan sailing for Europe. The one now shown to me was written after the negotiations luid proceeded several months. (I — Is that the letter you mean now shown to you? .1. — No, it is anterior to that. The first letter that opened the correspondence, I think, was written either in May or June of 1871. Q. — To whom was that letter addressed ? .1.— To Charles M. Smitli. CANADIAN PACIFIC RAIL"\YAY 135 ) how he dis- s to him, and Mr. Starncs' Q.— Did Mr. G. W. McMuUcii tell you that that loiter was included in the package placed in Mr. Starnes' hands? A. — lie told me that the package contained all the letters of importance. He did not indicate to me any sf)ccial letters. Q. — Are you confident with res])cct to Ihe date of it? A. — The only moans I have, of knowing is that the negotiations had proceeded some two or tliree months before tlic Cliicago fire, and that was in October, 1871. (2. — There are some letters addressed to Mr. Smitli in this package ; tlu-ough whom were they obtained from Mr. Smith? A. — I presume they were given to my brother. The relations between Mr. Smith and my brother and myself are so intimate, that all the correspondence M-as communi- cated to us. I handled all the letters of Mr. Smitli as well as my brother's, and Mr. Smith handled all my brotlier's letters in reference to tins matter. (>. — I low nearly can you particularize tlie date in regard to this matter? If you cannot say the day, say the month ? A. — 1 think it was early in May, 1871. Q. — You don't know where that letter is now ? A. — It was not considered of sutlicient importance to take much care of. (2.— What other letter do you recollect? A.- — Tliere was a letter detailing the sums of money that Sir Hugh Allan had spent. Q. — Do you remember the date of tliat? A. — I think it was in Fel)ruary. It was in January or February, 1S72. Q. — Here is a letter which reather did not say that it eontain<'d all the Ictli'rs, and I have no knowledge as to whether the paekage contained all tlie letters or not. And further for the ])resent deponent saith not. And on the twelfth day of Septeml)er, IST.T, re-appeared the said witness, and made the I'dUowing alterations and additions to the foregoing de|>osition. I \vi>li to add that the letters, which passed between Sir Hugh Allan and my hrother, date iVom the beginning of the negotiations, in 1871, until the close of the first 8essioa of Parliament — also in answer to tlie cpiestion, " Why don't you think that certain letters " are in the i)ackage?'' I wish to ciiaiige the word t/iri/ in my answer to /, making it read, " Because I did not " consider them of sufficient importance." I desire also tn add, that the conversation I refer to, with my hrother, with regard to the forfeiting i>;17,.''0(), took place a few weeks ago, and that my brother told me that if tlie Committee was dissolved, and the package fell into tiir Hugh Allan's hands, he would forfeit $17,i')00. On another point I have been thinking over in my mind, since my examination, and I now r('nu'mi)er that my brother and myself had two conversations. The contract that he showed me at the interview, at Pictou, was a private one between himself and his New York jjartner. Tlie contract between the American parties and Sir Hugh Allan was shown to me at Chicago. I wish to add further that when I saw the charges in the newspapei-s, that my brother was a paid witness, or something to that ellcct, I (piestioned to know if he had received any remuneration. He replied he had not received one cent, and would not even accept his current expenses. Q. — I think you said that you saw in your brother's possession, either received by him directly or from other parties, all the evidence that was published in the news- papers, is th;'- su? A. — I said that I saw the letters that were published in the * Globe.' Q, — Did you see the telegrams that were published ? A. — I saw them after they were jjublished. Q. — You did not see them before ? A.—^o. Q. — Not any one of them ? A, — Not any telegrams published in connection with his letter, them except in print. (2. — There is a cojiy of an alleged telegram from Sir John A. Abbott, which was published ; did you see the original of that? ^1.— No. Q. — Did you see the original of one purporting to be from Mr. Abbott to Sir John A. Macdonald, which has been published ? A. — Not except in print. Q. — Have you any knowledge in resi)ect to how they were acquired ? yl.— No. Q. — Can you give the Commission any further information on this subject? A. — I asked my brother how he got those telegrams, and he said he might tell me some time, but he would not then. Q. — You never saw any of the originals of the telegrams that apjiearcd ? A. — I never saw them till they appeared in print, and I did not know that my brother had them. Q. — There is a letter from Sir George E. Cartier published also, did you see that? ^.— No. Canada. I never saw any of Macdonald to Mr. IK) ( OIIKKSI'OXDKNCK JJKLATI VK TO THE Canada. 'I'o Sir Joliii A. IMmtlnnald, tlirou^li flu- ChiiinnaM : i>'iy other pajcrs (•oiinccffil with llic suhjfct of this inquiry furtliiT tliiiii Sir llii^li AUiin's (•orrcsiioiKlnici', ami tlic contrart you liavc spoken ol .' .!.- Not, tliat I have any rccollcctiou of. (). — You liavc not seen any of the jjapcrs attnclit'il to your l)rotlH'r's second letter I nil an the teh'granis spoUeii of l)y one of tlio Coiiiniissioners? .1. 1 (h)n't recoUeit wliiili was liis secoiHl letter. On heing informed, I sny that I never saw these telegrams till I saw tlieni in print. r;. — When did your hrotiur tell you that he would inform you at some future time where he got these teligrams? .1. -I don t recollect the exact date. It was after the letter appeared. It was in ('iiicago lie told me. Q.- You had seen all tlie other pajicrs yourself? yl,— I saw the correspondence. Q.- But he withheld these telegrams from you, you say? A. — Yes, I never saw them. Q.--You asked him where he got them ? A. — Yes, I asked wliere lie got the telegrams, and lie said that he would prohahly tell nie sometime. Q. — You did not jiress the question after? A. No. I thought it was of no use i)ressing it. And further deponent saith not, and this his di'jjosition having hoen read hy him he declares that it (contains the truth, persists therein, and hath signed. SHorn, and taken in part on the eleventh day ofj Septemher, IS7:!, and the ''.niainder ^ j^^j^jj.,j^ ^ McMULLKN. taken and the whole acknowledged on^ f^ ' the twelfth day of said ^r.onth and year. ' (Signed) CHARLES DEWEY DAY, Chairman. A. POLETTE. JAMES ROBERT GOWAN, Commissioners. IN THE MATTER OF THE COMMISSION rKOVINl'K Ol' O.VTAUIO, ) 6% of Ottawa. ) Api>ointing Ciiaui.ks Dkwkv Day, Antoink PoLr.-ni-, and Jamk.'^ Roiikut Gowax, Com- Diissioners to inquire into and report u[)on the several matters stated in a certain Resolution moved hy the Hon. Mr. Hintinotov in the House of Commons on tlie second day of April, a.d. 1S73, relating to the Canadian Pacific Railway. Present: TiiK Commi.ssiom;i!S. On the twellth day of Beptemlier, in the year of our Lord one thousand eight hundred and seventy-three, personally came and appeared hefore us, the above-named Commissioners, The Honoiiral)le JEAN CHARLES CHAPAIS, of the Parish of St Denis, in the Province of Queliec, who being duly sworn, d(i)oseth and saith : I am Senator of the Dominion of Canada I'or the I'rovince of Quebec, and a member of the Legislature. I was one of the Dominion Ministers from the time of Confederation up to 2.")th January last, when I handed in my resignation. Ji i)(;i; Poi.Krri: — 1 will read the first nart of the charge ; "That in anticipation of the legislation of last Session, as to the Pacific Railway, an agreement was made between Sir Hugh Allan, acting for himself, and certain other Canadian i)romoters, and (J. W. McMuUen, acting for certain United Stages capitalists, whereby the latter agreed to furnish all the funds necessary for the construction of the contemplated railway, and to give the former a certain percentage of ir.terest in con- sideration of their interest and position, the scheme agreed U2>on being oslensibly that of a Canadian Comjiany with Sir Hugh Allan at its head." Q. — Have you any knowh-dge of the arrangement there referred to? A. — Having heard the charge read, I declare that I have no knowledge of it whatever. I know nothing of any, except what I saw in the press, and the legislation referred to in Mr. Huntington's charge took place without there being any such arrangement. I did not learn of any such arrangement being in existence while I was a member of the Dominion Government^ nor did I hear of any conversations to that effect. I do not know CANADIAN PACIFIC RAIIAVAV. Ml McMlILLEN. loiisaiul cisht ly ncj^otiiitions Imviiijj; taken jilacc witli any nicinlH-r ol' Iho (iovcriinxiit. Several .iversatioiis (iceiirred relative to tlie means to lie taken to proenre the moiie/ necessary lor the eonstriiclion of the Paeilie Kailway, hut 1 (h> not know that mention waM particularly iruide of any such arranfj;ements as that rel'erred to in the deed ; in ail these cduversations I ahvays understood that th(< -ieneral desire was that the I'aciiic Kailway should he huilt with Hrifish capital. 1 never had any interview on the suhject with Sir lluj;h, nor do I know tiiat any other meinher ol' the (lovernment had any in respect ol' this matter. .]y\H,K I'oi.KTTK — I will HOW read another i)art olthe charm': "That suhsequently an understandiufj; was come to hetween the Government, Sir Ilugli Allan, and .Mr. Abhott, that Sir llnjih .Mian and his friends slioidd advance a large sum (d" money lor the jjurpose ol aiding the elections ol' Ministers and their supporters, at the ensuing general elections, and that he and his friends should receive the contract lor the construction of the railway." (I — Have you any knowledge of that sort ? A. — No; I do not know of nay sum having heen advanced to tlie Government for election iiurposes. (J,. — I)o you know of any promise of money having been made? ^1.— No; no sucli promise was ever made to me. Q. — Was it ever said that any member of the (Jovernment had received money to assist in the elections ? A. — It was never said before me. It is always understood that elections cannot be carried on without money. I under- stood money was suliscribed by the friends of the candidates, but no sum of money was derived for tlie service suggested. When I speak of aiding the elections, 1 mean the money that is spent legally. 1 do not know if any money was subscribed for the elections of Montreal, except from what has apjjcared in the press. (2. — Do you know Sir Hugh Allan? A.— I know him a little. We have never spoken but twice. Those conversations were not relative to the Pacific Railway. If that subje was ever mentioned, in was in so light and incidental a manner that 1 never thougbl anything of it. 1 think it quite possible that I mentioned it to him on the cars, and I may have asked him "what "progress are you making with your Pacific Railway project?" I knew that Sir Hugh Allan had an interest in the construction of the Pacific Railway, because on one occasion there was a question before me regarding an Act of Incorporat ion. The circumstance to which I allude is this : Sir Hugh Allan was one day introduced ill the Council Chamber, when I was present, and lie exjiressed there his intention to take an interest in the construction of the Pacific Kailway. I think this was in the autumn months of 1871. There had at that time been no legislation on the subject of tliis railway, but the matter was being discussed. There were only a few words exchanged at that time, only sufficient to give me to understand what I have just mentioned. There were other Ministers present. The means were not spoken of at that time for building the Pacific Railway. I do not remember who were the Ministers present, but I am certain the I'rime Minister was there. Sir Hugh Allan never spoke to me of the election fund. I did not know lie had subscribed until I saw it in the newspapers ; I never heard of it from him nor any one else. I never had any conversation with Mr. Abbott on the subject of moneys to be sub- scribed by Sir Hugh Allan for the elections, and have no knowledge of any conversation of that kind between him and any other person. Q. — Were you ever informed of the alleged facts into which this Commission is enjoined to inquire? yl.— No; there was nothing that could lead me to suspect that any such facts were true. I think if they were true I would have known them as a Minister. By Mr. Laxgevin, through the Chairman: (2-— Could you say what was the opinion of the members of the Government on the subject of the construction of the Pacific Railway by Americans and with American capital ? A. — With the exception of one of the Ministers, whom it is not necessary to mention, the Ministers were hostile to the construction of the Pacific Railway by Americans and with American capital. Q.— Can you state the name of the Minister who was considered favourable to the r C'anad*. Ari'': 1.42 CORRESPONDENCE RELATIVE TO THE Canada. Americans in connection with the construction of tlie Pacific Railway with American capital ? A. — I understand Sir Francis Hincks was not unfavourable to that. Q. — Do you know particularly if Sir George Cartier was opposed to the construction of the Pacific Railway with American capital ? ^4. — I have heard Sir George Cartier energetically oppose such a course, and I may here say the same for myself. Q. — Can you say if the negotiations for granting the Charter to the Company now cliar- tcrcd to construct Lhe Pacific Railway, were anterior to or after the general elections ? A. — These arrangements w<>re posterior to the elections. Q. — Is it correct that after the general elections the Government did all they could do to convince Sir Hugh Allan and Senator Macpherson, as representing the two in- corj)orated Companies, to consent to ai: amalgamation of the two Comj)anies, as provijrd for l)y the Act authorizing the Government to grant a Charter for building the Railway? A. — The greatest eflbrts were made by the Government, and the greatest persuasion was used to induce the interested parties in the two Companies to agree to amalgamation for tlie building of the road, and it was only after the imj)ossibiIity of arriving at such an agreement that the Govennnent used the means which the law gave them to exercise in the presence of suv^h an emergency. Q. — In granting the Charter of the Company which now exists, do you know if tlie Government liad in. view the sjjccial interests of Sir Hugh Allan ; or if, on the contrary, the Government did not do all it could to ensure the construction of the railway by means of a Company caj)able apparently of securing a representation of the federal interests of tht Dominion? A. — From the commencement to the end the efforts of the Government were constant to form a Company which would afford the best guarantee for the completion of tliat great work. Those (>flbrts tended to conciliate, as far as possible, the opposing interests of the two Province^, the most important in the Dominion, I mean Ontario and Quebec; and to that end W(! chose tlie organization of the Company now existing, the namw affording the best guarantee that the work will be accomplished. We considered tlie desirability of introducing into the new Company the names which appeared in both Acts of Incorporation of the Company. (2. — Can you state positively that before the general elections there was no agreement between Sir Hugh Allan and the Government on the subject of the construction of the Pacific Railway ? A. — In my recollection as a member of the Government, there never was any such agreement. (I — By the President: Can you say whether Sir Francis Hincks continued to hold his first o])inions about American cajiital, or whether he surrendered them subsecjucntly? ^'1. — Yes; he gave uj) his own opinions afterwards, and coincided in the views of his colleagues. And the said deponent saith nothing more for the present. On the thirteenth day of September, lAl'A, the witness again appeared and desired to add the following to his deposition : At the time of the interview between Sir Hugh Allan and some members of the Cabinet, of which I have above spoken, he was accompanied by two ,jersons named resjiectively Smith and ^NlcMiiUen. After the usual introduction, the question of the Pacific was mentioned by them. As well as I can remember, the following was the substance of the short conversation which took i)lacc on this subject. Sir John .\. Macdonald inquired if they had anything to say. To this they replied as follows : — " In " case projjositions are made to the Government, are they ready to discuss the".?" On Sir John replying in the negative, the gentlemen said that undei" tliese circumstances they had nothing to say. And the interview thus terminated. Ii$ And further the deponent saith nor, and this his deposition having been read by him, he declares it contains the truth, persists therein, and hath signed. Sworn, and taken on this twelfth day of^ (Signed) September, acknowledged Septemljcr, one thousand hundred and .seventy three. 13th I eight I JEAN CHARLES CHAPAIS. (Signed) CHARLES DEvv^EY DAY, Chairman. A. POLETTE, JAMES ROBERT GOWAN, Commissioners. CANADIAN PACIFIC RAILWAY. 143 with American IN THE MATTER OF THE COMMISSION ver was any sucli (l and desired to it'll read by liim, S CIIAPAIS. Province op Ontario,") CiO/ of Ottawa, J Appointing Chakles Dewey Da-»', Antoine Polette, and James Robert Gowan, Com- missioners to inquire into and report upon tlie several matters stated in a certain Resolution moved by the Hon. Mr. HiNTixacox in the House of Commons on the second day of April, a.». 18/3, relating to the Canadian Pacific Railway. Present : The Commissioners. On this twelfth day of September^ in the year of our Lord one thousand eight hun- dred iind seventy-three pei"sonally came and appearetl before us, the abovp-named Commissioners, The Honourable MATTHEW HENRY COCHRANE, of Compton, in the Province of Quebec, wlio being duly sworn, deposeth and saith : — I reside in Compton, Quebec. My occupation there is I'armer and stock breeder. I am a member of the Senate, 1 know Sir Ilugli Allan. I do not know Mr. G. W. McMullen. (I — Have you any knowledge of any agreement or negotiation between Sir Hugh Allan and Mr. McAlulleu in relation to tlie construction of the Canada PaciiicRailway at any time ? A. — None whatever. Q. — Have you at any time heard any member of the Government or Sir Hugh Allan himself make any reference to the existence of any such agreement or negotiation ? ^l. — Not to my knowledge. Q. — Were you, Irom the nature of your occupation, or from any particular position you were in, likely to become acquainted with negotiations of that character? ^1. — I might. Q. — Have you had any conversation with any of the members of the Government in relation to any contemplated agreement for the building of the Pacific Railway with American capital ? A. — I have not. (?. — Have you any knowledge of an understanding between Sir Hugh Allan, Mr. Abbott, and the Government, or any members of the Government, for the supplying of money to aid in the election of Ministers and their supjjortcrs in the general elections of 1872? J.— None, aside from what was in the i)ublic press ; nothing else. Q. — Has anything in any way come to your knowledge which would lead you to believe that there was such an understanding ? A. — None. Q. — Did you take an active interest or part in the ch?ctions of 18/2? A. — I was interested in them ; but I was on no committee whatever. Q. — Do you know of the subscription of any sums of money for the carrying on of these elections ? A. — One small sr.ia only. Q. — Was that in the city of Montreal or in the neighbourhood where you live ? A. — It was in Montreal. Q. — Was that sum subscribed by Sir Hugh Allan ? A. — It was not. Q. — Do you know what amount was subscribed in Mont il for the promotion of the elections ? A. — I do not. Q.— Do you know whether Sir Hugh Allan added to that subscription in any way ? A. — I don't, of my own knowledge. Q. — Have you any knowledge that anybody else, besides this one person whom you h.ave alluded to, subscribed ? A. — I have not. Q. — Have you any objection to state who he was? A. — It was the firm of Smith, Cochrane & Co., of which I am a partner. We have been in the habit of doing so at all the general elections, and have '.^-en doing it for many years past. Q.~ Have you any knowledge of the matters to be inquired into by this Commission? any knowledge relating to the construction of tiie Pacific Railway, or to tiie furnishing of money lor the elections, which you have not stated, and which may be of use to us ? T 2 Canada. i !'■ d 144 COKUESrONDENCE liELATlYE TO THE CiifADA. A — I was one of the Provisional Directors of the Tntcroceanic Comjiany. (2. — Are you aware of the negotiations which took place for an amalgamation between tliat Company and the Canada Pacific Railway Company? A. — Only what I have learned from the press. I never met the Directors but once, and that was in June of 1872, in Toronto. That was before these negotiations took ])lace. Q. — Do you know why thcpe negotiations failed ; why the amalgamation did not take l)lace ? A. — I don't further than what I see in the press. Q. — Are you aware that your name was put down on the list of witnesses ? A. — I am not. Q, — Have you any idea what information or what kind of information was expected to be derived from your testimony ? A. — I have nrt ; I have no idea unless it was because I was one of the Provisional Directors in the Interoceanic Company. To Sir John A. Macdonald, through the Chairman. I have no idea why I was put on Mr. Huntington's list of witnesses. I never had any conversation with Mr. Huntington on this matter except in a joking way after he had made liis charges. There was nothing said by me that would lead him to believe that I knew anything about this matter ; not the slightest. And further deponent saith not for the present. And on this thirteenth day of September, 1873, the witness re-appeared and made the following addition to his foregoing deposition : I wish to add to my answer to the question — "' Have you had any conversation with any member of the Government in " relation to any contemplated agreement for the building of the Pacific Railway with " American capital?" — the following: On the contrary, I have repeatedly heard one miml)er of the Government say that on no condition would Americans be allowed to liavo any control. Q. — What member of the Government said so, and at what time and where was it said ? A. — It was the Honourable Mr. Pope, in the fall of 1872, on several occasions at Ottawa, and also at Montreal. And further deponent saith not, and this, his deposition, having been read to him, he declares it contains the truth, persists therein, and hath signed. Sworn and taken on the twelfth day of "j September, 1873, and acknowledged I on the thirteenth day of said month f and year. / (Signed) CHARLES DEWEY DAY, Chairman. A. POLETTE, JAMES ROBERT GOWAN, Commissioners. (Signed) M. H. COCHRANE. IN THE MATTER OF THE COMMISSION PiinviNCK OF Ontario, ) City of Ottawa. ) Appointing Charles Dkwkv Day, Axtoine Polettk, and James Robert Gowan, Com- missioners to inquire into and report upon the several matters statt'd in r. certain RosoKition moved by the Hon. Mr. Huntixoi'ox, in the House of Coinmons, on the second day ol' April, A.n. 1873, relating to the Canadian Pacific Railway. Present: The Commissioners. On this twelftli day of ^-'eptember, in the year of cur Lord one thousand tnght hundred and seventy-three, personally came and appeared before us, the al)ove-naraed Commissioners, FREDERICK WILLIAM ('UMBERLAND, of the City of Toronto, who being duly sworn, deposeth and saith : Q. — Where is your place ol residence? A. — Toronto. Q. —What is your occujiation there ? , A. — Managing Director of the Northern Railway. Q. — Do you know Sir Hugh Allan ? ^.—I do. CANADIAN PACIFIC EAILWAY. 145 ation between 1 did not take ad to him, lie Q. — Do you know Mr. George McMullen ? A.— I do not. Q.~ Have you any knowledge of any agreement or any negotiations Vjetween these gentlemen in relati JU to the building oi' the Canada Pacific Railway with American caj)ital ? A.— I have not. Q, — (lave you any knowledge of any negotiations in relation to the construction of the Pacific Railway in the winter of 1872, or the autumn of 1871 ? yl.— Yes. Q. — Will you state what that knowledge was ? A. — Do you mean negotiations between other parties, or negotiations in which I myself was engaged ? Answer by Commissioner. I nuan negotiations in which Sir Hugh Allan was engaged. Answer by witness. Noiie whatever, except for the jnirpose of the amalgamation ol" the Interoceanic Com- pany with that of the Canada Pacific. Q. — Had you any knowledge of any negotiations having for their object the construc- tion ol' the Pacific Railway with American capital at any time? .1.— None. Q. — Were you a Provisional Director of the Canada Pacific Company, that was incor- porated in the Session of 1872 ? A. — I was a Provisional Director of the Interoceanic Company that was incorporated during that Session, but not of the other. Q. — Was the Interoceanic Company in some sense the rival of the other Company ? yl.— It was the Company commonly known as the Mac2>herson Company. Q. — Was it antagonistic to the other Company? yl. — Yes, it was the rival of Sir Hugh Allan's. (2— Are you a Director of the Canadian Pacific Railway Company — the one now chartered ? .1. — I am. Q. — Have you any knowledge of any negotiations which took place for the amalgama- tion of the Canada Pacific Railway Company and the Interoceanic Railway Company ? ,1. — I was aware of an eiTort being made to bring about that amalgamation, Vnit jjeforc tlie iflbrts were exhausted I left for I^iigland. Q. — Were there any negotiations Ijctween the two Companies having that end in view — tlie amalgamation ? A. — No, not to my knowledge. The negotiations 1 whiih I referred just now were those emanating from the Government. My opinion as soup;ht by a member of the Goveiiiment as to whether such an amalgamation was possible. Q. — V\ ho was that member? yl. — Tiie Hon. Mr. Camptell, then Postmaster-General. (2. -What was your impression as to his views on the subject ? yl. — Mr. Campbell evinced very great anxiety to bring about an amalgamation, and asked my opinion as to the possibility of it, so far as I knew the opinions and views of my colleagues on the Interoceanic Board. Q. — At what time did this conversation take place? yl.— T think it was about the end of October or early in November, 1872. Q. — Did any amalgamation take place? yl.— No. (2.— Why not? -l. — I caiHiot say of my own knowle-lge, because the efforts towards amalgamatin' 'id not been exhausted when I was obliged to leave for England, and I was not awari what couiiso these events too,; after my interview with Mr. Campbell. I was aware tliat he acted in some measure upon my advice, my opinion being that an amalgamation was not impossible, and that the majority of my colleagues on the Interoceanic Board would con- sent to such an amalgamation, provided that they obtained u sulRciout guarantee for the exclus on of American influence, to which I had already expressed our objection. Mr. Campbell told me that those guarantees would be given, and of a nature that would be quite satisfactory to us. I then, although recognizing personal difficulties as between Sir Hugh Allan and Mr. Macpherson, expressed the opinion tliat the majority of my col- leagues on the interoceanic Board would accept such a guarantee and consent to the amalgamation. Thai, however, did not priv,j to be correct. Canad.\. Q. — Was any sufficient guarantee given to the Interoceanic Company? WW m-ii 1 iff "** n Canada, lu I4n CORRESrONDENCE RELATIVE TO THE A. — 111 my opinion the guarantees that were then suggested by Mr. Campbell were amjily sufficient. Q. — They did not satisfy the Intcroceanic Company, did they? A. — I don't know. I tliiuk there were some personal reasons that probably offered additional obstacles. Q. — I low long were those negotiations going on, tending to the amalgamation of the two Companies? A. — It must have been for a very short time, because I left, immediately after my intcrvi'Hv with ]Mr. Campbell, for England. Q. — Are you able to say whcni tliey began? A. — My impression is that Mr. Campbell came to me first, so far as Toronto was concerned at any rate. I don't linow tliat I am able to state the date of that conversation witli accuracy, for I only remember it as immediately preceding my leaving for England. I til ink I left for England early in November. Q. — Had you any conversation Avith any other Member of the Government on the subject ? A. — Yes. I had a conversation with Sir John A. Macdonald. Q. — What was tlie purport of that conversation ? A. — It was after my interview with Mr. Campbell, and I think on my way to England ; the conversation was somewhat similar to tliat which I held with Mr. Campbell. I think I told Sir Jolin the purport of that conversation, and repeated my own views as to the possibility of an amalgamation. Q. — Was there any conversation especially, as to the exclusion of American capital and of the American element altogetlier, in your interview with Sir John A. Macdonald? -I. — Yes; both with Mr. Campbell and Sir John A. Macdonald. I explained that the American element would have to be excluded, but I thought if there was a sufficient guarantee given as to that, an amalgamroceanic Board appointed Directors of tlie Canadian Pacific Company, but at tills moment I do not recollect them. Looking at tlie list I see there were Major Walker, Mr. Shanly, uiid myself — these are the only ones that I recognize from Ontario. To Sir John A. Macdonald through the Chairman : Q. — On this occasion, on wlrich you and I had the conversation anterior to your going to England, do I understand that tliat conversation was as to tlie formation of a Boanl in case the amalgamation fell througli ? J.— Yes. Q. — And I was negotiating to get your opinion as to fitting representatives from Ontario on the Board of the Chartered Company ? We considered a great many names, including your own, did we not ? A.—\VH. Q. — You said that if you could be of use in the Company or out of the Company tliat I might use your name ? A.~l did. Q. — You took part m the Elections in Ontario, did you not ? A.~l did. Q. — In Toronto and vicinity ? A. — Yes. Q. — Did you subscribe to the Elections at Ontario? A. — I heljied at the Elections pecuniarily. Q. — In subscribing to the Elections, did you consider in any way that you were recompensing the Government for any interest in this railway. Canada. 148 CORRESPONDENCE RELATIVE TO THE Canada. A, — CtMtaiiily I did not. I subscribed and paid as a member of the party. I may just add this that I expressed rather strong reasons originally when I was invited to go on tlie Interoccanic Hoard ; and to yourself, I think, subsequently, with rel'erence to tlie possibility of my name being ])laced on the Board of the present Company, and at that interview, anterior to my going to England, I said that I had no desire to serve upon that Board, that I saw nothing in it : That tlie terms then described by the Government were not sucli as to attract anybody to the work, but that I was willing to work as a public servant. I did not consider that the terms were sufficiently liberal. Q. — You agreed to serve upon the Board if it was necessary, from public and patriotic motives ? -1. — As a public servant. I saw nothing in it. And furtlier deponent saith not, and this his deposition having been read to him, he declares tliat it contains the truth, persists therein, and hath signed. Sworn and taken on the twelfth day of \ Septcmbe;, 1873, and acknowledged /•si^ned^ V W C'lMRFRT AND on the thirteenth day of said month K^^6^<^V i ■ W. bJMlil.KLAMD. and year. J (Signed) CHARLES DEWEY DAY, Chairman. A I'OLETTE, JAMES ROBERT GOWAN, Commissioners. "•} IN THE MATTER OF THE COMMISSION 1^' Province op Oxtario, Citi/ of Ottawa. Appointing Craiiles Dewey Day, Antoine Polette, and James Robert Gow;*x, Commissioners to inquire into and report upon the several matters stated in a certain Resolution moved by the Hon. Mr. Huntixgton in the House of Commons on the second day of April, a.d. 18/3, relating to the Canadian Pacific Railway. Present : The Commisstoner.«. On this twelfth day of September, in the year of our Lord one thousand eight hundred and seventy-three, personally came and appeared before us, the above-named Com- missioners, DONALD McINNES, of the City of Hamilton, Merchant, who being duly sworn, deposeth and saith : I reside in tlie city of Hamilton. My occupation there is that of a merchant. I know Sir Hugh Allan. I do not know Mr. Geo. McMullen. Q. — Do you know of any negotiation carried on between these gentlemen, or of any agreement between them in the autumn of 1871 or the winter of 1872 for thepurpose of building the Canada Pacific Railway with American capital ? A. — No ; I know nothing about it. I may state that I think it was in tlie autumn of 1871, Sir Hugh Allan asked me whether I would consent to become a director ol tlic Canada Pacific Railway, and I consented. I think he told me in general terms that he was negotiating with some American capitalists, but I know nothing whatever beyond that. I don't think he stated who they were, Q. — Do you remember about the time this took place? A. — No. I do not. Q. — Can you fix about the time? A. — I cannot charge my memory exactly. I remember the occasion. It was on the train between Cornwall and Montreal. We had been at Cornwall to attend the meeting of a manufacturing company, in which we were both interested, and it M'as on the way back to Montreal that we had this conversation. I think it was about the latter end of 1871. Q. — Had the winter set in ? A. — I think so. Q. — Did he mention to you the name of Mr. McMullen ? A. — No. I don't think I ever heard of his name until it appeared in print recently. Q. — Did you understand that any agreement had been made ? '■ ^. — No. I understood that no agreement had been made. to. — Were you one of the Provisional Directors of the Canada Pacific Railway ? ^.— Yes. Q. — In that capacity did it come to your knowledge that any negotiations M'ere being carried on ? A. — No : it so happened that I never attendod any ,»f the meetings. CANADIAN PACIFIC RAILWAY, 149 ead to him, he IBERLAND. Q, — IIiivc you had any conversation witli any member of the Government that .Canada. wouUl lead you to tliink that such negotiations were going on? ^.— No. Q. — Do you mean to say that you liave no other knowledge than that which you have stated above in rel'erence to these negotiations? A. — None ''. natever, except, of course, what has recently appeared in the newspapers. Q. — Are you a member of the present Canadian Pacific Company? A. — Yes. I was named a Director wlien I was in England, by Sir John A. Macdonald. Q. — Can you state why that Comj)any was chartered, instead of the old Company, "the Canadian Pacific/' going on? A. — No, I cannot state the exact reasons. I was absent in England when that Company was formed. Q. — Have you any knowledge of any negotiations between the Canada Pacific Company and the Interoceanic Company with respect to an amalgamation ? A. — None excejit what appeared in the public pa])ers. (2. — You don't know otherwise than from the public prints that such a negotiation was carried on between the two Companies? A. — No ; I may have heard it mentioned in conversation that sucli a thing was going on, but nothing beyond that. (2. — Do you know whether there arc any American capitalists among the Directors of the Canadian Pacific Company, or any American capital invested there ? A. — I am not aware of any. Q. — Have you any knowledge, Mr. Mclnncs, of money having been subscribed for the sujiport of Ministers and for the aiding of elections of Ministers and their supporters in 1872, at the general elections in Ontario ? .,•1. — Yes ; I know there was money subscribed in the constituency where I belong, find paid. Q. — ^Do you know whether any money was subscribed by Hir Hugh Allan or Mr. Abbott ? .1. — No; I do not know of any. Q. — Was any money sent up from the Province of Quebec ? A. — None that I am aware of, (2.— Have yon any knowledge relating to the elections in the Province of Quebec? A. — None whatever. To Sir John A. Macdonald, through the Chairman : Q. — I think you are one of the principal merchants in Hamilton ? A. — I am a merchant there. Q. — It was in your capacity as being a merchant largely engaged in business that Sir Hugh Allan asked you to go on the Board of the Canada Pacific Company? A.- — I presume so. Q. — And to get a representative from Ontario? A — I think so. Q. — From whom did you first get any informa^^ion of your being selected to serve on the Board of the Chartered Company ? A.- — From yourself I was in London at the time, and received the news by cable. I received no information other than from yourself I answered accepting the appoint- ment. Q. — Have you any jjarticular relations with Sir Hugh Allan? A. — No, none. I am quite independent of him in business matters, except that we have a joint enterprise in Cornwall in a manufacturing Company. I know u? subscriptions being made at the last elections in Hamilton. That always hajjpened at t^ections, unfortunately. I know that I subscribed. Q. — On the right side, and at the right time ? A. — Yes ; I did that of my own accord, and not on account of being on the Pacific Railway. Decidedly not. I did not show any great anxiety to get on that Board, or to be connected with that enterprise. Q. — Was it altogether as a matter of duty and principle that you consented to serve on that Board ? A. — I felt that it was a great national undertaking, and if my services would be of any use in its promotion, that it was my duty to place them at the disposal of such a public work. And on this thirteenth day of September, 1873, reappeared the said witness and made the following addition to his foregoing deposition : I desire to add with respect to some correspondence which was published in the news- U 150 rOERESPONDENrE RELATFYE TO THE CANAnA. pajjcrs, in which my name was i)ut ns receivins hy wuy of gilt, as I undi-rstood it, the sum ol' !ir)O,0()0 ol' thi' C'anathi Pacific stock. I beg to state that Sir Hugh Allan, nor any one else, never made such an unworthy proposal to me. And further deponeth saith not, and this his deposition having been read to him, he declares that it contains the truth, persists tlierein, and hath signed. Sworn and taken on the twelfth day of September, "J 1873, and acknowledged on thirteenth day V (Signed) D. McINNES. of said month and year. J (Signed) CHARLES DEWEY DAY, Chairman. A. POLETTE, JAMES ROBERT GOWAN, Commissioners. •} IN THE MATTER OF THE COMAHSSION P ^L* ^r'' Provixce op OxTAnin," Citi/ of Ottawa. Appointing Charles Dkwey Day, Axtoine Polette, and James Roiiert Gowax, Commissioners to inquire into and rejiort upon the several matters stated in a certain Resolution moved by the Hon. Mr. HrxTrxoTON in the House of Commons on tlie second day of Ajiril, A.n. IS73, relating to the Canadian Pacific Railway. Present : The Commissioners. On this twelfth day of September, in the year of our Lord one thousand eight hundred and seventy-three, personally came and appeared before us, the above-mamed Commissioners, ROBERT N. HALL, of the Town of Sherbrooke, in the Province of Quebec, Advocate, who being duly sworn, dcposeth and saith : I reside in Sherbrooke. My profession is that of an advocate. I know Sir Hugh Allan. 1 do not know Mr. G. AV. McMullen. Q. — Have you any knowledge of any negotiation or agreement between Sir Hugh Allan and Mr. McMullen, relating to the construction of the Pacific Railway ? A. — Not the least, no knowledge of it whatever. (2 — Have you ever had any conversation with any member of the Government in relation to any such agreement ? A . — I have not. Q. — Have you ever had any means of knowing whether such a negotiation was going on with a view to an agreement of that nature? -.1. — I never saw anything to indicate it. Q. — Is it then a matter concerning which j'ou know nothing at all? A. — I have no knowledge of it Avhatever, not the least. Q. — Have you taken an interest or have you been engaged in railway enterprises ? -1. — I have taken quite .in interest in the promotion of railways in the section of country in which I live. U- — Have you had any interest or taken any i)art in the movement for building this Pacific Railway? .1. — I was ajipointed one of the Directors of the Canadian Pacific Company, that is the CJiartered Comi)any. (I. — When did your acquaintance or connection then begin with the enterprise for building this Railway ? -1. — It was only a short time before my appointment and before the signing of the contract. C2. — Before that did you know anything about it or had you taken any interest in the matter ? A. — I had taken quite an interest in it, although I did not identify myself in any way with its promotion. 'i. - You had not been consulted by Sir Hugh Allan or any other person in relation to the construction of it . -^^1. — No, I had not. I had no connection with Sir Hugh Allan in reference to it. In fact I did not know him before the contract was signed. My acquaintance with him is only since that time. Q. — Did you take any part in Lower Canada in the general elections of 1872 ? . A. — I did not^ CANADIAN PACIFIC RAILWAY. ' 161 bee, Advocate, i^een Sir HurIi Q. — Do you know of any money having been subscribed in aid of tlie election of Ministers or their supporters? A. — No, I do not. Tliere were very lew contested elections in the Townships, the elections were by acclamation — those at least in the part of the Townships were I reside. Q. — Do you know anything of the Montreal elections? A. — Nothing whatever. Q. — Do you know whether there was any subscription of money for the carrying of them on ? A. — I do not. Q. — Do you know whether Sir Hugh Allan contributed anything in aid of the elections in any part of the Province of Quebec ? A. — I do not. No contribution ever came to my knowlege in anv way. Q. — Are you aware of the reasons for which your name was put on the list of witnesses ? A. — I cannot imagine any reason. I never had any conversation with Mr. Hunt- ington at all. I had no knowledge of anything that tended to support the charges made by him. To Sir ,Iohn A. Alacdonald, through the Chairman : Q. — Do you know at whose instance it was that you became a member of the Board of the Canadian Pacific Railway ? A. — At the instance of the Hon. Mr. Pope, Minister of Agriculture ; at least I under- stood I was nominated by him. He is tlie representative of the Townships in my part of the country. He asked me to become a Director. He said it was desirable that that suction of the country should be represented on the Board, and asked me to act. He saiti there were two representatives from Montreal, and one from Quebec, and he thought therefore that the Eastern Townships should have a representative on the Board. I was in no respect, that I am aware of, the nominee of Sir Hugh Allan. I had no personal acquaintance witli Sir Hugh Allan at the time. I had reason to believe that Sir Hugh Allan wished to name another gentleman in my place. That gentleman was Mr. Foster. I understood tliat negotiations, at least the signing of the contract, was delayed on account of Sir Hugh Allan's pressing the nomination of Mr. Foster. And further deponent saith not, and this his deposition having Iteen read to him, he tleclares that it contains the truth, persists therein, and hath signed. Sworn and taken on the twelfth day of September, 1873, and acknow- ledged the thirteenth day of said month and year. (Signed) CHARLES DEWEY DAY, Chairman. A. POLETTE, JAMES ROBERT GOWAN, Commissioners. Canada. (Signed) ROBT. N. HALL. IN THE MATTER OF THE COMMISSION Province op Ontario,) City of Ottawa. § Api)ointing Charles Dkwky Day, Axtoine Poi.ktte, and Jamks Robkkt Gowax, Com- missioners to inquire into and report upon the several matters stated in a certain Resolution moved by the Hon. Mr. Huxtixotox in the House of Commons on the second day of April, A.D. 1873, relating to the Canadian Pacifin Railway. Present : TiiK Commissiox'ers. On this thirteenth day of September, in the year of our Lord one thousand eight hundred and seventy-three, personally came and appeared before us, the above-named Commissioners, JOSEPH IIAMEL, of the City of Quebec, Merchant, who being duly sworn, deposeth and saith : I know Sir Hugli Allan very slightly. I never had any conversation with him. I do not know G. W. McMullen. Having heard read that part of the charge contained in the Royal Commission which reads as follows : "That in anticipation of the legislation of last Session, as to the Pacific Railway, an agreement was made between Sir Hugh Allan, acting for himself and certain other U 2 152 COimESPONDENCK RELATIVE TO TTIIO Canada, ifi' Canadian promoters, and (.i. W. McMullcii, acting for certain United States capitalists, wliercl))' tlio latter agreed to furnish all tlie funds necessary for the construction of the contemplated railway, and to give the former a certain percentage of interest in con- sideration of their interest and position, the scheme agreed upon being ostensibly that of a Canadian Company with Sir Hugh Allan at its head," I declare that I know nothing of tliis arrangement. 1 only know wliat I have seen in the news])apers, nothing more, I am not aware whether the Ciovernment knew of the existence of such an arrange- ment between Sir Hugh Allan and G. ^V. McMuUcn. I do not know whether there existed any negotiations between certain persons for the construction of the Canada Pacific Railway, No Minister or meml)er of Parliament spoke to me on the subject, I declare that I only know of this affair through what 1 have read in the newspapers. Having heard read the other part of the charge contained in the Commission, which reads as follows : "That subsequently an understanding was come to between the Government, Sir Hugh Allan, and Mr. Abbott, one of the members of the Honourable House of Commons of Canada, that Sir Hugh Allan and his friends should advance a large sum of money for the purpose of aiding the elections of Ministers and their supporters at the ensuing general elcci'ons, and that he and his friends should receive the contract for the con- struction of tht railway," I declare that I know absolutely nothing of such an arrangement, except what I have learned tiirough the press. Sir Hugh Allan never told me that he had advanced money for the elections of Alinisters and their supporters, nor did Mr. Abbott, whom I know very slightly. No member of Parliament or Minister ever told me that Sir Hugh Allan had advanced money for the elections of 1872. I have no knowledge that money was subscribed (or ihe Montreal elections. As to other places, 1 am aware that subscrij)tions are always raised to assist the elections of JViends of the Government. I do not know that Sir Hugh Allan subscribed to aid the elections, nor Mr. Abbott either. I do not know if the friends of Sir Hugh Allan advanced sums of money for the elections of Ministers or their friends. When I say that I do not know that sums of money were advanced for the elections of 1872, I mean sums coming from this source — that is from Sir Hugh Allan, There were moneys subscril)ed by other friends of the Government towards the elections, but it was not for the election of Ministers. The subscriptions I have just Mentioned may have reached five or six thousaiul dollars for the election at Kamouraska. I am not aware of any moneys for other eUctions, I have never had any conversation with members of Parliament or Mith Alinisters on the subject of subscriptions by Sir Hugh Allan or Mr. Abbott, or their friends, for the elections of Ministers or their partisans, and no conver- sation occurred in my presence on the sulyect. I know absolutely nothing, of my jiersonal knowledge, of the charges mentioned i i the Royal Commission. I can form no idea why my name was on th j list of witnesses unless it was because I am a friend of the Government, I persist in declaring emphatically that 1 have no knowledge of any arrangement or understanding such as that mentioned in the charges before the Royal Commission, and I declare that I have had no conversation with Ministers or members of Parliament on this subject, and that they have never spoken about it in my presence. The money subscril)cd for Kamouraska was subscribed at Quebec and Kamouraska. It did not come from Montreal, And further deponent saith not, and this his deposition having been read to him, he declares that it contains the truth, persists therein, and hath signed. Sworn, taken and acknowledged on the day,^ month, and year first above written, > (Signed) JOS, IIAMEL. before us, j (Signed) CHARLES DEWEY DAY, Chairman. A. POLETTE, JAMES ROBERT GOWAN, Commissioners. Sfi.'., f'AXADIAN PACIFIC RAILWAY. ina IN Tin: MATTER OF THE COMMISSION have scon in rsoiis lor tlie vas because I PlvOVINCK OP OmTARIO, City of Ottaira. Ajipoiiiting Ciiai!m:s I)i:\vi:v Dav, Antoini.; Pouottk, and Jami:?! Roiumit Gowav, Com- inissioiu.'i'H to iiKiiiire into ami i\-\)q\-\ upon the st'vcral matters stated in a certain liesol'.itiiin moved hy the Hum. 5lr. I[i .ntin(JTO\ in the House of Commons on the second day of April, A.n. iS/;?, rclatinjj; to the Canadian Pacific Railway. Present: Tni: C'o.mmissio.nkks. On this fifteenth day of Septemlier, in the year of our I^ord one thousand eight Innidred and seventy-three, personally came and appeared before us, the above-named Commissioners, ECEllTON K. lU'RPEK, of the City of St. John, in the Province of New Brunswick, Civil Engineer and Contractor, who being duly sworn, deposeth and saith : Q. — Are you a member of the Dominion Parliament ? yl.— No. Q.— Wi you know Sir Hugh Allan ? A. — I am acquainted with him slightly. Q. — Do you know Mr. (Jeo. McMullen ? ^.— Yes. ^.— When did jour acquaintance witli Mr. McMullen begin, have you known him any length of time? .1. — No; I have known him since about the Session of 1872. (l — ^Vere you one of the Provisional Directors upon tlie Board of the Canada Pacific h'ailway Company, incorporated during the Session of \S72''. A. — Yes. Q- — Have you any knowledge, Mr. Burpee, of any agreement between Sir Hugh Allan and Mr. .McMullen, representing certain American capitalists, for the building of the Pacifii- Railway with American capital? ,1. — I was told by Mr. McMulh.'U that there was such an agreement. (2— Do you remember when he told you that ? .1. — At the same time — the Session oi' 18/2. Q — Can you specify more nearly the year, month, or day? A. — It was about the last of the Session. Q. — Was it after the Act of Incorporation had been passed or before ? A. — It was before. Q. — What did he say to you on that occasion? A. — I met him a great many diflerent times. He told me there was an arrangement made with American capitalists, in connection with Sir Hugh Allan, to build the road ; and he wished me to become a member of the Company. Q. — Did he state if there was any condition of that arrangement by which a certain interest was to be paid to Sir Hugh .\llan? .1. — No. There was a condition that Sir Hugh Allan was to be one of the Comjjany. Q. — Do you know who were the American capitalists whom Mr. McMullen represented ? -I. — I cannot remember them all; there was a large number. There was Governor Smith mentioned. Jay Cooke, and General Cass. 2. — ^Did you understand that the (Government of the Dominion was at that time favourable to that arrangement ? A. — No, I did not. It was rather adverse. Q.. — Did ^Ir. McMullen say anything to you on that subject ? A. — Nothing definite at all, except that he wanted the Government to acquiesce. Q. — Was this after the agreement to which you have adverted had been signed ? A. — He said it had been signed. Q. — At whose instance did you become a Provisional Director? A. — At the instance of Sir Hugh Allan and Mr. Abbott ; but I was for a long time interested in the Pacific Railway. We had been talking about it for some four or five years. I was solicited by both the Interoceanic and the Canada Pacific Company to join with them. I had a desire to be interested in the work, having already spent four or five years in working in connection with it Q. — W^ere jou requested to become a Provisional Director of the Interoceanic Com- pany before you were connected with the Canada Pacific Company ? il.-Yes. Q, — Was the Government aware that you had been requested to become a Director of the Interoceanic Company ? Canada. i 1S4 COIIIIESPONDENCE RELATIVE TO THE . K ■ 1- II. Canada. /J. — J cnnnot say timt they wore. Tlioso mombors of tlio Govfrnmeiit with whom T had any coMvcrsatioii liad always told mo that tlie two Companies would l)c amalga- mated ; or at loail lliat was their imi)ressioii. Q. — Who were those members of the (ioveriunent? A. — The members from the Province of New Bi uiswiek, M/. Tillcy and Mr. Mitchell. Q. — What reason had you to !)clievo that the Government was adverse to the intro- duction of American cajntal? A. — I liad l)een told by members of the Govi'rnment that it was intended that tlic road should be built with Canadian or British capital. Q. — Will you name tlie {gentlemen who told you so ? A. — I d(i not rcniembc.'r e.\actly, Init 1 know tiuit it was Mr. Mitchell's idea that the road shoubl be; so built. Q. — Any other besides Mr. Mitchell? A. — I tliink there were several others besides him. 1 tliink it was Mr. Tillcy's idea also. Q. — From your several conversations with members of the Government what was the conclusion tliat you came to as to the disjjosition of the Government in the matter '! A. — I was (juite convinced that the two Companies would hv united. For that reason I thoui^lit that it was immaterial as to wiiich Comi)any I belonged to. My opinion is, from the conversations I had^witli members of the Government, that the Government was adverse to the admission of American capital. Q. — Had you any personal knowledge of negotiations tending to the amalgamation of these two Companii's — the Interoceanic and the Canada Pacific? A. — No personal knowledge. I took no part in these negotiations. Q. — Do vou know why the negotiations were unsuccessful ? ^.— No." Q.- — An- you now a memljcr of the Board of Direction of the Canadian Pacific Company ? ^.— Yes. Q. — By whom were younominatcd a Director? A. — By the members of the Dominion Government for tlie Province of New Brunswick, Mr. Tilley and Mr. Mitchell. Q. — That Company consists of how many Directors ? A. — Thirteen. Q. — Do you recollect the date of that Charter ? A. — I think it was in January, 1873. I cannot remember precisely. I was here at the time. Perhaps it was February. Q. — When you were asked to become a Director of the Canadian Pacifi • Company, or rather before you were asked to be so, were you consulted in regard to the terms of the Charter? A. — I liad talked it over with different parties, and I was told what the provisions were, and I also liad an opportunity of reading it. Q. — When was the contract given under this Ciiarter ? A. — At the same time, if I recollect right, or a few days afterwards. Q — Having seen the Charter, what was your opinion in regard to it, and the terms of the contract upon it ? A. — It was to be entirely Canadian under this new Charter. Q. — Was the stock subscribed in order to lead to that result? A.— It was. It was distributed in the dillerent Provinces in proportion to their population. I was retjuested to get up one-thirteenth of the stock, and before I became a member the greater portion of the stock for New Brunswick was subscribed by other people. Q. — Then tlie stock was to be redistributed by the thirteen Directors in their several Provinces ? A.~Yes. Q. — Were there any prescribed terms on which the stock should be given out by these thirteen Directors? A. — Yes ; there was no one allowed to exceed a certain amount, and it was to be kept entirely in the hands of British subjects. It was to be given out to the difi'ereiit Directors in j)roportion to the population of the Provinces which they represented; lor instance, one-thirteenth of the wliole stock was allotted to the Province of New Brunswick. CANADIAN PAf'IFIC RAILWAY. 155 idcu tluit thu adiaii Pacific nee of New was here at ic provisions the terms of their several ;ivcn out by Q. — Were you prohibitt'd from putting any premium uinm it? ^.-Yes. (}. Were these thirteen Directors on an equal footing? A. — Yes ; so I understood. Q,- 'I'lure was no i)refcrencc given to any one over the others? A. — I never could see any. Q. As a man experienced in the construction of railroads, do you consider the ('liarter to he, or the contract to t)e, one of a particularly favourable and profital)le duiracter ? A. — I did not consider it satisfactory, Q.- .Satisfactory to whom ? A. — I mean that I did not consider it advantageous. I considered it a liard contract. (2.— You stated, did you not, in the beginning of your evidence, that you are a rail- road contractor? A.-Yes. Q. — Were you induced to take a ])art in tlie Directorship of this Company with the ]]0])c of making a i)rofit out of it ? A. — I thouglit so at first, but when I cam" into this last Comi)any I could not see mucli chance lor making a profit. I exi)ecte(l in the first i)Iace when I was working in connection with tlu; road that a profit mijjbt be made out of it; that is, years previously I tliouglit so. (2. — Have you any knowledge of any undirstanding Iictween the Government and Sir Hugli Allan and Mr. Abbott, for the furnisiung of money for the promotion of elections iu 1872? A. — None whatever. Q. — Where were you during the period of these elections ? A.— In New Brunswick, I think. Q. — You arc not in a position to know anything of the matter ? ^.— No. Q. — Have you any reason to believe that any money was subscribed in the Pi'ovince of {^uelicc or Montreal for the purpose of the elections? ^l. — It is a matter of wliich I have absolutely no knowledge. Q. — I suppose you took some interest in the elections in New Brunswick ? A. — In some of them. (2. — Do you know if money was subscribed there for the supjwrt of the elections? A. — I did not see any subscribed ; but I know money was spent. Q. — Do you know from what source the money came ? A. — From individual candidates and from their friends for them. Q. — Have you any knowledge that Sir Hugh Allan or Mr. Abbott furnished any money for election jjurposes ? A. — I do not know. I have no knowledge whatever. Q. — Do you know whether any money was sent to New Brunswick for election purposes from tlie Provinces of Quebec or Ontario? A. — I iiave no reason to believe there was. Q. — Have you had any conversation with any member of the Government which would give you any knowledge upon that subject? ^.— No. a— Or with Sir Hugh Allan? ^.— No. Q. — You say you know Mr. McMullen. Have you any knowledge of the correspond- ence! which took place between him and Sir Hugh Allan ? .1. — Nothing, excejjt what he told me of the correspondence. (2. — Have you anything to add to what you said he told you iu relation to that correspondence ? yl.— No. Q. — You have never seen the correspondence between them — any of the original letters ? . I. — I have seen some of the original letters, but I cannot say now what they contained. Q. — Would you be able to identify any of them now ? A. — I am not certain. I don't think I would. Q. — Were any of the letters which you saw afterwards published in the public prints ? A. — No; but I have- not read them all. I cannot say for certain that they are the same. I would not undertake to say that I could identify them, as I paid at] the time very little attention to them. Canada, FipF' li'"'^' 15(1 COimESPONDENCE RELATI'^E TO THE ■VI"' if' Canada. (2.— Were you present at any of tlic conferences between Sir Hush Allan and :\Ir McMnllen? J.- No. 0.- — Or with either of these gentlemen and any member of the Government ? A. — No. Q- — ^o you know anytliing about tlicse telegrams which have been publislicd ? .•1. — No knowledge whatever. i Q. — Have you any further knowletlge relating to tlic subject of this inquiry ? -1. — I don't think of any. '-2- — Do you know wlietiier Sir Jlugh Alhin received any money from United States capitalists ? A. — Mr. McMullen told me tliat lie had advanced liim money for the preliminary ex])enses of organizing the Company and getting llie (.'harters. Q. — Have you any other knowledge ijesides that? -1. — Nothing except from him. Q> — Did Mr. McMullen say to you for what purpose the money was furnished by him .' A. — It was ior the preliminary ex])cnses in getting the Charter and organizing tho Compan;, . It was bel'ore the lirst Cliarter was got. Q. — Was the use of American capital ever contemplated in the new Charter? yl.— No. To Sir John A. Macdonald, through the Chairman: 1 am a civil engineer as well as a railway contractor. I have had large cxjiericncc in railways in New Brunswick and elsewhere lor the last fifteen years. During the last live years I have directed my attention towards tlie Pacific Uailway — I gut \\\) sonic statistics in reierence to it at oir' time. I expi'cted to make some profit out of it at one time. I was asked by the representatives of New Brunswick in the Caliinet to act as a Director. They informed me that they had put my name down and asked nic to serve as a representative man I'roni New lirunswick — at least I took it in tliat light. I had no idea of making any profit out of it as a Director. I had a misgiving as to whether the arrangement was a ])rofital)le one for the Company. I was not asked l)y Sir Hugh Allan to become a Director of the present Comjiany. I am quite certain that it was not due to Sir Hugh Allan that I was ajipointed. I cannot say that Sir Hugh Allan was opposed to me, but my impression was that he was ojiposed to me ; but I do not know it directly from himself. I thought at the time that he was opposed to me. The interest of N w Brunswick in this Company was one-thirteenth of the whole stock, and as a Di: .tor I subscribed one-thirteenth 'if the stock, and i)aid a tenth of that amount; at least my friends and myself together paid it. That is, my New Brunswick friends. They took some of the stock for me before I subscribed. Those persons who subscribed for me were all Canadians. No American money was admitted on that snl)scri])tion list. There was an agreement between me and those New Brunswick friends that the stock should l)e transferred from me to them. I know that tlie Charter iirovided that there should be no transfer of stock without the consent of the Government, and they understood it so too. If this were not done, the money deposited was to be paid back by me to them. Mr. McMullen told me that Sir Hugh Allan had received from the Americans a sum of money to meet the preliminary expenses in getting the Charter for the first Company. I iiave had a good deal to do with getting up Railway Comiianies, and have had con- siderable ex])erience in that way. That is always the first step taken to get funds for jireliminary exjienses. It always requires money, and sometimes we are obliged to pay it ourselves. In my cmiversation with Mr. McMullen, I did not tell him tlmt American capitid would be excluded until after this last Cliarter was granted, or a short time before it was granted. I'nder tlu; new Charter, as it was drawn, it was not jiossible ibr American capitalists to get in without the consent of the (ioveniment ; at least, I cannot see any way how they could, and I told Mr. McMullen so. QueMion by a Commissioner. — VVliat are the names of the persons who joined in the subscrii)tion of stock with you? A. — There were several. There were Mr. Domville, who lives at St. John, and Mr. Hyan, of Miramaclii. His home is in Ontario somewhere, I believe. He had some one or two friends with iiim, whose names I do not know. Their stock was put in his name for them; Mr. McKean was one of them, I think. I have no other names, but both Mr. Uyan and Mr. Domville base Iriends joined with them in their stock. CANADIAN PACIFIC RAILWAY. 157 Ian and Mr My rcenson for supposinp,' that Sir Hugh Allan was not iavourahle to my becoming a director was, that I met him several times, and he seemed adverse to have anything to say to me about it. and I never had any conversation with him about it until after I had signed the articles, and then nothing but the ordinary intercourse of one with another; nothing was said with respf^ct to my name having l)een [)lace(l on tlie directorship. And further deponent saith not, and this liis deposition having been read to him he declares that it contains the truth, persists therein, and hath signed. Sworn, taken, and iicknowledged on the ] fifteenth day of Septeml)cr, 1873. (Signed) CHARLES DEWEY DAY, Chairman. A. I'OLETTE, JAMES ROBERT GOWAN, Commissioners. C.\NAU.\. } (Signed) EGERTON R. BURPEE. IN THE MATTER OF THE COMMISSION gut up siur|)ose of building the road with American capital.' .1. — I am aware that the Government did not encourage any such negotiations ; that they declined to promote or favour any such arrangement. (I — When did it first come under your notice that any negotiations tending to that did were going on ? A. — Merely i)y rumour. I think either during or shortly after the session of 1872. Q. Was tlie ojiinion of the (Jovernment decided upon that matter — that of e.\cluc'ing American capital ? .1. — Yes; decided for excluding it. U. — When was that decision of the Ciovernment apparent ? ..1. — I think shortly after the end of the session of 1H72, it became the pronounced policy of the Government to construct the railway altogether by means of Canadian and British ca])ital, and by means also of the amalgamation of the two Companies. I think it was made a})i)areiit shortly alter the close of the session of \^72. (.^. — When you refer to the two Companies, do you mean the Interoceanic and the Canada Pacific ? A. — I do. It was the policy of the (Jovernment to amalgamate these two Cominmics, to exclude American ca})ital, and to give tlie Charter to the Company, to be composed of these two amalgamated Comjianies. 158 CORRESPONDENCE RELATIVE TO 'IHE Ah Oak AHA. i;' (2. — Have you any knowkulge of the coirespr,ndeiice which took place bctwiven Sir Hugh Allan and Mr. McMullen? A. — None whatever. Q. — Would you be able to identify any of tlie letters that passed between them? .1. — Not in the least. (I — Have you read the published letters ol" Mr. MclMuUeu — t!ie two letters in the j)iess ? A. — I read those whicli appeared in the ' Montreal Ilcraid.' i have not read a recent account of an interview whicli some on(; had with him in Chicago. Q. — VVeve you present at any of tlie interviews wliidi the Government had with liim ? A. — No. I never saw Mr. McINIullen. Q. — Are you aware whether Sir Hugh Allan ever received any promise, or any encouragement from the GovernmenI, in his u.gotiations vvith American capitalists? A. — None whatever, so iar as I knt)w. (j,. — Do you know by wliom tlie negotiations for an amalgamation of the Interoceanic and the Canada Pacific Companies were originally suggested ? ^•l. — 1 do not. Q. — Were these negotiations looked upon favourably by the Government, or otherwise? A. — Favouraldy. I myself went to Toronto at tlie request of Sir John A. Macdonald about the end of October, 1871!, for the purpose of mideavouring to bring about such an amalgamation, and I know tliat from the end of the session of 1S72 — I don't remember exactly what time tlie session closed but irom that time uj) to the time of my visit to Toronto, and ai'tervvards - 1 should say uj) to tlie end of November- there wi're con- tinuous cflbrts being made by the (Jovermneiit to liring aliout an amalgamation of those two Companies. Besides my visit, eil'orts were also made by correspondence. Alter ( returned. Sir .John Macdonald went himself lor a like object. lie went some weeks, I think, after I returned. I wi'nt u]) towanls tlie end of Ocl()l)er and saw Mr. Macpherson, the President of the Interoceanic Comjiany. I also saw Mr. Cumberland, wlio was one of tlie Directors, and I went to Loniloii and saw Mr. Carling, wlio was another of tlie Directors, and Major Walkir, who, I think, was a membtu- of tliat Com])any, but I am not awar(! whether he was a Director or not. 1 endeavoured to ])ersuade M'". Macpherson that ills oi)JLrtions as to tiie American element in tlie Canada Pacific Company were ill founded, and that the guarantees which the Government were prepared to give we're so complete and so absolute, that they wcnild entirely exclude the possiliility of the Company being controlled by Aini'ricans. i did not conceive that Mr. Macphei'son was afraid of Anu'rican capital, Init that American views might control it, and that the lands which were promised to the Company might, fall into Ameiicau hands and be; usi'd for American purposes, 1 endeavoured to convince him by the clauses which would be j)ut in the Charter that it would bi: impossibl..; for Americans to get control of it, and tliat the railway would be really and thoroughly controlled by Canadians. That was the object wliicii 1 had in view, and these were the endeavours which I used. Tliis was late in October. Q. — You failed to convince him? A, — Yes; Mr. iMacpherson did not bimself put forward the idea that he claimed to be at the head of the Comjiany. He stat«'d that he had no personal objects of bis own to gratify, but he was persuaded that if it was not stipulated that Sir Hugh Allan should not be at the head of the Company, that American interests would not he excluded. I failed to convince him bicause ol that view which he strongly adhered to. I may add, that during the same visit in the west, 1, also saw Mr. (Jzowski, his partner, on other matters, and I think that 1 satisfied him that the guarantees proposed by the (iovernmcit were sufficient for the; ])urposeof excluding American control. I did not, however, suc- ceed in convincing Mr. Macplierson. Q. — Did Mr. Macpherson's opinions seem to be shaieu by all tlie other members of the Interoceanic Com])any V A. — Uy no means. Mr. Cumberland was quite satisfied that the guarantees were sulTu'ient. Mr. Carling and Major \Valker were also satisfied. All three of these gentle- men exprmsed to me the; opinion that Mr. Macpherson in holding firmly to these views, after what 1 had stated to him, would not continue to represent the views of the gentle- men who had formed his Cdinpany. These gentlemen were satisfied, and they thought that the larg(!r number of the members would be satisfied that the guarantees were sufricient to exclude American control. Q. — Did anything further pass at that conference with Mr. Macpherscn? A. — No. My visit failed on the ground that Mr. Macpherson could not l)elieve that, so Wl CANADIAN PACIFIC RAILWAY. isn between Sir 1 them ? Icttei-s iu the read a recent id with liim ! mise, or any [ipihilists? u Interoceanic or othorwisf ? \. Macflonald al)oiit such an )n't romembi-r ol' my visit to ore wi're con- ation oi" those LMK'o. Alter I some weeks, I r. Macplievsoii, , wlio was one nother ol' tlie any, but I am ['•. Mat'iihersou Huiny were ill I givi' were so )ility of the acphei-son was lat the lands id be usi'd for would be put ■ it, an1' liis own to Allan should oxcludcd. 1 I may adil, tner, on otiier (Jovorinne'it however, si .'- embers ol' the xrantees were these ^entle- I) these views, ol" the }>;entle- imbi-r of the ide American ■lieve that, so long as it was not agreed that Sir Hugh Allan would be excluded from the Presidency of this C!ompany, American interests would be effectually excluded. Q. — Did you explain to the gentlemen with whom you had the conference what the Charter was to be "/ A. — Yes. Tiie guarantees which we i)roposed, and which are now in the Cliartor, were that the original stock list should be subject to the supervision of the Government, and that no changes should take place in that stock list without the consent of the (lovcrnment; that the cdcction of Directors should be subject to the ai)probation of the (lovernment, and that no changes sliould take place in the Directory without the consent of the (iovernment. There were also provisions made in respect to the control of the lands. Q. — You M'ent uj) to Toronto to represent the Government V A. — T wiMit at the re(|uest of the Government, or rather at the request of Sir John Macdonald. Q, — ^Vhat time did Sir John Macdonald go there? A. — Two or three weeks after that, in NovemlxT. Q. — What was the result of the whole negotiations? A. — We could not convince Mr. IMaepherson that these guarantees were sufficient unless it was also conceded, and that wo should sti|)ulate to exclude Sir Hugh Allan i'loni the Presid(!ncy. Rut, at the same time, he clearly led me to miderstaml that he (lid not himself put forward any particular claim to the Presidency, but that Sir Hugh Allan should be excluded from that position. Q.--Was .Sir Hugh Allan aware of the ])art the Government was taking for the purpos(f oi i)ringioL'' about this amalgamation ? A. — I do not .now. 1 never had any conversation with Sir Hugh Allan about the Canadian Pacilic Railway at all. I presume that be was aware of it, but 1 don't know it myself. Q. — Was any further guarantee suggested besides that of excluding Sir Hugh Allan from the Presidency l A. — No, not in addition to those which I have mentioned. (2. — Do you know wlun it was announced to Sir Hugh Allan that the Government would not consent to the admission of the American element in the (,'onipany ? A. — ? of the Directors of the Ctmipany as representative men from the difi'«!rent Provinces was there any preference or advant^ige given to one over another "i* A. — None : and the desire was to get into the Company nun of standing, nun ol capital and men of railway knowledge. 'I'lu' Government also desired to procure from the several Provinces the best men of resp*Htability, stJinding, wealth, or railvvay knowledge. U. — Was there any inetiuality among themselves as to the footing on which they stood as Directors? yl.— None whatever. Q. — Were the t(Tms iijion which this Charter was granted and on which the contract was based more or less favourable than the terms cont/'Hriplatcc' by the tiovernment at the beginning "i* A. — They were the same terms in so far as these terms would bt; deduced from the Act of Parliament. Where the Act 0,()OU.()0() in money was fixed was .'i.oOO miles of railway at ,<10,nOO a mile. Q — You have seen the printed letters of Mr. McMiiUen you say, with the exception of one? A. — I have. Q. — Do you know anything oi' the sums of money whicl , are mentioned there as having been disbursed liy Sir Ilugh Allan? A. — I do not. Q. — These sums are !rH,r)00, to Sir John Mc.cdo}>ald and Sir Krancis Ilincks, and a large sum of money to newspapers, and a sum promised to the llonouralile Mr. Langeviii ; do you know anything about these sums of money .' A. — Nothing whatever, Q. — Do you know anything about the matters alluded to in Mr. McMullen's letters ? A. — No. I was present at none of the interviews. I never saw Mr. McMuUen. Q. — Have you any knowledge that Sir Ilugh Allan advanced $200,000, as stated in Mr. McMullen's letter ? ^.— No. Q, — Do you know anything about tlie sums of money alluded to, that is, moiuy advanced for the purposes of the elections ? A. — No; 1 know nothing about those sums — nothing whatever. Q. — Do you know anything about money payments to ilifierent individuals ? A.— No. Q. — At tiie conclusion o( this last letter of Mr. McMullen's, I find it printed in these terms :— " From Sir tieorge Cartier to Mr. Abbott, dated August 24th, 1872. In the " absence of Sir Hugh Allan, I shall be obliged by your supplying the Central Committee " with a further sum of 820,000, upon th(! sanie conditions as stated by me at tlie foot " of my letter to Sir Hugh Allan of the ;iOth ultimo. (Signed) George K. Cartier. " P.S. — Please also send Sir John A. Macdonald $10,000 more on the same terms." Do you know anything about that letter? A, — Nothing. C2.- l>o you know anything about the if 20,000 uentioned in it? A.- I was in Kingston immediately after Sir John A. Macdona'ul's election, and I understood fiom him that a certain sum ol money had be(;n contributed towards the elections in Ontario by Sir lliigb Allan. I bad no personal knowb^lge of the matter. Q.- -Have you ever seen these teli'grams which have been publishtni? A. — I have not. CANADIAN PACIFIC RAILWAY. 161 uction of tliis tlicre as havino; Uiiicks, ami a Mr. Lauscviu ; r. McMullen's lat is, moiuy Q. — Ilavp you not seen one from Sir John A. Macdonald to Mr. Abbott in these terms: — "I must have another $10,000, will be the last time of calling. Do not " fail me " ? >1.— No. (2.— Nor the answer of Mr. Abbott—" Draw on me for $10,000"? A. — No. '("Ik; telegram i)urports to be sent Irom Toronto. I did not see Sir John after be left Kingston. 1 lcame quite clear that the Government could not proceed and deal CANADIAN PACIFIC RAILWAY. 163 c Governmont ment with Sir Ian at Montreal ;ll as Aimu'icaii with cither Company, but must endeavour to procure an amalgamation, and so d(;al, if [)0ssiblc, with the Dominion at large. It was a matter affecting not only the interests of the railway, but the political existence of the Government. I am convinced that the Quebec interests could not have been excluded from any arrangement for building the road. Q. — If so, could Sir llugli Allan have been excluded? ^.— No. 4j._VVhy ? A. — Because he was put forward as a leading representative man. He was a liromincnt business man, and had been largely engaged in promoting tlu" Nortliern (olonization Railway, and for two or three years lie had |)uc himself forward as the k'ailer of Lower Canada in Railway matters, and \» as aceeptetl as such by l^ower Canada. (I — Are you aware tliat a deputation irom Lower Canada — Montn-al — came up lo Ottawa, and saw Sir CJeorge CJartier, to insist tiiut Sir Hugh Allan be viewed as the representative man ol' Lower Canada '! A. —1 was not aware of it. Q. — You \vere not a\vare that Mr. Iludon and Sheriff Leblanc came to Ottawa lor that purjjosc ? A. — No, I am not. (2. — Sir Hugh Allan is an exceedingly wealthy man, is he not? .1.— Yes. Q. — \Vluit is he rejjuted to be worth ? .1.— From 8r)()(),()(M) to ^OOO.OOO a year, I have heard it rejiorted. Q. — Reference has been made to Sir George Cartier's letter, and to my telegram td iiini repudiating his quasi arrangement. You were at Kingston at the time I received liis telegram. I su})posi' you saw it almost at the time I received it? A. — The same day or tlie next. (2. — Do you remember my repudiating it at once? A. — Yes, and also of your tek'graphing that you would go down to Montreal, at once, and of your making preparatory arrangements with me to go down if necessary that night. (2. — My election wiis then going on, was it not? A. — I thinii this was during the nomination week. Q. — So I made arrangements with yon, to enable me (o go down and break n[) such an arrangement, and aslvcd you to attend to my interests in my absence ? J.— Yes. Q. — Did you see the answer to my telegram ? .'I.— Yes. (2. — The arrangement stood according to my previous telegram? .4. — Yes ; the only thing you said, I think, was that the influence the (iovernmeut had on the Board would be used to get Sir Hugh Allan niadi' President. Q. — You assented to tliat, and tliouglit it reasonable that tlie wealthiest man in t'anada, and tlu- oldest on the Board, should be President? A. — Yes; and also because he was the lirst jierson who came forward as a Canadian, and took an interest in the project, and was willing to embark his means in it. Q. — Had Sir Hugh Allan any special reason for desiring the extension of railways westward ? A. — 1 don't know, except tliat he was largely interested in the Northern Colonization Road. (2. — Was he not also largely interested in steam transportation? /!.— Yes. Q. — Are you not aware that there was an attempt made to get up a rival Company in England ? A. — I have heard so. Q. — Under whose auspices ? A. — Of the (irand Trunk Railway, I understood. It was however a mere rumour? Q. — Did that present a cause of fear to Sir Hugh Allan that the steamship line might lie excluded from the ^Vestern trallic ? A. — It may liave been so. I never had any conversation with him on the subject, but 1 undt'rstood that he had those views. (2. — Arc you not aware that he was also interesting himself very much, and pressing on i)idjlic attention a road still further west than the Northern Colonization Railway. Tile Toronto and Ottawa Road? Canada. mr Ti I" 16-t CORRESPONDENCE RELATIVE TO THE Canada. j{ — Yes, it was to be a Road to run from here to Carlctou Plat'o and Peterl)oroiigh, throuf^li the interior of UpjHU- Canada, and come out to tlie lake at Toronto. Q. — The fact is Sir IIu<;li Allan had determined upon the extension ol' the Railway system, and desired to connect himself with it? A.— I understood from general rejjort that In; had the idea of a railway system from Montreal westward independent of the Grand Trunk Railway. To the Commissioners : I understood you to say that the terms of the Charter were finally settled some time in the latter end of January ? yl.— Yes. Q. — You mentioned also that you had several interviews with Mr. Abbott, as repre- senting that Company ? ^.— Yes. Q. — And his praying that certain alterations might be made? yl.— Yes. Q. — Did that touch the question of the exclusion of American control ? A. — It did not. That was a conceded ])oint before we sat down. Q. — Did the Government in any way concede the jKiint in regard to American control ? -1. — Not in any way, and he did not desire it. It was a conceded point that it should be excluded before we sat down, and our desire was to frame a Charter so as to make that secure, and he was eciually anxious with us that it should be so. Q. — What was the nature of the alterations he suggested ? A. — I can hardly remember. He may have suggested forty or fifty. (2 — What principle did they affect? ^4. — There was a great deal of detail as to the mode and rapidity I)y which the $!;50,0()0,000 were to be paid, whether the payment was to depend on the construction of certain sections or upon a certain quantity of laliour on several sections, and iiow fast it was safe for the Government to pay it out. He endeavoured to get stipulations for this money to be i)aid out as rapidly as possible. Sir .John Macdonald and myself, on the other hand, endeavoured not to have; the money ])aid until assured evidence had been effected that value had been received lor it by the country. And in the same way with regard to lands, his object being to obtain the land as quickly as possible, while our desire was that it should hv granted only as the construction of the road [jrogressed. What I mean to say is that he endeavoured to obtain some mod(> of determining the rate of progress in the work, more favourable than that of leaving it to the decision of the Government or its engineer. It was understood that the payments were to be depi'udeut on the rate of i)rogress. Then as to the way the land was to be dealt with as to the possibility of its being used, in any way injuriously tollie interest of the country at large ; as to the mode and rajjidity of its being patented and a variety of questions of like nature which must occur in a large national undertaking, came up from day to day. Q. — On how many occasions were you [)resent when Mr. Abbott also was present? ^1. — In the discussion of this Charter, we may have spent the best part of seven or eight days. Q. — Were you there on the lust occasion ? A. — I was there every time. Q. — On that occasion was there anything said with respect to American control or did he claim that any alteration should be made in that part of the Charter which was to exclude American control? A. — No. It was a conceded point before we sat down, that it should be excluded, and there was no effort made on his part to get the Charter changed on that point. (2- — That referred to American capitalists as well as American control? A. — Yes. Whatever Sir Hugh Allan wished, or may have done originally with his friends, Mr. Abbott, as his representative, and that of the Companies said he and they had entirely abandoned any intention of having American interests introduced, and Mr. Abl)ott was equally anxious with Sir John Macdonald and myself to preveiit the possibility of this control or influence being brought in. Q. — Can you state what was the date of the first intervie\v between the members of the Government and Mr. Abbott, in relation to the final settling the exact terms of the Charter? yl.— I should say towards the end of January, probalily about the 20tli. I do not remember whether the time was given consecutively or not. I think Mr. Abbott may have had occasion to go to Montreal once or twice. Q. — In what form was the draft, I mean was it a rough draft ? . .* CANADIAN PACIFIC RAILWAY. 165 ay system from ttled some time bbott, as reprc- d to American A. — It was originally in manuscript, and at the time it was p seiited to me it was in type — in galley. To Sir John A. Macdonald, through the Chairman : I think it was the end of January that Mr. Abbott was jmt in communication witli you and mysell", but the communications and negociations had been going on long before that. What I was asked was as to the interviews which resulted finally in the settlement of the Charter. Q. — The draft of the Charter commenced with a few headings, and by degrees exj)anded, and became more and more worked into details, until at last we sat down and framed the Charter. A. — It was set down in detail, printed in galley, revised and reprinted. I think it was printed four or five times, as the alterations were going on before it was finally settled. I desire to add one word. In that last letter which Mr. McMullen publishes he says, I think with reference to a hill or note made by Mr. Hillyard Cameron, that it was renewed by the Merchants' Bank, and says that the renewal was at the instance of the Government after a visit of the Postmaster-General to Montreal. I was tlie Postmaster- General at the time, and am the person to whom he referred, and I wish to say that the insinuation conveyed by that paragraph is false ; that I knew nothing of the renewal of Mr. Cameron's paper, and that no visit of mine to Montreal had any reference to any such renewal, nor did I ever ask anyone to renew such a note. And further for the {iresent deponent saith not. And on this sixteenth day of September reappeared the said witness and made the following addition to his foregoing deposition : — At the dose of my dci)osition I spoke of a statement which Mr. McMullen had made in a letter, that I took some jiart in having a note renewed which had been made by Mr. Hillyard Cameron. I was sjjeaking from memory as to what Mr. McMullen had stated. Since I gave my testimony I have looked up the statement as it appeared in the pajiers, and I find his statement is not as to the renewal of a note but as to the inception of it. The statement is: "And now let me " add one more fact which will illustrate the position of tlie Committee and of the "al)Solute control which the accused and their friends have exercised over it. Outside " of the amounts which may have been furnished him by Sir John A. JMacdonald, the " Chairman of the Investigating Committee applied through the Premier lor a loan of " |.'>,000 when the elections were all over, and Sir Hugh Allan supposed that he was through *'|)aying, and he objected, but after a personal visit of the Postmaster-(«eneralto Montreal, "and urgent letters and telegrams of Sir John, who announced that it was to help us, the " thing was done." I desire to say in reference to the inception of the note and the original loan, that the insinuation of any visit of mine to Montreal had anything to do witii it, is false. I knew nothing of such a loan, and no visit of mine to Montreal had anything to do with it. Q. — Did you visit Montreal about that time ? A. — I can hardly tell. I never spoke to Sir Hugh Allan on the subject, nor to any officer of the Merchants' Bank. I was not aware until long afterwards that there was such a discount. Q. — Do you know of Sir John A. Macdonald having written to Sir Hugh Allan in respect to this note ? A. — I do not of my own knowledge. Q. — Do you know of any telegrams; did you send any telegrams respecting this matter ? A. — None; nor do I know of any having been sent. Q. — Do you know of any application by Mr. Cameron to any member of the Govern- ment to assist him in obtaining this discount? A. — Not of my own knowledge, but I believe there was some communication on the subject, and that Sir John Macdonald did assist him to get this discount ; but I have no personal knowledge of it. And further for the present deponent saith not. And on this 17th day of September reappeared the said witness and continued his deposition as follows : — The amount which I learned from Sir John A. Macdonald in my conversation with him at Kingston, as that which was to be contributed by Sir Hugh Allan to the Ontario Election Fund, was $25,000. This was after Sir John's own election. Q. — Did you hear of any other sum being promised by Sir Hugh Allan? A. — I did not until after tlese discussions took place in the newspapers. Q. — Did you from any other member of the Government? A. — I did not, until, as I have said, these matters became rife in the newspapers. Y Canada, ICP) COHUKSl'ONDKNCE RELATIVE TO THE Canapa. q. — Ho you know nt niiy time of ixny otlirr sums bdn^ furnishal l)y Sir IIuj^li Allan, than the $2r),(t()(»? A. — Not until those newsiMiper reports came out. But afterwards I did hear so from the conversation I had with Sir .lohn A. Macdonald himself. Q. — Did it then come to your knowledge that further sums had heen suljscribed by Sir llufjh Allan? A. — Yes ; there were sums in the aggregate which amounted to $ }."f,000. Q. — Eor the Province of Ontario ? .4.— Yes. Jdesire, with the permission of the Commissioners, to add that on my visit to Toronto, and in the interviews I had with Mr. Macpherson to bring about the amalgamation between the two Companies, I did not desire to make any stipulation as to wlio was to be President, nor did I desire to make any stipulation upon the subject of the Presidency. It was Mr. INIacpherson who desired it to be stipulated that Sir Hugh Allan should not be President Q. — Upon the grounds he stated ? .4.— Yes. I desire to say further, that I have had no corresi)ondcnce whatever with Mr. Al)l)ott about the amount or mode of distribution of any election fund of which Sir Hugh Allan was the chief or sole contributor, or of any other election fund whatever. I make this statement, as I see in the ' Montreal Herald' it is suggested that such a correspondence took place, and I desire to contradict it. Q. — Had you any correspondence with Sir Hugh Allan? ^1. — No ; not witii anybody. And further deponent saith not, and this his deposition having been read to him, he declares that it contains the truth, persists therein, and hath signed. Sworn and taken on tlie fiileenth day of September, 1S73, and acknow- ledged on the seventeenth day of said mouth and year. (Signed) CHARLES DEWEY DAY, Chairman. A. POLETTE, JAMES ROBERT (iOVVAN, Commissioners. (Signed) A. CAMPBELL. "} IN THE MATTER OF THE COMMISSION PllOVINCK OK OnTAIMO, C% ()/ Ottaira. Appointing Cii.\um:s Dkwi:v Day, Antoivi; Poi.ktte, and Jamfs Rohkiit Oowax, Com- missioners to inquire into and rejmrt upon the several matters stated in a certain Resolution moved by the Hon. Mr. IIuntkv(1T0V in the House of Commons on the second day of April, a.d. 1873, relating to the Canadian Pacific Railway. Present: TiiK Co.m.missio.\ers. On this fifteenth day of September, in the year of our Lord one thousand eight lunulreil and seventy-three, personally came and appeared before us, tlie above-named (Jonunissioners, The IIonounil)ie I'ETER MIT(TIELL, of the City of Ottawa, who being duly sworn, deposcth and saith : I am a member of the Privy Council, and Minister of Marine and Fisheries in tlie Dominion Government. Q. — I will read to you the terms of the charge which the Commission is enjoined to inquire into, the first clause of which is as follows : — " That an agreement was made " between Sir Hugh Allan, acting for himself and certain otiier Canadian i)romoters, *• and (i. W. McMullen, acting for certain United States capitalists, whereby the latter " agreed to furnish all the funds necessary for the construction of the Pacific Railway, " and to give the former a certain percentage of interest in consideration of their interest " and position. The scheme agreed upon being ostensibly that of a Canadian ('ompany, " with Sir Hugh Allan at its head." Have you any knowledge of any agreement or negotiation of tlie kind ? A. — No, not of my own personal knowledge. I have such knowledge as the public prints have lately afforded. Q. — Is all your knowledge confined to that which you have derived from the press? A. — Entirelv so. CANADIAN PACIFIC RAILWAY 1C7 Q. — Were you not aware at any time previous to the publisliing of tlie corres- pondence that such negotiations were Roing on ? A, — I was nwarc from public rumours tiiat Mr. McMullen and Sir Hugh Allan had some intercourse in relation to lliis matter, and (hat they had talked ol arranging some plon by which American capital could be acquired. That information I got from Mr. McMullen himself. Q, — You know Sir Hugh Allan and ^Ir. McMullen, do you not? A. — Yes; I know both of tlieni. Q. — And tile inibrmation you possessed in regard to these negotiations was derived from Mr. McMullen himself. A. — Yes, as to the fact that such negotiations were going on. I never had any conver- sation witli Sir Hugh Allan on the subject. Q.- Were \ou jircsent at any interviews between tl'e members of the Government and t:^ir Hugh Allan and Mr. IMcMullen? .1.— I was I I'sent at one interview with Sir Hugh Allan, Mr. McMullen, and I think Mr. Sni li, but I am not sure whether Mr. Smith was there or not. I don't remember tlie (uite, but it was the first interview which Mr. McMullen in Iiis publisbeil letter states that I was present; although I don't kiu)w whether it was the lirst or Mcoud interview except from what 1 have seen in the jiapers. I tliink it was the interview which McMullen states in hi letter took ])lace early in July, \^7\, at which I was present. It will lie iu the one win re he states I was present. (>.- 1'bis interview at which Mr. McMullen says you were present, took place the 5th October, was that the one 'i A. — I jiresume so, Q, — What passed on that occasion? A. — Not very much. I understood that these gentlemen came there to make sonic proposition to tb- Government, and that he asked an interview with the G<»verninent lor that purpose, 'lliey got the interview, and the sul)stance of what took place was, that when tlie gentU men ol)tained the interview, and the ordinary courtesies bad l)cen gone through. Sir Ilugli Allan was asked by Sir John A. Macdonald if be had ,iny jiroposition to make to the (tovernment. Sir Hugh asked the Government never gave him any encouragement or favour in this project or enter})rise, so as to induct" him in any way to believe that American capital would be admitted in the build- ing oi the road ? -1. — I am prepared to say the Government never did, and, except what Sir Francis Hincks said, I am not aware that any member of the Government did. There was no encouragi-ment nor any insinuation of any kind that Americans would be permitted to liave any interest in the (construction of the railway. I only speak of my own opinion, and of what transpired in the Council Chaml)er. I am sjifislled in my own mind that no expectation could have been held out that American control would l)e permitted. Q. — Have you any knowledge of any negotiations that took place for the bringing about of an amalgamation between the Interoceanic and the Canada Pacific Com- panies ? .1.— I took no i)art in such negotiations. I was aware that negotiations were goiii,' on, l)ut what the ])articulars were I did not exactly know. All I know was this, that it was the desire of tlie First Minister to bring about such an amalgamation, ami that oi)inion was coincided in l)y all of his colleagues. Q. — Who took an active part in these negotiations? A. — Sir John A. Macdonald, Hon. Mr. Campbell, and perhaps Sir Francis Hincks?, I don't think Sir I'rancis took part so much as the others. Of course the other membei-s of the Cabinet stated their views and a])proved ;, dis- .•i])|ii'()vcd as it struck their min Government, vde it was sul)- and clause by at other times nifested by tlic iueiit point was he public mind 1 took no part s it arrived at? A. — My imjirension is that it was immiHliately after the return of Sir John A. <'a»'\i>*. Macdonald from Toronto, I think that was late in the fall of 1872; we had Hoverul discusHJoim about it in tho Council liefore that decision was come to. My impression ih, although I am not confident aiM)ut it, that the determination to issue that Carter was fixed ujwn in the month of December, that was alh'r the failure of the negotiations; at least that s<'em«'d to be the settled s«Mitiments of the Governm«!iit, but it may not have Ixt-n settled upon before January. ^2. — Was it ill eonsequence of that failure that they determinecl iiiHni that courst?? A. — It was as tlu; only means left open to the Cabinet for carrying out the wishes of I'arliament. Q. — Was that contract given under that Charter under any more favourable terms than had been previously contemplated by tlu" Government? A. — None that I am aware. It was on very much Itss favourable terms than Sir lIuLth Allan asked. My recollection i that Sir Hugh Allan asked a greater amount of money and a larger gram uhidi reads, " I must have another ton "thousniul." A'c? A. — I know nothing of it, or of any othor telegram of that cha'. actor ; I never heard of it until I saw it in the newspajK-rs. To Sir John A. Macdonald, through the Chairman : Q, — What was Sir (leorge Cartier'b opinion as to the admission of American capital into this enterprise ? A. — He was always hostile to allowing American capitalists to he interested in it. His opinions were very decided, and suffered no variation from the bi-giiming. I leariiecl liis opinions by his statements at the Council Hoard, and also visiting occasionally at his house, an, relating to the Can. lian Parifie I'ailway. Present: Thk ('ommipsionkrs. On this seventeenth day of September, in the v.ar of our Lord one thousand night hundred and seventy-three, iK»rsonally came and appeared before us, the above-named Commissioners, The Right Honouralde Sir JOHN A. MACDONALD, Knight, Commander of the liath, and Minister of ilustice for the Dominion of Canada, who, l)eing duly sworn, de|)oseth and saith : Q. — You are aware of the charges relating to the construction of the Pacific Itailway, and to the raisin;; and distribution of lands for the promotion of the elwtions in 1872, recited in the Cominission; will you have tlie got'dness to state to the Commission all the facts witliin your knowledge relating to th.N (.latter? A. — I suj)])ose it had lu-tter be done as a narr, five. In the Session of 1S7I, Resolutions were pa^sed admitting British Columbia into the Dominion, any were not fully in accord amongsi themscdves, in conse- " quence, as Sir Francis Ilincks informed nie, of (Jrand Trunk jea'.ousy of Allan repre- " sonted in tiie imjjortant ju'rsonagcr of Sir (ieorge t'artier." This is altogether an erroneous statement; we were quite in aeiord among ourselves.jwe were all in accord that we could not consider any i)roposition until after wc hail the sanction of I'arliament ; that we were not in a condition to make any arrangement until Parliament had authorized us to do so. In consecpieiice of its being known that Sir Ilugli Allan had entered into this arrangerricnt with American capitalists, it was known to every one- a feelingof fear arose in Ontario, especially in Toronto, that tiie I'acilic Railway might get into American hands and under American control, or might get into Anu'rican and Montreal iiaiids, and that in the construction of the Hoard the interests df Ontario might be forgotten or neglected. This, I think, ;ulded to the urgent request of myself on frequent occasions to a number of gentlemen in Tomnto, induced I think the formation of (he Interoceauic Conqjany. I liad sjioken to Mr. Macjdierson, Mr. How land, .Mr. Cumberland, Mr. Worts, and a mimber of other gentlemen in Toronto, to try to interest them in it, and the Conqiany was formed. Mr. Mac])herson took a warm interest in the forming of il early in the autunni of 1871. The statement had got into the newspai.ers, and the imjiression had goiu' abroad that American capitalists were not interesting themselves in the Canada "acillc Railway on its own merits, but that tlu'v were connected with the Northern Pacilic R.'dlway. and were nideavouring to make it subservient to the interests of that railway : and ^1u! lear arosi^ ;iMd s|)read through (Canada, 'hat our railway would be nuult^ sidiordinate t't American interests ii' they were admitted to any share in the enter])rise. I was one of those who |iarticipated in that fear, and itseemr-d to be also the o])inion of my colleagues, in( luding, la.'U'rIy. Sir Francis Ilincks when hi' iipuiul that the opinion was ;;enerally shared by his colleagues against the admission of foreign cajdtal, and that the object of the Ann-ricans in getting control of our railway was to connect it with tlieir system of railw.iy;:. I think the (lovernment became as (me in the oj)inion that American caj)ital should be excluded, although we had not cimie to any formal decision on the matter. During the Session of Oanaii.\. who usually sn])portcd the tlovernnunt that the majority of ■ere of thf* same (qiii.ion. It soon became apparent to everyone, 1S72 we I'ound that tho' flic House of Commons 1 think, to Sir Hugh .Mla.\ who was lu're occasionally promoting the Rill for the nicor- poration cd' the Canad i I'ai'fie t'omjtany, that S'arlianu'ut would not saiiili )n any scheme wiiich would involve the aiinission ol American capital. The (lovernment then ci me to the conclusion that as there were two great bodies of ca])italists, one from Mon n-al aud the otlier from 'i'oronto. both petitioning for Acts of Incorporation, I say the (Tr.crnment came to the conclusion to aid in the passage of Acts of Incorporation of any resjiectable body of persons who would ajjply for that purpose; ;ui(l then the f those <'ouq>anies, anluHdd be granted, giving the (lOvernment the power to grant such Royal Charter. The (lovernment .Act contained a cdause to enable the (Jovernment to grant a subsidy in land and money. Then were two Acts of Incorporation p.issed, as has alnady been several times l)ronght liefore your notice; one for the Interoceanic Railvvay Company, of which the prim ipal seat was in Toronto, and the other for the Canada Racilic Railway Company, liie principal seat of which was in Montreal. So soon as the Session was over, which I lliink was in June, when Parliament was ))rorogueanies. Tliey n'jiresented l)ie interests principally id' (^lU'bee and Ontario, although I lielieve both of those Companies contained names of gentlemen as Corporators fromtheother Provinces. Still it was generally understood that the Interoceanic Company was the Ontario Com- pany, and that the Canada Pacific was the (Quebec Company. The policy of the Covern- nu'iit, from the time of prorogation until n(>w, I may say, had never varied. Il was that an ain.dgamation of these two llonqianies should be procuri'd if possible. We were salij-fuil that such was the jealousy that had arisen between tlii' two Companies, that it would be impossible to give tlit! (Iiarter to either of these Companies, that is the const nic- tiuii of the road to either of ther'.- two Companies. ^Ve knew that no (lovernmeiit could exist that would give the contract to either section. If it were gi^'en to Sir Hugh Allan's Company, the Government would be certain to alienate the suj-.port of their Parliamentary Z r 174 roHHKSPONDKNCJK HELATIVK TO TIIK Canada. l'iii>ii(ls IVoui Oiiliuio, and I'Ici' I'erm; so tluit wo spared no pains in tli(! altomj)! at. amal <;aniati()n. Tlif Canada Pacific Hailway Hoard always expressed their willinf;iiess to aniali;amale. I lie liit( roceaiiie Board (Xjjre'iscl an umvillinj^ness to amalj;ainate. lin- niediafely alter the Session of l>i7^,or shortly alter, I went to Toronto lor the purpose nl seeing; my IViends there who were inleresled in the Int'-roceanic C'om})ui)y, and I jiresscd then; as much as jiossihle to acfpiiesce in theamaljianialion. 'riieelections weretoconic on hetween duly ami Septemher, and we I'elt as a (lovernnienl that it was very important to us to jj;o to the ctnuitry with a sclu'ine perlivted iuid an amalf^amation eirecled with tlie capitalists oi' Ontario and Qiiehcc, ready to co-oi)eral»! in the construction ol' the Pacific Railway. After talUinj; tlie matter over with Mr. Macpliersou and other }^entlemt;n in Toronlo. I wrote to Montreal and I asked Sir Hn^h Allan to come up to Toronto, and Mr. Ahhott, a memher ol' i'arliament, and who had taken ureal interest in the (Canada Pacilic Kail- way, also to eomo to Toronto and discuss the matter with Mr. Macpherson. Sir lltii;ii Allan wrote me that it was im[)ossil)Ie lor him to come up, hut that .Mr. Ahhott mij^til. Mr. Ahhott did come up, and saw Mr. Macpherson, and you will lind in the evidenif piven hy Mr. ^hu•pherson a memorandum ol' the sui)slance ol' the conference hetween those two }^entleinen. That memoraiidum I helieve to he substantially correct from the inlbrmation that 1 had from huth (d'the ^'cntlemen who attended it. I left Toronto to <;o to Kiny;ston, to attenil to my own election, impressed with tlit iilea that there were no insuperalde didh-ulties in the way of amalgamation. They liad approached very nearly each other. There were only two |)oints ol •lilVerence. The oni" was the (|Uestion of the Presidency, and the other was the nunil)( i' of the Directors. A\ith respect to the numlier of Directors, it was sujigested that tlu\ should he thirteen, 'i'his suu;^estion emanated from the (Jovermnent. W'v took tlir Mumher in the C'ahinel, which v.as thirleen, as a sort of precedent, and it was su not, of course, so advantai;eous for Ontario to have seven representatives as af^ainst six from Quebec, as it would le to have live from Ontario ajj,iin.>t four from Quebec, on a Board of tliirteeii members. Then, as reijards the Presideiny, Mr. .Macpherson always lield to llu' same position; tliat lu; did not look forward to it him. -elf, he did not press his o\\n claim for it in any way, but he thoujjlit that Sir llufjii .Allae,from his Iniviiif^ ori!.;inally maile this arran^'c Itieiit witii the .Americans, if he wen ph'ced in the position ol President, from his aeknowledu'ed wealth and influence, would h.ive too much poweron the Hoard, and that lie mi;;ht exercise that poW(.'r in favour of briiiniiij.; in Ami.'rican cajiital. SJill it seemed to me. that as that was really the only (piestioi , that is. the (juestion of the Presidency that we were very near an amalu;amation, and I left Toronto, as 1 have said, impnssed witli the idea that that dilliciilty would be removed av could lie removeil, and that there would be an amalgamation. When I WHS ai Kiiiy;ston, ;itteiidiiit^ to my election, I was comniunicaliiiK, I may say. with Sir (ieorne Cartier, Kivinj;- him ar. account of the pro<;ress I had been makiiii,' at 'I'oronto, and my commniiicalions were always of an eiicourajiinf;- iiaturi; because 1 believed tli.it the two ('oinpanies would be amalgamated ami we would ;;et over this dilliculty. When I was at l\iii;;stoii Mr. .Macpherson came there either to see me, or was there accidentally, I really lor;;et whiidi, but he was at Kiiiffston, and we had a diM'ussioM about it, and I found the dilliculty still I'xistini^ aboiil the Presidi'iu^y. and I made ii|i my mind tlnit there was no use in attempting- to procure the anialf^aniation before tin elections, and that matters should be allowed fostaml on the terms as discussed betueiii Mr. MaepherHon and Mr. Abbott at their nieetiiif;' in Toronto. I tele>;raphed Sir Ceort^e C^arlicr in that sense. Tliat telen;rain is net out in th(! allidavit of Sir llui,'li Allan made in Montreal. I have, howt'ver, t,'ot a rouj;h draft of it. The lel(!}j;rain is dated the 'Jiitli .hily. and is herewith produced and fylid marked "(«." I may say, with respect to the exprebsion in that tchj^ram, "that this should I'c CANADIAN PACIFIC RAILWAY. 175 itUsmpt at amal r williiij^iuss to lalj^aiUiUc. Im- )!• till' pai'ixwc of •y, and I jUH'sscd Diis writ- ti) ronii' s very iinpoitiuit on cirfclcd witli bti'iulioii ol' tlu' mi!ii in Toronto, and Mr. Al)l)()tt, ,da I'ai'ilic Kail- I'son. Sir llii;;ii r. Al)l)<)tt nii;::lil. in flic I'vidcncf ruri'iu'c bctwt'eii forirct from the )irssi' of iuciuIhts tn Mv. iMacplu'i'smi although it wa^ rs as a<;aiiist six im (iiaduH', on a ic same jiosilioii; lini for it in any adf this arrange ■lidcnl, I'rom his t'oard, and that is, flif (lucstidii it 'I'orontu, a^ I vcd or could iif iliiifj;, I may say. hccn niakiuf; at I'cansi' 1 ht'licvi'ii this diHicult). nc, or » as tluTf hail a disi'ussioii , and 1 iiiadi' up lation liiiorc tin iscusscd lii'txM'di tflc,i;raplicd Sir vit of Sir llui,'li Thr trh'firani is tliis should •'<• "acropted hy Sir Iliit the id(>a that Sir Ccortcc was not so friendly as he oii{j;ht to havu liecii t<» the Northern Colonization Koad, in which a larf^e nunilier of Lower Canadians look great interest, esi)eeially Ihe I*,lontrealei's, and of which Sir Hugh Allan was Pii'sident, ami that in fact they had got the impression that Sir (fcorge (^artier was throwing C(.!d water on all those (;nter])rises which Sir Hugh Allan had entered ujion, and this, of course, unless it were removed, would he fatal to Sir (leerge ('artier, and in Jiower Canada would lose him l'arliannntary snpport, ami, of course, lose the Govcrii- mciit I'arliamentary sujiport. The idea had lieen industriously spread ahroad that Sir (leorge, as being the Solicitor or Ciifreal and 1 to go to Toronto, cd' course, as h'ading niemhers of the (iovern- nienl. we were anxicms for the success of our Parliamentary su))po.ters at the elections, and I said to Sir (ieorge that the severest contest would he in Ont;irio, where wf might expect lo rei-eive all the ojiposition that the Ontario (iovernnicnl could give to ns and to oiir friends at the pidls. 1 said to him you must try and raise mhIi funds as yon can lo help us, as we are going to ha\i; Ihe chief hatlle tliei-e. 1 incut ioni-d the names of a few iViends to whom he might apjdy, and Sir I high Allan amongsl the rest, and thai he waa interested in all those enterprises which the C'oN'ernment had heen Ibrwarding. When, llierefon . I ascertained (hat Sir (ieorge Iiad put il all rinhtwith his friends, I then com- nnniicated to my friends in Montreal, Sir Ceorgi" and Mr. Aliliolt, slating I hoped they would not forgi't our necessities; that they would s«v to v;iise some fiiinls for us iit Ontario. On Ihe .'{nth, 1 think, ol. Inly, 1 ie(ti\ed a h'tter from Sir Hugh .\l!an, addressed to me at Kingston, stating thai he hail cmne to an arrangemenl with Sir (Ieorge Cartier. He (lid not send me a copy of the arrangement itsidf, hut he said he had come to an arraiigenunt and !iad reduced it to wrifiii;.-, slatinii; generally the terms of the .irrange- ineiil. 1 was not salislicd with ihis. It was not in accoidanci' with my telegram (d' the 'Jilth, and although it was «'xceedingl\ inconvenient lor me, for I was in the heat of my I'iei'tion. and was recei\inga most stern opposition, I t(degra]>hed hack at once that I would not agrn- to ii at all, hut that I would go ihiwn to Montreal that night or Ihe next night, and see them, so that there n\iuht Ik- n > mistake or misapprehension in the matter. It appears that Sn deorgi' Carlier saw Su lluuh Allan al once, ami iulormed him that I ohjecled to the arranmnient that li»d lieen made, and that unless the propo- silii'i! ( ontained in my Irlegram ol the 2(it!i .lulv was adhered lo, that I would go down to Montreal and discuss the wliole matter with th«'m. I then received two telegrams, line from Sir Hugh Allan and the other from Sir (ieorge ('artier, which I Ibrtunateh kept. whi« )i 1 shall read 'I'his is datvd .list .lnl\. It is from Sir (ieorge Carlier. ll (ommences as ii)|lows : '• I have seen Sir I lugh Allan. He withdraws the letter writieii ■■ to yon, siiu'c vou make ohjection to it, and relies lor a hasis of arrangement on your " telegram to me, of" which I gi\e him a cony, A'c. " I herehy prfxince and fyle it inarkj-d "II. At the -aiiie time I received this one from Sir Hugh Allan, aildressed lo myseUof the same daU*. It eommences as follows : " I liave seen Sir (ieorge Cartier to-day, you may • letiini my letter, ite." I hen-hv jmiduei' aiul tyh- il marked " I." 'Vhai was the «"»ly arningt-ment that was ever made lietwccn the (ioveriinient and Sir llugli Allan, ir • le C.mada Paiilii- Kailway Conipany which he represented, and I had ■10 disensstoii or "•lr. McMullen in one of his letters, that there was a snhsequent arrangement made on the si.\th of Auf^ust betwe(;n Sir (leorge Cartier and Sir Hugh Allan. If such an arrangement was made I am ([uite unaware of it, and more tiian that I don't bclievt; it. lam quite satisfied that if Sir (ieorge Cartier had made anv such arrangement, lu; would have nientioned it to me. Sir (ieorge was a man of the highest honour, and between him and myself there wen; no ])olitical secrets, arid if he had made any arrange- ment of that kind respecting tin- railway he certainly would have communicated it to mc. I ol)serve that Sir Hugh Allan says in one of his letters, which has been published, dated the (ith or 7th of August, he '•yesterday concluded an arrangement with Sir (ieorge "(!artier." The way I read this is that by yesterday he meant a day or so before, which Avould be about the .'!Oth .July when he signed these pa|)ers. After the elections were over, we renewed our attempts to promote the amalgamation of the Coni|mnies. At my refjucst, my colleague, the then Postmaster (icneral, Mr. ('am])licll, went to Toronto, with what results you know from his own statement. Early in November, about the Tth or Stli of November, I went to Toronto, and once or twice I thought 1 had succeeded in overcoming tin; reluctance of .Mr. .Maci)hersoii, but after discussing it with hiin fre(|uently, and pressing all my vii;ws upon him, I had at last to leav(; Toronto unsuccessful in my mission. On my return to Ottawa the Government then addressed itself to the formation of a (-'om|)any under a Koyal Charter. As I have; aln-ady stated, the (iovernment were satisfied that it wouhl be ii> tiu- highest degree ine.v.pedient and impolitic to grant the construction of the Koad to either of the incori)orated C(mi|)anies. We canu; to the conclusion that we should exerci.se the power conferred upon us by the (iovernment Act of the Session of 1S72, and endeavour to form a (Company in which all the din'ercn' Piovinces would lie represented in one, as I have mentioned. And we did grant that ('barter as is known. In the s(;lectioii of the first Hoard of Directors and sharelndders, the (iovernment had oidy the one object: that of getting men who would command the conlidence of the country, either from being men of capital or being men of known staiiding, or of being men es]iccialiy accpiainted with the subject of the construction of Railways. The nanus of various gentlen.in were discussed, some were originally selected and afterward^ changed. At first the (iovernment tliought of some hailing men who were in Parliament on accoimt of their \v»'altli and standing. There were several gentlemen who were selected wlio \vere members of one bouse or the other, but afterwards on consideration o!' the whole (|uestion, tlu; (ioverinnent came to the conclusion that it would l)e better to exclinleall mend)ers of Parliament Irom the Doard. There had been a motion made in the House of (yommons . lianicd with great care. The principal heads of it were prejiared by myself; that is, the leading principles of the Charter were jotted down by myself, and iicipiicsccd in by my colleagues, and were coinmnnicatcd to the gentlemen whom we li;id selected to \\n-\n this Hoard. We had several meetings, I fancy in December and •iMiiuary, at Citawa. where these matteiN were iliscussed. The provisions I'l' tlu; Charter w-re adibd to and enlarged IVom time to time, and at last Mr. Abbott was selec-teii to meet Mr. Campbell and myself and settle all details of every nature. Mr. Abbott w.^s acting, not on his own account, but as [ understood as counsel for the new Company, which was about to be formed. He was early selected as the legal 7Tian of tin Com[)anv, and in that cajiaeity he met us and we worked out the details, most painfully worked at them for a considerable time; had them printed and reprinted, and at last they assumed the form in which they now are in the completed Charter. I think that 1 have given you ast.atementoi all the facts connected with the jiromotion (if the Co'T nany and what I know of the communications and original arrangements with the Aiiii ,nis. 1 may say that every prtvaution that we could think of or that was ^uggj-s! u to u^ to prevent the .\iiiericans gi-nnig in either dircitly or indirectly so as to have control oi the Conijianv, w;is adopted In the first place, by the election of the thirteen gentlemen who were iirf, only Dirtvtors of the Company, but were also share- lioldei's and held all f.be stock I'hcy were all gentlemen M higli sbuidingand Canadians, and certainly would not, any "lie of theni, be in any w;iv a party to handing over the Canadian Pacific liailway to foreign control. Thej held the whole of the stock, and not a single share could he trnnsfern;d l»r the first six years until the sanction of theCJovernment had been obtained. The reason we select«!d si.\ years was this ; we gavi- the Coni})any one year — to the first of Janairy next — to raise the necessary funds, and we thought that after five years of activi' prosecution of the work there would be no fear of the road getting into foreign Oamada. 178 CORRESPONDENCE REI.ATIVE TO THE Oamada. hands, and that point onco giiinod, tlie loss the Govornmciit had to do with the stock the ~~~' hcttrr, lor it would letter the trnnsler of the stock and of course render it less vaUiuhle. The uncf>rtaiiity as to whether a purchaser would \w approved ol' l)y the Government would ojnrate ap;aiust the vfilue of the stock in the market. Q. — Have you any further statement to make ? A. — Nothing lurther occui-s to mc. I can state and propose to take up the question as to the contribution of election funds. As I have already mentioned, wlu-n Sir (ieorge Cartier went to Montreal I'rom Ottawa, and I went to Toronto, 1 asked him to endeavour to i;et what pecuniary help he could from our rich friends in Montreal; and when 1 wiis in Kingston at the tinu" of my own election, I got a letter from Sir Hugh Allan stilting that lie would contribute $2.'),()((() to the election fund. He used the exjjri-ssion that he would contribute $'2r),()l»() to help the friends of the Administration in their elections. I may say here that 1 considered myself a trustee to that fund, and certninly did not apply any of that money to my own (dection, Q. — Have you got that h'tter? A. — No ; I destroyed it. It was sim])ly informing me that lu; would contribute to that extent. I paid the expenses of my own election; and in fact, I did not receive any funds at all Irom Sir Hugh Allan until after my own tdection was over. 1 was at Toronto the most of the jK-riod during which tlu; elections were being held, going olf occasionally to one place or another to communicate with my friends. 1 got jjecuniary assistance where 1 could. Ill CaiKida we have not the same organi/.alioii that they have in Kiigland. We have neither a Uelorm Club nor a Carlton Club to manage! elections, and the leaders liav<- to undertake that for themselves. 1 found as the contest went on that it was getting mine severe ; rejiresentations were coming to me from all parts of Ontario that the Opjiosition. to use a general expression," had two dollars to our one, and 1 redonbh-,UO() each were given at ni; re()(> resjjeetively, with very Kood knowl»Hl)j;e that it was never to Ix; repaid. With relercnee to that sum of ^4,000 to myself, that isn eomjihte and utter falsehood. I never received i«il,00li from Sir Ilu^h AUaii. I never liad any money transactions with him in my life. He nev(!r pave me any money or never lent me any money in his life. It is utterly false, aud I have reason to helieve Sir IIujj;h Allan never said so. Mr. McMullen does not stiite tliat we received the money, hut tliat Sir Hugh Allan said so to him, Init I do not believe he ever did say so, for two reasons; In the first place, if In; ever did it, it would have been a I'alseliood, and in the nc^xt place, when INlr. .McMullen came to see nie in Decemlier, I think it was then tliat he came to «•(' me, the .Hrst time alone; alter the elections, 1 I'orget the exact date, he came evidently for the pur|)ose of attemptiiif; to ItuUy me, and levy black mail upon me, and he spoke vi'ry mysteriously of what he could prove. That Sir lliij^li Allan hud told him some very str ii'j;e stories about expenditure of money for members of Parliament, and so on. I was very much surprised to hear that statement, and he said anions other things, "In; never mentioned your name in con- " nection with any of thi-se expenditures, luit he has tlie names of persons who are very " near yon." I said he could not very well have nu-ntioned my name, bwause 1 m-vcr hud any money transactions with him. In the Hrst place I know the st^itcment is false, and I am satislied for these two reasons that Sir llu};h Allan never said so. A^ain Mr. McMullen says: — " I met Sir John Macdonahl in Montreal after the ch)se ol the Session. " while on his way to meet Lord Duilerin at Quebec, and he sngscsted that as Allan liaas a (.!anadian himself, but I did not know whether he had anystcnk or inttu'est in the Pacific Ctmipuny. I was exceedingly guarded with him. I heard what he had to say. Hi; said the t'ompany was orgaiii/ed. 1 said it is not the slightest use having anything done until thi'rc is an amalgamation. lie then said to me that he was going to leave Montreal for Chicago, and he tlu-ught he would stop at Toronto on his way home and see Mr. I\Iaci)lierson. I think 1 said it would do no harm, or some answer of that kind. I did not encourage him to go. He informed me that he would go. 1 made no suggestion to him in regard to it. It would be (piite absurd to sii|)])ose that if I could not lU'isuade Mr. Macpherson to go in for the amalgamation of the two incorporated C-'ompanies that he could do so. It is quite a misstatement. Mr. McMullen says again : "After having Sir (ieorge sign " an agreement, as stated in the h;tter of August (Jth, he commenced paying miniey, but, "as he told me, having (^artier's order in each case, and taking a receipt therefor. When " making the agreement he had no idea that the anioiinl of money Would In; excessively " large, and when it had run np to between $ir)0,0(IO and !^200,()IH) he became alarmed, " and told Chattier that he must stoj) paying the drafts which were coming in so rapidly " uuh'ss the whole Government would sanction the bargain. He then stated that Sir " Cjieorge sent to Ottawa and receivej<,'et with \\liicli I am very cdiiveisant. The Keporter says: "Hut ^ |(i(),()(i(t is a pretty ;;ood sum of money for one " man to lose. Does .Sir IIut;h really sulfer this loss.'" .Mr. MeMullen sa\s: "Sir lliif;h " is President of the Merchants' Hank of Canada, u very lar>;e iiis»ituti(i;i, which in its "current Meport shows a (•overnment deposit, without interest, of over !«l,*Jltti,0()(l, and " as all its funds are directly uinler his control, it is safe to suspect that up to the presi nt " lime he is even. 1 iindersland that another iiank in .Montreal furnislicd a port ion of " l\w sum hy discounting iioti's secured hy Allan's eiidorseiiunt, and that these are still " heinj; carried. This hank also has over ::^.'!00,(l(i(l of (Jovernmeiit money on the eipially " lilieial terms of no interest." That statfinent is untrue. I do not helieve the .Men hauls' Hank have ever at any time dejiosits of over s.'l()(i,(((il) witlioiil interest. Funds accumulate in the dill'erent hanks, and aiij' profit yoes to the shan holders and in no way to Sir lluf^h Allan cxcejit as he is a shareholder. !5ut the sum of ."r^l.'JOO.lKiO is alto;;ellier lalse. I think these are all the remarks I have to make. Tliere is one more statement which 1 desire to make in justice to Mr. Ilillyard Cameron. It is stated that at my pressinj; instance Sir Hugh .Vllaii advanced moiie\ or (lisidimted a note of Mr. Cameron's of some !j!'),0()0. Mr. MeMullen says: ••The "(Chairman of the Investigation Committee applied through the Premier I'or a loan of " :S,'>,(I(M» after the (dections were all over, and as .\llaii supposed he was through jiaNing, " he oiijected, hut after a personal visit of the Postmaster-deiieral to Montreal, and the '■ urgent telegrams an 1 letters of .Sir John, who annminced that it was to hel|) iis, the thing " was done." The eireumstance was simply this: Mr. Cameron told mu— we are very great friends —that he was very hard-up, and that he wanted some money and was anxious to get a discount, and he asked me if I would drop a line to .Sir Hugh Allan asking him to get his note diseoiinted hy the iMereliants' Hank. 1 wrote down asking Sir Hugh to u.s(! his inlluenee to get a discount for Mr. Cameron for ;^ :\ O \ i 182 CORRESPONDENCE RELATIVE TO THE Oasaw. a. — On tlie 23rcl of January he saw me and said he would send me copies, and he did — ^ send me copies. Q. — Are these copies of the originals which were afterwards included in the sealed packet ? A. — Yes, I think so. I have got them. Q- — Are you able to state whether these copies you have are copies of the originals here ? A. — I have got all the copies. It would take some time to bring them now, as they are at my house. Q- — You will produce them to-morrow? A. — 1 did not get them on the 2iJrd of January. He promised to send me copies of all the pa])ers, and I subsequently got them. Q. — 1 lad you any knowledge that that correspondence was going on at that time ? A. — No. <2- — When did you first become aware of it? A. — I became aware of this correspondence by seeing it in the 'Montreal Herald.' Of course I was aware of the correspondence at the time I got the copies, and I next saw it in the ' Montreal Herald.' And further for the present deponent saith not. And on tliis eighteenth day of September reappeared the said witness, and continued his deposition as follows : — Q. — Have yoii any knowledge of the sealed packet of papers which was placed in the hands of Mr. Starnes ? A. — The first I heard of these papers was when application was made on the floor of the House by Mr. Huntington to have them impounded. I then afterwards saw the packet when it was produced beibre the Committee by Mr. Starnes. It was sealed, and the members of the Committee who were present put their initials in the vicinity of the seal, but it was not opened. Q.—U that envelojie now shown to you the one which you saw ? A. — I have no doubt but that is the one. I recognize Mr. Hillyard Cameron's writing on it, and also that of Mr. Blancliet ancl Mr. Dorion. Q. — Will you have the kindness to look at the letters contained in that sealed packet, and numbered from 1 to 19, and say whether the copies which have been given to you are coi)ies of these letters ? A. — I would say with respect to these copies that Mr. McMullen, at the meeting V .ucli I have spoken of already, stated to me that he would send me copies of the corre- spondence between Sir Hugh Allan, and Mr. Smith and himself. He did send me copies of that correspondence two or three days after. I see in that correspondence two letters addressed to a gentleman in New York. These letters appeared in the ' Montreal Herald,' and, I think, without the name of that gentleman. His name I see in those papers. These letters belong to that gentleman, and I do not wish to be a party to making them public, but I will hand them in to the Commission. On comparing the correspondence sent me with that in the packet which was placed in Mr. Starnes' hands, I may say that there are two telegrams, and a letter previous to the 8tli of December, 1871, the earliest date of any communication in the packet. Q.— Do these copies of the correspondence which were sent to you purport to be copies of a correspondence between Sir Hugh Allan, Mr. McMullen, Charles M. Smith, and this New York gentleman ? ^.— Yes. Q. — These copies have continued in your possession since you first received them? A. — Yes. Q. — No copies of them were given by you to any person ? A. — None. Q. — I i)erceive that there are some statements in these letters, several of which I wish to call your attention to. In the letter of the 28th of February, 1872, Sir Hugh Allan mentions the distribution of stock in the Canada Pacific Railway Company, $100,000 to Mr. Mac])herson ; A. B. Foster, $100,000 ; and so on. Have yen any knowledge of an arrangement between Sir Hugh Allan and these gentlemen, of that kind, or of any arrangement which Sir Hugh Allan projmsed to make with respect to the distribution of stock ? A. — Not the slightest. I never saw this document or knew that Sir Hugh Allan proi)osed to distribute the stock among Canadians in this proportion; but I heard from Mr. Macpherson that in a conversation which he had with Sir Hugh Allan, that he had CANADIAN PACIFIC RAILWAY. 183 ameron's writing t'ived them? mentioned or written the manner in which ho thouglit it would be right that the stock. in the case of amalgamation, should be distributed in Canada, but the particulars 1 do not know. Q. — Then there is the letter of the 7th of August, to which you have already adverted in your examination in chief. In the letters of tlie 6th and 7th of August, two distinct letters. Sir Hugh Allan states that " We (meaning himself and Sir George Cartier) " yesterday signed an agreement by which on certain monetary conditions they agreed to "form a Company of which I am to be President, to suit my views, to give my Iriends a " majority of stock, and to give the Comjjany so formed the contract for building tlie road " in the terms of the Act of Parliament, which are $30,000,000 in cash, and 50,000,000 "acres of land, with all the advantages and privileges which can be given to us under " the Act." Have you any knowledge of what agreement he refers to in that statement ? A. — No; the only agreement is the one I have mentioned in my examination, namely, that of the 30th July, to which I objected. Q. — You have no knowledge of such agreement being made on the 5th and Gtli August, by Sir George Cartier, or any other member of the Government ? A. — No, I don't believe he ever did maice such an agreement. Q. — Do you know of any agreement which was entered into between Sir Iliigli AUan and Mr. McMuUen, and certain capitalists in New York, in relation to tlie construction of the Pacific Kailway ? yl.— Yes. Q. — When did you first become acquainted with tliat agreement ? A. — I know that Sir Francis Hincks had mentioned to Sir Hugli Allan the names of these gentlemen, and had suggested that Sir Hugli should put himself in communication with them. After that I cannot speak with any certainty. I was not aware that any arrangement had really been come to until shortly before Sir Hugh Allan came witli these gentlemen to Ottawa, and then when they came to Ottawa we declined to enter into any discussion of the matter with them. Q. — Did you see the agreement ? A. — Not until I received a cojjy of it from Mr. McMuUen. Q. — Is it among the pa])ers you handed in ? A. — No; I have only given you the correspondence. I also produce and fyle other papers marked " K." Though these I received at the same time as the copies of the corre- spondence, the papers I now produce show drafts of Sir Hugh Allan to tlie extent of $40,000 mentioned in Mr. McMuUen's letter, and the contract as originally entered into in New York, with a modiiication of it afterwards. Q. — When was the decision arrived at by the Government to exclude American capital ? A. — I don't remember when there was a I'ormal announcement of our policy on that point, but from the time it was first mooted in the press that American capitalists who were seeking to be concerned in the construction of road, were interested in the American Northern Pacific Railway and other United States systems of railways, the Government began more and more to doubt the expediency of allowing American capitalists to have anything to do with it. The Government was not I'avourable to allowing Americans to come in, inasmuch as we foresaw the difficulty of preventing the control of the road, al'ler its construction, from falling into their hands if they were allowed to construct the load. This feeling grew in the country more and more intense as the subject was discussed by the press, and as public excitement and public feeling was increasing against it, the Government individually, and as a body, before Parliament met, came to the conclusio.i that it was impossible to allow Americans to have any interest in the road. Q.— Was this before April, 1872 ? A. — Before April, 1872. When Parliament met and I had an opportunity of seeing the members of Parliament, it was then evident that this was the general, almost the universal, feeling in the House. Q. — Was any encouragement at any time given to the proposal to buiid the road with American capital by the Government or any member of it ? A. — No, except the communication I have already mentioned made by Sir Francis Hincks, I am not aware of any communication of any kind between any memlier of tbe Government and these gentlemen. On the two occasions when these gentlemen were present in Ottawa I principally conducted the conversation with them, and certainly I gave no encouragement to Mr. McMuUen or the American capitalists. Q. — Was there any communication or correspondence with Sir Hugh Allan on the subject which would lead him to believe that the Government would favour that mode of building the road ? 2 A 2 Canada. HIP 184 CORRESPONDENCE RELATIVE TO THE Canada. 1^' II A. — No, I am certain Sir Iliigli Allan when lio camo up he found out tiiat the GovertimiMit and I'arliamont were ('(lually ojjposcd to tlie admission ol" American ca])ital. Q. — You say when Sir Hugh Allan came up hero lie Ibund that out. Can you fix the (late ? A. — No, I don't at all renieml)er. I remember this fact, however, that Mr. Abbott, who took a great deal of interest in tlu; jjromotion of the Bill before the House, stated distinctly to me as a member of the (ioverrinient that he had undertaken it on the solemn assurance that only Canadian capital should be concerned in the enterprise, and that he had that assurance from Sir Hugh Allan. Q. — When did the f Jovernmcnt first determine to unite the interests of Ontario and (i)uebec and the other Provinces together in one common Company for the building of this road under the Royal Charter? ^1. — Immediately after my return from Toronto, in November, I think. I got here ai)out the 22nd of November. We then came to the conclusion that we would not — altliougli the Interoccanic Comjiany had declined to have any amalgamation — give the construction of the road to the Canada Pacific Company, but that we must issue a Koyal Charter. Even if tluiy had consented to an amalgamation taking place between the two Companies, it would have been too late to amalgamate under the Act. By the Government Act it is provided tluit the amalgamation must take place within one montli after the ])assing of the Act; so that if the two Companies had amalgamated they could only have gone on under one of the Acts of Incorporation. It would have been a matter of indilference whetiier they proceeded under one of the Acts of Incor- poration or under a Royal Charter. (i. — At what time was it that the Government determined not to give the contract to the Canadian Pacific Com])any, and contemplated the formation of another Company by the amalgamation of the Interoccanic Company with that of the Canada Pacific, for the purpose of carrying on the work ? A. — We at no time contemplated giving tlie construction to any one of the Companies, but we formally came to the conclusion to grant a Royal Charter on my return from Toronto. Q. — WIkmi was the idea of forming the Interoccanic Company first originated? A. — During the summer or autumn of 1871. I had been pressing Mr. Macpherson, Mr. Wm. Ilowland, son of the Lieut.-Covernor, Col. Cumberland, and other gentlemen to take uj) the question, and had spoken to my friends and leading n jn in Ontario, not to allow Americans to come in and l)uild the railway. Q. — Have you any reason to believe that the Company was formed because of the opinion you expressed to your friends in Toronto? A. — I am sure of it. (2. — Was it from the beginning formed upon the basis of excluding all American capital ? A. — No. With res])ect to the Interoccanic Company I am not perfectly informed ; I do not think that when they first commenced to discuss the formation of the Inter- occanic Company, they contemi)lated the exclusion of American capital ; I think on the contrary, that in the Interoccanic Company's Act of Incorporation, if I remember aright, there is some jirovision that the majority should be British subjects ; I forget now what the expression is, but there is something in that Act which from my recollection indicates that there was no jmsitive exclusion of American capital. Q. — Was there anything which indicated an intention to exclude the controlling influence of American capital in the road? A. — I have no doubt that they had that in their minds ; that those who were pro- moting the Interoccanic Bill had determined that they would not allow American capital to have control. I have no doubt that that was one of the inducements to their getting up the Comi)any. In the first place they thought it was a great thing for Canadians to be engaged in tliat great national enterprise. In the second place, as I thought myself, and as I expected they thought that Canadians ought to be interested in it, and no doubt their desire to be interested in it was greatly increased by their fears and the rumours which some of them had heard that it was an attempt of American capitalists to get hold of the control of this gr(!at work, but I cannot s|)eak specifically on that. Q. — Have you stated at what time you gave up the expectation of bringing about an amalgamation between these two Comjjanies ? A. — About the 14th, 15th, or Kith of November. I had thought at one time that I had succeeded in removing all tlie objections, and that amalgation would have taken place, but I failed. Q. — Was it at that period that the Government determined on issuing the Charter of the present Company ? CANADIAN PACIFIC RAILWAY. 185 jecause of the le controlling he Charter of A. — I returned here about tlie 22nd November, and of course we had no time to lose. We immediately addressed ourselves to get uj) a Com])any composed of representative men from all the different Provinces who woukl accept llie Royal Charter. Q. — Was that determination the result of the failure to bring about the amalgamation ? A. — It was. (i. — You stated yesterday that the number of Directors in tlie Company is tliirtcen, and tlie distribution was a good deal governed by the princijjle wjiich had governed the selection of members of the Cabinet. \Vas there any inequality of condition or advan- tages among the several Directors ? A. — There was not. I forgot in -my statement yesterday one or two points. In speaking of the personnel of tlie Directory, I forgot to alLide to the two Directors from British Columbia and Manitoba. With resi)ect to Manitoba, the Government asked Mr. Donald Smith, a member of Parliament I'rom that part of the country, the representative man in Canada of the Hudson Bay Comi)any, to be a member of the Board. The Government thought it would be a great advantage to get the asssistance and influence of that i)owerful corporation in England if the Company liad to go to that market to borrow, to get them interested in the Pacific Railway, and we asked Mr. Smith to become a Director; and with that view, and a person greatly interested in the matter, he attended several of the inlbrmal meetings that we had. We had a good many of them here ; but when the Government came to the conclusion to exclude members of Parlia- ment, Mr. Smith was, of course, 'excluded, and we consulted him as to getting a repre- sentative man from Manitoba, ile recommended Mr. McDermott, whom he represented to be a wealthy merchant in \Vinnipeg, J'or whom he acted, and from whom he had procured a power of attorney to act. That is how Mr. McDermott was appointed. In the same way Mr. Ilelmeken, of British Columbia, was aj)poiiited. He is a gentleman of very high standing there, who was one of the delegates to Canada to settle with the Canadian Government as to tiie terms of union between lirilisli Columbia and the Dominion, and who was alterwards asked to become a senator, from his well-known higli standing and character in British Columbia ; and I know, as a matter of fact, that he was asked to be the first Premier since Confederation, by Lieut.-Governor Trutch. lie also declined that. He is considei'ed a man of high standing, and, therefore, we asked him to become a Director. He did become a Director, and Mr. Nathan, a member of Parliament from British Columbia, representing Victoria, was his attorney. I had forgotten to mention these two things. Then you asked me as to whether there was any advantage of one Director over the others. There was none. The plan upon which the Government acted was this ; there were to be thirteen Directors, each to take one-thirteenth of the stock, and each to pay up a tenth to form a deposit of $1,000,000 which the Government Act required. We stipulated with these Directors that they should be in fact trustees for their several Provinces ; that they should not hold more than $100,000 each of stock at first, on which they would each pay $10,000; and that they should give an opjiortunity to the peoi)le of their different Provinces to subscribe for the rest of the stock as they chose. Such subscription being of course i)rovibioiial, until sanctioned by the Government, as it was a provision that no transfer could be made of any shares without the consent of the Government, and then, in case the stock was not subscribed in the different Provinces, whatever was unsubscribed should be placed in the open market with the same condition that no person should get any stock whatever until their names Avere submitted and apjiroved of by the Government. Q. — Who was elected President ? A.— Sir Hugh Allan. Q. — Do you know whether he was elected through the influence of the Government? A. — I know that he was not elected through the influence of the Government. I know it in this way : that, for convenience sake, I was made the sole means of communication between the Government and the Provisional Board of Directors. I know, therelor that when they met I made no suggestion at all, because it was not necessary that 1 should do so. They all seemed to assume that Sir Hugh Allan, from his wealth and standing, and having taken it up first, was to fill the position as a matter of course. That seemed to be understood by all the gentlemen. If there had been any doubt about it, I should have carried out what I said I would do in my telegram. I would have said I liope you will elect Sir Hugh Allan, but I did not do so. Q. — The Government did not find it necessary, then, to exercise its influence, promised by your telegram of the 2(ith of July ? A. — They did not find it necessary. I do not remember making any communication to any member of the Board on that subject for all seemed to take it as a matter of C.INADA, mn 186 CORRESPONDENCE RELATIVE TO THE If ^'- pi:' Oax&oa. coui'st'. I am more jiarticular about that, because several of them did speak to me about who sliould l)e Vice-President. C>.— Who is the Vice-President ? A. — Major Walker, of London. Q. — Does Sir Hugh Allan, in consequence of being President, enjoy any peculiar advantages, other than the dir'inction, of course ? A. — The only advantage he has is sitting at the head of the table regulating the pro- ceedings, and having tiie name of President ; but by law he has no advantage, and that view I pressed strongly on Mr. Macijherson and other members of the Interoceanic Com])any, and that every Director made liis own position on tlie Board according to his abilitv. Q. — Did Sir Hugh, then, in tlie course of his negotiations in relation to this whole matter, obtain from the Government any advantage greater than these other gentlemen '! A. — No, none whatever. Q. — I think you Stiy, in your examination in chief, that after your telegram of the 2(Jtli July — after that arrangement was made — that tliese arrangements were made between Sir George Cartier and Sir Hugh Allan, with respect to the furnishing of funds for the supjmrt of the elections. Did you not state something to ihat effect ? A. — No ; I did not state that. (2. — Have you any correspondence relating to that matter — of the money to 1)0 subscribed in Montreal by Sir Hugh Allan? A. — No, I have not. Q. — Was Sir Hugh Allan the only one that you mentioned ? A. — I mentioned other names. I think it liardly fair to mention the names of those other gentlemen. I mentioned Mr. Brydges' name, and Mr. George Stephen's name, and several other names. I have no doubt I mentioned Mr. Ogilvie's name, and otlier friends. Q. — Had you any reason for mentioning Sir Hugh Allan's name beyond that which actuated you in mentioning the names of the other gentlemen ? A. — Yes, I had. I tliought Sir Hugh Allan was especially interested in getting a Railway Parliament returned, and that he was interested in sustaining the Government which would carry out the railway policy which they had inaugurated. Q. — Did you consider him then to have a direct personal interest in the result of elections ? A. — Yes. I considered him to have a strong personal interest in this way. Sir Hugh Allan had, as is well known, a very large interest in the Steamships line, and in getting freights for that line. He knew, as it was well known in tlie country, tiiat there was an opposition line being got up, under the auspices of the Grand Trunk Railway Company, to run to England ; and it is well known that he was alarmed at this, because he naturally assumed that, if the rival line were connected witli the Grand Trunk Kaihvay, there would be prelcrence given to that line over his own in matters of freight from the wt^t. Sir Hugh Allan, I think I am not wrong in supposing that this excited him very much, and that it was the primary cause of his connecting himself with the Northern Colonization Road from Montreal westward, and encouraging the building of the Northern Road between Montreal and Quebec, and the extension of the inner line between Ottawa and Toronto, so as to have another and competing line which would giva. exix'iisi's, iiiiloss somo of my constitiioiits paid some money that I do not know of out ol their own pockets. I i)aid all the ex])onses of my own election, and did not reimhursc my^-elf for any portion of my own election expenses out ol' these funds. On the contrary, 1 jidfled to the election fund out of my own lim'ted means to help my friends elsewhere. object of sustaining the (lovernment and their railway jjolicy in connection with tlie Pacillc Kail- way, h'" lieing assured that that policy would 1)0 sustained with the inlluence and power of file Government if it remained a (iovernment. To tlie Hon. Mr. Canii)bell, through the C!liairman: — Q. — You have had verv many years' experience of elections? yl.— Yes. Q. — During thirty or tliirty-five years? A. — Durinj^ about Ibrty yeai's, from 1830. (2. — At all elections, I believe there is a certain expenditure of money ? yl.— Yes. (I — AVhat is the' character of that expenditure? A. — ^It is an uncertain expenditure. There is what they call the legitimate expenses, which every candidate has to undertake — the expenses of canvassing, printing, and advertising — those are tlie legitimate exi)enses. Tliere is also a very large expenditure, which isvery common in this country, although it is contrary to the Statute. It is, how- ever, I believe, so universal that I have never kno\vn any serious contest before an Election Committee on that ground. 1 refer to tiie ex])enditure lor teams to bring the voters t'" come to the jioUs. iMy experience has been, with respect to this item, that you cannot g.'t the voters to come to the polls on either side unless some effort is made to provide conveyances for them. (>. — That constitutes a very serious item? A. — Yes, 1 have always imderstood tliat to be the chief iicm. Q. — Then tlierc; is more or less treating ? A. — Ye •, and dinners and things of that kind, all of which are contrary to the Statute, but they generally ])revail in Canada. (2. — Did you find at the elections which occurred last, in 1872, any particular necessity for spending money? A. — ^Therc was this necessity, that I don't su])pose there ever was a fiercer struggle for the mastery than that which took place between the two parties, especially in Ontario. Every cIRirt was made on both sides to carry their candidates. There was an unusual amount of exertion jnit forth, the exertions of the Ojiposition being much greater ui 1872 than they were in 18C7. (2. — The exertions of the 0])position ? A. — Yes, and of course there was a corresponding exertion made by the party to whidi I belong. Q. — And there was a corresponding increase in the expenditure ? yl.— Yes. Q. — You had a very general knowledge of the contest in Ontario ? ^.— Yes. Q. — You found that there was an expenditure of a much larger amount than usual on lioth sides ? ^'1.— Of course I am not in the secrets of the Opposition, but I found such a concurrent opinion in Ontario from independent sources that money was being spent very largely, unusually so by the Opposition, that I had no doubt aliout it. Of course some of those statements might have been exaggerated in particular localities, but the same report came from all quarters. I have recently seen statements tliat may perhaps at some time see the light verifying that liict. Q. — You were at the head of the (Jovernment during the last elections, and also during the previous general elections ? A. — I was during the election of ISfi/, and of the last elections. I have been, if not at the head of the Government, a member of it since 18r)4, with the exception of the twenty months which Mr. Sandfield Macdonald was in power, and the six or eight days during which Mr. Brown was in power. Q- — Is there any other machinery in Canada for raising funds to meet election expenses except the efforts of individuals ? A. — There is no such machinery here as prevails in England. In each constituency, I sujipose, the different parties raise a fund, and they usually have a central fund. Q- — There is no such machinery as the Carlton Club and the RelbrmClub in England, but the head of the Government cliarges himself with doing as much as possible among his friends for the general funds ? A. — The leaders of parties which divide the country, exercise their influence amongst their friends to raise funds for that purpose, 2 B (!.\\AI)A. WT) '1 100 ('0U1U:S1'()NDKNCE HKLA'IVE TO TllH M Canada. (}, — Von spoke ol' tlic a])i)()intnu'iit, of IMr. IIall,aiul said tliat tlic fust naino siigsostcil \\as that ol'tlic Hon. Mr. Foster. Do you nicaii that the appointment of Mr. Foster was strongly pressed on tlie Governnu nt l)y anyone? A. — liefore we settU'd that there were to be no members of Parliament on the IJoard, Sir Ihijih Allan and ^fr. Al)hott both asked that Mr. Foster should be ajtpoiuted. Tile («ov( riuuent left that to Mr. Fope, who is a member of the (Jovernment, and he seleeted Mr. Hall, as I understood, on Mr. Foster saying that he would not resign his yenatorship to become a Director. Q. — That was just about the time of the Charter being signed? .4.— Yes. Q. — U]) to that time ^Ir. Abbott and Sir Hugh Allan had been pressing the appoint- ment of ^Ir. Foster ? A. — Yes. And, if I remember rightly, Mr. Foster was offered a ]iosition on the Hoard if he would resign his Senatorship, which I understood he declined to. I was informed by Mr. Pope of the fact, and he selected ^Ir. Hall. If I remember rightly, Sir Hugh' Allan desired that if Mr. Foster was not appointed some one representing him should be chosen, and he suggested his brother. I wish to make one remark. I stated that when Sir George Cartier and I i)arted, when lie went to Montreal before the elections, I suggested to him certain names liesides Sir Hugh Allan, and I gave him those names. I do not wish it to be understood that I know that these gentlemen subscribed. I do not know whether they did or not. I merely suggested seme friends of the Conservative party. And further deponeth saith not, and this his deposition having been read to him, he declares that it contains the truth, persists therein, and hath signed. Sworn and taken in part on the seventeenth day of Se])tember, 1873, and remainder taken on eighteenth day of said month, and the whole acknowh.'dgcd on the twenty-second day of said month and year. (Signed) (Signed) JOHN A. MACDONALD. CHARLES DEWEY DAY, Chairman. A. POLETTE, JAMES ROBERT GOWAN, Commissioners. Pi;ovi\CE OP Oxtahio Citi/ of Ottawa. } IN THE MATTER OF THE COMMISSION Appointing Charles Dewey Day, Antoine Polette, and James Robert Gowax, Commissioners to inquire into and report upon the several matters stated in a certain Resolution moved by the Hon. Mr. Huxtin'otov in the House of Commons on the second day of April, a.i>. 1873, relating to the Canadian Pacific Railway. Present: The Commissioxers. On this eighteenth day of September, in the year of our Lord one thousand eight hundred and seventy-three, personally came and appeared before us, the above-named Commissioners, The Honourable HECTOR L. LANGEVIN, of the City of Ottawa, who, being duly sworn, deposeth and saith : Q. — You are aware, Mr. Langevin, of the terms of the charge recited in the Com- mission ; the alleged agreement with American capitalists for building the Pacific Railway ; the knowledge of the Government of this agreement, and the subsequent charge that there was an understanding between the Government, and Sir Hugh Allan, and Mr. Abbott, to furnish funds for promoting the elections in 1872, for which they were to receive the contract for building the road. You are familiar with these allega- tions, will you have the goodness to make a statement in detail, giving all the facts within your knowledge relating to these charges? A. — About the arrangement for the contract between Sir Hugh Allan and the American capitalists, I kneAv nothing until I saw it mentioned in the newspapers. I may say, as was said by others, that the Government and the diflerent members of the Government were from the beginning opposed to Americans obtaining the contract and the control of the Canadian Pacific Railway, with the exception of Sir Francis Ilincks, CANADIAN PAt'IFIC RAILWAY. IDl ng the apiioint- read to him, he CDONALD. i)iit finding afterwards that liis coll(!af;iii's wen- unaiiiinous on tlio .siilijicl, lie ^avf up his own opinion, and af;r('('d with us tliat the Companv to ho I'oriiicd should lie rorincd by (.'anadiuns or IJritish suhjccts. The cliargo niade l)y Mr. I huitin|i;tou that the (ioverii- inentor mcmliors ol" the (ioverinncut, in consideration oi' I'unds to he rurnisiu'd or paid to tlie (jovernnient, or any memher or menihers oi' the (fovernnient, nuKh,' any ai;rieinent, or had any uii(U'rstaudinf; with Sir IIuj;h AHan and .Mr. Ai)l)ott, or Sir lluf^h Alhm or Mr. Ahhott, or anyone else, lor tlie building ol' the Canadian Pacilie Railway, or I'or the obtainiiii^ ol' the eontraet.or I'or any advaulaf^i; t)r any }j;ain connected with it ; that charge is false. 'I'lie (iovernuieul never had any such nuderstandini;, or ever made any such promise or any such harfz;ain, aiui in so far as I know, and I liave no doultt that it it liad been otherwise I would have known it, there has been no bargain, no contract, no understanding of that kind between Sir Hugh Allan and Mr. Abbott, or citlicn- of them, or the Americans on the o!ie side and any mend)er of the (lovernment on tlu' other. I try to make it as general and as spi cial as ])ossible, because 1 want to give a complete denial to the charge. I may now say about the giving of the contract to Sir Hugh .Vilan or to anyone else, that the statements made l)y me here about the action of tlu; (ioverii- ment are perfectly correct. The Government did not make any arrangement with Sir Hugh Allan, or with anyone else, for the building of the Canadian Pacific Railway until after the general elections of 1.ST2. Up to that time there was no promise or arrangement of any kind made by the Government or any member of the Governnrjiit about the building of the road. I may i....o add that the Government Mere determined from the beginning to give no advantage to one Province over any other. We knew I'uU well that Sir Hugh Allan was considered i)y the Lower Canadians as their representative man in this matter. We knew that he had taken Irom the begimiing a very important part in the promotion of the railway : but on the other hand we had to consiiler that this railway was not for tlu- Province of Qui;bcc alone, but also for the other Provinces, I should say for the whole Dominion. On the other hand, the Toronto interest was very iiui)ortant. Our Toronto friends were very jiressiiig, and by Toronto I'rii'uds I mean the financial interests of Ontario ; that interest was very pressing, and of course they as well as the Quebec or Montreal interests were dring their best to have the upper hand in this railway. We had therefore to be very careful as a Government, that no pre- ponderance should be given to one Province over the other, but that in giving the Charter the interests of the wholi; Dominion should be considered and taken care of. We therefore did all that we could to bring about an amalgamation of the two Companies; that is to say, the Canada Pacific Kailway Company and the Interoceanic Railway Company, the first having as its representative Sir Hugh Allan, and the other the Hon. Mr. Macpherson. However, the negotiations which we had Mith those two Companies failed. We could not induce the Interoceanic Company to amalgamate, and therefore we had to decide what course the Government should then take. We had only those two Companies incorporated by Act of Parliament, ^\'ere we to give the contract to one or the other, we would necessarily have given oflence to one section or the other, and also given an undue preponderance to one Province over the other. The consequence was that the Government took advantage of the clause in the Act relating to the aid that Parliament allowed the Government to give to this undertaking. We took advantage of that clause, and formed a new Company, composed of some of the leading men of the (^mada Pacific Company and of the Interoceanic Company, adding to them some other leading men of the Dominion. The composition of tlie new Company has already been described by Sir John A. iMacdonald, and I have only to say that I would have only to repeat w hat he lias just said on that point. As to the names, that is a correct description. The Charter of the Canadian Pacific Railway Company was given, I think, in the first days of Februaiy. 1873, if I am not mistaken. Q. — \Vill you now proceed to the other branch of the subject, respecting the money furnished for the elections ? A. — As I have already stated, there was no bargain of any kind. I mean that neither the Government nor any member of the Government, so far as I know — and I would have known of it if it had been otherwise — made any bargain or agreement by which the Government, or any member of the Government, was to receive any sum of money, or any advantage from Sir Hugh Allan, or from anyone else, for the granting of tlie Charter, or for the influence of the Government, or any member of the Govermnent, oi for the services of the Government, or of any one of tlnim. Respecting the sums o. money that Sir John A. Macdonald had stated as having been received for the Ontario elections, I know nothing. Respecting the sums of money iurnished to the Moutrea. Central Election Committee, I knew nothing either. 2 D 2 CAJfADA. 192 COUKKSrONDKNCi: RKr,ATIVi; TO TIIH Canada. Durinf; the Session of iM/'i [ hail a conversation with Sir (icorj^o Cartif r, my (iucluc Itnuhr, on tl,c I'U'ftions that wvw coniin;; on, and I stated to iiini that we should divide the worli in Lower Canada, in order that our Irieiids shonhl lie al)le to refer with certainty to one of us, in ease they neech'd advice or ntherwise. It was so unih'rstond hetwecn us, and I went farther I told him the e\iierienc( 1 iiad had at previoiw elections, and that I couhl not niyscdf jirovide the finids that niiiiht lie re(]uire(l in ni\ rey;ion without help from the exterior. That of course I had friends that could helji me to a certain extent, hut that he was aware that the ^Mvat wealth of the Province of Quehec was centred in ^^tntreal, and not in (^iieliec, ai\d that therefore I woidd exjiecf that whencNcr he ohtained from his weallhv friends in Montreal coutriliutinns to the election fund for the Province of Queiiec, he shouhl remember that 1 should have a share to help in tlu" election contest of ni}- ret^ion— that is, the eastern part of the Province ot' Quehec. He proniises I am conci'rned, 1 say positively that he never s])okc to me on the snl)ject, and never promised me anythinj; at any jjcriod. The oidy time I had a conversation on election matters with Mr. AI)i)olt was, I htdieve, some time duriuL!,' tlie Session of IST'J, when he, hiiviuu; occasion to conn- to my depart- ment to see me aliout some ni:ili,er eomu'cted with a public work in his county, I spoke to liim. as being one of my best political friends from my own Province, on tliu prospects of the electoral contest that was to take ])lace durinij the simimer. I told him that the last eonlest Jiad \iv'.'i\ a severe oi\(; for nu-, in so far as my small purse was concerned, and that, of course, my position beiuLi,' more prominent now than it was tluii, I was afraid that the claims or the calls uj)ou me would iii' still f;reater, and on that lit; remarked that it would not be fair that the burden sliouhl all fail on my shoulders, but that certainly I should he helped by my irieiids. That is the only conversation I ever had with Mr. Abbott on that subject, and of course it is one of those conversations I could have had with any other political friend supporting,' me in Parliament or supportiiii;' me out of Parliament ; and I may add that Mr. Abbott never spoke to nu* ai)out the Pacific Railway, or the IJills tliat wiuu; bi'fore the House, and he never asked my support of any of the measures that ■were then befort! the House, or asked whether I would support or oi)pose them. In consequence of the conversation I had with Sir (•eori;e Cartier, as I stated just now, dm'ing the elections of IS/L', I rt.eived from Sir Georuc Cartier, hy the hands of Sir Ilu^h Allan, Sl<'),"l">, he (Sir Hugh) statinj; that he was instructed by Sir George ('artier to remit me that sum for the election I'luid of my region. Sometime afterwards I received a note from Sir Hugh Allan stating that on my giving a receipt to Mr. Abi)ott he (Mr. Abbott) was instructed to deliver me, also by ilircction of Sir George Cartier, ij!l(),()OU additional for the same oiijcct As I was ahout leaving Ottawa for Quebec during the elections, and understanding that Sir Hui;li Allan had gone to Newfoundland, I telegraphed Mr. Abbott at Montreal to be kiml enough to nuct me on board of the Quebec boat at Montreal, wdiich he did. I told him there tliat I had received a note from Sir Hugh Allan, as I stated just now; that I liad asked no money from Sir Hugh; that the sum of ;< I. 5,01)0 that he had sent me before came from Sir George Cartier; that I had understood from Sir George Cartier that any sum of money that he would send to me would he a portion of the subscription of his wealthy friends in Montreal, and that therefore 1 could not for a moment think of giving a receipt or of receiving any money on any condition whatever, and that if this sum of !«;I(),()0() was not on tlie same footing as the Slo,<*0() first sent, 1 could not receive it. Moreover, if there had been any misunderstanding about the first sum, ami if that first sum was not a pure giit on the part of the subscriijcrs to the fund, I would go down to Quebec, and would return that amount immediately. Mr. Abbott told me that there must he some misunderstanding, that he was sure that there must be no intention of putting any condition or exacting any receipt about this money. So wc parted. Mr. Abbott sent me afteruards the SHI,000 without any condition, and I believe stated that his explanation to me was the proper one. Some time afterwards i.;/^^ CANADIAN I'ACIFK! UAILWAV. m,", Ik; Proviiu'i- ol' Sir Gi'()r|;f('artiiT, wliom I had seen en imssaiit in Moiifniil, mid who lind ask inc in wlrit jiosilioii I 1(11111(1 inyscll jiixnit tlic clcctidiis in in\ rc';;i()n, >\as iniornicd iiy nic llial, iicsiiics ni;, own clcition and what I iiad contiiljiilcd jicrsonally tn otlicis, 1 was sliort to tiic anidimf of i^7,r)()0 or !i«7,(l(IO. He told mo he tiioiij^iit his Klcition ConunitUi! would !ia\c to provide lor that additional snni ; and simc time al'tcrwards I received it witli a note IVoni Sir Hiiuli Allan, ^^tatin^; llial Sir (Icorgo ('artier liad iiistruitid him to liand ine tlial amount. 1 never iiad any conununicatioii on this suliject with Sir Hugh Allan, beyond what i liave just, stated, By my statement tiio ('ommi^sioners will see tliat none ol" tliat money was emi)K)yed in j'ayinfi- tlie expenses ol' n)y own eleetion. (I Did yon take as active an interest in the nejjotiations eonfernin<; tlie hniMinj; of the Paeille Railway in the earlier stages of it, as other meml)c'rs of the Cahinel'/ A.~ No. 'I'he first nejidliations were condueted by Sir. John A. Maedonald jirineipally. Till- nei;otiati()ns hetween Sir i'raneis llineks and Sir Iln^h Allan and others were con- ducted as com in;,; from hiinself at the hcninniii;;' ; and. as Sir .lohn INlacdonald staled correctly when we heard that he was favouring the introduction (d'tlie American interest in tlu; projjosed Railway Company, we expressed our dissent from tliat action ; and from that moment until the end, the Cahinct never wavered on that jioint, showing tlu ir determination to exclude Americans from the I'acillc Railway Comiiany. (I — Do you recollect about the time that that decision was arrived at'/ J.— The formal decisoti on that point was, I think, in April or May, l^'7-^ liut I am not sure. Previous to tlie Session of 1872, that deterniiii.u ; mi was arrived at on the part of the Government. Although. ])erliaps, it was not know a ;a outsiders, yet it was the settled jKdicy i)revions to the Session of lST2, and when we met Parliament and had an oiipor- tunity of seeing the members of the House oT Commons, it was clear that any other policy would fail. Q- — ^^'el•e yon present at any of the intervu^ws \v ntioiu'd by some of the witnesses, and ilso in Mr. McMuUen's letter relating to this m;itier'.'' .1. — No; I was not i)resent when the Aniericai) gentlemen were there. At the first interview I understood that there W(^re only two members of the (lovein- ment present — 5iir John ^lacdonald and Sir Francis Flincks. The second interview was reported to me on my arrival here, I think I Jiad gone to Montreal or Quebec. Q — You liave no recollection of having ever met those gentlemen in conference? -/I.— No ; I never met them. 1 never sa\v Mr. (Jeorge McMnllen. (2- — Mad you ever any conversation with Sir Hugh Allan on the subject of the agree- ment they had entered into ';■ .1.— No. (2-— Then you know very little of that ? -L— Very little, indeed. Q. — Did you take any ]iart in the eilbrts which were made to bring about an amalga- mation of the Intei'dceanie and the Canada Pacilic Companies? A. — Nothing more than as a member of the Privy C'ouncil. (2.— You knew that the negotiations were going on "/ A. — Yes. The action was determined in the Privy Council before being taken. (2. — Kespecting the organi/ation of tlie Canadian Pacific Comiiany and tlie appoint- ment of Directors, you state that the evidence you would give would ije that givi n by Sir John A. Maedonald '! A. — Exactly what he gave. The Hon. Mr. Reaubien, who was specially selected !)y me, was so selected to represent the interests of the District ol' Quebec, not as opi)osed to that of Montreal, but as being distinct from that of ^Montreal. That was the object I had in view in selecting him from that jiortion of Lower Canada. Q. — Sir Hugh Allan was elected President of that Board':* A.— Yes. Q. — Have you any knowledge of any iniluencc being used to procure liim that position ■? A. — 1 am not aware that the Government used any special influence or any iulluence to bring about his election. Q- — Do you know whether his election was unanimous or not '.' A. — I understood it was. Q- — You liave no personal knowledge on that subject '! A. — No ; I was not present. Q. — Had you any communication with Sir Hugh Allan ui)oii the subject of money to be furnished for the elections before your communication with Sir George Cartier'.^ Canada. w !«::> 194 CORRESPONDENCE RELATIVE TO THE Canada, A. — No, never ; at no time. Q. — You liad no conversation with him on the subject ? ^.— No. Q. — Do you know how much he subscribed in all for the elections ? A. — No ; I don't know. Q. — Have you in your possession the letter that Sir Hugh Allan wrote, to which you have referred ? A. — No. 7 don't keep any of these lett(!rs, nor any letters that are mere formal letters. It has always been a rule with me as soon as I have finished a letter to destroy it, unless it is an official letter to be filed iu the department. But my own letters I destroy, and I think, l)y what I have seen since, that I was perl'ectly right in this. Q. — Do you remember the terms of that letter ? A, — No ; there was nothing special in it. Q.— Did it lelate to the advance of that $10,OUU ? A. — Sir Hugh Allan stated, so far as I can recollect, that Mr. Abbott would pay me, or hand me §10,(100, and that Sir George Cartier had wished him to send it to me on my giving him a receipt. Q. — Was that the only condition in the letter ? A. — As I'ar as I can recollect, there was no other condition than that. Q. — You have said, I believe, that you received another letter from Sir Hugh Allan, enclosing tlie last sum you received? A. — No, I don't think there was any note with it ; if there was any, it was simply stating tliat, " I send you $7,000, or $7,(JO0, by order of Sir George Cartier." I think he must have sent some such note as that, but I have no special recollection of it. Q. — You don't remember the terms of the letter ? A. — No ; it was nothing more than a mere business letter that might be written by one person to aiiotlicr. Q. — Me mentioned to you that he had sent you that sum of money ; did he say anything elbe? ^.— No. Q. — Did he not say anything else? A.— lie said, " by the direction of Sir George Cartier," or " by the wish of Sir George " Cartier." Q. — Nothing more than that? ^.— No. Q. — You say you mentioned to Mr. Abbott that unless it was ■> free gift on the part of the subscribers to the fund you Avould go to Quebec, and at once return the first $15,000. yl.— Yes. Q. — AVhy did you make that remark ? A. — Because when I saw tliat Sir Hugh Allan, in his letter, stated that Mr. Abbott had §10,000, which he would hand me, or send me, or pay me on my sending a receipt, or giving a receipt, I thought that meant that it was not a mere subscription, and therefore thinking that the same thing might apply to the first §15,000 that had been sent, and for which no receipt had been given, 1 stated at once to Mr. Abbott that if this money that had been sent by direction of Sir George Cartier was not a mere gilt on the part of the subhcrilxi's, I must return it, and I was going down to Quebec and would return it at once. The reason for that Avas apparent. The object I had in view when I spoke to Sir Gee rge Cartier in the Session of 1872 was to see tliat the heavy expenditure of the elections siiould not fall on me, and that I should not be responsible for the whole amount, and if this had not been a mere gift on the part of the subscribers, I would have found myself responsible for the whole amount, which I would not undertake to be. Q. — You use the word " gift " in opposition to " loan " — not a loan but a gift ? A, — Yes, that is what I mean. I wish to add in regard to Sir George Cartier on another point. It is that from the beginning he showed his opposition to the introduction of Americans or American capital in the Pacific Railway Company to be esUiljlishcd or to he incorporated. He expressed himself so to me more than once, stating, I cannot recollect his exact words, but the meaning of the conversation was this, that lie would not allow the Americans to build our railway. Their interests commercially speaking being difierent from tliose of tiie Dominion ; and that we had in Canada and in England men who could find tlie necessary capital, and who would have the necessary skill to build thij railway. He was very positive and never wavered on that point. Q. — Do you know anything of the letter from Sir George Cartier to Sir Hugh Allan of date t!ie 30th of July ? CANADIAN PACIFIC RAILWAY. 1.1(5 ir Hugh Allan, 1 of Sir Georae ,1. — No. I know (f no letter except tliat which lias been published in tlie neswpapers. Camada. TiuM-e is one of that date publisjied. Q. — Do you know of any otlier letter of that date which has not yet been published ? A.— 'So. Q. — Did Sir Goorge Carticr mention any such letter to you? A. — I never had any conversation with liiin about that. To the Hon. Mr. Campbell, tbrou^h the Chairman: Q. — You stated that 3 ou concur in Sir John Macdonald's statement of the mode in which the present Directors of the i)reseni; Company were chosen ? A. — Yes. Q. — Did Sir Hugh Allan exercise any influence in the choice of these Directors? .tl.--No, not that I am aware of; and if he had exercised any influence, there is no doubt I would have known it iVom the knowledge I had of the business of the Council. Q.— Did not both Sir Hugh Allan and Mr. Abbott press for the appointment of a person in lieu of Mr. Foster, Avhen the Government arrived at the determination that no member of Parliamcit should be on the Ijoard^ as Mr. Foster's nominee in fact? A. — Yes, they did. Q. — And no such appointment was made ? A. — No such appointment was made. Q. — They continued to press for the appointment up to the last moment^ did they not? A. — They did. By the Commissioners : Q, — Who was the person put forward ? A. — I think Mr. Foster's brother. Q. — And they were pressing for the appointment of Mr. Foster up to the last moment, until they were told, in fact, it was no use ? ^.— Yes. Q. — So Sir Hugh Allan exercised no influence in the selection of the persons who are on the Board ? A. — None whatever. And further deponent saith not, and this his deposition having been read to him he declares it contains the truth, persists therein, and hath signed. Sworn and taken on the eighteenth day of N September, 1S73 and acknowledged ^g; ^^^^ HECTOR L. LANGEVIN. on the twenty-sixth day of said month | and year. j (Signed) CHAELES DEWY DAY, Chairman. A. POLETTE, JAMES ROBERT GOWAN, Commissioners. IN THE MATTER OF THE COMMISSION Province op Ontario") City of Ottawa. J Appointing Charles Dewy Day', Antoine Polette, and James Robert Gowan, Commissoners to inquire into and report upon the several matters stated in a certain Resolution moved by the Hon. Mr. Huntinotox in the House of Commons on the second day of April, a.d. 1873, relating to the Canadian Pacific liailway. Present : The Commissioners. On this eighteenth day of September, in the year of our Lord one thousand eight hundred and seventy-three, personally came and appeared before us, the above-named Commissioners, SANDFORD FLEMING, of the City of Ottawa, Civil Engineer, who being duly sworn, deposeth and saith : Q. — You reside in Ottawa, I believe ? A. — Yes, at j)resent. I am a Civil Engineer. Q. — Do you know Sir Hugh Allan ? A. — I know him very slightly. Q.—D0 you know Mr. G. W. McMullen? A,~ I do not know him. Q. — Have you any knowledge of an agreement between Sir Hugh Allan and Mr. ilh in' 196 CORRESPONDENCE RELATIVE TO Till] i^*' i Oanada. G. AV. McMiillen, representing Unitoil States capitalists for the construction of tlic Canada Pacific Railway with American funds? A. — None whatever, except what I have recently seen in the newspapers. Q. — Were you brought in relation to the parties lo that transaction at the time it was going on ? ^.— Not at all. Q. — You therefore know nothing at all about it? A. — Nothing of my own knowledge. Q. — Have you ever had any conversation with Sir Hugh Allan relating to it ? A. — No conversation wiiatever. Q. — You were, I think, one of the Provisional Directors of the Canada Pacific Railway Company ? A. — My name is in the Charter of the present Company. I was not connected in any way with any of the Companies that were incori)oi'ated by Act of Parliament. Q. — When did you first become interested in the movements for the construction of the Pacific Railway? A. — In 1871. I was called upon by the Government to conduct the surveys. Q. — That was all your connection with it initil you^were appointed a Director of the Canadian Pacific Railway Com])any ? A. — Yes, until I was asked by Sir John Macdonald to consent to be one of the Directors. Q, — About what time were you requested to become a Director? A. — It must have been in January of this year, 1873. I am not quite sure, but I think it was only about two or three weeks before the date of the Charter, the Charter is dated the 5 th of February. Q. — How many Directors are there upon that Board? A. —I believe tiicre are thirteen names in the Cliarter. Q.— Tliey are all upon an equal footing as Directors? ^.— Yes. Q— AA'ho is President? j4.— Sir Hugh Allan. Q. — Were you present at his election ? A. — I was. Q. — W' as there any difference of opinion on his election ? A. — I don't think there was. It seemed to be agreed upon by common consent that he should be President. Q. — What were the motives which induced the unanimous election of Sir Hugh Allan? A. — He had taken a very active ])art in the whole affair, and he was one of the wealthiest men, if not the very wealthiest man. He seemed disposed to embark his capital in this enterprise to a very large extent, and it was also thought that he would as President be better able than almost any other man to influence capitalists in England to join in tiie work. Q. — Was it considered an advantage to the undertaking to have hiia at the head of it as President? A.- — It was then considered so unquestionably. Q. — You have extensive experience and reputation, and knowledge as an Engineer, JNlr. Fleming. Can you give an opinion as to the pecuniary ])romise of this cnteriirise under the Charter. Does it apjjcar to you to be of a j)rofitaijle character ? A. — Anything I can say on that head must be very Kj)eculative. I suppose I have had a better opportunity of judging tlian any other member of the Board, on account of being connected with the surveys; but I always had grave doubts about the financial success ol the scheme. Q. — Did you accept a Directorship from a desire, or with the expectation of making money out of it? A. — I accepted ii Directorship because it was pressed on me by the Premier. I hesi- , tated very much about accepting it, and did not do so solely with the idea of making money out of it. Q. — Do J ou know anything about the general elections in 1872 — about the raising of funds for the i)urpose of carrying them on ? A, — None whatever. I was not in this part of the country at the time. Q. — Aiul nothing has since come to your knowledge with respect to these elections? A. — Nothing, except what anyone can read in the public papers. Q. — You stated the reasons which seemed to operate with the Board in selecting Sir CANADIAN PACIFIC RAILWAY. 197 I of tlic Canada be one of the ITugli Allan as President. Were they the reasons which operated with you — that is, his wealtli, his position, his I'acility for obtaining means, and so on ; were tliese the reasons whicli operated with you ? A. — I tliink so. Everything pointed to Pir Hugh Allan as the proper man. Q. — Had you any other reasons than those you liave named lor giving him your supi)ort as President ? A. — I never gave the matter very much consideration. Everything pointed to Sir Ilugli Allan as the pror jr man to be President ol' the Company. His name was first on the list of names given in the Charter, and he had no rival. Q. — Was any influence used with you personally to induce you to support Sir Hugh Allan as President ? A. — -I am not aware of any. It seemed to be generally understood by everybody that lie should be President. He seemed to have no rival. And further deponent saith not, and this his deposition having been read to him, he declares that it contains the truth, persists therein, and hath signed. Sworn and taken on the eighteenth day of Canada. September, 1873, and acknowledged on the twenty-ninth day of said month and year. (Signed) (Signed) SANDFORD FLEMING. CHARLES DEWEY DAY, Chairman. A. POLETTE, JAMES ROBERT GOWAN, Commissioners. IN THE MATTER OF THE COMMISSION \t the head of it xtion of making it the raising of Provixct; of Oxtario, 1 Cit>/ of Ottawa. J Appointing Ciiarlk.'? Dkwky Day, Antoixk Polette, and Jamks Roi!Ert Gowax, Commissioners to inquire into and report upon the several matters stated in a certain Resolution, moved by the Hon. Mr. IIiiXTiNaioN, in the House of Commons, on the second day of April, a.d. 18713, relating to the Canadian Pacific Railway. Present : The CoMiiissioxEns. On this ninteenth day of September, in the year of our Lord, one thousand eight hundred and seventy-three, personally came and appeared belbre us, the above-named Commissioners, Sir HUGH ALLAN, of the City of Montreal, Knight, who being duly sworn, deposeth and saith : I am a resident of Montreal. Q. — You have taken an active interest in the negotiations and operations for the constructing of the Canada Pacific Railway '! A. — I have. Q. — There are a number of letters which have been found in a package entrusted by you and Mr. G. W. McMullen, whom 1 suppose you know, in the hands of Mr. Starnes, and we desire, in the first place, to prove those letters to bj in your handwriting. Will you take the package and examine it, and state if they are so ? A. — With reference to the parcel itself, it was not I who put it into the hands of Mr. Starnes, or made it up. I cannot swear positively as to the originality of the package. I can, however, identify my own handwriting. Q. — These letters now shown to you, were they all written by you to the gentlemen to whom they are addressed ? A. — Yes; they were private letters for private information, and not lor publication at all. Q. — Are the telegrams also correct ? A. — I think so. I have only a knowledge of their general terms. Q. — Are there any other contents in that s(!aled package which you can identify ; that is, for instance, the sealed packet and other documents, one a letter addressed to tiie Hon. llciu'y Starnes, is that your letter ? A. — Yes; that is my signature. Q. — Is that Mr. McMulleu's signature to it also ? A. — I think so. 2 C TTTTT iCh 108 (.:ORRESP()NDENCE RELATIVE TO THE Canada. Tlicrc is also another envclojjc here containing a cheque for $17,500, and I hereby produce and lyle it, marked " N." Q. — \Vliat was the letter addressed to Mr. Ptarnes with the memorandum and agreement ? A. — Tlie letter is herewitli ])rodiu'ed and fyh'd, marked "O." Ci.— You have said tliat you liave taken an active interest in the negotiations for the construction of the (Janada Pacific Railway. I will now read to you the formal charges that have been made against the (lovernment on that subject, with the view of receiving a statement of what you know about tliem. ^Vill you liave the goodness to state all the facts within your knowledge relating to the subject matter of these charges? A. — If the Court will permit me, I will read a statement which I have drawn up relating to tlie matter. With rel'erence to this statement, and any other I may make, I wish the Court to understaiul that at this distance of time — I'rom one to two years — during which many changes have taken place, and, as a nuitter of course;, I cannot exactly charge my memory as to conversation about i'acts and figures which then took place, and therefore I can only state what occurred to the best of my knowledge and l)elief. The witness then made the following statement : — I have for some years past taken a strong interest in the development of railway conmiunication throughout the Dominion of Canada, and particularly through the district of country lying to the westwanl of Montreal, with a view to increasing the facilities of communication between tlie seai)oar(l and ^Vestern America. And that, amongst other projects, my attention was early direcfed to tlu; sclieme for constructing a railway between Montnjal as the most westerly Atlantic seaport, and the Pacific Ocean. That in the autunm of 1871 I learned, in conversation with Sir Francis Ilincks, that certain American cajiitalists bad j)ro})ostd to the Government, through Mr. Waddington, to organize a Company for the purpose of building the Canadian Pacific Railway, but that no action had been taken upon their proposition. That, thereupon, inasmuch as no movement ajjpeared to be contemplated in Canada lor the pur])ose in question, and 1 doubted if Canadian capitalists could be induced to suljscribe to it to any large extent, I obtained from Sir Francis Ilincks the names of the persons who had been comnuuiicating with the Government, and immediately placed myself in correspondence with them, lor the purpose of endeavouring to form a Pacific Company, in advance oi the measures which were expected to be taken by the Govern- ment at the tliOii ensuing Session of Parliament. That, accordingly, after a certain amount of negotiation, I visited Ottawa in company with some of these gentlemen, and w(! had an interview with the Government, rciV'-rcil to by Sir John, on or about the 5th October, 1871. Sir John's account of that in* rvicw accords perfectly with my recollection of what took place. On the 23rd Decembti "^71, I entered into an agreement with certain American capitalists. T now produce a c ^/y of that agreement, omitting only the names of the other signers, which I conceive 1 have no right unnecessarily to drag before the public. The witness here reads the agreement, a copy of which is produced and fyled marked " P." There was also a sup])lcmentary contract made at a future day. I had no recollection of this contract until within the last few days, and if I had been asked, would^have said I had never seen it. There is no question but that the contract was entered into and tiiat [ was one of tlu; signt.'rs. Witness here reads supplementary contract, a copy of which is produced and fyled, marked " Q." Neitlier the Government as a whole, or any member of the Government, ever saw that agreement or liad any kiu)wledge of its existence, as far as I know, until very r(!cently. On looking at the deed of agreement it will be seen that it was stipulated that the Road should Ije built i)y the route and on the terms prescribi-d in the Act to be passed respecfing it, and it was further understood that in addition to the route north of Lake Sujx'rior, a Ijranch was to be constructi-d from Lake Nipissing to Saiilt Ste. Marie, with a branch to Georgian Ray near the mouth of French River. At Sault Ste. Marie the river was to be bridged aiul the line carried along the south shore of Lake Superior to Duluth where it would join the North Pacific from which line another branch would lead to Fort Garry. I'rom I'ort Garry westward to the Pacific it was intended the Road should proceed on till" route afterwards determined by the surveys, and it was regarded as a possibility that the Northern Pacific, when it got as far West as the Missouri River, miglit l)o (JANADIAN PACIFIC RAILWAY. 199 itions for the (lolbctcd so as to join the Canadian Pacific, get the advantage ol' our easier pass through the mouatiiins, and run on its track to some point Mcst of the mountains*, Avheri- they would again se])arate; the Nortliern Pacific ])assing south to New AV'estniinster, and the Canadian Pacillc seeking the sliore of tlic Pacific Ocean at such point as determined by the surveys. I favoured this scheme, hecause it not only gave us such a Pacific Railroad as W(! might desire, but also the advantage ol" a direct connection willi the States of Northern Michigan, Wisconsin, Minnesota^ and Dakotah, the traffic and ])r()(Uice of which would naturally find its way to and from tlie seaboard through Canada, as l)eing much the shortest, and consequei\tly the eheajjcst route, even lor the traflic of New York and Boston. Thus, in place of, as lias been alleged, sacrificing the interests of Canada to the United States, these phuis, if carried out, avouIiI have Incn a greater benefit to Clanada than any other scheme oi communication that could be desired, and would have given a double communication with I'ort CJarry. And with regard to this agreement I most distinctly and explicitly declare that neither in the agreement itseli', nor in Jiny conver: :ition or negotiation connccti.'d with it, was there any bti])ulation, statement, or exjjre.ssed plan, which had for its ol)ject any retardation of the work, or any other jjurpose, than itsi'om- pletion throughout, at as early a day as would he consistent with reasonaljle economy in building it. And more particularly 1 declare that there was no intention ex[)resse(l or implied, either in the agreement or in the negotiations which accompanied it, oi' placing it in the power of the Northern Pacific Railway, or ary other Company, or body oi' men, to obstruct the enterprise in any manner or way whatever. 1 am bound to say here that these New York gentlemen behaved throughout all my negotiations with them in the most honourable and consistent manner. Although the organization at Ih'st gave them a majority of Directors, when it was thought that this might give rise to objection, they at once agreed that tlie majority bliould be Rritish sul)jects, residing in Canada; and they consented to abide by all the regulations and conditions that the Parliament or Gov(;rnment of Canada miglit impose uj)on them. They never proposed to make the Road subservient to tlie Northern J'acilic, nor to use it in any way otherwise tluu; for the best interests of Canada. It ".as arranged that tlie Americans would advance money I'or necessary pre- liminary exiJonses, and they jiaid in S4( >,()(}() American currency for this purposi-. A large portion of this was spent to their jjerfect satisfaction, but owing to tlu! subse- (juent changes in the aspect of allairs 1 thought it better, without any apjilication I'rom them, to return to them the entire amount, and I did so. 'i'htre was no other money contributed by the Americans in any form or lor anj' jiurpose to which I was a party. Soon after my return i'rom New York I wrote to 'loronto with the view of enlisting gentlemen in the scheme, and tlie lirst person I ai)plied to was the Hon. 1). L. Mac- ]ilierson, to whom I explained the whole scheme, and asked him to join the organization. This he declined to do on the plea of its connection with the Americans. I found the general feeling of the people in Toronto rather cool towai'ds tlie Pacific Railroad, because their city did not lie on the direct line of the j)roi)csed Road, though they could not deny the great merits of the scheme in a public point of view. They feared that tlu' western traflic wcnild, by the proposed road, be carried past them to Lowcjr Canada. No further steps of imporlance were taken by m\self or associates up to the tim(; of the opening of lb;- Session of Parliament at Ottawa in resjii'ct of the lU'ojected Com[iany, except that I placed myself in communication with the Government, oU'ering to organize a Company which would undertake the construction of the Road, and discussing the question of the facilities and aid which the (jlovernment would probably recommend to he furnished by the country, and in the course of these discussions and negotiations I endeavoured, as far as possible, to secure for myself the position of President of the ])rojected Company, which was the position my associates were willing to allow me; and to which 1 thought mysi^lf entitled from the activt; part which I took in the great national enterprise to which the agreement and negotiations in t(uestion had reference. And as to this point I had • nsou to believe from the first that the Government was prepared to admit my claim. That when the time for the Session of the Canadian Parliament approached, I ajiplicd to Mr. Abbott to prepare the requisite legislation ; and shortly after Parliament had opened, I proceeded to Ottawa for the purpose ol' ascertaining how matters were pro- gressing, and what pros^jcct there was of a successful prosecution of the undertaking Ijy mjself, and the persons who were then associated with me. 'i'hat previous to tliis time, however, I had communicated w ith a large number of jicrsons in Can;;da on the subject -2 V 2 C.\.VAIU. m: 200 correspondencp: relative to the Itt-X: Cajiada. of the projiosed Comimny, refiuMiiig their oo-oporation and assistance, and endeavourin<^ to iudueo tliem to sul)seribe lor stock to such an extent as 1 thought lair, considering liieir jjosition and means. And tliougli 1 did not meet witli any great measure ol" succcbs in procuring oubscrip- tions of stock, yet it was quite as great as 1 had antici])ated when making my arrange- ments with the American cai)italists. In my negotiations witli tliem, therefore, I provided for the distribution of tlie stock whieli those gentlemen were willing to subscribe, or which I believed they would eventually be willing to subscril)e upon the formation of the Company, as mentioned in my letter of the 28th February, 1872, already referred to. \Vhen I visited Ottawa, as stated in the last paragrapli, I ascertained by personal ol)servatiou and communication with the members of the House that a strong prejudice had arisen against any connection with American capitalists in the formation of the l)roi)osed Comjiany, the I'ear expressed with regard to that subject being that such ca])italists would fnid it for their interest, rather to obstruct the Canadian Pacific, and I'urther tlie construction of the Nortlun-u Pacific, than to act in tlie interests of Canada, l)y pressing forward the Canadian Road. And though I did not share this fear, and always believed, and still believe, that the persons who proposed to be associated with me would have gone on with the enterprise in good I'aith, to the best of their al)ility, yet I Ibund the feeling for the moment so strong that I judged it expedient and pro])er to yield to it, and therefore consented that the legislation to be presented to the House should exclude foreigner!* from the (Jom2)any, and that the Directors should be exclusively Canadian. A Bill incorporating the Canada Pacific Company was then introduced into the House Ijy Dr. Grant, who had lieen a ])rominent advocate of the Canadian Pacific scheme, and had introduced in the last i)revious Session a similar measure jit the instance of tiie late Mr. VVaddington and others, who were then interesting themselves in the i)roject. Notwithstanding that the Bill which was so intioduced, contemplated by its terms the exclusion of foreign(;rs, I did not feel by any means convinced that the Government would insist upon any such condition, believing as I did, and do, that such a proposition was impolitic and unnecessary. I did not, therefore, feel justified in entirely breaking oil' my connection with my American associates, altliough I acquainted them with the difficulty which might arise if the (roverumcnt took the same position which the majority of the ])eoi)le with whom I conversed at Ottawa appeared to do. I was aware that by th.e terms of the Bill introduced by the Government, they would have a con- trolling power as to the terms of the contract, and I was willing to abide by their decision as to the extent of intercut, if any, which foreigners might be permitted to hold. And until tliat decision was communicated to me, I felt in honour bound by the agreement I had made to leave the door open for the entrance of my American associates into the Company, unless the contingency arrived of a distinct prohibition by the Government against admitting them. And in inlbrming them of the progress of the afiair in Canada, as I did on certain occasions as an individual and without implicating the Company, of which I was a member, I consider that I was only acting fairly by them. .And I did not intend thereby to bind, and, as I conceive, did not in any Avay bind or com])romise, to my views, the other members of tin Canada Pacific Railway Com- pany, with whom I did iu)t think it necessary to communicate at all on the subject of my occasional correspondence with my former American associates, the more especially as that corresi)ondence was entirely private and confidential, and, moreover, was written with such inattention as to accuracy of expression as might Ijo expected in corres- pondence intended only to be seen by those to whom it was addressed. During my stay at Ottawa I had some communication of an informal character with members of the Government, and 1 found that tliey were still dis})osed to recognize the value of my services in endeavouring to organize a Comjjany, but in view of the rivalry which appeared to exist in resjjcct to the Pacific scheme, and the strong array of Canadian names which had been obtained by the Interoceanic Company as associates in its project, nothing definite leading me to expect any preference for myself or for the Company which I was endeavouring to organize, or indeed anything definite relating to the project, was said by the members of t!:e Government with whom I then communicated. It appeared to me that while their intentions and opinions had been freely expressed to rac when no Company other than that which I was proposing to organize was likely to be formed the presence of competition amongst Canadians for the contract had decided them -J allow matters to take their own course until they should have been enabled to decide after the formation of the Canadian Companies what line of conduct would be most conducive to the interests of the country. And there was, therefore, very little CANADIAN PACIFIC IJAJLWAY. 201 said or done during the Session wliidi gt-vve me any clue to the views of tlie Government witli r('S]ie(t. to tlie course ol' action which they would proljuhly ultimately adopt. In order to make my narrative intelligible, it is necessary I should recall to mind the Lcijislation ol'the Session of 1872, as regards the Pacific Railroad. During that Session two Coinpanicjs were incorporated with jn-ecisely similar powers. Tiie Interoccanic C'ompany, of which Mr. Macpherson was a leading memi)er, and the Canafiii Pacific Company, in which I took a ])romincnt jnirt. The Acts ol' Incor])oration oi' these ("om- panies conferred on them no grant or right to the contract. A third Act was passed, a Government measure which empowered the Government to grant .')(),000,000 aires of laiul, and $;50,()0(),()00 in aid of the construction of the Railway, and to contract for its construction and running, either first with any Company incorporated for the i)urposc during that Session, or second witli •\ny two or more Companies amalgamated for tlio purpose, or third, with any Company which the Government might create by letters jiatent for the ])urpose. After !l)(^ Session, the Canada Pacific Railway Company, of which I was a member, ]m)cee(led to oi'ganize and notified the Government that they were prepared to take the contract for i)uil(ling and ruiuiing the Pacific Railway on the terms and conditions men- tioned in the Government Act. They caused stock books to be opened in various parts of tlie Dominion, in conformity with tlie Act, and took such initiatory steps and such other proceedings as were necessarv to enable them to act as an orgfinized corportite body. Tliat it soon after became evident to me that the Government would be best pleased to see an amalgamation of the two Companies incorj)orated by Parliament, in order that united action might be secin-cd and the greatest strength obtained in the formation of a Canadian Comi)any. I therefore opened negotiations with the Interoceanic Company, for the jiurpose of endeavouring to eflect such an amalgamation, and at the same time the Canada Pacific Company placed itself in communication with the Government with relation to the same sul)ject. It was thereupon intimated that the Government were also desirous that th(! amalgamation should take place. That thereupon, Mr. Abbott, a moniber of the CJanada Pacific Railway Company, j)roceeded to Toronto to meet Senator Macpherson, and if possible to arrange terms of amalgamation that would be satisfactory to l)oth Companies. And after a discussion of the matter during two or three days, in Toronto, l)etween him and Mr. Macpherson, he reported to the Canada Company that there did not a])pear to be any material difficulty in the way of our amalgamation, except that the claim which I made to be President of the amalgamated Company, and to have the nomination of an equal number of the members in the new Board to that nominnted by .Mr. Macpherson, could net be acceded to. Mr. !Macpherson's proposal was, that h(>, as representing the Interoceanic Company, should have the nomination of a larger numi)er of members in the amalgamated Company, than I, and that the ((uestiou of the Presidency should be left to the Board of Directors. With regard to the Presidency, Mr. Abbott informed the Company that Sir John Macdonald expressed liiniself as being favourable to my election as President, and that any influence the Ciov(!rnment might possess among the members of the amalgamated Company, would be exercised for the purpose of aiding in my election to that ol>'ce, and that probably the difficulty as to the nomination of members to the new Board between myself and Mr. Macpherson might be obviated in some way. In other res])ects he reported that he could find no divergence of opinion as to the amalgamation of the two Companies Irctween myself and Mr. Hacphersori. After receiving Mr. Abbott's rejiort of the negotiations at Toronto, I felt satisfied that 110 difficulty would occur in bringii'g them to a successful termination. And as tin; late Sir (ieorge Cartier happened to be in Montreal shortly afterwards, and I was taking con- Hiderable interest in his re-election, I met him and had an unofficial conversation with liim on the suliject of the Charter, on several occasions urging that the influence of the Government should be used to procure the amalgamation upon such terms as I considered would be just to myself and the Company over which I presided. On tlie 2nth July, 1872, I received a message from Sir George Cartier asking me to see him the next day. I requi>sted INIr. Abbott to accompany me, and I discussed the whole question with Sir Cieorge, who stated his views fully. He communicated to me a telegram he had received from Sir John A. Macdonald, of which the following is a copy: — Canada. "Sir G omiK tl\RTrEi{, Montreal. "July 20, 1872. " Have seen Macpherson. He has no personal ambition, but cannot in justice to Ontario concede any preference to Quebec in the matter of the Presidency, or in any other particular. lie tays the question about the Presidency should be left to the 202 CORRESPONDENCE RELATIVE TO THE SfU" Canada. Board. Under tliese circumstances I authorize you to assure Allan that the influence oi' the: Government will be exercised to secure him the jjosition ol' President. The other terms to he as af^reed on lietween iMiici)lu:rson and Aljhott. The whole matter to he kept quiet until after tlie elections. Then the two gentlemen to meet the Privy Council at Ottawa and settle the terms ol' a provisional agreement. This is the only practical solution oi" the difliculty, and should be iieceptod at once by Allan. Answer. (Signed) 'MOIIN A. MACDONALD." And Sir George Cartier on that occasion gave me the assurance which he was by that telegram authorized by the Premier to convey to me. Tiiat on further discussion with Sir (jeorge Cartier as to the course which the Goveni- ment would probably take with regard to the amalgamation and the contract to be granted, 1 urged upon him certain modifications ol' the terms of the above telegram from Sir John Alacdonald, and finally Sir (ieorge came to entertain the opinion that I Avas entitled to have certain of those modifications conceded to me, and expressed his willingness to recommejid it to his coUeagueif. Being desirous of having as definite an expression of opinion from Sir George, as he felt himself justified in giving, I requested that he would jjut what he sUited verbally to me in writing, and accordingly on the 30th July, 1872, he wrote me the following letter: " Dkau Sir Hugu, " Montreal, July :J(), 1872. "I inclose you copies of telegrams received from Sir John A. Macdonald ; and with reference to their contents 1 woula say that in my opinion the Uovernor in Council will approve of the amalgamation of your Company with the Interoceanic Company, under the name of the Canadian Pacific Railway Company ; the Provisional IJoard of tlu; amalgamated Company to be composed of sevent^-en members, of whom four shall be named from the Province of (Juebi-c, by the Canada Pacific Railway Company, four from the Province of Oiitaric, by the Interoceanic Railway Com])any, and the remainder by the (jroverumcnt ; tlie amiilgamated Company to have the power specified in the lOtli section of the Act incorjiorating tlie Canada Pacific Railway Conijiaiiy, and the agree- ment of amalgamation to be executeil between the Companies williiu two months from this date. "The Canada Pacific Company might take the initiative in procuring the amalga- matiiiii, and if the Interoceanic Company should not execute an agreement of ai'.'ulga- ination upon such terms, and within such limited time, I think the contemplated arrangement should Ikj made with the Canada Pacific Company iinder its Charter. " Upon the subscription and payment on account of stock being made, as required by the Act of last Session, respecting the Canadian I'acific Railway Comjiany, 1 have no doubt but that the Governor in Council will agiuse with the Company for the construction and working of the Canadian Pacific Jiail way , with such branches as sliall be agreed upon, and will grant to tlie Comjicuiy all sucli subsidies and assistance; as they are em[)owcred to do by the Government Act. I believe all the advantages which the Government Act emjiowers the Government to confer iqion any Comi)any, will be required to enable the works contemiilated to be successfully carried through, and I am convinced that they will be accorded to the Company to be formed by amalgamation, or to the Canada Pacific Company, as the case may be. " 1 would aild, that as I ai)prove ofllie measures to which I have referred in this letter, 1 shall use my best endeavours to have them carried into effect. " Very truly yours, (Signed) "GEO. E. CARTIER." I observe that it has been stated that there was a postscrijit to the I'oregoing letter. I declare positively that there was no such thing, and I now exhibit the original letter to the Commis-sion, in support of wliat [ say, but I do not dispossess myself of it. An authentic copy of which, liowever, is herewith jirodueed and fyled, marked "R." I positively declared that up to the date of tliis hotter I had not any understanding of any kind or descrijition with the Government, either directly or through any other person, than that contained in Sir John Macdonald's telegram of the 2Gth of July, which is given above; and that telegram and the above letter from Sir George Cartier contained every- thing that was ever stated or agreed to ijctween any member of the Government and myself, on the subject of a Pacific Railway jiroject, up to that date. On the same day that I received the above letter from Sir George Cartier, I informed Sir John A. iMacdonald of the substance of it, and asked for his sanction to the views which it contained. But he declined to concur in the terms of Sir George's letter, tele- CANADIAN PACIFIC UAILWAY. 203 le was by tliat 1 in this letter, CARTIEK." grapliing to liim (Sir (loorpic ("articr)thiit he would not agree to them, ami that he would come down to Montreal and confer with hiui respecting them. Hereupon I immediately informed Sir (JeorgeCartier that I sliould consider the letter addressed to me as ])eing withdrawn, and to my knowledge Sir George telegraphed to Sir John that he had seen me, and that as he (Sir John) objected to Sir George's letter, it had been withdrawn. I also telegraphed to Sir John on the same day (July lilst) to tlie effect that I had seen Sir George Cartier, and that he (Sir John) might return my letter or regard it as waste ])aper, and that 1 was satisfied witli the telegram of tlu; IKith, as expressive of the views of the Government. These two telegrams are, I understand, produced by Sir John A. Macdonald with his affidavit. 1 positively and explicitly declare, that exccjjting so far as an understanding between the Government and myself is expressed in the foregoing correspondence, I had no agree- ment of any kind or descrir/iion either verbally or in writing, l)y myself or through any other jierson, in respect of the contract lor the Pacific Railway or of any advantage to be conferred upon me in respect of it. In one of my letters in the published correspondence dated fith August, 1872, 1 ajipear to have said, " Yesterday we entered into an agreement. " The word " yesterday " was used inadvertently for " recently," or " some days ago." That this was merely a slip of the pen will appear from the letter following in the publisliud correspondence, and Avhich is dated tlie day after, /th August, in which, referring to the same agreement, I again used the word " yesterday." There never had been anything tliat could be called an agreement, except that ar'sing out of Sir Jolni Macdonald's telegram of the 2(ith July which remained untouched, Siv fieorg(;'s letter of the 'Jdth July, which I have just exhibited, and my oAvn to Sir Jolni A. Macdonald being considered withdrawn. As we were leaving >Sir George said to me, in his usual abrupt manner, " Are you not " going to assist in our elections?" or words to that effect. I replied tbat as on former occasions I would no doubt do so to some extent, but I wajited to know how much he required. He said it was impossil)le to tell, but from tlu; opposition raised to the Pacific Railroad project, it might amount to ife 100,000. I thought this was a large sum, but I felt that the interests involved in the issue of the approaching general elections were most important in a national point of view. It seemed to me to be a question whether the policy of the Administration with reference to railroads, canals, harbours, light-bouses, and emigration was to be approved of or not; that policy I thouglit then, and still think, deserving of the support of all those who would really care for the development of the resources of the country. In addition to these public reasons ior giving pecuniary assistance to the Government in the late general elections, I had personal reasons, Avhich will be readily appreciated even by those who cannot iniderstand any higher motives. As a person largely interested in the carrying trade, I could not fail to desire the success of every scheme which would increase the communications with the interior of the continent. In addition to this, my feelings were aroused by the attacks on myself personally, as well as on the Government, the ground of attack on the latter being m.ainly on its Pacific Railway policy, and as I approved of that policy, I therefore determined to give; the Grovernment all the assistance in my power, and in answer to George's request, 1 asked him to state to me in writing what he wanted mo to do. In the afternoon we again waited on Sir George, and he gave mc a letter of which the following is a copy : — {Private and Confidential.) " Di:au Sill High, " Montreal, July .30, 1872. " The friends of the Government will expect to l)e assisted with funds in the pending elections, and any amount which you or your Company shall advance for that l)iirpose shall be recouped to you. " A memorandum of immediate requirements is b(;low. " Yory truly yours, (Signed) " (GEO. E. CARTIER. NOW WANTED. " Sir John A. Macdonald $25,000 Hon. Mr. Langevin iri.OOO SirG. E. C. 20,000 Sir J. A. (add'l) 10,000 H(.n. Mr. Langevin 10,000 Sir (}. E. C. (add'l) ;i(),000 Canada. « u 11 20/1 CORRESPONDENCE RELATIVE TO THE Canada. Q, — Havp you tjol that letter in your iJOSScsHiou ? A. — I Imve, aiiil I hcreliy prodiue it lielore the Commission, hut do not wish to (Us- possess myself ol it; an aullieiitie eopy is herewitli prodiacd and I'yh'd.and marked "S." As the letter now a])|)ears, the menioranduni is lor Sl lO.OOO, Imt at the tinu; il was written the (irst three items amouiitin;j,' to s^dO.OOd only were mentioned, Sir (ie(ir};c said, however, that they eoidd talk ol" that al'leruards. A(Tordin!j;ly I imid over the thre( iirst sums oi' money to the j;ciitlemen indicated. Afterwards Sir (leorj^e rj'ciuesled me to send a further amount lo Sir .lidin A. Maedoiiald ol' ^l(»,()(H), and ^1(),0()() lo Mr. Lan,u;evin, and !i«;iO,()(l() to the Central Connnittee of I'Mi'ctions; and the three sums hist mentioneil in the memorandum appended to the letter wer(; then added to it hy Sir Geori;c. I aee(U'dini;ly remitted sid.OOO to Sir John Macdonald, i^.'iO.OOO to the Central Committee, and left slO.OOO with .Mr. Abbott for Mr. liangovin, to be paid upon n'ettiii^,' from that j^entleman a receipt for it. In Sir George Clartier's letter of the .'{Otli July, namely, the one to which I have secondly alluded, there is an undertaking on the part of Sir (Jeorge that my advances would be paid back to me. 1 did not see well from what source this money could he repaid, but Sir (Jeorge held out some hope that liis political friends would eontributi- to make it uj). Beyond this there was nothing tliat I can recall as to the maimer of ri'payment. On leaving Sir Gi-orge I said to Mr. Al)h()tt, that I saw no possibility of my ever being repaid tlu!se contributions. Neither then nor on any other occasion had I any correspondence with Sir George as to the repayment of these sums. I loft Montreal for Newfoundland I think early in August, and only returned at the end of the month, and e.xcept by infrequent telegrams I had no communication witii Montreal during tliat time. Among the.se ti'legrams I had two from Mr. Abbott, inlbrm- ing me that Sir George wanted s2(l,00() more for the General Committee, and ii!l(),()()(l for Sir John. I authorized Mr. Abbott to pay over thesi' sums, and placed the money at his dis})osal. I think I also received telegrams from Mr. Abhott telling me that ^Ir. Langeviii would sign no receipt, and asking my authority to hand him tlu! money without any reeei])t. This last telegram did not reach me in time to be acted upon, and I have since learned from Mr. Abbott that ^ir. Langtivin gave no receipt. 1 heard of Sir George's defeat Avliile in Nova Scotia on my way back. In this way on my return I found that the limits of payments which I had first agreed to had been exceeded, and with subsequent advances they finally stood as follows: To Sir George E. Cartier's Committee $85,000 To Hon. Sir John A. Macdonald towards election expenses in Ontario - - 45,000 To Hon. H. L. Langevin towards electoral expenses in Quebec - 32,600 $162,000 I also paid for the assistance of other friends of my own in connection with the elections between $IG,000 and $17,000. These sums, with the preliminary expenses on the Pacific and various railroads in which I was engaged, more or less directly connected with the Pacific enterprise, made up the amount of my advances to about $350,000. After the elections I made another attempt to amalgamate the two Companies with the assistance of the Government, by addressing the following letter to the Hon. D. L. Macpherson : — "Dear Sir, " Montreal, September 5, 1872. "I received, some time ago, a communication from the Government, informing me that it was deemed advisable that our two Companies should unite and form one Company, for the construction of the Canadian Pacific Railroad, and expressing a hope that the suggestion would meet Avith the apjiroval of the two Comi)anies. No doubt you also received a similar communication. " In conformity with the wish of the Government, the Canada Pacific Railroad Company, of which I am President, is prepared to amalgamate with your Interoceanic Company, and I consider it is for both our interests that the amalgamation should take place as soon as possible. '' I have therefore directed a meeting of the Provisional I'oard of my Company to be called for the purpose of authorizing the execution of a deed of amalgamation being- agreed upon. CANADIAN I'ACirit; HAIIAVAV. 205 "I understood that tho (jloveriuneiit would approve of such an amaluiamation upon tlie following conditions : — " 1st. That cither of the Charters should he the Charter of tlu; aniali^aniated (Company. "2nd. That the Provisional Directors of the amalganiated Company should he seventeen in numl)er, of whom four should he namcil by you, four hy uu\ and the remainder by the (iovernmeut. " ;h'd. That the Board thus constituted should elect the Provisional Chairman or President. "As the Canada Pacific Company has opened stock hooks in conlbrmity with the Act, and has retained them at the dilferent points recjuired by tin; Act since they were so opened, I would suggest that the proposed subscrij)tions should be inserted in those hooks, subject to allotment l)y the Provisional Moard, to be constituted under the deed of amalgamation. And the books could then remain open at such ])oints as may be ordered by the I'rovisional Board for further sul)scrii)tion, either in this country or in Kiiglaud. By thus availing ourselves of the proceedings of the ( 'anada Pacific Company, (lie time within which theC'ompany can he regularly organized will be greatly shortened, and the amalgamated Company will be in a position, at an early date, to proceed with the financial arrangements re([uisite for commencing the work next spring. "I shall be haj)i)y to hear from you as early as jjossible on the sul)ject of these sugges- tions, with any others which you may feel disposed to make, should you entertain tiie idea of au amalgamation; and in that event you might consider it desirable to call your Hoard together, in order to act in concert with our Board in carrying out the amalga- mation as soon as possible. " Arrangements should also be made, and powers obtained, to enalde us to negotiate and execute a contract with the Government. " For this purpose a meeting at Ottawa of au Executive from each Company may be necessary, and I will be prepared to meet 3 ou there when required. " Your obedient servant, (Signed) - llUCill ALLAN. '■ Hon. D. L. Macplierson, Toronto, Ont." This offer was again rejected, and on grounds similar to those formerly given, and I made no further attempt at amalgamation, but the Government coiitiiuied in their endeavours to induce the Literoceanic Company to amalgamate, till towards the end of the month of November. A little before this time, however, a Memorandum was communicated to me, which had been received by the Government from the Interoeeanic C()m))any, which apjjcared to destroy the jn-ospect of amalgamation, and although the Canada Company endeavoured to remove the objections made by the Interoeeanic Company, they failed in doing so, and the idea of amalgamation was shortly afterwards finally abandoned. Thereupon the Government informed me that it was decided that the contract should not be given to either of the Companies alone, but that the Government would incor- porate a new Company of the prominent members of the two incori)orated Companies, iiiid any leading Canadians who might he disjiosed to join them and able to give assist- ance, and could he induced to subscribe the stock in the jiroportions which the Govern- ment had decided upon, which proportions are those embodied in the Charter. And from that time the efforts of all parties interested in the project were directed towards pro- curing the association together of the mo?t prominent men of both Companies in the new Company to be incorporated under the terms of the Government Act of the previous Session. And it was, as the result of these efibrts, that the present Company was formed, composed, in a majority of instances, of gentlemen with w horn I had no communication whatever, and not in any respect as the consequence of any understanding between myself and the Government. From that time also communication between myself and my former associates ceased, having finally been broken off by myseli', as soon as I ascertained the desire of the Government. And I state further, positively, that no money derived from any fund, or from any of my former American associates, was expended in assisting my friends, or the friends of the Government, at the recent general elections. That with regard to the construction which appears to be intendecl to be placed upon the statements in the letter referred to as to the preliminary expenses connected with the Chai'ter, I state most positively and explicitly that I never made any agreement or came to any understanding of any kind or discription with the Government, or any of its members, as to the payment of any sum of money to anyone;, or in any way whatever, in consideration of receiving the contract for the Canadian Pacific. I declare, that I did expend considerable sums of money in various ways which ai)peared to me to be advan- 2 D Canada. ~ mm 206 COHUESPONDKNCK UKI.ATlVi: TO 'I'lir: IM' Canada, tn^cous to tlic (!onii)iiiiy I liad ormaiiizcd, and nilculatctl fo strciif^thcn my ImndH in unilt'iivoiirinu; fi> olitiiiii tlu' coiitriicl lorfliat ('(iiniiaiiy. Imt, tliat I did not on any occasion or in any way jiay or a^rir to ])ay anyti\in^' wlmtcvcr to any nicnihrr ol' tin; (iovcrnnicnt, or to iinyoni' on ludiaii', or at flic instance ol' the (Government, i'or any eonsideration wlmt- cver, in eonneetion with the Cliarter or contract. As may iu- !j;atliere(l from the h-tfcis in (Hiestion, I considered it, to lie my policy to stren;;then my jjosition as far as I jiossibjy could with my own iViends and I'ellow-citizens in fii(! Province ol' (^uel)eo, and nKni' L'sijccially in so far as related to tiie Montreal Nortliern Cloliini/ation Railway, which 1 conceived would at some day ho the nutlet I'rom the Canadian racifie to the Port ol Montri'al. And a consideraI)le portion of the money referred to in those letters was expended I)y me in i'urtherance ol'that project in many ways, and it was with those views In addition to those already stated, I contrihiitcd tlie money already rel'errod to, hut with- out any imderstanc lormcil wrro ciitirrd upon with fhi' (lovciiimi'ul late in the iUitumn, I canu'to unlisliL'(l in the ' lli-iiihl,' Init which was in the I'ollowing terms: "Mv DKAii Mil. MrMir.i.KX, "Montfonl, Oetoher 2t. 1872. "No aetion lias yet (as far as 1 know) Iuhmi taken liy tin- (Jov<'r!iiiieiit in tlio matter of the Paeilie Railroad. Tlie opposition ol'the Ontario jiarty will, I think, have tlie ellect oi' shutting out our Amoiiean friends I'rom any partiei])alion in the road, and I ajipreliend all that negotiation is at an end. It is still uncertain how it will lie L;iven /the contract), hut in any case the (iovermni'iit seem inclined to exact a declaration that no loreigners will have directly or indirectly any mtirest in it. \\i\t everything is in a state ol' uncertainty, and 1 think it is unnecessary l'<>r you to visit New York on this husi- ni'ss at jiresent, or at all, till you hear what the result is likely to he. "Public sentiment seems to be decided that the road shall be built by Canadians oidy. *' Yours trulv, (Signed) "HUGH AFJ.AN." I desire also to state I'urther with regard to the envelo])e, and the paj)ers which it con- tains which wen- placed in the hands of the Hon. Mr. Stariies shortly before my dei)ar- tui'c for Kngland with the delegation of the Pacific I{aihvay, that upon being inl'ormcd by nie that all negotiations between my fornu'r American associates and myself on the suliject of the Canadian Pacific Hallway must cease, large demands were made upon me liy iMr. MciNIullen, based ))artly upon alleged exjienditure by him, and partly upon a claim by him lor comiiensation for his loss of tiiui' and service in the promotion of the enterprise, so long as lie and bis Irieiids rtmained cuiiiie ted with it. These demands at first were of so extensive a character 1 declined altogether to entertain them. 1 was dis- posed to return to my American associates any money which they might have expended in the matter, and I was ready to compensate Mr. McI\Ii,llen for the loss of his time and liis exjienses ; but it ai)])eare(l to me that tlie sum whicb iie demanded was much greater in ainount than all such disbursements and exiieiis( s could possibly have reached. I J'c.lt naturally that by trusting to the honour of my correspondents, and writing to them ina manner somewhat incoiisiderate, I had placed it in their power to annoy me by the jiub- liiation of those letters, and 1 feared that the outcry which might follow their pul)lica- tion in the columns of certain jiajiers which have manifested unceasing hostility to the Canadian Pacific Railway might injure the prospects of the dilegation in England. 1 therefore authorized an arrangement to be made w itli Mr. McMuUen. by which a sum very much less than his original demands should be paid to him, the greater portion at once, hut the remaining, and a considerable, j)ortion on the delivery of the letters to me, iifter the present Session of Parliament, should they not be ])ublished in the interval. This was accordingly done. Mr. McMuUen received the greater part of the sum agreed to with him, namely, !^2(),00(), and the remainder, namely, !?17,''J told me of an interview he had had with Mr. Waddington, Mr. Smith, and Mr. McMuUen. He strongly recommended mo to talvc up the enterprise, as being one whidi must redound greatly to any person who carried it out. He urged that it was a great enterprise ; if the promoters succeeded they would be conferring a great lienefit on tlio country. I was very relucta:it to go into it at all. I lelt that it was too large a matter, and too important, for a man with so much business on his hands as myself to engage in: but he was very urgent, and finally he persuaded me to agree to enter into it. At the same time I was very reluctant to do so. He then said tliat the best thing to do was to put myself in communication with those jjarties Avho have applied to us; you can make your own arrangement with them. You will find those gentlemen at New York, and you will find them more likely to take it up than the people in England, because they have already constructed two railways across the Continent, and arc about commencing a third. They are much more likely to undertake it than our own people, who do not know any- thing about it, and who would be afraid of so large a sum. Q. — Were you induced by that conversation to enter into communication with your American r'-sociates ? A. — I was. Q. — Then I suppose you attached yourself rather strongly to the idea of building the Railway hy these means ? A. — I did. I became, I may say, passionately enamoured of it, and determined that if it rf>uld be carried through by any means, even by a large expenditure of my own money, I would carry it through. Q. — Except from Sir Francis Hincks did you receive any encouragement from the Government to enter into communication with your American associates ? A. — No, never. Q. — From no other members of the Government ? A. — No. They were very reticent on the subject. After two or three months liad elapsed when it appeared tliat the West had taken up o])position to it, the Government began to indicate that they were also opposed to it. (2.— Did you ever receive any encouragement from any member of the Government except from Sir Francis Hincks? yl. — Never, Q. — You ''It a good deal disappointed at the result ? A, — I di' (ideed ; very much disappointed. Q. — With M'hom originated the idea of a new Company or tlie amalgamation ol the two Companies ? A. — I think it was witli Sir John Macdonald the whole of these things originated. CANADIAN PACIFIC RAILWAY. 211 o not know any- ation with your of building the jment from tlie le Government Q. — That was against your opinion and wish ? A. — It was. I was satisfied that the first arrangement would have bee nmost successl'ul. Q. — Do you knoAV when the Government became first acquainted with tlie agreement between you and your American associates of December, 1871 ? They were not aware of it at that time ? A. — No, not for long after. Q.—Not at the time of the legislation of 1872 ? A. — They were aware that negotiations were going on and had gone on, but they had never seen the agreement. Q. — Did you consider the telegram of Sir John A. Macdonald of the 2Gth July, as the basis of an agreement to be made ? A. — Undoubtedly that was the basis, and the only basis, we had to go upon. Q. — Has that basis been adlicred to or departed I'rom? A. — As iar as it could be it has been adhered to. It suggested an amalgamation, and at the meeting at Ottawa after the elections I acquiesced in all the proposals, and wrote to jNIr. INIacphersoii, and requested him to meet me in Ottawa, tj carry out Sir John's telegram of the 2Gth July. Q- — By whom was Sir John's disapproval of the letter of the 30th July communi- cated to you? A. — Sir George Cavtier communicated it to me on the .31st July I think; but I think it was not direct to me, but to Mr. Abbott, and through him to me. Q. — I mean the telegrams which Ibllowed the letter from Sir George Cartier of the m.h July? A, — I sent a telegram upon the 3lst, and I think Sir John telegraphed down imme- diately to Sir George Cartier his objection. Q. — You stated that yon were a very large subscriber of money for the support of the elections. That money Mas subscribed about what jieriod ; can you state the time ? yl.— On the 30th July, I agreed to that anKuint of $(!(),00O or 875,000 I think, as stated in Sir George Cartier's letter. He mentioned the amount he required on that date. I agreed to that, and subsequently within a day or two before I left I'or Newfoundhuid he stated that he wanted a further sum, and I sent him over the letter to put down what lie wanted, and he did put it down. I agreed to that also. That Avas the last I heard of the matter until I had gone to Newfoundland, and when I was in Newfoundland, I received two telegrams, I think from Mv. Abbott, on the subject of money. Tiiese telegrams I agreed to. He telegrai)hed me also with regard to the reeeijit from I\Ir. Langevin, but I did not get the telegram and did not kno'v of it at the time. Q. — The letter of Sir Geoge Cartier of the 24th August, cT which a copy is i)ublished, is in these terms: — "In the al)senee of Sir Hugh Allan, I shall be obliged by your sup- " plying the Central Committee with a further sum of ^20,000 upon the same conditions " as the amount written by me at the foot of my letter to Sir Hugh Allan, on the " 30th ultimo. (Signed) "GEORGE E. CARTIER. "P.S. — Please also send Sir .Tohn Macdonald !? 10,000 more on the same terms." What was meant l)y these expressions, " the same conditions" and "the same terms?" A. — It is difficult to say what Sir George meant by those words. He was not a man with whom you could talk very much, because^ in rll the interviews with him he jrcncrally did most of the talking himself, and you could with difliculty say anything. 1 never understood exactly what he meant on any of these points. I was quite satisfied that he jirobalily felt that he did not like to be under such very heavy obligations, and Avould endeavour at some future time, to make it up by subscription or otherwise. I did not think that he had any very definite idea, and I did not think it would be done. Q, — He says, "as written bv ir.o at the foot of my letter to Sir Hugh Allan, of the oOth ultimo"'? A. — That IS liie recouping, 1 sujjpose. Q. — Did you ever receive any other letter from Sir George Cartieron the snbjcct ? A. — Never. Q. — "The friends of the Government will expect to i)e assisted with funds in the "pending elections, and any amount which you or your Company shall advaiue for that "purpose shall be recouped to you." This is the letter to which he refei', in the letter of the 24th August ? J.— Yes. Q. — This was all the communication in writing between you? A. — That was all the communication I ever had from Sir George on the subject. Canada. I }•>/■ m 212 CORRESPONDENCE RELATIVE TO THE Q. — And you had no further conversation with him than what you have mentioned which toolv place on tlie oOth July ? A. — I think I only saw him once or twice after the 30th July, previous to my leaving for Newfoundland. I was very much occupied, and during that time we had no further conveiaution on tlie subject of tlie money. lie did not require any more then. Q, — Had you any understanding with Sir George or any other member of tlie (rovernment, or derived from any quarter that you were to receive certain advantages for the subscriptions which you gave — certain favours from tlie Government for the subscription whicli you gave — towards the elections ? A. — Certainly not. Q. — Had you any expectation of receiving any such favours? A. — No, I had not the slightest. Q. — Have you received any favours from the Goverument ? A. — I have not. Q. — What is your position in the Canadian Pacific Railway Company ? A. — I am President of the Compuny. Q. — Have you any other advantage than that? A. — None whatever, except the paying out of money. Q. — Were you elected President through the influence of the Government? A. — Not to my knowledge. I am not aware that the Government exercised any influence over anyone. I was elected unanimously, and many of the persons I had never seen before, and did not know. Q.- — What was your motive in subscribing so largely ? I will ask you a preliminary ([uestion, Had you ever subscribed so much in any previous election? .1. — Never anything like it, and on this occasion I was actuated by a variety of motives. They did not all come into operation at the same time, but from time to time. I was very desirous to support the present Government in its commercial views. The policy that it had inaugurated was entirely according to my feelings and wishes, as being right and proper for the development of the country and for the advantage of the Dominion. They had undertaken a very large emigration scheme and very large canal expenditure, so as to make our internal communications superior to any other country, and to bring down all the produce from the West in this direction, which I was very much interested in tb.eir doing. Tliey had undertaken to enlarge tiie harbour of Montreal to a very great extent. They had undertaken and built a vast number of lighthouses all through the Dominion, and their commercial policy was of the most enlightened character, and such as I entirely approved of; and I thought it was my duty therefore to sustain that policy, and I was to a large extent influenced by that motive, partly of course in consequence of my own interest in it, and partly in consequence of the great development of the country which it was sure to bring about. Then again I was interested in the Northern Colonization Road. I had expended a large sum ol' money in bringing it to the point it had then reached. Its prospects were not BO brilliant at that time as they are to-day, and there was some doubt whether it would go on or not, but I saw at once that if the Pacific Railway was built the Northern Colonization Railway would become a necessity. Montreal especially could not do without it; could not do without a direct connection with the Pacific. That road would have carried all the trade which the Pacific Road might bring across the Continent for shijiping by sea. I had a further interest, inasmuch as the members of the present Government were among my own friends and acquaintances ; I had known them for many years, and although I am no politician myself, and never voted at a Parliamentary election in my life except once, yet the members of the Ciovernment were persons with whom I was always in contact, and I wished to assist them in every way possible, I Avas also interested as being largely engaged in the carrying trade, and I saw that my interest was to support the j)resent Government in their position, (J.. — You had a very large sum of money invested in your steamships and other enterprises in the country? A. — A very large sum. Q. — This sum which you gave amounted to nearly $400,000 ; was that not sufficient to cramp you or distress you very much in your monetary afliiirs ? A. — Not at all ; I gave it entirely from my own funds. I never borrowed any or asked any from anyone. I never encroached on the moneys of the firm. I did not even speak to my brother on the subject, and never drew a shilling from the firm for the purjjose. It Mas entirely out of my own pocket. Q.— Do you know how this money was distributed ; how it was spent? A. — I know nothing about it. %:, <:■ CANADIAN PACIFIC RAILWAY, 213 lave mentioned )u a preliminary at not sufficient jOth July mentioned about your being What did you understand by that ; by Q. — Sir George Cartier's interview with you was on the 30th July. When he asked you to subscribe, was any allusion made to the contract for the Pacific Railway ? A. — No, not more than the fact that the letter was written that morning. Q. — He did not say " You have helped us, we will help you ? " .1.— No. Q. — Did he intimate anything of that kind ? A. — He did not. Q. — Sir George Cartier in his letter of the repaid, or recouped I think is the word he used, wliom were you to be recouped ? A. — That is one of the points on which Sir George did not give any explanation. He talked in his usual abrupt manner about money, and he said he would get up a subscrii)tion among the l)arty to pay mo back, or at least a portion of it. He did not suppose that he would be able to realize the whole of it, but he talked about getting up a subscrij)tion to pay back a portion of it. I myself did not believe that anything of the kind could be done, therelbro I placed no confidence in the statement. (2. — Was there anything to justify you in supposing that it would be repaid out of moneys to be devoted to tlie construction of the Pacific Railway? A. — It was impossible, and it could not have Ijeen done if he had. Q. — Do you know the Hon. Mr. Foster, Senat'-'*? yl.— I do. Q. — Was Mr. Foster present at any interviews you had with Mr. !MciIullen ? A.—l could not say in reality, I am not certain. (2.— Have you ever had any conversation on the subject of these matters witli him, MJiich are stated in Mr. McMullen's letter ? A. — I never had any conversation with him on the subject of the Pacific Railway at all, except tliat he was very anxious to become a Director, and I was very anxious to liave him one. That is the only point on which I had any conversation with him. He never spoke to me about any of the other matters referred to, so far as I remember. Q. — Can you not say whether he was presen*^ or not at any interview you had with Mr. McMulleu? A. — No, I cannot say. (J,. — Did you ever speak to him on any of the subjects respecting those payments of money, or tlie other allegations made by ]\Ir. McMuUen? A. — Not tliat I remember. I think I never did. I may have had a conversation, but in a very slight and indirect manner, with Mr. Foster on this subject ; but I don't remember ever speaking to him about it. Q. — You say that you were absent from the 13th of August to the 3rd of September? A. — I think those were the dates. Q. — Have you with you any memorandum from your books showing when the difl'erent payments were made, and to whom they were made ? A. — I have not. Q. — Can Mr. Abbott state when these payments were made ? A. — I cannot say. He would be more likely to be able to state them than 1 would. These difl'erent payments were made, I think, as stated in the letter published. I think on the 14th of August a furtiier payment was made in my absence. (2- — Then all the sums except that amount paid on the l-lth of August would, I understand, probably have been i)aid before you left? A. — Not the whole of them; probably more than one was paid after I left. I think Mr. Abbott paid three sums after the 13th August. (I — Would you have the goodness to look at that letter from Sir George Cartier, of the 30th July. ' I observe that the body of the letter is not in his handwriting, but the signature is his. In whose handwriting is the body of the letter? A. — I think it is Mr. Abbott's writing. Q. — Mr. Abbott stood in confidential relations to you apparently. What were they ? What was the position in which he stood towards you ? Was it as a professional adviser or otherwise ? A. — Scarcely as a professional adviser, and yet, to some extent, it was so. He was deei)ly engaged with me in all these railway schemes, and as such we had become closely allied in all matters of this kind. He was w ith me at all the interviews I had witli Sir George Cartier, and I did nothing on any point without consulting him. Q. — Then he was present at the time Sir George Cartier made this appeal to you to subscribe for the assistance of the Government at the elections ? .1. — He was, but his recollection of what took place differs a little from mine. AVhile 2 E Canada. w 21t CORRESPONDENCE RELATIVE TO THE Canada. r,'f m I think he mentioned $100,000, Mr. Abbott thinks Sir George did not mention any sum, but only spoke of a large sum. Q. — Was he present at the interview from the first to the last ? A. — He was. Q. — And had the means of knowing all that passed on the occasion? ^.— lie had. Q. — Did he, or did you, or did Sir George suggest a letter of request to be put in written i'orm ? A.— I did. Q. — Were the terms of the letter settled at that time ? A. — They were settled by Si' George himself, I think, without consulting us. He dictated the letter, I think, to Mr. Abbott, without allowing any interference. Q. — Then this letter was Mritten at the time ? A. — I am not sure whether it was written at the time or during the interval between the morning and afternoon. Q. — You saw him again in the afternoon ? A. — Yes. (2.— Was IMr. Abbctt present then ? -4.— Yes. Q. — Was it then that the letter was signed ? ^.— Yes. Q. — Had you any conference in the meantime with Mr. Abbott as to the terms of that letter ? A. — I had not. We did not know what Sir George wanted, or how he proposed to state it at all. We were not going to dictate to him what he should say. Q. — I should like to hear again if you remember the way in which Sir George approached the subject of a money subscription ? A. — It was in a very abrujjt manner. As we were going out at the door after arranging tlie first letter of the 30th July, he turned about and said : " Will you " help us at our elections"? or "Are you going to help us"? or something to that cflect. Q. — Did you make a reply ? A.—1 did. Q.— What was it? A. — I said that I had been always in the habit of giving something to the elections, and no doubt I would do so on this occasion. Q. — Who spoke next — what Avas next said ? A. — I am not sure; but 1 think it is possible that I said to him, "To what extent will you require assistance?" or, "What do you want?" and I also suggested that he should put in writing what he wanted. Q. — Your recollection is that he said ,$100,000 would be wanted? A. — Yes. 'Sh. Abl)ott thinks he did not mention any definite amount. (2. — After he named that sum, what did you ask him to do? A. — To i)Ut the request in writing. Q. — Wliy did you wish the request in writing? A. — I wislied to have some authority for payment, and to know what I was doing. (i.— What purpose did you tiiink that would serve? ^'l. — Nothing beyond being more satisfactory to myself. Men of business generally require things to be done in that way. Q. — I understood you that, notwithstanding what Sir George Cartier had said about making a subscription among his friends, and raising some portion of the same, you yourself had little hope of being recouped? A. — Very little hope indeed. Q. — Why did you think it necessary to have this letter written ? A. — Simply because, as I thought, as a man of business, I should have an authority for the large sums of money I was going to pay. Q. — This, then, is the only document that you have which relates to any agreement or arrangement in respect of that money between you and any member of the Government, or the only one that was ever executed? A. — The only one that I know of (}, — And no understanding or condition was made, though not expressed in writing, as to the receipt of that money, or as to the mode in which it was to be recouped, or as to some advantage which was to be given to you ? ; , . A. — None whatever. CANADIAN PACIFIC RAILWAY. 215 mtioii any sum, st to be put in nterval between to the terms of V he proposed to f. lich Sir George to the elections, an authority Q. — I observe in the letter of the 7th August you speak very definitely. Have you a Canada. cojjy of that letter with you ? A. — I have not. Q. — Tlie words used are these : — " It is unnecessary to detail the various phases '• through which it passed, but the result is that we yesterday signed an agrccmeiil by " whicli, on certain monetary conditions, they agree to form a Company, of which I am " to be President to suit my views, to give me and my friends a majority of the stock, " and to give the Company so formed the contract lor building the road on the terms of "the Act of Parliament." You explain that in using the word "yesterday' in your letters of the 5th and (5th of August, written to General Cass and Mr. McMullen, you merely meant to convey the idea that it was recently, the letters having been written in a hurried manner, you never supposing they would be published, and in botli you refer to this document, and this only ? A. — I referred to both letters. (2. — And this letter goes no further than what is contained in both documents? A. — No I'urther. (2. — You say " signed an agreement." You were aware that any document which Sir George Cartier signed would not bind the Cabinet ? A. — Yes, I was aware of that. (2. — Then why did you use the expression, " signed an agreement " ? A. — It was tlie expression used in the hurry of the moment ; undoubtedly the agree- ment was just so made. Q. — Was it upon any opinion you had expressed in a letter of the 1st in which you say : — " On a calm view of the situation, I am satisfied myself that the decision of the " question must ultimately be in the hands of one man, and that man is Sir George " Cartier, the leader and chief of the French party, who lias held the balance of power " between tlie other factions, and has sustained and kept in office and existence the entire " Government for the last five years." Did you take what Sir George Cartier did as according to your view of the situation equivalent to an agreement with the whole Government ? A. — No, I cannot say that I did. I looked upon it simply as an agreement that he would promote our views when the time came, in the Cabinet, and until the telegram was made known to me that Sir John Macdonald declined to accede to it, I looked upon it as a kind of agreement. Q. — You arc still more definite in your letter to Mr. McMullen of the Gth, wherein you say, "He yesterday signed an agreement by which on certain monetary conditions "they agreed to form a Company, of which I am to be President " ? A. — These were merely expressions made use of in consequence of the communication with Sir George Cartier. I had no communication with the Government at all. Q. — And the only documents embodying Avhat you have called an agreement are George Cartier, and one other the longer contained in this letter of the 30th July, by Sir letter? A. — The only ones. Q. — ^This letter of the .30th July, will you have the goodness to look at it^ letter of the 30th July. In whose handwriting is that letter, the body of it ? A. — There are two writings in it, and I do not know either of them. Q. — When was that signed ? A. — It was signed, I should think, between twelve and one o'clock on the 30th July. (2. — On the occasion of the first interview ? ^.— Yes. Q. — On the first interview you say the money was sp*" iien of? A. — Yes, at close of it. It was immediately alter that interview that that letter was signed, and immediately afterwards the money was spoken of. Q. — Was anything said about money before the longer letter of the .'50th of July was signed. A. — Nothing whatever. Q.. — Was Mr. Abbott present on that occasion also ? ^.— Yes. (2.— I do not desire to press the question which I am about to put, but I should like you to answer it if you have no objection. It seems a very large sum lor anyone to give towards such a purpose, and as I only know by report your means and the extent of the capital employed in the various undertakings in which you are engaged in connection with railway and otlier great enterprises, if you have no objection, I should like you 2 E 2 mm' V. c. 216 CORRESPONDENCE RELATIVE TO THE Canada. Ls'lS to give a general statement of the amount of capital you have in these undertakings. Of course it is a question I do not jircss if you do not choose to answer? A. — I have no objection to answer. I consider that my property, invested in various ways connected with the country, in business of all kinds, amounts to about $0,000,000. Q. — Then all the interest that you speak of in connection with your investments in this wpy would be promoted by the policy of the Government? A. — It was with that intention that I supported them. Q. — Was there any discussion as to the exact terms of this longer letter before it was signed ? A. — I think there must have been. . Q. — Do you remember what it was ? A- I am not quite certain what it was, but I think I probably wished to have a larger amour..; of influence in the Company than the Government were willing to give me, and I think it was probable that that was the point that we discussed together. I think it was entirely the organization of the Pacific Railway, and I think it only referred to the amount of influence I would have in it, and nothing else. Q. — Claims made by you for more favourable terms and not conceded by Sir George? ^.— Yes. Q. — Are you aware that Sir George at one time, according to tiie evidence before us, had an opinion entirely unfavourable to the introduction, not merely of American control, but of American capital in this enterprise ? A. — I am aware that he had, up to the very last moment, when the ultimate contract was signed, and on that day when I had the interview with him in regard to this matter, one of the conditions was that no American capital or control was to be introduced into it. Q. — Did you at any time consider him hostile to the interests you were desirous ol promoting ? A.— I did. Q. — Up to what period did you consider him decidedly hostile to the interests you thought it desirable to promote ? A. — Up to the time that a Committee of his constituents came up to Ottawa and visited him, for the purpose of influencing him on the subject. There was a large meeting held of his principal supporters in Montreal, and they, entertaining the opinion generally held in Montreal, as to his hostility to the organization we had formed, appointed a Committee to come to Ottawa and assure him that if he continued that hostility, he would not be re-elected for Montreal. I understood from them afterwards, that Sir George had agreed to abate his hostility and forward the views expressed by his constituents as far as possible, but I have no doubt it was that hostility which caused tlio loss of his election in Montreal. Q. — AVhen was that deputation ? ^ A. — I think it was during the St^ion of Parliament. Q. — That is the one Mr. Leblanc speaks of? A. — The same. Q. — You used all the influence you possessed in endeavouring to mould public opinion in unison with your own views; were you in any way inst -omental in stimulating the feeling that prevailed in favour of views which Sir George did not approve of? A. — I was no doubt very influential in raising public opinion in Montreal in favour oi' the scheme, and there is no doubt that meetings were held and means were used to diffuse information, which had a great effect in causing a feeling to arise against Sir George Cartier. Q. — Did you know anything of this deputation waiting on Sir (jeorge Cartier during the Session ; did you know anything of it before it was formed, or of the intention to form it before it was formed, or when did you first become aware of the appointment of the Committee? A. — I first heard of it iu Montreal. There was an intention of sending up a Committee for the ])urpose. I was aware that they had held a meeting and appointed a deputation, but I did not know anything about what the instructions to that Committee were, or what the action of the Committee was. Q. — When did you first discover that there was a change in Sir George Cartier's views, or that yielding to the pressure of opinion he was disposed to change them ? A. — Immediately after the deputation called on him. I was at Ottawa within a few days of or at the time the deputation was here. I happened to meet Sir George, and I thought I observed some change in respect to his views. Q. — Can you fix the date of that ? A. — I cannot. Q. — Was Parliament in Session at the time you met Sir George ? [' ?' CANADIAN PACIFIC RAILWAY. 217 uiidertakinsrs. 01' itter before it was d by Sir George? the interests you Id public opinion A. — I think it was. I tliink it was within a day or two after that deputation was up Canada. hci-e. — Q. — You were with a deputation that waited on tlic Government at Ottawa ? A— Yes. Q. — What is your recollection of wliat occurred on tliat occasion. What gentlemen were with you representing the interests you were desirous to promote ? A. — Mr. Smith, Mr. McMullcn, and mysell", I think, were the only ones to represent that interest. There was, perhaps, anotlier, but I think there were only three. I think the members of the Government luimbered altogetlier nine or ten, and the discussion was participated in by Sir Francis Ilincks and the deputation. Sir George Cartier never spoke during the whole time. Very lew of the other members spoke at all. No opinion was expressed by the Government on the subject. Q. — Do you remember what was said ? A. — I remember that I explained to them the route by which it was proposed to take the railway, the advantages it would give to the Provinces, the means by which it could be built, and the results that would i)robably arise from it, I don't think anything was said by any member of the Government except merely asking explanations on points which they did not quite understand, Q. — Was that the interview at which you were asked to make some proposal '! A. — It was. Q. — What did you say ? A. — I said " Are you prepared to accept a proposal if I make one? " Sir John replied, " We arf> not prepared to accept any proposition ;" then I said " I am not prepared to " make one." Q. — Returning to the money question once more, I understand you to say that you had no hope or expectation of receiving that money back again ? A. — Not the slightest. Q. — You say you got this paper as a sort of business matter. Did you make any entry in your books as to the disbursement of that large sum of money ? A.— In my own private books. (2. — What was the I'orm of the entry ? ^1. — I don't keep it in regular style and make entries in it. Q.— Is there any entry made which would indicate any source from which you expected to have those large sums repaid to you ? A. — A considerable portion of the money was expended in the Northern Colonization Road. I do expect to get back some portion of that money because it was legitimately expended for railway purposes. There was a large amount of money expended on the PaciKc Railway, I having paid all the preliminary expenses connected with it. I do not expect to get that back. In all probability I will not. There was a large sum expended on the Ottawa and Toronto Railway. I think when that comes to be organized I will get that back. I have paid for surveys, and paid tiie conimissionere for getting bonuses from the municipalities, altogether quite a large sum of money, and I expect to get that back. The portion of money paid to assist in the elections directly I don't expect to be repaid. Q. — That is the money you disbursed to Sir George Cartier, Mr. Langevin, and Sir John ? ^.— Yes. Q. — And the subsequent moneys, paid through Mr. Abbott ? .4.— Yes, amounting in all to $162,000. Q.— Did you make any entry in your books about those particular sums. Did you separate them ? A. — No, I don't think I did. I imagine that my books contain merely a memorandum of the payments. Q. — And you have no claim in any way lor their repayment ? .4.— No, not in the slightest. To Sir Jolui A. Macdonald, through the Chairman : Q. — As I understand it, then/.the agreement between you and the Government, or any member of the Government, may be considered to be confined to my telegram of the 26th July ? A, — I think so. Q. — At the time that that telegram was sent to Sir George, on the 26th duly, there had been no conversation with him or anyone about helping to contribute to the elections. A. — No, not at all ; it was after that. Q. — It Avas after that, so that as far as that agreement was concerned there was no connection between your subscription to the elections and that telegram ? WW Wfi*»*»JiW< ,1 'Sl^»W.'"'F" 218 CORRESPONDENCE RELATIVE TO THE J!^ Canada. yl.— None at all. Q. — When Sir (Jeorgo niul yourself oiiterod into this ngroemont of the 30th July, varying the terms of my telegram, its terms were settled before there was any diseussiou about money matters ? A. — Yes, immediately after those terms were settled the discussion about money matters came up. Q. — Then liis letter, my telegram to liim of the 2nth, and his letter of the .'JOth July, were all iiefore the conversation took place about the money matter. Then on receiving my telegram, or after having ascertained that 1 objecti-d to the agreement of the .'JOth July, you replied to me next day that 1 might treat your letter as waste pa])cr ? A. — I am not sure what day it was, but it was a day or two afterwards, at all events. Q. — You authorized Sir (ieorge, also, to telegra])h me that your letter might be regarded as waste paper, and that the agreement was my telegram of the 'idtli July? yl.— I did. Q, — Therefore, any sums you may have advanced to aid in the elections, must have been after your were aware that I had rejected that letter of the 3()th July of Sir (Jeorge ? A. — I cainiot say when the actual ])ayments were made. Q. — The agreements were made on the afternoon of the ."JOth July, and on the 3Ist you rejjlied that your letter was waste pajjcr? A. — I am not sure when the i)ayments were made, but I regarded them, at all events, as having Ijeen j)aid without reference to that matter. Q. — Yon say that you considered it to be to your interest to support the Government and its policy in tlie various subjects you have mentioned '! A.— I did. Q. — And tliat there was a danger that that policy might be discontinued or reversed in case of a change of Government ? A. — I ajiprelicnded it might be so. I did not know that there would be, but I appre- hended that there might be. (2. — Now in that communication in that pa])er, respecting the recouping, he (Sn George) says, " You or your (.'omi)any." AVhat Company does it refer to ? A, — I am not able to exi)lain what Company was meant. I can only judge from analogy. Sir George had said before that the Americans were to have nothing to do with it, therefore he could not have meant th(!m. The Canadian Pacific Railway Com- pany was not formed, except provisionally, and had no fund. The only other (.company that he could have possibly meant, was my own firm, and that never paid any of tlie money. Q. — Sir George did not know of tlie agreements between you and the Americans, and could not have any reference to them ? A. — No ; he did not know anything a})Out it. Q. — You never showed him that agreement, or made any communication to him on that matter? A. — I did not, nor to any member of the Government. Q. — And you kej)t that away even, I take it, from the other gentlemen connected with the Canada Pacific Railway ? A. — Except talking about it in general terms to Mr. Macpherson and the other gentle- men in Toronto, there was no knowledge of it whatever. Q. — Sir George did not know of it; you never told him? A. — No, he did not know of it; at least, not from me. Q. — 1 need not ask you about the loan to me of $4,000 ? A. — I have clearly stated that. Q. — Not a word of truth in it ? A. — None. Q. — Not only no $4,000, but no dollars at all nor cents? A. — None. Q. — You liave stated that you did not give authority to Mr. Abbott to make arrange- ments with Mr. Langevin as spoken of in Mr. McMulIen's letter? A. — I do not remember speaking to Mr. Abbott at all on the subject. Q. — I remark that you state that you gave a discount to 'La Minerva' newspaper. Was that a business transaction? A. — A business transaction entirely. Q. — Had it any reference at all to the Government or to the Pacific Railway? A. — Not the slightest. Q. — As a matter of fact, was that arrangement between the proprietors of * La Minerve,' or with the individuals composing the firm ? A. — It was not with the proprietors of * La Minerve.' It was with an individual and not with the Company. CANADFAN PACIFIC RAILWAY. !in n about momv lued or reversed be, but I apprc- ouping, he (Su ition to him on ;men connected ve newspaper, Q. — You made tlieni a discount at your Hank? A. - I don't renicniber wlietlier it was tlimuf^h the Bank or through myself. It waa lor a small amount; a mere business trantiac'tion. (2 — Tbi'n there was no agreement ? A.~ None. Q. — Was there any telegram I'rom me to you approving of or confirming the pro- ceedings of Sir (ieorge Carticr, as stated by Mr. McMullen? vl." You did not telegraph me at all that I know ol'. (2. Your received no telegram Irom me approving of Sir George Cartier's arrange- ment, and the only ac(|uaintance you have of any telegrams from me was one disapprov- ing of it? A. — Exactly. Q. — I see that Mr. McMullen speaks in tliis interview about your being a large gainer, and that you would be recouped by the (Jovernment deposits, to a large extent, in the Mercliants' Bank? A. — The Merchants' Bank has tlie smallest amount of Government deposits of any Bank of the same class, so that was quite imjjossible. The Merchants' Bank collects at various points lor the Government, where its other agents have no branches, so there is a very small amount there, much smaller tlian is usual in other Banks. Q. — Do you happen to remember the amount ? A. — It varies every day. Q. — Can you state the average ? A.— I think it is from $200,000 to !i<30l),()UO. Q. — Any profits tliat miglit l)e niadi; on these deposits, to whom would they go? A. — To the shareholders of the Bank, of course. Q. — And not to Sir Hugh Allan personally? A. — By no means. Q. — You get your jjortion ? A. — Yes, my sliare of the dividend, that is all. (^.-Mr. McMullen states tluit you ])rei)ared a memorandum, setting forth all the telegrams, correspondence, and everything coimected with the Pacific Railway, and threatened the Government to publish it, and that then they came to your terms. Is there any truth in that? A.- — None whatever. , Q. — Did you ever make any communication approaching to it? A. — None whatever. Q.— It is altogether a falsehood ? A. — pjutirely. Question by the Commission. Had you any communication i'rom the Goveruracnt respecting the suppression of these letters ? A. — None whatever. Q. — Or from Sir John, Sir George, or any other member of the Government? A. — None whatever. Question by Sir John Macdonald. There is a statement by Mr. McMullen that I sent you a telegram stating that you had "a big tiling," and "must shell out." Did you ever get such a telegram? A. — I never got such a telegram. Q. — Or anything like it? j4.— No, nor anything like it. Q. — When in one of your letters, Mhicli has been referred to, to Mr. Mc^IuUen, or Mr. Cass, I forgot which, you say " by tiie means you know of," did you refer to pecuniary means, or political exertions by yourself, or how ? A. — I don't know. Q. — What did you mean when you said in your letter of the 1st July, 1872, that means must be used to iniluence public opinion ? A. — It meant simply by newspaper articles and means of that kind. « Q. — W^orking up the jiublic excitement and so on ? A. — Yes, the usual way in which such things are done. And further for the pre:^ent deponent saith not. And on this 2jth day of September the said witness re-appeared and made the follow- ing addition to his foregoing deposition : In answering the question " Was anything said about the money before the longer " letter of the 30th July was signed ? " I wish to say that nothing was said about money ( 'anada. 220 ( OHKKSi'ONDENCE RELATIVE TO THE C'AifADA. I previous to the terms of it beinj* agreed upon, but reference was made to it iu a later period ol'lbc! day. And i'lirtber deponent saitb not, and tliis bis deposition bavin^ been read to bim, ht! declares tliat it contains tiie trutb, persists tbercin, and batb signed. Sworn and taken on fbe ninefeentb day of I September, 1S7;;, and acknowledged [ (Signed) HUGH ALLAN, on 2r)tb day of said montbaiid year. | (Signed) "CHAHLKS DEWEY DAY, Cliairman. A. POLETTE, JAMES ROBERT GOWAN, Commissioners. PnOVINCK ni' OSTAIMO, City of Ottau-n. IN THE MATTER OF TIIE COMMISSION Appointing (;M.\Kr,r;s Di:wi;y Day, Axtoi.vm Pomiiti:, and Jami:s RoiiicnT (Jowax, Com- missioners to in(iuiru into and report upon tbe several matters stated in a certain liesolution moved by tbe Hon. Mr. IIi;.NTi\(iT0N' in tbe House of (^onmunis on tlie iiecond day of April, a.u. 187.'!, relating to tbe Canadian raeifie Railway. Present; 'I'm; CoMMi.s.';i().\i,ns. On tbis nineteentb day of Sejjtember, in tbe year of our Lord one tliousand eight bundred and seventy-tbree, i)ersonally came and aj)peared before us, tbe aljove-nameJ Coinmissioners, Tbe Honourable .JOHN J. V. ABP.OTT, of tbe City of Montreal, Advocate, who being sworn, deposetli and saitli : Q, — You reside in Montreal? yl.-Ves. Q. — You are an advocate ? yl.-Yes. Q. — And a member of tbe House of Commons? ■ ^.— Yes. Q. — Do you know Sir Ilugb Allan? A.—\ do. ' Q. — Have you been connected witb liim of late years in railroad operations? A, — I bave been associated witb bim in two or tbrec railroad enterprises during tlu; last year or two. (^.— Do you know Mr. G. W. McMuUen ? A.—\ do. (2. — You are aware of tbe cbarges relating to tbe construction of tbe Pacific Railroad, and tbe fiirnisbing of money for tbe elections, recited in tbe Commission. Will you have tbe kindness to state in detail what you know of these matters ? A. — My first interview with Sir Ilugb Allan on the subject of tbe Pacific Railway was very shortly after tbe Session of 1871. Then I suggested to him that this enterprise would be a fit ol)jcct for gentleman of bis position and wealth. To that be replied, "AVell, ])ut (town your ideas in writing," but this I did not do for reasons Avbich it is unnecessary to mention now. I did not take any iurtber steps then. Tiie next I beard «f tbe Pacific Railroad from Sir liugb was when be called on me in ^lonfreal, I think in tin; month of March, 1872, and :uiked me if I would assist bim, as he was going to take up tbe t-nterprise. I agreed to do so. and shortly alterwards I met Mr. McIVIiillen at bis bouse in the evening, at a dinne; j/ivty or something of that sort. He (Sir Hugh) then told me that be bad made an aiiangenu'nt witb certain American capitalists to foi'ni a Company to build tbis road; that he bad been in communication witb the Govern- ment about it, and that be thought they could organize a Company tliat would build it, and that they would get the contract. As far as I recollect, ho did not show me either tbe contract or the sup[)lementary contract on that occasion. In fact I did not see either the one or tbe other mitil within tbe last few days, except the contract which I saw for a moment at Montreal in the early part of this year, at a meet- ing I fiad with Mr. McMullen and two of bis friends, and I bave not yet read them care- fully. He said that tbe Americans bad sketclied a Bill for the incorporation of tlie Company ; that they thought the best mode of getting tbe road built was by a cor})ora- tion, and he gave me these two Bills as a sort of basis for the preparation of the legisla- tion that was required for the incorporation of the Company. I took them, and that was about all that passed on that occasion. I was not told \^\\o the people were, and I think did not know until a very considerable time afterwards, except that one of them was Mr. J. Gregory Smith. I did not know that there had been any formal agreement executed CANADIAN PACIFIC RAILWAY. 221 it ill a later cad to him, hu LLAN. I'liiaii. mniissioners. [ISSION ' Go\VA\, Coni- x'd in u ceituiii jiiimoiis on thu ilway. tlioiisaiid figlit u above-iiameJ ati", \vi;o belli;; ions r iscs during tho acific Railroad, Will you have ic Railway was tliis enterprise lat lie ri'plied, ans which it is le next I heard cal, I think in IS goinj; to take rSl alien at his ir Hugh) then ilists to iwin a 1 the Goverii- it would build did not show ision. In fact ays, except tlie ear, at a meet- read them caro- loration of the s by a corpora- of the legisla- m, and that was ire, and I think f them was Mr. iment executed at that time, or if I had heard that tliorewas, I did not know its nature. It amounted to tills, lliat Sir IIu;.;b Allan, jirobabl; reeollectini; my suf^gostion to liin> of the iJi'cvious year, and knowing that I was fre([iniitly engaged in my prolessional capacity, in the orgaiii/atii)nH of corporations, ajiplied to me to prepare the necessary Legislation lor tiie Comjiaiiy to build the road. 1 undertook to do that, and shortly altenvards Parliamiiit met. I don't know tliat I had any fuvllur iurerview or conversation, cither with Sir Hugh Allan or Mr. McMullen, uulil utter I'liriianu-nt met. I cainc! up {o Ottawa alioiil the first w«'ek of the Session, and I found that there was a very considerable feeling in the House aijainst the admission of .Vmcrican infUunice into the Pacific Railway. In fact I suggested to Sir Hugh Allan and .Mr. McMullen tliat tlu\\' ])robal)ly would be such a feeling, and that if they attempted to give to it the character of an .Vniericaii Company, they might not succeed in passing their Rill. When I readud Ottawa, liowevi r, I louiid this feeling much stronger than 1 had anticipated, and I louiid then for the lirst time that a Company had been ])artially organized in Ujiper Canada. A iiiiiuber ofnauu" had been got which were understood to be jiledged to the formation of a Company to exclude American capital and American control. I conferred with a noml ni my of the members, and with some of the Ministers in a general way about this, and I saw plainly that no CMiarter to incorporate a ('ompaiiy to build tin- road with ^\ merle ai capital, or leaving the control of it in the hands of Americans, would be sanctioned by either the Jlouse or ilie Government. A sliort time alter this Sir Hugh Allan cuue himself to Ottawa ; I think I asked him to come, and 1 told him what I thought was the position of all'alrs, and that unless he set himself to work to organize a Canadian Company, and abandon his American project, he could not succeed in what he wished to do. (2. —About what time was this ? A, — About three weeks after the opening of the Session. It must have; been about the end of April, I should supj)ose. I had two or three conversations with Sir Hugh Allan on thi« point, and Mr. iSlcMuUeii himself had been here before that, and 1 Iiad expressed tlie same opinion to him. I told Sir Hugh this in the jjresence of Mr. McMullen, and after some consideration Sir Hugh authorized me to j)roceed with the jireparation of a Rill for the incorfioration of a ('omjiany that would entirely exclude American influence and American cai)ital. I should not say American capital, we could not exclude that if people chose to put it in, but entirely to exclude American indiience, and 1 understood from that moment that any agreement that had been made with American cajjitalists was at an end. Subsequently I told Sir John Macdonald our con- versation ; and I also apjiroached Mr. Mac})herson, and suggested to him, that as Sir Hugh Allan and his friends were willing to go into a C^omi)any compo.sed entirely of Canadians, and entirely under the influence and control of Canadians, it would be bi'tter if lu; and his party, which was strong, should join with Sir Hugh Allan and his party, which was also strong, in forming one Company for the purpose of taking uj) this enter- prise — that is one Canadian Company. Mr. Macpherson was not convinced that the connection between Sir Hugh Allan and his American friends had ceased, nor that the influence of those people had ceased in the Company ; and this was one of the reasons, tliough not the only reason for his not yielding to my suggestion to form but one strong Comi)aiiy — the strongest Company the l3ominion could raise, to proired with the building of the road. Consequently I th.en in-epared a Charter for the Canada Pacific Railway Com})any, which was the name given to the Com])any of which Sir Hugh Allan was the prominent man, and the Charter of the Interoceanic Company was subsequently prepared and jirinted in nearly the same language. (2- — They were incorporated by Statute ? A. — Yes, but the incor|X)ration did not take place for a considerable time after that. I think the Canada Pacific Bill was printed first, and the Interoceanic Bill afterwards, con- taining the clauses of the Canada Pacific Bill, and a few more, and the matter remained in that position until about the beginning of June. The j.'olicy of the Government as I understood, during that interval, was not settled with regard to these Comi)anies ; that is to say, they seemed to be unwilling that the incorporation of private Com[)anies should proceed until their own measure, laying down the principles u])on which they were prepared to act in carrying out the enterprise, should have either passed the House, or made such progress before the House, as would enable everyone to know what the project was really to he. After this took place, the Bills were allowed to go before the Standing Committee on Railways. Q. — The policy of the Government then to exclude American influence was known before these Acts of Incorporation were jiassed ? A. — It was known in this way, that everyone knew that there was a strong feeling on 2 F CiiNADA. m wtm \p. 000 C'OltUESPONDENCE RELATIVE TO THE > 1 Canada (In. pmt t)f the Government against American influence. No one knew, as far as I am aware, that there hafl been any distinct decision by the Government, but yet everyone in ilie House distinctly understood, tliat either the Government, or the greater number of the jicntlemen composing the Government, were opposed to American influence being introdiici'd into the Company, and more especially was Sir George Cartier known to be opjiosi'd to it. I know myself that on several occasions he expressed himself strongly against tlie admission of American influence, and apjjcared to show rather a liostile feeling towards the Allan Company ; and to have the idea that they did intend to take the Americans into their organization. For some time he apjieared to liave tliat feeling. About the first week in June, I think, the Bills were allowed to go to the Committee. The Government Bill having been introduced, and its terms made known, the other two 15ills were allowed to go to the Committee, and they were passed in exactly the same language. I do not think that there was any diflerence in them from one end to the oilier, except in the names of the corporators. The Canada Pacific Company's Bill had lieen framed with a clause, excluding absolutely all foreigners from being members of its Board, but the Interoceanic Company's Bill, as prepared, provided only for t'le exclusion of a majority of foreigners from its Board, and permitted a minority of the Company on the Board. Before the Committee, the form of the clause adopted by the Interoceanic Company was inserted in the other Bill, and I believe that both stoor , and for that matter stand to this daj', allowing a minority of foreign Directors ; but up to that time there was this difference, that the Canada Pacific Company had provided for the exclusion of all foreign Directors. (3.— That is, the draft Bill that you prepared for the Canada Pacific Conpany expressly excluded Americans? A. — ^Yes, it excluded all foreigners. Q. — The other Bill was in the terms you state, providing for a majority ol Canadians? A. — Yes. The Bills were read a first and second time and referred to the Committee on Railways, and in that Committee their terms were assimilated to each other iu the form adopted in the Interoceanic Company's Bill. Q. — With the approbation of the promoters? A. — -Yes; at least I cannot say that the question was ever submitted to the promoters of the Canada Company's Bill. I was re])resenting them before the Commit 'ce, r.nd as the (Jovernment were desirous of having the Bills in the same terms, and Mr, Macpherson's Company were unwilling to put in a clause excluding foreigners, I yielded to the suggestion that it would be better not to exclude them absolutely, and to make the Canada Company's Bill the same as theirs. Immediately after the Session there was a sort of provisional organization of the Canada Company. They appointed a President and Vice-President, and caused books to be oi^cncd throughout the Dominion. The books were oi)ened iu the principal towns in every Province in the Dominion, and notices were inserted calling for subscrii)tions of stock. Tlie greatest possible publicity was given to these notices, and there was no restriction as to the amount which might be suiiscrilied. The Company were anxious, so far as I knew, to get all the subscriptions they possibly could. The matter remained in that condition. Q. — About what time were those books open for subscription ? ■ A. — 1 think early in July, but I am not quite certain as to the date. Immediately alter this provisional organization took place, the Company communicated to the Govern- ment the fact that they had so provisionally organized themselves, and applied to be granted tlu; contract. They got no immediate answer to that, but shortly afterwards were informed, I think by a letter from the Government, that the Government desired that an effort should be made lor an amalgamation between the two Companies. nt with him at that hour. To the best of my recollection Sir Hugh is mistaken in saying that I had been with him at |)revious interviews with Sir (ieorge Cartier. I do not think that 1 was witli liim except on the occasion ol' which I have just s]K)ken, iiamel}', the ai)i)ointed meeting of the 30th July. Sir Hugh called upon me, and we went to Sir George's rooms and saw him there. Sir George and Sir llugli liad quite a lengthy discussion, whicii ap|.;'ared to me to flow to some extent irom previous intei\ lews about the jKJsilion of tliese Companies, about their amalgamation, about the jjrosi'.ects of the amalgamated Company in connc tion with the Kaihvay ; in I'act, on the whole subject ; and tl.i;y came to agree in certain views about the malter, wl-.ich were stated l)y Sir (ieorge and Sir Hugli plainly enough. The basis of their conversation was the telegram which Sir John A. Macdonald had sent Sir George on the '2(5th July, and Sir Hugh urged certain addi- tional conditions beyond those mentioned by Sir John A. Macdonald. In point of fact, the telegram of the 2Gth July appeared n^ally to settle nothing excejit wliat had been perfectly understood from the first, so far as 1 know, tliatSir Hugh Allan was tiie fittest person to be President of the Company. That the Government considered him so, and considering him ao would use their influence to obtain for liim that jjosition; l)ut every- thing else connected with t!ie railway and tlie enteri)rise was to be postponed until the elections were over. This position of affairs did not exactly setth; one of the obji-cts for wliich I understood Sir George and Sir Hugh liad met. The people of Montreal, and a very large portion of the iieojile of Lower Canada, were extremely anxious to know sometliing about this railway and its prospects. They thought that the preponderance of the I'jiper Canada Company meant that the tratlie of the Pacific Railway " oiild be brought down to Toronto, and over tlie Grand Trunk to Montreal and tlii' il^oard ; while the preponderance of the liOwer Canada Company would ensure a direct com- munication to Montreal with the Pacific Railway, by means of the Montreal Northern Coloni/ation Railway, which the jieojile were also very mucli interested in. In the interests of Sir George Cartier's election, as well as for other reasons. Sir Hugh ai)])eared (Irsirious of having something more definite settled than was contained in Sir John's tel(>gram. The result was that they appeared to agree ujion certain jioints in which Sir George was disposed to liivour Sir Ilugh's views. Sir Hugh then said to Sir (ieorge — "Now if you can put these jioints in writing for me, as you state tliem, I think they will "satisfy our friends." Sir (ieorge was extremely busy, and \\as not a very leady pen- man at any time, and he said — '' Mr. Abbott has lieard our conversation, let him put " down what he nnderstands has passed between us, and come back this afternoon and " we will close it 'p." VVe then rose to leave, and were leaving the room when Sir George addressed Sir Hugh on the subject of money in the manner which Sir Hugh has described. He said in an ofl'-liand kind of way, " Are you not going to help us with our " elections?" Sir Hugh said he woulu, or words to that efl'ect, and said, " How much " do you want," oi ' How much do you require ?" or sometliing like that. I understood Sir George to say that there would be a considerable sum required, as there was so much opposition on various grounds. Sir Hugh said, as far as 1 can recollect, " \Vell, write " down what you want." Sir (ieorge said very rapidly, " You know you won't lose .t " all. Our party will make up the greater part of what you give, but we want it now," or something like tliat. My memory is very imperfect as to the exact phrases used, as 1 never end(;avoured to recollect them until lately, when the matter became the subject of conversation. Sir George then said, " Very well ; come back this afternoon. Let "Mr. Abliott write a note requesting you to advance this money, and telling you that I "will see that you are repaidjand come back this afternoon at such an hour and we will "close tlie whole matter up." W'c left upon that; I went to my oHice, sketched a letter about the railway afl'air, either by di(\atioa or otherwise, I don't remember now corrected it, and had it copi'^d. Q.— l would call your attention to these two letters now ? A.-^l sketched those two letters. 2 F 2 CAWADit mw^ 224 CORRESPONDENCE RELATIVE TO THE Canada. Q. — You saw them, I suppose ? ^~~^ A. — I sketched them ; I drew them. I sketched those two letters roughly, knowing, I thought, what to say with regard to the first — the railway affair — hut knowing very little about the other. Sir Hugh called upon me, and I took these two letters I had sketched to Sir George Cartier's office with Sir Hugh Allan. The first letter, referring to the railway. Sir George was satisfied with as to tlie first two jjages of it, but not Avith the third, 'rii'! letter was written u])on three leaves. He was satisfied with the first two leaves, hut the conclusion of the letter did not exactly please him. He said " leave "that off, and I will dictate to you what conclusion to put to it." He then dictated the four or five Hues which constitute the last sentence of the letter as published, signed it, and handed it to Sir Hugh Allan. The other lelter witli respect to the money he did not approve of, and struck his ])en through the most of it, I think, if not the whole of it ; wrote a lew words upon the draft, and requested me to write it over for him, which I did. either from his dictatiou or the draft so altered by him. These are the two letters which Sir Hugh has ])roduccd this morning. I find that my recollection differs a little, hut not materially, from that of Sir Hugh. I think that the terms of the first letter referring to the railwiiy were agreed to, but that it was not written or signed at the first interview ; that is, we were leaving, and after the terms had been agreed to. Sir George spoke to him about the money in the manner in which Sir Hugh Allan has indicai,ed, and that in tl e afternoon the two letters were signed. That is my recollection of the circumstances connected with that. Subsequently, in fact I think some time after this, the question oi the amalgamation of the two Companies was revived. We received an informal intimi tion from the Governmeut, or some member of the Government, that it would be well to have a meeting at Ottawa, I think in the latter end of the month of September, with the Interoceanic Comjiany, or with leading men from tha*^ C' mpany, carrying out ))recisely as I understood it the telegram of Sir John A. M, ?do r 'i ol t!ie 2Gth July. Several members of the Canada Company came to Ottawa ifvi '■ iv i : ■ and some gentlemen, I think connected with the Interoceanic Company, al^ rail,:-, out of this I am not quite sure. At all events, on our arrival here, or shortly after, we were informed that the Interoceanic Company had sent in a Memorandum giving reasons for declining the amalgamation. Q. — Is that the Memorandum publislied in the Blue Book? A. — Yes. the first one. We saw several members of the Government about it, and requested to have a cojjy of that paper, that we might have an opportunity of answering it. They urged u])on us to endeavour to answer it in sur-h a manner as to remove the objections of the Interoceanic Comjjany if jiossible, rather than get into an altercation with them, and so increase the difficulties of amalgamation. The paper was not com- municated to us at Ottawa, but a copy was sent to us at Montreal. The answer was drawn u}" as we thought in a very '-onciliatory spirit ; urging the amalgamation strongly, and endeavouring to dispose of the grounds of objection raised by the Interoceanic Com- pany, and doing all that we could to endeavour to bring about an amalgamation. This answer was communicated to the Interoceanic Company, and they replied to it I think. Q. — Was that the document of the 12th of October, signed by Sir Hugh Allan, your- self, and Mr. Beaubien ? A. — Yes ; but I cannot remember the date. We were the provisional Committee. \u answer was sent to that, which, I think, is also printed. On seeing that answer t thought that the attempt to amalgamate would i)rove imsuccessful, and I do not think the Canada Conijjany took any lurther steps to bring about an amalgamation : !,ui we were informed that the Government had taken up the matter and were making an effijrt, and of Sir John A. Macdonald's visit to Toronto to see Mr. Macpherson ; and the probability at first of his succeeding and afterwards of his failure. These efforts were commenced before the elections, suspended to some extent during the elections, and re- commenced towards the end of September and carried on until the end of November, with every desire, I think, on the jiart of the Canada Company to have been successful. After this, I think cither at the end of November or the beginning of December, lale in the autum, at all events. Sir Ilugli Allan was 'nformed, and I myself I think verljnlly, also, that the Government intended to form a Comjjany under the power given tln'iu v their Act ; that they did not think that it would be i)roper to give the contract to !(■ er Company ineorjMjrated ; that these Comjjanies were to a very considerable extent section' and that the Company which should get the contract must be one that would iairiy represent the whole Dominion. The Govtn'ument then stated that they ^vere endeavour- ing to get togotlier a Company comiKised of such men as w oald f; :iv' v -epresent the who'e Dominion, and would command confidence here and u> /"i.gland, where it was supposed the funds were to be obtained for building the road, Sh» rtly after '\,i.- a few of the gentle- CANADIAN PACIFIC RAILWAY. 225 '4 ravn whom the Government liad been consulting about the Company, met in Ottawa, and perhaps every week or so tbey met again, their numl)crs being increased eacli time ljy persons who were tliought lit to come, and who were encouraged to come in. 1 tliink that in January the number iiad been j)retty nearly filled u}), and the framing ol' the Charter was proceeded with. At the meetings here I liad always taken an active part, and given a good deal of attention to the whole subject, and I came gradually to be i)ut forward without any formal a])pointmcnt to rejjresent those gentlemen in settling the details of the Charter ; and tlie Goveriunent corresponded willi me on several occasions in tlmt sense, and caused mi; to visit Ott2"),000 to aid in the elections about Quebec, on " condition of his friendly assistance, and Mr. Abljott re|)orted that he had done so .'" A. — As regards that I think it is necessary to make a statement. In the first i)lacc, tlie statement in tliat form is entirely untrue, but it ii; quite true that I had a conversiitioiv early in the Session with Mr. Langevin about the expenses incurred in the elections at Quebec. Mr. Langevin mentioned to me that at the i)revious general elections he had been obliged to exjiend a very considerable sum of money, not very large in itself, but large comparatively, and he said he did not think it fair that the burden of those elec- tions should rest entirely on him. He said he thought he ought to have a share of any funds subscribed in Montreal i'or election jiurposes to assist in Quebec, which he had not had in previous elections, and that they could not exiKict much of a subscription from Quebec to help the Government. I agreed with him in thinking that it was unfair that iie should bear the burden of the Quebec elections, and I told him that in so far as I Canada. 22C CORRESPONDENCE RELATIVE TO THE 0am ADA. t ^ Mft H coiilil liiivo any influence in the m.attcr I would try tliat he should have a portion of any fund which might he got up in Montreal for general election purposes. Talking over matters — and I think it is this that Mr. IMcMullen speaks of — it came out in conversation that i)robably the elections would cost in the district of Quebec, irrespective of his own, a sum of $25,000 or $30,000. I told him that as liir as I could influence the matter I would endeavour to get something like tluit amount allotted to the district of Quebec. That is what took place between Mr. Langevinand myself. 1 did not at that time make any allusion to tiie position of the Canada I'aciflc and ito Charter. I knew Mr. Langevin was a strong Lower Canadian, and I thouglit tliat h'.-i friends were all in favour of arrang- ing the Pacific matter in sucli a way that tlicre sliould be direct communication with the seaboard at Quebec and Montreal, and I assumen that in any matter in which he could support tlie views of the Lower Canadians he would do so, and we did not wish anything more. I never said anything more ; I never reported that I liad made any arrangement witii Mr. Langevin, though, no doubt, I did mention it to Sir Hugh Allan, that if we got up a I'und Mr. Langevin should have a part of it to the extent of $25,000, Q. — Did you communicate this to Mr. McMullen ? A. — It is not likely that I would do so ; though Mr. McMullen appears to have become aware of it. But there lias been so much spying and betrayal of private documents and abstraction of private letters in the course of this all'air, that it is impossible to say how Mr. McMullen became possessed of it. Q. — I do not understand you ? A. — 1 mean that nearly if not all the pajjcrs publisjied in the press relating to this Pacific afl'a \ . ave been obtained by illegal if not criminal means. For instance, the four papers whii ublished at the end of Mr. McMuUen's second letter, must have been obtained l)y n, hich I think I may call criminal. Q. — What i)aj' lo you refer to ? A. — I refer to the two telegrams and the receipts, the one from Sir John Macdonald to me, the one from me to Sir John Macdonald, the letter of Sir George Cartier to me, and. the receipt of the Montreal Committee to me. Q. — In whose possession were they ? A. — These papers were in my possession during the absence of Sir Hugh Allan in Ncvlbundland. Q. — Have you them yet ? A. — No, I gave them to Sir Hugh Allan when he returned from Newfoundland, and it is (piite obvious, at all events I am convinced of the I'act, that those jiapers were either stolen from the ]n'ivate drawer in which they were kept while in my possession, or from the place in which Sir Hugh Allan put them. Q. — You say Sir Hugh Allan has them now? A. — I don'u say he lias them ; I say I gave them to him on his return in Sej)tembcr, 18V2. I don't su])pose these gentlemen had tlie originals in their possession, but they must have obtained them by bribing a confidential clerk or secretary wiio had access to them to copy them. For tiiese reasons I say I don't know how Mr. McMullen got his informa- tion. It is barely possible that he could have heard it from Sir Hugh Allan or myself (2- — You were acting as confidential agent to Sir Hugh Allan with respect to tlie money ? A. — No, I don't think I was. Sir Hugh Allan asked me to assist him in this affair. I think the preponderance of his motive was that my professional practice liad led me in the direction of tliis kind of business — the organization of Companies. I also took an interest as a i)ublic man in this particular railway, but I considered I was acting more as the solicitor of Sir Hugh than in any other capacity 1 can describe. I never was in any sense his agent. Q. — I think you were made the medium through which the moneys were paid for election jnirposcs ? A. — Only while Sir Hugh was in Newfoundland. I never had anything further to do with the moneys than this. I was present when those letters which I have described were talked about ami signed, and when Sir Hugh Allan left for Newfoundland I was mi;de the medium of communication witii him with respect to three or four transactions. Q. — Did any other sums come into your possession other than those subscribed by Sir Hugh 'I ^.— None whatever. I had nothing whatever to do with the distributionof the money subscriljed for the elections. Q. — What was the amount paid through you by Sir Hugh Allan for the elections? , ^.— The first amount was $10,000. Q.~At what date ? A. — I think it must have been about the 8th or 10th of August. It was $10,000 which CANADIAN PACIFIC RAILW '.Y. 227 IIusli Allan iu s wore paid for is i)( 1 0,000 wliicl ho left in my hands to be given to Mr. Langevin. He wrote to Mr. Langevin, I think, iiiJbrniing him that the money was in my possession, and that on his giving me a receipt for it I would pay it. The first I heard of Mr. Langevin's action was his telegraphing me to meet him on the Quebec boat, which I did, on his way down to Quebec. He said h'? had received a letter from Sir Hugh Allan saying that on giving a receipt I would give him the money. He said lie could not understand wliy such a receipt was asked from him. I told him I did not see that there was any reason for it either, and I did not think that there was any particular reason. He then said that he would have notliing to do with it; that he could not give me any receipt. He did not know what Sir Hugh Allan's reason was for asking it, and at all events he would not give any receipt whatever. It looked to him as if it might be said that it was not a free subscription to the elections at Quet)cc which Sir George Cartier iiad promised him, and unless it was, he would not take it at all ; and moreover, he would on his arrival at Quebec return the $15,000 which Sir Goor<;i! Cartier had previously caused to be sent him. He appeared to me to be a little excited aljout the matter. I left him upon his expressing his determination not only to rcluso that money but to send back the $1.5,000 which was the sum first paid. I tele- giai)lied Sir Hugh Allan saying that Mr. Langevin did not leel disposed to give any receipt, and asking his authority to give Mr. Langevin the money M'ithout a receipt. I ditl not get an answer within two or three days, and knowing that the elections were going on, and that the money would probably be wanted, I took the responsibility of sending the money to Mr. Langevin by exjiress, and wrote liim at the same time telling him tliat I had done so. The second sun , namely, $20,000, was paid to the Montreal Central Committee, I getting Sir Hugh Allan's autliority to pay it, l)y telegraph. The third sum was $10,000, respecting which Sir John Macdonald telegraphed me. That I also inlormed Sir Hugh oi'. and obtained by telegraph his authority to i>ny it. I think tiiese were all the sums of money I had anything to do with. I kept these vouchers, these letters and telegrams, ill 111) i)rivate drawer in my office until Sir Hugh Allan returned from Newl'oundland, ami then I gave them to him. Q. — Were they out of your possession at all ? A. — Not that I know of. (2 — I'be $20,000 was given upon this letter of Sir George Cartier's to you of August 24th? ^.— Yes. Q. — You are familiar, of course, with the terms of it, namely :— " On the same condi- " tions as the amount written by me at the foot of the letter to Sir Hugh Allan of the " .30th ultimo. Please send Sir John Macdonald $10,000 more on the same terms." What did you understand by those expressions in Sir George's letter to you? A. — I understood him to refer to the letter of the 30th July, in which he informed Sir Hugh Allan that any advances he made would be recouped. Q- — Tliere were two letters of that date, both drafted by you in the first instance, then jiortions of them rejected, and tlio whole modified by Sir George. Do you remember the terms of your draft of your letter? A. — No; I do not. My im})ression is that the third sheet of the longer letter vva« rejected because the conclusion did not please him, and my idea was that the objection was hypercritical, as it only referred to the phraseology. Q.— Not to the matter, but only to the form of expression ? A. — Yes; you will perceive that the conclusion of the letter is a sort of statement that these being his views he would urge them uj)on his colleagues. The form in which the draft concluded was a little different from that, but not materially. He preferred liis form, and he dictated it to me, and I wrote it as you see it. Q. — What was your draft relating to the money ? A, — I think it was about the same length as the one produced, but I cannot say posi- tively. I had a great difficulty, I remember, in saying anything about the details, because I did not understand how it could be recouped, and did not believe that Sir George could raise such a sum of money as he described from his party. Q. — Were there in the draft any special terms or conditions upon which the money was to be advanced ? A. — I think not. Q. — Do you think it corresponded in general meaning with the letter that is produced ? A. — I think so. I think it made some mention of the money being repaid out of such money or fund as could properly be appropriated to the })urpose. It was a perfectly harmless letter, and one perhaps less open to misconstruction than the one which has been produced. Q. — There was no difference as to the substance ? Canada. www w^ 228 COHllESPONDENCP: RELATIVE TO THE Canada. ^. — "J^at that I recollect. Sir Hugh Allan informed me that he did not attach the slightest importance to the promise ol" repayment. 1 think, if the Commission will allow me to refer to it, I remember a statement which appears in a Chicago paper, said to have been made by Mr. McMuUen to some newsi)aper editor there, respecting an agreement which lie says was executed subsequently to the .'JOth .hily, and he mentions a circumstance wiiich lie appears to think confirms his posi- tion ill connection with the agreement. He says it was written by three clerks in my oflice, so that none of them might know its contents. No such agreement was ever pre- ])arc(l or written, but as a matter of fact the first letter wliich has appeared before your Honours was written by three clerks in my office. The first two pages were written by two different clerks, and the third leaf was written by a tliird clerk, and that is the jmper of which some person, I have not the slightest doubt, who has been willing to lK;tray confidence, has given him an inaccurate description, and caused Mr, McMullen to suj)])ose that it was a different paper from that jiroduced. Q. — Why was it written by three clerks ? A. — Simply because the space of time between the interviews was so short, I had to write it out or dictate it, get it extended, corrected and recopied, and so I placed one sheet in the hands of each clerk to save time. If I had supposed it possible that any one of those clerks could have been bribed to disclose the contents of the paper I might have been more anxious to prevent their knowing Avhat it contained, but I had no such idea and no sucli motive. Q. — Were you present at any other interview, or do you know of any communication between Sir Hugh Allan and any members of the Government in relation to the sul)- scription of money for the elections ? A .■ — No, I never heard of any other. Q. — Do you know how these moneys were spent at all? A. — I cannot say that I do. I Iiave a general knowledge that they were expended in furthering the elections in different jjarts of tiie Province. (2 --!^ir George Cartier's election? A . — Yes, and other elections. I do not know many of the details ; I have personal knowledge of scarcely any of tliem. I was not a member of liis Committee, and did not take part in his election, as I had enough to do in attending to my own. Q. — Did you ever hear from Sir Hugh Allan an exjjression of expectation of receiving any advantage from the Government ? A. — He certainly had the expectation of receiving advantage. He expected to retain in ])ower the Government whose policy he approved of, but as to the Pacific Charier, beyond sustaining in power the Government which was disposed to carry out the build- ing of the Pacific liailway, I most unhesitatingly say that I never heard a word from him, Q. — You were in very intimhte relations with him on this subject? A. — Yes. I did not see him very often, but he seemed to speak to me without any reserve. Q. — ^Do you know Mr. Foster ? .4.— Yes. Q. — Was he present at any of your interviews with Mr. McMullen? A. — 1 think he was present at interviews witli Mr. McMullen during the Session. He was one of the Directors of the Canada Pacific Railway Company, and. we desired to get 111 in on the Board of the Canadian Pacific. He is a man of considerable railway exjierieiice, and I believe of capital. He was entirely in tlie confidence of the Company, and during the Session of 1872 assisted, to some extent, in getting the Bill through. And I have no doubt that Mr. Foster, Mr. McMullen, and myself frequently met during that Session. Q. — Did you ever liave any conversation in Mr. Foster's presence in relation to any sums of money to be jjaid to tlie (iovernment or any member of it ? A. — To th(! l)est of my recollection, no. Nothing of tliat sort was ever contemplated at all to my knowledge;, either during the Session or afterwards. The election fund, to which Sir Ilugii Allan alterwards contributed, was not, I think, spoken of at all during the Session, except as I had ))reviously stated. After the Session I saw very little of Mr. Foster, and nothing at all of Mr. McMullen for a considerable time. Q, — Sir Hugh Allan mentioned that he had never given anything so large at any l)revious elections. Did it occur to you that this was a very large sum for him to give on this occasion ? A. — I know nothing of what Jie had given on previous occasions, but I certainly thought that this was a very large sum for him to give. At the same time it must be observed that he did not agree deliberately to subscribe the whole of this sum at once. CANADIAN PACIFIC RAILWAY. 220 jt attach the ement which )n of receiving c without any elation to any lie contributed from time to time as tlu; elections went on and as tlic money was needed. Probably lie mij^ht liavi; besitated at subscriliiii Cnnipany were concerned, tliere was nut the sli^Iitest idea of the introduction of Ann^rican inlUienee and cai'ital. Aly elforts were directed to framiu" the Cliarter, or assisting the Government to frame tlie Charter, so as to exclude tlie l)ossil)iIit\' of it. U. — Were you present in Ottawa at the time the names of the genth;men Avho appear in the Charter were settled on? A. — ^Thi-y were not all settled on at once. It was a work of some time to collect togetlier the Directors of the C^ompany. I am aware that several gentlemen were spoken to, others were corresponded with, several came to Ottawa and saw the Government ; and one hy one fit people were selected from one part of the Dominion or another, until the lull complement of thirteen was decided upon. I think the last one was not entirely settled niion until within two or three days of the signing of the (Jharter. I refer to I\lr. Hall. lie was not linally selected until two or three days before the Charter was signed, partly because Sir Hugh Allan and myself had urged the a])pointment of some one sug- gested by Mr. Foster, and partly because Mr. Foster himself was desirous of being rejjre- sented on the Board, and jjartly, 1 believe, because Sir (ieorge Cartier had expressed a wish that Mr. Foster should be on tlie Board or represented on it. Q. — Did you come to Ottawa instructed by the Company, or prepared to submit any names as Directors to the Government? ^.— No. Q. — Did you submit any names? A. — No, I never did. The only name on the Board that was submitted by any member of the Comi)any ? Q. — Do you mean the Canada Company? A, — No. The Canada Company ceased to have any existence, T may say, for the ])urpose of this Railway, when the design of amalgamating it with the Interoceanic Company was abandoned. Q. — Still to some extent the interests of the Canada Company were represented ? A. — No, not in the slightest degree. When the project of amalgamation was aban- doned, several gentlemen independent of any Company were asked to come to Ottawa to meet, with the view of discussing the details connected with a Company. I have not a very precise idea of the way tliey Miire got together at first, but I know that five or six gentlemen who desired to be interested in the formation of a new Company, met at Ottawa, and the Canada Company had no more to do with it than any imaginable com- pany out of tlie realm. Q. — Do you know if Sir Hugh Allan suggested any names to the Government? A. — Yes, 1 know he suggested the name of Mr. Beaudry. Q.— Any others? A. — No others that were accepted. The only one I Ijelieve that Sir Hugh Allan was the means of introducing into the Company was Mr. Beaudry. To Sir John A. Macdonald through the Chairman: Q. — Siieakingof the terms ■which uere granted to the Canadian Pacific Railway Com- pany by the Charter; and supposing that Sir Hugh Allan had had no connection in anv way with the Company, from what you know of tlie policy of the Government, and from the communications between members of the Government and yourself and the Boaril, would not the same terms have been granted ? A. — I have not the least doubt they would. I think the terms of the contract and Charter were settled without the remotest reference to Sir Hugh Allan any more than to any other member of the Board. I never knew a suggestion of his, however much it might l)c pressed, if it appeared unreasonable that was not rejected without ceremony. I don't know of any favour or concession ever having been made to him. Q. — Then you are satisfied that if the construction of the Road had been confided to the Interoceanic Company, tliey would have got the same terms ? A. — I am quite satisfied of it. Q. — Then these subscriptions for election purposes had no effect on the Charter? A. — No ; so far as I knew, and I believe I was in a position to know as much as any one, the subscriptions for the elections had no influence whatever upon the negotiations. I never heard them referred to. Q. — AVas it not the case that every effort made by Sir Hugh Allan to get any prepon- derance to his sectional influence was overruled ? A. — I don't know that he made any special effort to give a preponderance to his sectional interests in the Canadian Pacific Company, but in the Canadian Pacific Com- pany, the efforts that he made were overruled ; for instance, I know that he made some suggestions in respect to the amalgamation, and that they were overruled. CANADIAN PACIFK; RAILWAY. 231 ■st idea of the led to framiuj^ to exclude tlie len who appear time to collect icn were sj)oken c Govcn.meiit ; r another, until vas not entirely I refer to Mr. rtcr was signed, f some one sug- 1 of being repre- lad expressed a 1 to submit any jmitted by any lay say, for the the Interoeeauic ^presented ? lation was abnn- mc to Ottawa to y. I have not a V that five or six 'omi)any, met at imaginable eom- .>rnment ? lugh Allan was Railway Com- onnection in anv nmcnt, and from and the Board, the contract and my more than to owever much it thout ceremony. been confided to he Charter ? as much as any the negotiations. get any prepon- onderance to his an Pacific Com- it he made some Q. — There is a (luotation made in one of i\Ir. MclSIullen's letters. A series of para- graphs from tlie pajier, eominunicateills which uere introduced in the first instance in the House for the Canada Comjjany. In point of fact, that fact is true, though the inlerence is not correct. I believe he did pay the House for the two Bills and some other trifling expenses. Q. — What would they amount to? A. — The House fees were i?2 t.j.00 for whicii I got receii)ts. There were some other trifiing expenses, prol)ably amounting to slOO or SlaO more. The receijjts ibr the House lees aw herewith produced and fyled marked "S." and " T." In fact Mr. McMullen did keep uj) a certain amount of connection with the promotion of the Pacific Bill, alter he was perl'ectly aware that all coniu'ction with thi' Americans must cease. He was a 'Canadian hinistdl', and Mas very anxious to keep himself connected with the scheme so far as he could, in hopes of something turning up in the end. He met Sir Hugh Allan occasionally. The Bills were called u]) in the Committee hurriedly, and it was necessary to have the ices paid on them before they could be passed through the Conmiittee, and to the best of my recollection I said "I wish Sir Hugh '■ would send the money," or " I wish 1 had the money to pay the fees," or something of that kind. He said he had money for such ])urposes, and he jiaid the fees. The matter had entirely slij)i)ed from my memory, as I supposed he had settled it with Sir Hugh Allan. However, when negotiating for giving up Sir Hugh Allan's correspondence last Jiuuiary, he told me that he had these receipts fi)r the House fees, and the other small expenses I have mentioned. I told him to bring them to my office and I would give him a cheque for the amount unless Sir Hugh Allan settled with him. Sir Hugh Allan did settle with him, and Mr. IMcMuUen gave up those receipts to me. Q. — Are you aware what sum Sir Hugh paid him in relation to giving up the corre- spondence ? ^.— The sum of $20,000. Q. — Are you aware of what money he refunded of what he received from the United States cai)italists ? A. — He told me that he had refunded it all. Q, — Do you know anything about the sealed packet of letters left with Mr. Starnes ? A. — Yes. It was I who arranged lor their deposit with Mr. Starnes. About the latter end of the year Mr. McMullen himself, I think, told me that he had a number of letters. Q. — Letters of what year ? A.~Oi' 1871 and 1872, I think. He (Mr. McMullen) made an application to Sir Hugh Allan, claimhig that his people had the right to command the services of Sir Hugh Allan in connection with the Pacific contract, and stated that Sir Hugh had not used them well, and that he ought to pay whatever advances they had made, and also for their loss of time and other claims. The demand made by Mr. McMullen amounted to a con- 2 G 2 Oahasa. 232 rollHESPONDKNCE HELATIVE TO THE 'i^Mi- i Canada, sidcnil)!*' s\im. I fliiiik over ?r'2()(),(tl»(), if not .'i2r)(),0(in, in tlic first jilace, Itiif tliis incliuk'(l tlu! !?I(),()(I0 Sir Hugh Imd received. Al'tcrwiirds there was some liltiu nei^otiiitioii about it, and lie reduced his claim somewliat, and liually he came to IVIontreal with Mr. Smith and Mr. Hurllnirt. He read me passaf^es irom tlie correspou- deuce, and showed it to mc; stated to me Ins position, and adiU-d that lie had heen ill used, and spoke of'liis claim I'or a considerable sum of money. He also showed me the contract with his friends, which 1 j;lanced over to verily a statement he made as to its contents. 1 wrote him, with Sir Hu<;;h Allan's authority, that so I'ar as tlie disbursements went, Sir Hugh Allan was ready to pay tliem, md with regard to their services, he was ready to pay them a reasonable sum, but that t lie demand lie was maUing was me which did not ai)|iear to me to be based on either ol those principles, but was in fact such a demand as that Sir Hugh could not listen to at all. He cani«> to Montreal, as I hjive stated, with Mr. Smith and Mr. Hurlburt, of Chicago, 1 had an interview with tliose gentlemen, and I then, for the first time, saw those letters. I think this was in January. I did not read them all, but I read, or heard read, extracts from some of them, which showed me their character. I saw at once that the jiublieation of these letters whidi Mr. McMuUen had threatened to publish, would jn-oduce a deal of outcry, and would probably interfere with the prospects of the deputation going to England to raise money for the Koad. I thought it was best for Sir Hugh Allan to make any arrangement ia reason, or out of reason, in order to get through with his mission to England before there was any row made about them. I therefore arranged with Mr. McMulleii to accept !:rlO,()0() in American currency. He assured me that he had spent above $20,000, and tiic remainder he claimed as remuneration for loss of time of himself and his friends. Ihit this arrangement did not include the $40,000 received by Sir Hugh Allan. I thought it would he a prudent precaution to prevent the publication of these letters, and therefore to make the payment of part of the money dependent ujjon their not heing published for a reasonable length of time. The jiaper read by Sir Hugh Allan, which was al'terwanls given to Mr. Ptarnes along with the sealed packet, was prepared by myself, ll was submitted to Sir Hugh Allan and signed by him, and afterwards also signed l)y Mr. Mc.MuUen. The package was made up on the spot, and Mr, McMulleu and I gave it into the hands of Mr. Starnes. I also})aid ^Ir. ^le]\Iulleii l?20,0()0. The chetiue for the remainder was to be delivered to him some time after the rising of the Session in the event of these papers not being published. He declared to nu; that there were no copies of them in existence, except tliu one which he had given to Sir ,101111 A. ^lacdoiiald, which is the copy referred to in the paper. He undertook also to procure the sanction of ^lessrs. Smith and Hurlburt to this arrangement, and he wrote a letter to Sir Hugh Allan, discharging him from all claims of every kind and description. I think Sir Hugh Allan has this letter which ^Ir, McMuUen wrote to him. I also produce and fyle the letter which Mr. McMullen wrote to me marked " U." Q. — Uo you know Mr. McMuUen's handwriting ? A. — 1 think I saw him write this letter. Q, — Was that concession or payment made by Sir Hugh Allan at once or after con- sultation with you '! A. — It was made after the negotiation had spread over a couple of weeks, I should think, and after several notes and interviews had passed between Sir Hugh Allan and myself. Q. — You were negotiating with ^fr. McMullen ? ,1. — 1 was negotiating with him on behalf of Sir Hugh Allan as his Solicitor in the matter. (2.— What did you say was the motive that induced Sir Hugh Allan to give a sum beyond the actual disbursements which were alleged to be $20,000. J.— Ill the first i)lace, I think, Sir Hugh recognized the fact that Mr. McMullen and his friends had really spent a good deal of time about their scheme, and that they had given themselves a good deal oi' trouble .ibout it. I think he recognized also, that they should have some remuneration for that. I think he considered that the sum demandetl for that was very large, indeed cxorljitant, but he thought it was better to settle the matter than to have a great outcry and scandal, while he and the delegation to England were endeavouring to raise money for the Pacific Railway. I imagine that he saw that if these letters were jiublished an immense deal more would be made out of them than their importance warranted, by any parties who were opposing the Pacific scheme, and he desired that their publication, if it were to take place, might not be until after his return. CANADIAN PACIFIC 15AIIAVAY. 23.-! llllU'C, l)llt tliis ■as some littli- ly 111" c'l'um" to 1 till' coni'spoii- lu! Imd lu'cii ill showed nu' the ; inadu as to its e dishurscmi'iils services, hv was r was 'lie which s ill laet such a treal, as I have •vic'V with tlioM' was in .laimary. ol' them, which se letters which tery, ami wouKl I to raise money arrangement in on to Enfi;laiul I Mr. MeiMulleu lad spent ahove time of himseli received by .Sir II ol' these letters, ; upon their not Sir Hugh Allan, et, was ])reparc(l d afterwards also I Mr. McMuUeu is to he delivered papers not being tence, except tlie I'erred to in the lurlburt to tliis from all claims etter which Mr. McMuUen wrote mce or alter con- ' weeks, I should Hugh Allan and Solicitor in the 11 to give a Slim McMullen and d that they luid d also, that they e sum demandeil ter to settle the ation to England iue that he saw ade out ol' them Pacific scheme, ot be until alter 111 Q. — When dill you, Mr. ^IcMulleii, and Sir Hugh come to an understanding'.' A. — It is mentioned in the pajier which was lyied this iinu'iiing. Q. — As soon as you came to an agreement it was committed to writing ? yl.— Yes. (i. — Was it at your suggestion that a portion ol' the money was withheld '? .'!.— Yes. Q, — You were acting as Solicitor lor Sir Hugh Allan '{ yl.— Yes. Q. — And thought it a reasonable and ])roper i>recaution to fake ? A. — Yes. I thought it jiossible that there might be copies ol' these letters extant, and tliat no sooner would the money be paid than copies might apjiear in the newspapers. I thought that the retention ol' a portion ol' the money would operate as a check against anything of this sort. Q. — " Within ten days after the end of the coming Session of Parliament, Mr. Starnes " is requested," and so on : why was that time fixed upon '! A. — .lust for the same re.ison as any other time might have been fixed upon in order to give sufiieient time to enable the delegation to go to England and return. The iniblication then would lie better than during the Session of Parliament, as it would create less noise and scandal than during the .Session. (I — The date is the '2(ltli of February. AVheii did Sir Hugh Allan leave for l']ngland ? .1.— I think on the first of March. U. — For what jjurpose'.' A. — As one of the delegation to try to raise funds for the Pacific Railway. Q. — When did copies ol' these pajxTS appear in the newspapers'/ A. — The first timi; that copies ai)peared was on .Inly 4tli, in the ' Montreal Herald,' but the charge! Mr. Huntington made in the House was supposed to be based on some copy which he had of these j)apers. I understood that he proposed to read paj)ers Mhich bori' a resemblance to tlu!se documents. (I. — You say that it was a])preheiided that the publication of these papers might all'ect the mission upon which Sir I lugh Allan went home to raise money. Do you know if it did? A. — I am perfectly certain that it did. I was cm- of the delegation of four — comiiosed of Sir Hugh Allan, (Governor Archibald, Major Walker, and myself — and the chief ditliculty we met with in England, was the feeling caused by the violence of the pul)- lications in this country, the extravagant charge made against the Company, causing the belief in the minds of English capitalists that the success or failure of the Company dejieiided upon the success or failure of one of the great political jiarties in tliis country. Peojile became convinced, as far as I could judge, when these charges were made and reiterated to such an extent, that if the Government maintained themselves in jiower, the Contract would likely be carried out and the Cimijjany go on ; while on the other hand, if the Ciovernment were ejected from power, the Contract and the Charter would I'all to the ground, and the road would not be built. They felt then that they were not only imperilling their money on the chance of the success of an enterprise sullicicntly difficult in itself, but on the chance of one or the other of the political parties remain.'iiL; in power. There was more hesitation from that notion, that any successful result wo.' Id depend upon the success of one party or the other, rather than in view of tlie diflii iiit;. <;! ^lie undertaking itself. This it was that prevented capitalists in England from siibscribing; in fact that was the reason given by one large firm of cajjitalists, with whom the delegation made the greatest progress in negotiating for the money. Referring to the deposition of Mr. ^Vhite, I wish to state that the draft P>ill which he sui)posed I bad pre])ared, and caused to be printed on behalf ■•, I'e projected Ami'iican Company, was, to the best of my recollection, the dnift i- ■ 'a print, which 1 have already sfcited. Sir Hugh Allan gave to me when he requested me to jireiJare the legislation for the Session of 1872. And further deponent saith not, and this his deposition having been read to hini, he declares that it contains the truth, persists therein, and hath signed. Sworn and taken on the nineteenth day of "i Sei)tember, 1873, and acknowledged .o- n t i << AuurvPT .1 .4 4.U 1 1- • 1 (Signed) J. J. < . AlJJiUil. on tlie twenty-seventh day ol said ^ <= >' month and year. j (Signed) CHARLES DEWEY DAY, Chairman. A. POLETTE, JAMES ROBERT GOWAN, Commissioners. Oan.vda. 9M CORHKSl'ONDENCE RELATIVE TO THE Oan/u)a. Provivck ok Oxtaiuo, Cit;/ of Ottmm. IN THE MA'rrEH OF THE ( OMMISSION iii Appointing Ciiaki.ks 1)i:\vi:v Dav, Anioink Poi.kttk, and .Ia.\ii:s Kohkrt Gowax, Com- niissionurs to in([uirt' into and report npon the several jnatters stated in a certain Resolution moved liy the Hon, Mr. IlrMiSdTo.v in the House ol' Commons on tin; seeond day oi' April, A.n. i.ST.'J, relatiiif; to the Canadian Pacific Railway. Present : TnK Comsiia-uonkuh. (.>n this twentieth day of September, in the year of our Lord one thousand eij^lit hundred and seveuty-tiirce, personally came and ajjpeared belbre us, the ahove-named Commissioners, WILLIAM EDWARD ULUMHART, of the Clity ol' Quebec, who being duly s\w)rii, deposeth and saith: I reside in (Quebec, but this summer I have resided temjiorarily in New nrunswicl<. My occupation is general agent of a company for building railways. I am not an engineer, l)ut attend to the business portion of the agency. Q. — Were you residing in Quebec during the years of 1871 and 1872? A. — Yes. ^ Q. — Do you know Sir Hugh Allan ? A. — I don't. t Q. — Do you Icnnw Mr. Geoige W. McMuUen ? A. — No, I do not. Q. — Do you know anything of an agreement made between those gentlemen relating to the building of the Pacific liaihvay ? A. — I do not. Q. — ^Vere you in a position to know anything of that matter ? ^.— No. Q. — You are tlien utti'rly witliout knowledge relating to that subject? A. — Yes. I have no knowledge whatever, excej)t what I have seen in the public prints. Q. — Did you take any part in the ginieral elections of 1872 ? ^.— Idid. ■ Q. — Were you on any of tlie committees? A. — I was on several committees, but not the General Committee. Q. — Were you on any committees Avhich were organized, as it was supposed, in favour of the promotion of the election of the Government candidates? yl.— Yes. Q.-—Do you know anything about the subscription of money for promoting the elections ? A. — I know that money was subscriljcd. Q. — Do you know by whom ? A. — Several persons subscril)ed. I saw no names, nor any list of names of subscribers. J know there were subscrijjtions made. I do not know to what amount. Q. — Do you know whether Sir Hugh Allan was one of the s'abscribers ? A. — I do not. Q. — Do you know through whose liands any money came which was used by the Central Committee, or by any other committee ? A. — I do not. Q. — How do you know that money Avas subscribed ? A. — I know that one gentleman told me that he had subscribed. Q.— Was that Sir Hugh Allan ? A. — No. A gentleman from Quebec — a tradesman. Q. — A tradesman in Quebec ? ^.— Yes. Q. — Do you know the names of any of the gentlemen who 'vere on the Central Com- mittee in Quebec? ^.— Yes. Q. — Will you mention them? A. — I know Mr. Beaudct. Q. — His Christian name ? A. — Elisie. Q.— Do you know the Hon. Mr. Langevin ? A.— I do. CANADIAN PACIFIC RAILWAY. 235 issiON ^*:.:.,., T GowAN, Com- ited ill a certain CumnioiiH on tliu Liiilway. thousand fi;j;lit lie al)ove-nami'd 'inf; duly sx^oiid New Brunswit k. i. I am not an Icmcn relating to en in the puhlic pposed, in favour promoting the les of subscrihcrs. was used by the he Central Com- (2. — T)o you know wlietlior any noncy was vcrcived througli him by the Central Com- Canada. mitfee or l)y any person for tlie elections i* A. — I do not; I ni'ver was on tiiat Committee at aU. Q, — Had you aiiythin;j; to do with the distribution of the moneys which were sub- scril)ed for tlie elections? A. — All tlie nuiiic)- I had anything to do with was what we subscribed ourselves and spent ourselves. (i. — Had you any conversation at any time with Mr. Laiigevin about election expenses? A.— No. Q. — Had you any such conversation with any other of the ministers ? yl.-No. (2. — Do you know anything; about any understandinj; between the Government and Sir Hugh Allan and Mr. Abbott in relation to subscriptions for elections? ^1.— No. Q. — Have you any knowledge whatever in relation to the subject matter of this iiKpiiry ? A. — Nothing but what has appeared. Q. — Do you know why your name was put down upon the list of witnesses ? A. — 1 have no idea at all. Q. — Have you ever said anything to give reason to believe that you had some know- ledge concerning this matter ? A. — No, I always on the contrary, since I saw my name on Mr. Huntington's list of witiu'ss(!s, said I had no idea why my name was put down, as I knew nothing about the matter. Q.— For whose election were you on a committee? A. — For the countii's of Kiniouski, Ri'llechasse, and iNIontmagny. Q. — Who was the candidate for Kiniousl ■ ? yl.— Mr. Sylvain. (2.— Who for B<-llechasse ? A. — Mr. Caron. (2. — And lor Montmagny ? A. — The Honourable Mr. lieaubien. Q. — These were all Government candidates? yl.— Yes. Q. — Were they elected ? A. — No, they were all defeated. They had not money enough. Q. — Do you know whether any money was sent down from Montreal for the support ol' tliese elections ? A. — I do not. ^2. — Do you live in the City of Quebec ? yl.— Yes. Q. — Do you know anything of the elections in the City of Montreal or the Montreal district ? A. — No, my exertions were confined entirely to the Counties l)efore mentioned. Q. — Were you on the Kainouraska Committee? .4.— No. Q. — AVho represents Kamouraska now ? ^.— Mr. Pelletier, 1 think. Q. — ^\Vho rejjresents Bellechasse? yl.— Mr. Fournier. Q. — AVere you on the Election Committee for the Centre Division of the City of Quebec ? A. — No, I was absent from the city. The elections in those three Counties, where I have mentioned I was engaged, took place on the same day. Q. — Had you ever any conversation with Air. Huntington on the subject of this inquiry ? yl. — No, nev(,'r ; I do not know Mr. Huntington. And further deponent saith not, and this his deposition liaving been read to him, he declares that it contains the truth, persists therein, and hath signed. Sttoru, taken, and acknowledged on the 1 day, month, and year fii-st above \ (Signed) WM. E. BLUMHART. written, before us. J (Signed) CHARLES DEWEY DAY, Chairman. A POLETTE JAMES ROBERT GOWAN, Commissioners. wwmr Canaka. m- 23C CORRESPONDENCE RELATIVE TO THE IN THE MATTER OF THE COMMISSION Pkovinti-: ok Ontakio. Cifi/ cf Ottawa. Apjioiiitiiiii; CiiAiuj'H Dkwky Day, Antoixk Polkttk, and Jamkh Rouert Goavax, Comniissioiicrs to inquire into and report upon tlu; several matters stated in a eerfuiii Resolution, moved by tlie Hon. ISIr. IlLNTiNcroN in tlie House of Clonimoiis on the seeond day ol' April, A.n. 1S73, relating to tlii> C'anadian Paeific Railway. Present: Thk Commissioxkrs. On this twenty-lourth day of Sejitember, in the year of our Lord one thousand eip;lit hundred and seventy-three, personally eame and appeared before us, the above-named Commissioners, I'REDEIHCK CALVIN MARTIN, of the Town of Woodstock, in the Province of Ontario, wlm Ix'inp; duly sworn, deposeth and saiti : (>. — I will read over the terms of the charge which it is the duty of tl'.e Commission to inquire into, that you may kriow precisely what they are, and then proceed to put you questions. Haviuij; heard the eliarge read, 1 will now ask you first as to tlu; part of the charge relating to the agreement between Sir Hugh Allan and Mr. G. W. McMullen. Do you know .Sir Hugh Allan .^ A. — I do not. k (3.-1)0 J on know Mr. G. W. McMullen? ^ A. — I do. He is a second cousin of mine. Q. — Do you know anything of an agreement between Sir Hugh Allan and Mr. G. W. McMullen, acting for certain United States capit;'.lists, v;herel)y Mr. McMullen agreed to furnish i'unds lor the construction of the Pacific Itailway? A. 1 know that Mr. G. "\V. INhvMullen, with several other capitalists, were forming au a'j;recnient with Sir Hugh Allan to obtain the contract for building the Canadian Pacific Railway. Q. — When did you become accjuainted witli that fact? A. — First through friends or ri'lations of Mr. McMullen's. Q. — About what time? A.~\ tliink it was in 1S71, the latter part of 1871. Q. — Have you any knowledge whether any agreement took place between Sir Hugli Allan and Mr. McMullen and his friends, tending, or with a view, to tlie construction of the Pacifu' Railwa\ ? A. — 1 have no knowledge I'rom Mr. MelMullen himself, except this: — Had a conver- sation with him; I think it was in April, 1872, at my father's house. I spoke to him on that occasion on the subject of the Pacific Railway. The first (juestion I asked liim was al)()ut the route that would be taken; whetiier the Road would not be obstructed liy snow, and as to how they would overcome that dilTu-uUy. He said that he thought that the Itoad would go too far north for that; or north of the sn(nv limit, I think, lie expressed it. I asked him if the ' Globe' newspaper would not be strongly opposed to the building of the Canadian Pacific Railway, it being a Government measure. He said no, not to any extent. (I- A. — I do not. Q. — Von had no other conversation with him? J.— Not at that time? In July, 1S72, I left for Chicago, in order to visit him. I arrived on the 28th July, 1872, and s\Mini a week there, and then went on out to the prairies. I eame back to Chicago, and I think it was on my return I stayed there about a week .»nd a half. One day Mr. McMullen came into the room and said he had received a letter. Holding it in his hand, he said, "This is from Sir Hugh Allan." He read me a part of the letter, and he said, "Sir llugli Al'-n is a tricky fellow and not to be dependccl upon, but I think we have got him so tightly bound by these letters that he dare not go back on us." Q. — Is that the whole of the conversation ? /I.— ^'es. (^.— AV as any allusion made to the part which the (Jovernment were taking, or that the Government had taken any part in that agreement? .1. — No, there was not. (I, — \Vas any allusion made to any members of the Government ? .l.~Tliere was not. There was something said about the elections, but nothing affecting tlu' Government. -Do you know anvthing about the terms of this agreement \ j;i CANADIAN PACIFIC RAILWAY. 237 ISSION lOUKRT GOWAV, ttors stated iu a use ol' Clomnions 'acifie Railway. • thousand eight ,he above-named the Province of ' tl:c Commission oceed to put j on irt ol" the charge ylullen. Do you m and ISTr. G. W. dcMuUcn agreed , were forming an ■ Canadian Pacific )et\veen Sir Ilugli le construction ol' — Had a convcr- I si)ol. — What time in August was the s(>coiul conversation? A. — About the middle of the month. I remaiii'd in Chicago at that time a week, and from Monday till Saturday I was out on the jivairies, and then I returned to Chicago, ;ind left there on the 21st August. Q. — Did Mr. McMullen show you any ])ai)ers? A. — Nothing Init this letter, and he did not hand it to me, but only read me a ])or- tion of it. Q. — Do you remember the contents of it ? A. — I do not know that I do. I did not pay any particular attention to it at tliat time. It was a letter tliat he receivcnl in August when 1 was there, from Sir Hugh Allan. it — Was any person present besides Nir. McMullen and yo.irself? A. — There wai not. 'J'here were otiicr persons in the liouse, but we were alone in tiie drawing-room at the time. It was at his brother's house. Q. — Where did he take the ])aper from ? A. — I think lie had it in his hand when ho came in. 2 II Canada. 238 CORRESPONDENCE RELATIVE TO THE Canada. Q. — Was there anybody witli liim when lie came in ? A. — No; he was alone. He had it open in his hand. Q. — Was he apparently reading it ? A. — Yes. I was in the room when he came in. He then made the remark to me that I have mentioned. And further deponent saith lot, and this his deposition having been read to him, he declares that it contains the truth, persists therein, and hath signed. Sworn and taken on the twenty-lburtli day of September, 1S73, and acknowledged on the twenty-fifth day of said month and year. (Signed) (Signed) FRED. C. INIARTIN. CHARLES DEWEY DAY, Chairman. A POLETTE, JAMES ROBERT GOWAN, Commissioners. i IN THE MATTER OF THE COMMISSION Provivce op On'TARIO, Citi/ of Ottawa. Appointing Chahi.L'S Dewky Da'x, Axtoi.vk Polktti:, and James Robert CrOWA\, Com- missioners to inquire into and report upon the several matters stated in a certain Resolution moved by the Hon. Mr. HuNTiNnrox in the House of Commons on the second day of April, a.d. 1873, relating to the Canadian Pacific Railway. Present: The CoMaissioxEus. On this twenty-sixth day of September, in the year of our Lord One thousand eigh hundred and seventy-three, personally came and appeared bel'ore us, the above-named Commissioners, THOMAS WHITE, junior, of the city of Montreal, who being duly sworiiv deposeth and saith : I am a resident of Montreal. Q. — What is your i)rofession ? A. — PuMisluT. Q.— Pul)lisIuT of what? A. —The ' Montreal Gazette.' (2. — Do you know tlie charges which are recited in the Commission ; are you familiar with them, or shall I read them to you? A. — I know them. Q. — Do you know Sir Ihigli Allan? A— I do. (I— Do you know :Mr. G. W. McMullen? A.-l do. Q. — Have you any knowledge concerning any agreement between Sir Hugh Allan on one side and Mr. G. W. McMullen on the other, representing certain United States capitalists, relating to the construction of llie Canada Pacific Railway? A. — I have no knowledge of any formal agreement. 1 am awar;h the Chairman. Q — You say tliat you know »liat Sir George Cartier, in order to counteract any aMpnhendcd American iulluence, attempted to strengthen the Iiiteroccauic Company ? 2 H 2 Canada. 240 CORRESPONDENCE RELATIVE TO THE If Cahaba, j_ — I am aware of it. Q. — Do you know that Sir George favoured the introduction as corporators in that Company, of some leading Lower Canadians for that purpose? A. — I am aware of it. Q. — Can you mention their names ? A. — The names mentioned at the time were Mr. Tourangeau and Mr. Simard. Mr. Tourangeau was one of the members of the House I'or Quebec East at that time, and Mr. Simard was the member for Quebec Centre. Q. — They were corporators in Mr. Macpherson's Company ? .4.— Yes. » Q. — You know pretty well all the names of the corporators in that Company, and in the Canada I'acific C()mi)aiiy ? A. — Yes. I have looked at them frequently. Q. — Are there any American names mentioned in either of those Companies ? A. — I think not. Q. — Do you remember anything about an original draft of the Canada Pacific Railroad Charter? A. — I tliiiik tliat Mr. Abbott caused tlie original draft of that Charter to be printed before tlic Session. Q. — Before the Session of 1872 there was a draft of the Act of Incorporation of the Canada Pacific Railway Company; there were Americans included in that? A. — There were. Q. — Mr. McMullen's name was in it ? A. — I think so, and Mr. Smith's of Chicago. Q. — That draft was atjaiuloned ? -1. — Yes. I tliink it was never introduced at all into Parliament. (2- — How do you account for its being abandoned ; was it because of Sir Hugh Allan's connection witli Americans, and consequently tliat such an Act would not be acceptable to Parliament? A. — That was, I understood, the reason for its non-presentation. Q. — You tlien understood from Mr. Abbott, who svas i)romoting the Bill wliich is now on the Statute Book, that all connection with the Americans had been abandoned ? A. — Yes, and towards the close of the Session that was the general impression in regard to the Canachi Pacific Comjiany. (2. —Mr. McMuUen must have known tliat at the time? -1. — He must have known it, but I have no knowledge that he did know it. Q. — You say, with respect to the expenditure of money for the elections in Montreal, vou were on the Committee for tlie \Vestern Division? ^.— Yes. Q. — You don't know personally what was the expenditure in Montreal East ? A. — I do not. I think it was very large. Q. — You s!iy the largest item in the expenditure was the payment of canvassers ? A. — Yes, the payment of paid canvassers. That was a plan which was adopted by both sides. Q. — Hotli jiarties had paid canvassers? ^.— Yes. (2.— Was there a very large expenditure for that purjwse, besides other expenses, in Sir George Cartier's election ? A. — There must have been from the number of paid canvassers. I cannot form any estimate of the amount, but it was several tliousand dollars, judging from the whole expenditure that took place. (I — Do you know anything about a sum of $25,000 being raised by the supporters of Mr. Jettc! for his election? A. — Nothing but the rejxjrt prevailing at the time. There was a very large sum raised, and I understood it was $25,000. Q. — To assist Mr. Jette in defeating Sir George Cartier? ^.— Yes. (I — Do you not know that by Hom\; mysterious process a good deal of Sir George Cartier's money went to the other side ? A. — That was the impression at the time. There is no doul)t of our being sold. Men who had i)een working with us were found on the day of the election to be working lor the other party. That was the case in both tlir Eastern and AVestern Divisions, i do not know whether we were outbid or not, but these men were found working on the day of the election on the other side. CANADIAN PACIFIC RAILWAY. 241 lorators in that jinpany, and in lev oxpenscH, \n of Sir George Q. — You liavc read Mr. McMnllen's letters, in which he makes charges of corruption against the Government, and in fact everybody else? A. — I have. Q.—l think he has included you? A.— He has. Q. — Would you be kind enough, with the permission of the Commission, to state exactly your relations with Sir Hugh Allan, and also what were his relations with your nc\vspa])er '! A. — The copyright of ihe 'Gazette' was purchased from Sir Hugh Allan and Mr. Brydgcs by T. and R. Wliite (our firm) in 1870. The plant of the office was leased to us — leased ui-o:" the understanding, or upon the condition, that after a certain expen- diture in the way of salaries the profits siiould be divided, and that we should have the riglit to j)ui'chase within ton years for $1)0,000. Tlie papers were made out, at Mr. Brydges' request, in the name of Sir Hugh Allan; hence our relations in the first instance with Sir Hugh Allan rather than with Mr. Brydges. Alter some time we became anxious to comi)ling that named in the first lease when we first purchased the good-will of the paper. Question by the Commission : Q. — With whom did you see the printed Bill, prepared by Mr. Abbott, that you speak of? ^1.— With Mr. Abbott. Q. — In what form was it? A.- -It was in the usual form, Q. — Where was it printed ? A.— I am not very sure ; I think it was printed in our office. I saw it first in Mr. Abbott's possession. Q. — Did lie give you a copy of it? A. — No he did not, Q. — Do you kno*v of any one having got a copy of it ? A. — I do not. Q. — You have no knowledge as to whether he exhibited it to any one else ? A. — I have not. Oakaoa. ■■'. ? 242 OORllESPONDENCE RELATIVE TO THE Cakada. ]\ir. McMiiUeii, I siii)pose, knew of it. I knew such a Bill was printed, and that tliere were American names in it. Q. — For wliat purpose did Mr. Abbott sliow you the Bill ? A. — Because we were in constant communication with regard to railway matters. Q. — Fen' wliat purpose did you say that he sliowcd it to you ? A. — In tlie ordinary course of conversation; not for any specific purpose. I think I knew almost everything that was going on in connection with railway matters at that time. Q. — The names of the American capitalists were Mr. McMnlIen and Mr. Smith. Were there any other names? A. — No; I don't know of any others. And further deponent saith not, and this his deposition having been i*ead to him he declares tliat it contains the truth, persists therein, and hath signed. Sworn, taken, and acknowledged on this 1 twentv-sixth day of September, 1873. j (Signed) (Signed) TIIOS. WHITE, JuN. CHAIILE;:: DEWEY DAY, Chairman. A. POLE'TE, JAMES liOBERT GOWAN, Commissioners. IN THE MATTER OF THE COMMISSION Provixce of O.vtario,! Cit>/ of Ottawa. ) Appointing Charles Dkwey Day, Axtoine Polette, and James Rouert Gowan, Com- missionei-s to inquire into and report upon the several matters stated in a certain Ri'Kolution moved by the Hon. Mr. Huntix«ton', in the House of Commons, on the second day of April, a.d. 1873, relating to the Canadian Pacific Railway. Present: The Commissioners. On this twenty-sixth day of September, in the year of our Lord, one thousand eight hundred and seventy-three, personally came and appeared before us, the alcove-named Commissioners, Tlie Honourable HECTOR L. LANGEVIN, of the City of Ottawa, being recalled on the application of Sir John A. Macdonald, Avas by permission of the Commission, the second time examined, who being duly sworn, deposeth and saith : Q. — I think you stated in your previous examination that you had taken part in the elections on the Ministerial side in the District of Quebec? .1.-1 did. (t — And that you had raised funds for that purpose ? .1.— Yes. (2— How much did you say you had raised; how much did Sir George Cartier send you ? J.— $32,000 I think. Q. — Have you been a good deal connected with elections in your part of the couutry for many years ? A, — Yes. (2. — D<» you consider that that subscription or tliat expenditure was excessive in your part of the country, as compared with previous expenditures ? .1. — I consider tliat the expenditure at the last elections was greater than at the previous elections, speaking of the expenditure in the elections around. Q. — The expenditure on liotli sides was much larger in 1S72 than in 18{)7? .1. — Yes, much larger. Q. — Which was the most expensive election in your part of the country ? A. — I think it was Quebec Centre. Q. — Who were the candidates? A. — The candidates were Mr. Cauchon and Mr. J. G. Ross, merchant. Q. — Can you form any idea as to the expenditure in that single election ? A. — I uncierstand that the exjienditure was — in fact I know that one of tlie candidates I'XiKMided nearly $l.'"),Of)(), and I understand that on the other side the friends of the otiicr candidate expended nearly !j!30,000. (i. — You say that one of che candidates expended $15,000 ; wl n was that candidate ? . 1 . — Mr. Cauchon. (I. * ft "?; CANADIAN PACIFIC RAILWAY. 243 iiid Mr. Smith. read to him he V'lIITE, JuN. G corse Car tier t of the country (I — IIow (lid you know tliat he expended that amount ? A, — I knew it from liimself, Q. — IIow do you know the expenditure on the other side ? A. — I do not know it from Mr. Ross, but I know it from some of his friends, and it is a matter of public notoriety in Quebec that the expenditure on that side was nearly dou'yie that on Mr. Cauchon's side. Q. — There was a good deal of riot in that election ? A, — Yes, and loss of life also. One man was killed. Perhaps I might be allowed on that point to state this also, thiit none of the money that was entrusted to me for the elections was expended in this election of Quebec Centre. I make this statement specially because it has been stated outside, of course by my ojjponents, that they were not surprised now to find that there had been so much rioting and loss of life in that election of Quebec Centre ; and, of course, I wish it to be well understood that I had no part in that election. Q. — You stood aloof from the election, did you not ? A. — Yes. The fact is, Mr. Cauchon gave me to understand that he was friendly to the administration, and so did the friends of Mr. Ross, on the other side, give me to understand that Mr. Ross was also friendly to us ; and finding therefore that our friends in Quebec Centre were divided, some supporting Mr. Cauchon and others Mr. Ross, I stated to Mr. Cauchon and to Mr. Ross's friends that under the circumstances the Government would take no part in that election, but that they would leave their friends to fight the battle out themselves, and elect what candidate they thought right under the circumstances. Q. — Are you aware of the election contest in the Missisquoi ? A. — Nothing special. Q. — That is not in your district ? A. — It is not in the region I was looking after. Q. — You know nothing of the expenditure there? A. — No, only by hearsay. Q. — Do you know anything ofth(! expenditure in Kamouraska? A. — Not personally, but 1 understand it was very large. Q. — Who were the candidates? A. — The candidates were Mr. Pelletier on the Opposition side, and Mr. Routhier (now Judge Routhier) on the other side. (},. — The expenditure was very large in that County? A. — It was very large. '2. — IIav(! you any moans of judging approximately of the expenditure there ? A. — If I could judge from public rumours, I should suppose that it was between $10,000 and $18,000. Q. — On bo A sides ? ^.— No ; about $8,000 or $0,000 on each side. Q. — Whicli is Mr. Fournier's County ? A. — Bellechasse. Q.—Do you know anything about the expenditure there ? ^1.— No; but I understood it was large on botli sides. The fact is that in all ihe elections the expenditure was very large; much larger than usual. My political friends from the ditt'erent portions of the eastern part of Lower Canada all state that tb.c expenditure against them was such that they could not stand it. This accomits to a very great extent for the loss of some of the Counties there. And further deponent saith not, and this his deposition having been read to mm, lu' lu "lares it contains the truth, persists therein, and hath signed. ISwcni, taken, and acknowledged' (Signed) HECTOR L. LANGEVIN. Canada. on this twenty-sixth of September, 1873 Igea » day V (Signed) CHARLES DEWEY DAY, Chairman. A. POLETTE, JAMES ROBERT GOWAN, Commissioners. 244 CORRESPONDENCE RELATIVE TO THE Canada. PjtovixcK OK Ontario,) Citi/ of Ottawa. j IN THE MATTER OF THE COMMISSION m Appointing CitAiirx-* Dkwky Day, ANTOiNf; Poleitk, and Jamks Riihert (iOwax, Oini- missiontTs to inquire into and report njwn the several matters stated in a certain Resolution moved by the Hon. Mr. HrNTiNOTOX, in the House of Commons, on the second day of April, a.o. 1873, relating to the Canadian Pacific Railway. Present: Tiir; Commipsio.vkrs. On this thirtieth day of September, in the year of our Lord one thousand eiglit hundred and seventy-three, personally came and appeared before us, the above-named Commissioners, The Hon. GEDEON OUIMET, of the City of Quebec, Provincial Secretary and Member of Public Instruction for the Province of Quebec, who being duly sworn, deposeth and saith : Having heard read that portion of the charge contained in the Royal Commission, which reads as follows : " That in anticii)ation of the Legislation of last session, as to the Pacific Railway, an agreement was made between Sir Hugh Allan, acting for himself and certain other Canadian Promoters, and G. VV. McMulIen, acting for certain United States caj)italists, whereby the latter agreed to furnish all tlie funds necessary for the construction of the contem])lated Haihvay, and to give tiie i'ormer a certain per centage of interest, in consi- deration ol' their interest and position, the scheme agreed upon l)eing ostensibly that of a Canadian Company, with Sir Hugh Allan at its head." I have no knowledge of such an arrangement, and I would add that, from communi- cation with Sir (ieorge Etienne Cartier, Sir Hugli Allan, and some of the Directors of the Northern Colonization Railway, I was induced to think the contrary. , I do not know (i. W. McMullen. I do know Sir II. Allan. I have never had any knowledge touching this arrangement, or any other of the kind. I have no knowledge that the (ifovernment entertained the idea of entering into an arrangement of this kind. I say this l)ecause of frequent communications with the late lamented Sir George Cartier, who certainly entertained altogether contrary opinions. I don't know that the Government, or any member of tlie Government, entertained the idea of entering into arrangements witli Americans, or of forming any Company for the purpose of constructing the Pacific Railway in which American capitalists were to be included. Q. — What was the nature of your relations? A. — As a member of the CJovernnient of the Province of Quebec, I took an active part in the policy inaugurated l)y that Government in favour of the construction of railways ^vitllin the limits of our Province, among others the Montreal Northern Colonization llailway. After the formation of tliat Company, the Government of Quebec did me the lioiiour to select me as one of the directors to represent that Government in this Company. Iji'vond my interest as a member of tiie Government, I was much interested in the con- struction of tiiat Railway, as being a proprietor in the City of Montreal, and also as a member in the Local Legislature for tlie County of Two Mountains, through which tlie contemplated Railway was to pass. I also took an active part with my friends in endeavouring to induce tlie citizens of Montreal to subscriiie the million of dollars which was asked for that great enterprise. The question of a depot within or near the limits of tlie City of Montreal was considered one of vital importance for the town as well as for the province of Quebec. With a view to securing the success of the Railway, we addressed ourselves to Sir Hugh Allan in his capacity as a great financier and as an eminent man in our province, in the hope to secure a more easy and certain result. It was thus, when ♦ he Pacific Railway came up as an important political question in the Confederation, that 1 made efforts with my friends with a view to have this gretit Railway united with the Northern Colonization Railway, that it might pass through the Province of Quebec and V:.,y. iin depot within or near the City of Montreal; and it was then that I worked to favour the Pacific Railway, the object being to secure the success of the Northern Colo- nization Railway. My communications with Sir Hugh Allan were to this effect, and it was equally with the same olvjects in view that my name appeared as one of the provi- sional Directors in the Canada Pacific Railways Act of 1872 ; and concerning the apjiear- ance of my name in the Act of Incorjioration, I may say that I only knew of its being there after the Bill had passed through the committee, and, as I said IjHjfore, I was suffi- ciently favourable to the enterprise not to make any objection, and I made none. This CANADIAN PACIFIC RAILWAY. 346 IISSION IT Go\7A>r, Com- ated ill a oiTtaiii ol' Commons, on [ic Uailway. tlioiisaiul fight ;he above-named ary and Member sworn, deposeth yal Commission, cific Railway, an lid certain other States cajjitalists, nstruction ol'tlie interest, in eonsi- tensibly that ol' a from communi- ; Directors ol' the ther of the kind, entering into an ^ns witli the late ary opinions. , entertained the Jompany for the ilists were to Ijo ok an active part :tion of railways ern Colonization lebec did me the in this Company, ested in the eon- 1, and also as a rough which the 1 my friends in of dollars which lear the limits of n as well as for ray, we addressed an eminent man t was thus, when infederation, that united with the c of Quebec and that I worked to Northern Colo- his effect, and it ne of the provi- ning the appear- new of its being ifore, I was sufl'i- lade none. This Bill, which is .^'ith Vict., chap. 73, was discussed, I think, in tlie month of May, 1872, Canada. and I was then in Ottawa, not only in the interests of the Montreal Northern Coloniza- tion Coinpany, but for the purpose of meeting my colleagues in the Quebec Government, the Honourable Messre. Chauveau, Beaubien, Archanibault, and Irvine. We had at the time several meetings of the Executive of Quebec, at Hull. This, then, was the interest which I had in this question of the Pacific Railway, an interest altogether relative to tlu; Northern Colonization Railway. In a conversation which I had with Sir Hugh Allan in April or May, 1872, that gentleman asked me to neglect nothing in the interests oi the Northern Colonization Railway. lie also spoke to me in the interests of the Cor.serva- tive party, to which he attributed his commercial prosperity in a great measure, and did not hide from me the fact that that i)arty had already made efforts to maintain his Steam- ship Company, and that he was convinced the party had ruade sacrifices in his favour, or words to that effect. I did not fail to tell him that I was doubly interested myself in the success of the Northern Colonization Railway, of which he was Pres'ueiit, as well Irom being a member of the Government of Quebec, as Irom being mehiber of the County of Two Mountains, and that I should make efforts to have this line traverse the county that I represented. The aid which I gave to Sir Hugh Allan relative to the construction of the Pacific Railway at Ottawa or elsewhere was of a friendly character as a citizen who was inter- ested in this great enterprise, and interested more directly, as I have already explained, in the construction of the Northern Colonization Railway. Sir Hugh Allan, nor anyone else, ever engaged my service as advocate, nor in my character as Attorney-General of the Province of Quebec (a charge which I have already denied) in the interests of the Pacific Railway. I procured the aid which I have already spoken of to Sir Hugh Allan because I wa i in communication with Sir Hugh Allan as a Director of the Northern Colonization Rail- way. I may add that Sir Hugh Allan ai)peared to honour me with his confidence. I endeavoured to induce my friends from the Province of Quebec who were members of the House of Commons not to lose sight of the interests of our Province, and to favour the Northern Colonization Railway, and if that influence was favourable to the Pacific Railway, with a view to its union with the Northern Colonization Railway, I induced them to give it, but I did not, properly speaking, give any aid to the Pacific Railway as a question apart from the Northern Colonization Railway. I desire also to say that if I had not been interested in the Northern Colonization Railway I would have liad nothing to do with the Pacific, because I was not a member of the House of Commons. For the rest, I cannot see what influence I could have outside of that which I have just mentioned. Having had communication of letter which has been published in the newspapers, over the name of G. W. McMuUen, and in which the following appears : " ^6,0U0 to Attorney- " (reneral Quimet for aid rendered at Ottawa," as having been paid by Sir Hugh Allan, and being asked for any ex])lanations on this point, I say in reply: — Having never been asked by the Company, nor by any i)erson whatever in its interest, nor by any person for for my services as a lawyer or otherAvise, and it being impossible that I should be engaged by the Company in any quality as Attorney-General, my services as such being of no assistance either in the obtaining of the Charter or the contract, having acted only as a friend to the enterprise, as a citizen desiring it to come to a good end, I affirm that I never received the sum of $6,000 in question, nor any sum whatever. I affirm, moreover, that I never had, either directly or indirectly, either from the Company or from any friends of the enterprise, any promise of money, or of anything else. I never received any sum of money from Sir II. Allan, nor from anyone else, either directly or indirectly, as I have already said. I was largely interested myself in the Northern Colonization Railway Company and road. I have in its interest disbursed considerable sums, and undergone much fatigue, but, God be thanked, without recom- pense, or hope of recompense, hoping only that to the Province of Quebec may accrue the benefits which will flow from the construction of the Northern Colonization JJailway. I do not know if Sir Hugh Allan paid $4,090 to the ' Minerve,' nor of the other sums mentioned by McMullen in his letter as having been paid by Sir Hugh Allan. 1 do not believe a word of them or of the other charges made by him. I do not know whether the Government or any member of the Government had any knowledge of the negotiations spoken of before between Sir H. Allan and Mr. McMullen, nor do I know if Sir Hugh Allan had any negotiations with Mr. McMullen. The second part of the charges contained in the Royal Commission is as follows; " That subsequently an understanding was come to between the Government, Sir Hugh " Allan, and Mr. Abbott, one of the members of the Honourable House of Commons oi" 2 I 2-10 ("OnRESPONDEXCE RELATIVE TO THE Oanada. '■ Caiiadn, that Sir Muf^li Allan and liis IViciids slioiild advaiue a lar^c sum of money for " the puipost- of aidini; the eh'ctioiis of Ministers and their suj)]K)rters at the en^uin^ " {general elections, and that he and his friends should receive the contract for the ron- " struct ion of tlie Kaihvay." 1 declare that I know nothinu: of it. I could say, however, that I had some conversa- tion with Sir (ieor^e ('artier in June, July, and August, 1H72, in which lie spoke to me of Sir IIuji;h Allan, the Allan Company, the I'acilic Railway, and the Northern Colonization Uailway. Sir Ceori^e rehutted the idea of any connection of American capitalists with the Pacilic Railway, and said that he never would consent to such a thinj;, and that lie thouj^ht that the roads should be constructed without the aid of American capitalists. While expressing his appreciation of tlic merits of Sir Hugh Allan, Sir (jfoorge Cartier did not appear to me to be on very I'riendly terms with liim — tliat is to say, on terms of personal friendsliip. Nevertheless, he thought that Sir Hugh Allan, from liis jKJsition, would he of great assistance to the Pacific Railway. He told me that he wished to see the amalgamation of the Macplierson and Allan Companies, and that he liad been unjnsty reproached with opposition to the Northern Colonization Railway in favour of the Grand Trunk Railway. I remarked to him that I ri'garded it as unfortunate that his Govern- ment had not settled this (piestion of the contract of the Pacific Railway before the elections, because, I added, that this question would militate against him in the Province of Qnebi'c, and particularly in Montreal East. 1 said to him also that Sir Hugh Allan had to'd m»' that he owed his commercial jjrosperity in a great measure to the Con- servative ])arty, and that I thought that Sir Hugh or his Company would aid him by influence or otherwise in his election. Sir (ieorge thereupon said that lie could not entertain much hope that Sir Hugh Allan or his Company, meaning the Montreal Ocean Steamship Company, would come to his assistance, but as for himself (Sir George) he had several times ])ut his portfolio in danger to malniiJn or obtain the subsidy for the Allan ('omj)any. Sir George told me this in that energetic language which lie ordinarily used, and which is well known to those who were familiar with him. I had the honour to occupy myself in the election of Sir George at the last elections, and, notwithstanding that liis friends urged him to let us make his election on the basis of the railway policy, and particularly the Pacific, he would not consent, saying that he would conduct his election on his own jiersonal merits. I have not any knowledge that Sir Hugh Allan advanced a sum of moiujy to aid in the I'lection of Ministers and their sujjporters. 1 wei>', a few times to Sir George's Central Election Committee, but 1 know nothing of the distribution of the money. Of course I know fi'om peisinial experience that it was necessary to spend money on that as on other elections. No memhers of the Government ever told me that Sir H, Allan had advanced money for the elections, nor did Sir H. Allan ever tell me. This conversation with Sir George Ca"tier. in reference to the road that I have men- tioned, took place at several intervals, aud I tiiiiik that the last conversation 1 had with him was two or three days liefore the polling in the Eastern Division of Montreal, iu which Sir (ieorge was a candidate. Q. — Do yon know the date on which the polling took place? A. — Late in the month of August. lieing asked if I can give any ex])lanation, or if I have any idea why my nanii! is men- tionetl in McMullen's letter, as having received ^(i,OOU, I declare that I have no idea how my name came to be mentioned. The charge is wholly false. And further deponent saith not, and this his deposition having been read to him, he declares that it contains the truth, persists therein, and hath signed. Sworn and taken and acknowledged on the | gj ^^^^j. GEDEON OUIMET. thirtieth day oi September, 1873. J v » / (Signed) CHARLES DEWEY DAY, Chairman. A. POLETTE, JAMES ROBERT GOWAN, Commissioners. CANADIAN PACIFIC RAILWAY. 247 aJvancisd money LIST OF EXHIBITS. A. " Sealed Packet " addressed " Hon. Henry Starnes," and subbcribed ''Sir Hugh Allan," "G. W. McMullcn." A 1. Letter IVom Sir Hugh Allan to Hon. J. J. (). Abbott, consenting to the opening of the sealiHl packet, dated Montreal, Septeml)er 2, IH73. B. Letter I'rom James lieatty, jun., to Sir F. Hincks, dated July 17, 1S71. C. Reply of Sir Francis Hincks, datod July 20, 1871. D. Letter from James Beatty, jun., to Sir F. Hincks, dated July 24, 1871. E. Reply of Sir F. Hincks. dated July 26, 1871. F. Letter of Hon. D. L. Macpherson to 'Mail,' dated July 8, 1873, containing his reply to Sir Hugh Allan. G. Telegram from Sir J. A. Macdonald to Sir G. E. Cartier, dated July 20, 1872. II. Telegram from Sir G. E. Cartier to Sir J. A. Macdonald, dated July ,'{1, 1872. I. Telegram from Sir Hugh Allan to Sir J. A. Macdonald, dated July 31, 1872. J. Cojiies of a portion of correspondence between Sir II. Allan and C. M. Smith, G. VV. McMullen, and George VV. Cass. K, Copy of " First Contract " between Sir Hugh Allan and his American associates, dated December 23, 1871. L. Copy of "Supplemental Contract" between same parties, dated March 2S, 1872. M. Copy of acknowledgment, dated April 1, ls7'2, from Jay Cooke and Co., to G. W. McMullen, of his draft on various parties, to amoiuit of !3;.')0,00(), setting out drafts numbered 1 and 2, &c. ; also of receipt by G. VV. McMullen, of fees for Legislation. N. Cheque by Sir Hugh Allan, on Merchants' Bank, for $17,500, in favour of Hon. Henry Starnes, dated February 20, 1873, contained in "Envelope No. 2," portion of contents of A, or " Sealed Packet." 0. Memo, between G. W. McMullen and Sir Hugh Allan, February 2(5, 1873, contained in small envelope addressed " Hon. Henry Starnes," portion of contents of A, or " Sealed Packet." P. Same as "K." Q. Certified copy of Letter from Sir G. E. Cartier to Sir Hugh Allan, July 30, 1872. U. Certified copy of Letter from Sir G. E. Cartier to Sir Hugh Allan, July .'JO, 1872. S. Receipt for House Fees re Incorporation of Canada Improvement Company, June 1, 1872. T. Receipt for House Fees ?c Incorporation of Canada Pacific Railway Company, June 1, 1872. U. Letter from G. W. McMullen to Hon. J. J. C. Abbott, dated February 2.j, 1873. Canada. read to him, he EXHIBITS. A. COPIES OF LETTERS AND TELEGRAMS ENCLOSED IN ENVELOPE No. 1. No. 1 Telegram. Montreal, December 8, 1871. I have seen Sir Francis to-day. He says they have determined to advertise, and that it is of no use to visit Ottawa at present. I write you l)y mail. (Signed) HUGH ALLAN. C. M. Smith, Banker. Letter No. 2. Sir HroH Allan to Mr. Smith, dated London, 4th November, 1871, will be found at jKige 52. Telegram No. 3. Sir HuQU Allan to Mr. Smith, dated Montreal, December 7, 1871, printed at page 52. •> -■. .,( • 2 12 !| l-'E S-i- It' ii 248 Canada. CORRESPONDENCE RELATIVE TO THE Telegram No. 4. Montreal, Derembcr 0, 1871. I arrived here this morning and will be glad 'o sec you as soon as convenient. (Signed) HUGH ALLAN. C. Mather Smith, Banker. Letter No. 5. Sir Hion Allan to Mr. Smith, dated Montreal, December 8, 1871, printed at page f).'}. No. 6 Letter. Sir Hugh Allan to Mr. McMullen, dated Montreal, December 29, 1871, printed iit page 53. No, 7 Letter. Sir Iluan Allan to Mr. McMullen, dated Montreal, January 1, 1872, printed at page 53. No. 7. Letter A. Deak Sir, Montreal, October 6, 1871. I enclose copy of the communication sent to Sir John. Everything looks favour- able at present at Ottawa. I sail Irom Quebec to-morrow. Yours truly, (Signed) HUGH ALLAN. C. M. Smith, Esq., of Chicago, Metropolitan Hotel, New York. No. 7. Telegram (b), dated Father Point, October 8, 1871, printed on page 52. Letter No. 8. Sir Hugh Allan to Messrs. Smith and McMullen, dated Montreal, January 24, 1872, printed on page 53. Letter No. 9. Sir Hugh Allan to Mr. McMullen, dated Montreal, IVb. 5, 1872, printed at page 54, No. 9 Telegram (a). Montreal, Feb. 16, 1872. Why is it that McMullen does not answer my letter ? I will be in Detroit on Wednes- day evening, can I meet you there ? (Signed) HUGH ALLAN. Mather Smith. Telegram No. 9 (b). Montreal, Feb. 19, 1872. ! I think it is the Douglas Hotel, at Detroit. Don't fail to come. (Signed) HUGH ALLAN. C.M.Smith. (•ANADTAN PACIFIO RAILWAY. 240 Letter No. 10. Canada Sir Hioii Allan to Mr. Smith, elated Toronto, Feb. 23, 1872, printed at pogo 51. 871, printed at 1871, printed ut 1872, printed at No. 11 Letter. Sir Iluon Arj.AN to Mr. Smith, dated Toronto, Feb. 24, 1872, printed at page r)4. No. 12 Letter. Sir ITiGn Allan to Mr. Smith, dated Montreal, Feb. 28, 1872, printed at page 54. iVo 13. Letter. Sir Hran Allan to Mr. McMullen, dated Montreal, 4th March, 1872, printed at jKige .'')4. No. 13. Letter (a). Dear Mr. McMullen, Montreal, April 1.'), 1872. TIu; enclosed telegram from Mr. Cass reached me this morning. He wishes you to go to New York, hut I wish to see you before you go. I leave here on ^Vednt>sday morning, and will see you on Thursday morning. You will be able to leave for New York on Thursday evening if you desire to do so. Yours truly, (Signed) HUGH ALLAN. anuary 24, 1872, 872, printed at No. 13. Letter (A). Sir Iluon Allan to Mr. McMullen, dated Montreal, April 16, 1872, printed at page 55. No. 14. Letter. Sir Hugh Allan to Mr. McMullen, dated Montreal, June 12, 1872, printed at page 55. Letter No. 15. Sir HioH Allan to Mr. McMullen, dated Montreal, 10th July, 1872, printed at page 55. Letter No. 16. Sir Hugh Allan to Mr. McMullen, dated Montreal, 6th August, 1872, printed at page 58. IGH ALLAN. ■' ' No. 17 Letter. Sir Hugh Allan to Mr. McMullen, dated Montreal, IGth September, 1872, printed at page 58. No. 1 8 Letter. Sir Hugh Allan to Mr. McMullen, dated Montreal, 24th October, 1872,' printed at page 63. Canada. 250 CORRESPONDENCE ET^LATIVE TO THE Letter No. 19. Dkar Mu. McMullk.v, Montreal, Uth November, 1872. You really know as much about the Pacific Railroad contract as 1 do, and that is Hot much. I am assured that the Government have resolved to form a new C/ompany, but under what conditions or who the parties will be I am ignorant. It is said that the whole matter will be arranged by the end of the month, and if so, we will soon know it. I have not changed my views of what it ought to be. Yours truly, G.VV. McMullen., Ebti., Pictou, Ont. (Signed) IIUGII ALLAN. Note.— For residue of « Sealed Packet " see " N " and " O." A 1. Letter from Sir Hugh Allan to Hon. J. J. C. Abbott. Dear Sik, Montreal, 2nd September, 1873. Referring to the parcel of pai)ers deposited with Jlr. Starni>s, and which will no doubt be produced bel'ore the Royal Commission, I authorize you on my behalf, to con- sent that it shall be opened by the Commissioners. Rut I olyect to any of the papers in it being used or published unless they are found to contain evidence which can be legally or judicially used in the case. Yours truly, Hon. J. J. C. Ablwtt. (Signed) IIUGU ALLAN. B. Letter from James Bcatty, jun., to Sir F. Ilincks, dated 17th July, 1871. (For this letter see deposition of Sir F. Ilincks, page 100.) C. Reply of Sir F. Ilincks, dated July 20, 1871. (For this letter sec de^wsition of Sir F. Hincks, pa:' iOl.) D. Letter from James Beatty, jun., to Sir Francis Ilincks, dated July 21, 1871. (For this letter see deposition of Sir F. Hincks, page 101.) E. Reply of Sir Francis Ilincks, dated 2Gth July, 1871. (For this letter see deposition of Sir F. Hincks, page 102.) P. Letter of Hon. D. L. Macpherson to ' Mail,' dated 8tli July, 1873, containing his reply to Sir Hugh Allan. (For this letter see deposition of Hon. D. L. Maci)herson, page 111.) [;:^s Tdeijram from Sir John A. Micdonald to Sir Geonje E. Cartier. (Private.) July 26th, 1872. Have seen Macpherson. He has no personal ambition, but cannot, in justice to Ontario, concede any preference to Quebec in the matter of the P., or in any other particular. He GH ALLAN. CANADIAN PACIFIC RAILWAY. 251 says the question about the P. sliould be left to the Board. Under these circumstances I authorize you to assure Allan that tlie power of tlie Ciovernnieut will he exercised to secure him the jiosition of P. The other teinis to be as agreed on between Macpherson and Abbott. The whole matter to be k''})t quiet until after the elections; then t'le two [gentlemen to meet the Privy Council at Ottawa, and settle the terms of a provisional agreement. This is tl\e only practicable solution of the dilTiculty, and should be accepted at once by Allan. Answer. (Signed) JOHN A. MACDONALD. Sir George Cartier, Ottawa. Canad,\. JGU ALLAN. 1871. (For this i)osition of Sir V, H. TcJecjram from Sir G. F. Cartier to Sir John A. Macdonald. Kingston, 31st July, 1872. (By Telegraph from Montreal.) Rave seen Sir Hugh. lie withdraws letter written you since you make ol:jcction to it, .ind iellcs ^or basis of arrangement on your telegram to me, of wliich I gave liim cojiy. Alatters go on well here. Hope they are same with you. Don't think it is necessary lor you to come down here Saturday. I want to be out of town on Sunday, but will remain liere if you specially desire to see mc. Answer. (Signed) G. E. CARTIER. To Sir John A. Macdonald. Tele(jram from Sir Hwih Allan to Sir J. A. }[aciloHnld. Kingston, July ?,\, 1872. (By Telegrapli I'rom Montreal.) I have seen Sir George Cartier to-day, you may return my letter or regard it as waste jiapor, it was not inti-nded as anytliing odicial. Your telegram to Sir George is tlie basis or our agreement, whicli I have no doulit you will approve of. lie juirposcs to go out of town on Saturday afternoon, and I am persuaded his liealth will be benefited thereby, (Signed) HUGH ALLAN. To Sir John A. Macdonald. 1871. (For this ,er see deposition J. Copies of a portion of Correspondence hctwcen Sir Ihnjh Allan and Charles M. Sr.iith, lleorge W. McMidkn, and George W. Caf, 1871, printed at page 53. No. 7 Letter. Sir Hugh Au.AN' to Mr. McMilmo.v, dated Montreal, January 1, 18":?, printed at page 53. jYo. 8 Letter. Sir Hugh Allan to Messrs. Smith and ISIcMri.ijiN', dated Montreal, January 21, 1872, printed at page 53. No. Letter. Sir Iluon Ai.i.ax to Mr. McMui.len, dated Montreal, Feljnnry 5, 1871, printed at page 54. » No. 10 Letter. Di'AU Sir Toronto, February 21, 1S72. ' "^Sinco writing to you yesterday I have seen Mr. D. L. Macphcrson, ol Toronto, who is member of the Dominion Senate, and ratiier an important person to gain over to our side He has been applied to by our opi)onents, and uses tliat as a lever by which to obtain better terms from us. He insists on getting !?25(),00(» of stock, and threatens opposition if he does not get it. You will remenilier he is one of those 1 proposed us a 1\viTl do the best 1 can, but I think that IMcMulleii,you an. low api>roaching a J us. I have been ju iufornied «>1 the progrcs.s and jjosition of affairs, Lence I have not communieatcd with you on the subject {!.vnai)a. as often as I otherwise would have done. No doubt he inibrmed yon that, thinking as I liad tixkcn uj) the project, there must he something very good in it — a very ibrmidable opposition was organized in Toronto, which, lor want of better, took as their cry, " No foreign influence'" — "No Yankee dictation" — "No Northern Pacific to choke of!' our Canadian Pacific," and others equally sensil^le. So much effect, however, was ))roduced b>th in and out of Parliament by these cries and the agitation consequent on them, that after consulting Mr. McMuUen I was forced unwillingly to droj) ostensibly from our organization every American name and to put in reliable p<'ople on this side in place of them. It will be ai)parent to you tiiat at this point Mr. McMullen and I differed a little as to the means to be adopted to influence tht^ Government itself. Two opposinj^ Companies desiring to build the Railroad were formed, the one from Ontario having tlie greatest number of names, while that from Quebec had the greatest political power. Mr. McMullen was desirous of securing the inferior members of the Government, and entered into engagements of which 1 did not ai)prove, as I thought it only a waste of powder and shot. On a calm review of the situation 1 satisfied myself that the whole decision o!" the question must ultimately be in the iiands of one man, and that man was Sir George K. Cartier, the leader and chief of tin; I'Veiieh party. This ])arty lias ludd the balance of power between the other factions. It has sustained and kept in offu-e and existence the entire Government for the last five years. It consists of forty-fivi; men who have followed Cartier, and voted in a solid phalanx for all his measures. The (iovern- ment majority in Parliament being generally less than forty-five, it follows that the dofcc'ion of one-half or two-thirds would at any time put the (iovernment out of offu-e. Jt was therefore evident that some means must be adopted to bring the influence ot this compact body of members to bear in our favour, and as I soon made up my mind what was the best course to pursue, I did not lose a moment in following it uj). A l^ailroad from Montreal to Ottawa through the I'reneh country, north of the Ottawa river, has long been desired by the rrench inhabitants, but Cartier, who is the salaritd solicitor to the Grand Trunk Railroad, to which this would be an opposition, lias always interposed difficulties, and i)y his influence prevented it being built. The same reason made liitn desirous of giving the contract for the Canadian Pijcific into the hands of parlies connected with tht; Grand Trunk Railroad, and to this end he fanned the fiame of opposition to us Mut 1 saw in this Firiwh Railroad .scheme, and in the near approach of the general election, when Cartier as well as others had to go to their constituents for re-election, a sure means of attaining my object, especially as 1 purposed to carry it through to the terminus of the Pacific. The plans 1 propose are in themselves the Ix'st for the iiitercsts of the Dominion, and in urging them on the jjublic 1 am really doing a most patriotic acdon. Rut even in that view, means must be used to influence the public, and 1 emjdoyed several young French lawyers to write it up for their own news- papers. I suljscril)ed a controlling influence in the stock, and proceeded to sul)sidi/e the newspapers themselves, both editors and projirietors. I went to the country through which the road would pass, and called on many of tlie inhabitants. I visited the jniests and made friends of them, and I employed agents to go amongst the princiiial people and talk it up. I then began to hold public meetings, and attended to them inyself, making frequent speeches in rrench to them, showing thi;m where their true interests lay. The scheme at once became popular, and I formed ii committee to influence the members of the Legislature. This suceertled so well thot in a short time I had 27 out of the 4') oil wliom I could rely, and the electors of the ward in this city which (!artier himself represents, notified him that unless the contract for the Pacific Railroad was given in the interests of Lowit Canada he need not present himself '"or re-election. He did not believe this, but when he came here and met his constituents he found to his surprise that their determination was unchangi'able. lie then agreed to give the contract as required in this way, that there would be 17 Provisional Directors, of which Ontario wouhl \m\c. H and "■.•> i) tlierel)y giving us the control. We at once proceeded to organize the Comjmny (our Swtion), and they named me the President. 1). Mclnnes of llamilton. Vice-Prtsident; K. L. de Bidlefeuille, Secretary ; and the Honourable J. ,1. C. .\bbott, Legal AdvLser. We liave advertised that the books Ibr subscription of stock will be opened IStli .luly at the different j)laee9 nnnunl in the Act, and we have iiotifieation in the construction of the Railway. Whatever skirmishing may be dune by way of talk, they can hardly have an idea thai y"u will prove recreant No 14 Letter. Sir Iluon Allan to Mr. McMvllen, dated Montreal, July 16, 1872, printed at page 55, CANADIAN PACIFIC RAILWAY. 255 )sciiiitioiis must ubscribing niiif- ty may not. sub- if you Avill send Jay Cooke and m Bank in New ill pass till tlio awarded us will nd me, as early [ Co.'s certificate ) take the whole lod to part with ext week, if you I wish to see me, lit without great d, but I think it GH ALLAN. of the stock you H. A. 1872, printed at 1872, printed at m y.age 57. 1872, printed at 872, nriuted at Nov. 6, 1872. ne cousiderttl)ly, he fact that the I Imve of course 1 know whether debar our Asso- iver skirmishiuf; I prove recreant to your business associates in an arrangement mainly of their own suggestion (I mean the Government who first requested you to write to Chicago). However much they may be beset with political jn'oblems, I do noi, believe they could get, in any other way, so diffi- cult a one on their hands as they could by taking such a course. Mr. Ogden and party are now back from Puget Sound, and I shall take an early opportunity of meeting them. I should like any possible positive information, and in case the affair goes so that our Association either directly or through you, cannot handle it, it would be well to know it. But as the Government could not exj)ect you to go into it and leave the others out entirely, I should think you could have it arranged as we have several times talked, i.e. the stock held by you subject to private arrangement witii the others. And what- ever street rumour may say of public opinion, I should judge that this would do all that is needed. Please let me hear irom you. Truly yours. Sir Hugh Allan, Montreal. (Signed) G. W. MoMULLEN. OAl'AOAk Lbifer Xo. 20. Sir IIuou Allan to Mr. McMullkn, dated Montreal, November 11, 1872, printed at page 250. K. Copi/ of l.st Contract between Sir lltujli Allan and his American Associates. New York, Dec. 23, 1871. The undersigned hercJjy agree to associate themselves together for the following pur- |ios(«i, to wit ; First. — To form the Canadian Pacific Railway ('ompany under a Charter substan- tially aa agreed upon, and sulyect to such modifications or changes as shall be bereafti-r mutually assented to, which (Jharter is to bo ])rocurod by Mcssre. Sir Hugh Allan, Charles M. Smith and Geo. VV. McMullon from tlie Parliament of Canada at its approaching Session. Second. — Under and by authority oi' sfiid Charter the undersigned propose to construct the said Railway. For these purposes, we, the undersigned, each for himself and not for the others agree to subscribe in all the sum of ten millions of dollars to the capital stock of the said Canada Pacific Railroad Company as follows : — The various names subscribed to this contract at the end of it except Allan, C. M. Smith and McMulien, and such others as they may associate with them shall subscribe five millions five hundred thousand dollars (!?r>,r»00,(i()0) and Sir Hugh Allan, Chas. M. Smitii and George W. McMullen, and such others as they may associate with them, sha'; subscribe four millions five hundred thousand dollars (^4,500,000) and it is further agr»ed that the above-named parties who shall subscribe five millions five hundred thou and dollars, shall pay in the sum of ten per centum on the whole ten millions of dol'ars of stock to be subscribed as aforesaid, into the Banking House of Jay Cooke and Co, mNew Yorl< city, to the credit of th«; Canada Pacific Railway Com])any upon its orgai i/ation to be used for the construction of the said railway and for such other j)urrjses as the Directors of said Company hereafter to be elected shall determine, and it 'j also agreed that on the or:;anization of said Railway Co., such a By-law shall be adojjt d as will pro- hibit any further assessments on the stock beyond the ten jwr cent, paid a', before specified unless ordered by a vote of at least nine-tentha (~) of all the outstar Jing stock of the Company at some regular or special shareholders meeting. It is further agreed by the parties hereto, that they shall associate tlemselves together as the Canada Land aiui Improvement Co. which it is pro])osed shall be hereafter iucor- l)orated by the Parliament of Canada, for the purpose of constructing the said Railway, and for the purchase and sale of lands, arul lor other needed objects, and that their interests in the said Land and Improvement V.q. shall be in the same proportions as their usual subscriptions to the railway stock, aforesaid, bear to the whole ten millions of dollars ($10,000,000) subscribed, and it is agreed that the contracts for building any or all of the various Sections of the Canada Pacific Railway, when let, shall l)e let to the saiu Canada Land and Improvement Co. at fair prices, and to the Canada Land and Imj)rove- meiit Comjmny shall operate and be allowed the use of the said railway, during the iwriod 2 K 2 256 CORRESPONDENCE RELATIVE TO THE |-f» li Oaxaoa. of its construction, without charge ♦ neri'lor, except tlic expense of keeping the same in good order and repair at tlieir own rest, during sucli use and control of said railway. It is also agreed that the first working capital of the said Canada Land and Improvement Company, sliall be tlie aforessxid one million of dollars, to be paid in on the Railway Stock before-named, less any amounts previously expended by order of the Board of Directors, and shall also consist of such sums or profits as shall thereafter be received by it, from time to time from said Railway Company for construction and for work done in excess oi' the cost of such work, or so miuh thereof as may be necessary for th(! successful prosecution of said work. And it is expressly agreed that the first prolits arising from the contracts above referred to, shall l)e used to reimburse (parties subscribing for $5,500,000) and their associates for the one inillion of dollars paid by them as a ten per cent, instal- ment on tlie Railway Stock aforesaid, with interest thereon at the rate of seven per cent, per annum. And it is furthermore agreed that all, or at least a majority of all the stock or interest ill both the (Canada Pacific Railway Company and the Canada Land and Improvement Company, held by each of the undersigned, shall be placed iu the hands of a trustee (wiio is to l)e selected by the undersigned), to i)e held by him during the time occupied in building the said railway, or until two-thirds of the owners or representatives of said stock, so held by said Trustees, shall elect to terminate said trust, and the said stock shall be votetl on by the said Trustee or his successor, meanwhile, at all the meetings of stock- Iioldcrs, iis he shall be directed to voU; by the owners of a majority thereof. It is hereby agreed that after the one million of dollars heretofore mentioned, with the specified iiiti'iest thereon, has been refunded to the parties advancing it, then all divisible profits of both the Canada Pacific Railway Comjiany and the Canada Land and Improvement Canipany, shall be divided among the stock-holders of each Company in proportion to tin- shares they severally hold. It is hereby understood that the names " Canada Pacific Railway Co." and " Canada Land " and Improvement CIo." are used for the sake of convenience, and in case diilerent names shall 1h; adopted by the Canadian Parliament, or in case they shall fail to authorize any Kiicli I^iid and Imjirovement Co., then this agreement shall be understood to relate to ^ lull railway as shall be authorized to be constructed in accordance with the provisions liereol aiross Rritish Territory to the Pacific Ocean, (jiulf ol' Georgia, or Straits of Fuca, and to the Iiiiprovemcnt Company or Association jn-oposed to be organized to construct ihc same, which may be organized under and in accordance with the laws of any of the States comprising the United States, and its terms shall govern the parties hereto in iil;ition to the same, in the same niaiiner as if the names above-mentioned had been used in the said projiosed Charters for said projioscd organizations. It is understood that no moneys in excess of one hundred thousand dollara shall be drawn from the funds of the proposed Canada Pacific Haihvay Company until the actual <;)nstructi()n of the road begins unless by consent of the owners of or subscribers to at li;ist two-thirds of the ten millions of dollars of stock to be subscribed iu accordance witli the terms of this contract. The essential conditions of the Charter referred to are a subsidy of fifteen thousand dollars (5;1"),()00) jier mile for each and every mile of Road constructed, payable on the t'onipletion of secticns ol twenty miles, and a grant of lands ecjual to twenty thousand acres ]ier mile from all the Road except for Fort (iarry East, on the North Shore of Lake Superior to a junction with the section jirojiosed to be built from Lake Nipissing to the SaultSte. Marie on which (he grant of laiuis is to be equal to twenty-five thousand acres per mile. The only forl'eiture in case of failure to complete the entire road within the time specified is to be the; right to finish the uncompleted portions, the payments lieing absolute on the cmnpletion of each section of twenty miles. The amounts pro})ose(l to i)e subscribed by the various jiartii-s to this contract are as follows: J. Cooke and Co., )s;[,lH(0,00() ; 1>. McLaren, $')()0,000; Wm. 13. Ogden, !i-(;:i7,rj(»(t; .1. Gregory Smith. $500,000; G. W . Cass, .*G;}7,r)()0 ; II. R. Pay son, $175,000; Thus. A. Scott, $506,O0() ; F. E. Cauda, $175,000; C. .1 . Cauda, $150,000; R D. Rice, \\ . (i. largo, Frederick liillings, Wm. Windowa, B. P. (.'Iieiiey, A. II. Harney and Thomas 11. ('.iwlield, or so many of them as become jiarties to this agreement, in all $1,225,000. ."^ir Hugh Allan, Charles M. Smith, and (jieorge W. McMuUen for themselves and others, $4,500,000. iSi^ned) .1. Cooke and Co., one million of dollars. \\ Ml. R. Ogden, six hundred and thirty-seven thousand five hundred dollars, (i. \V. Cass, six hundred and thirty-seven thousand five hundred dollars. .i. Gregory Smith, five hundred thousand dollars. I). .McLaren, five hundred thousand dollars. ilK:-: ir; ng the same in id railway, li Improvement Ml the Railway r the Board of • be received l)y )r work done in )r the successful irising from the for $r),r)Oo,()oo) per cent, instal- [■ seven per cent. stock or interest \ Improvement f a trustee (wiio me occupied in ntatives of said said stock shall jetings of stock- if. It is hereby h the specified divisible profits d Improvement in proportion to 1 " C!anada Land dillerent names to authorize any aod to relate to I) the provisions Straits of Fuca, !ed to construct vs of any of the )arties hereto in I had been used loUars shall be until the actual iubscribers to at in accordance (illcen thousand payable on the wonty thousand Vorth Shore of ,000,(100) and fifty millions (50,000,000) acres of land as compensation for the construction of said road, he is hereby authorized to do so ; and in case a iurtber reduction in \n'\cv is found to be indis])ensal)le in order to secure the contract for the construction of the said Canada Pacific Railway, then . I. (iregory Smith, Sir Hugh Allan, G. W. McMullen, Geo. W. Cass, and Wm. B. Ogden are hereby constituted a committee with authority in them or a majority of them to submit to such further reduction in the money i)riceto be paid in their discretion or any sum not below thirty millions of dollars ($;U),000,000) as they shall think necessary or advisable, and the said committee or a majority of tluin shall have power to inakeiuch assessments irom time to time, for the general purposes of the Comi)any, not exceeding in all one and one half per cent, of the amounts agreed to be suliscribed by us to the ^toek of the Canada Pacific Railway Company as they shall deem expedient. The said assess- ments are to be considered as jmrt oi the one million dollars agreed to be paid on the stock contracted to he subscribed by us in the agreement of Deceiniier 2.3rd, l!^71, and to 1)0 subject to the same conditions of payment and refuiuling with interest as are therein set forth. And we hereby authorize the said Committee to take such other action lor us as they may deem necessary in the premises consistent with the general terms of the contrad, ol December 2;{, 1871, and as modified hereby. - , New York, March 28, 1872. (Signed) Jay Cooke & Co., J. (iregory Smith, B. P. Cheney for self and W. .1. I ar;j,(), R. D. Rice, Thos. II. Cawfield, A. H. Barney, G. W. Cass, Daniel McLaren, by .1. \V. i:ilis, Frederick Billings, >\'m. Windowa, 11. R. Payson, F. K. Cauda, C. .1. Candii, Saniiiel Wilkinson, W. B. Ogden, Walter Ilinchman, Hugli Allan, Charles Mather Smith, George W. McMullen. ■' I ■'(''"'*..•'.;,( 1 fill '1' ' - ' ' .- ■ '' .'!''! Canada. M ' y. •'. Oamaoa. 258 CORRESPONDENCE RELATIVE TO THE M. Copy of acknowledgment from Jay Cooke (J* Co., to G. W. McMullen of his drafts on various parties^ <.fc. (Copy.) G. W. McMullen, Esq., Secretary, Canada Pacific R. R. Ex. Committee. Dear Sir, New York, April 1, 1872. We have to-day received of you your drafts on various parties to the amount of $50,000, which sum we credit to the Executive Committc of the Canada Pacific R. R. Association, subject to the draft of Sir Hugh Allan. Respectfully, (Signed) JAY COOKE & CO. No. 1. Jay Cooke & Co., Bankers, Corner Nassau and Wall Streets : Pay to myself or order. Fifteen Thousand Dollars. 115,000. No. 2. Jay Cooke & Co., Bankers, Corner Nassau and Wall Streets : Pay to myself or order, Twenty-five Thousand Dollars. $25,000. New York, May 2, 1872. (Signed) HUGH ALLAN. New York, May 3, 1872. (Signed) HUGH ALLAN. I have also receipts for Fees on the Bills of the Canada Pacific R. R. Company, and the Canada Imi)rovement Company, paid with other things to tlie Hon. J. J. C. Abbott, and by him settled with Mr. Todd, whose receipt I hold. Also my cheque showing the payment, returned me by Bank of Montreal, in due course. G. W. McMULLEN. N. {Enclosed in Envelope Number Two, being portion of contents of " jd " or " sealed packet." $17,500.00. Merchants' Bank of Canada, February 26th, 1873. Pay Hon. Henry Stames, or Order, seventeen thousand five hundred dollars cy. (Signed) HUGH ALL/iN. To the Cashier. Endorsement on back of above Cheque. Mr. Starnes will please endorse and collect this Cheque, and pay proceeds to Mr. McMullen if he becomes entitled to it by the instructions. (Sd.) H. A. 0. {Enclosed in small Envelope addressed " Hon. Henry Stames," being portions of contents of "A." or ^'' sealed packet." Montreal, February 26, 1873. The Honourable Henry Starnes is requested to deliver over envelope No. One to Sir Hugh Allan ; and envelope number Two to Mr. George W. McMullen, unless Sir Hugh Allan claims that the contents of the letters contained in envelope Number One have been divulged, or copies of them have been given to other than one person mentioned to Mr. Abbott (which Mr. McMullen declares has not been and will not be done), in which case Mr. Starnes will open envelope Number One and having heard the parties will d«;tcrmine whether the contents of such letters have been divulged, copies granted other than above, or not. If he decides that they have not, he shall hand over envelope Number Two to Mr. McMullen and the letters to Sir Hugh Allan. If he decides other- ii^V^ CANADIAN PACIFIC I^AILWAY. 259 of his drafts on April 1, 1872. ,o the amount ol' Ida Pacific R. R. OOKE & CO. , May 2, 1872. GH ALLAN. , May 3, 1872. rCH ALLAN. wise he is to hand over envelope Niim1)er Two to Sir ugh Allan, and the letters also, unless Mr. McMullon ])ays him Twenty thousand dollars in gold, in which case he will hand the letters to Mr. McMullen and envelope Number Tico to Pir Hugh Allan with the twenty thousand dollars. And Mr. McMullen declares that the said envelope Number One contains all of Sir Hugh Allan's letters in his possession or under his control. (Signed) G. W. McMULLEN. HUGH ALLAN. Oavaoa. {Endorsement on envelope covering above). If Mr. Starncs is not requested to decide any disputes in regard to the ownership of papers herewith, he is to burn this envelope with its contents unopened, immediately on settlement. Hon. Henry Starncs. Endorsement on larye inner envelope, contained in "A" or " sealed packet" and covering envelopes Nos. 1 and 2, ana small envelope addressed " Hon. itenry Starnes!' Montreal, February 26, 1873. Within ten days after the end of the coming Session of Parliament, the Hon. Henry Stames is requested to deliver envelope No. One' to Sir Hugh Allan, and envelope No. Two to Mr. G. W. McMullen, unless objections be made by Sir Hugh Allan to his doing so ; in which case he will open the envelope addressed to himself, and act as instructed therein. (Signed) HUGH ALLAN. G. W. McMULLEN. !ompany,and the I. C. Abbott, and que showing the McMULLEN. " sealed pockety ry 26th, 1873. ollars cy. GH ALL/.N. proceeds to Mr, Sd.) H. A. tions of contents uary 26, 1873. e No. One to Sir unless Sir Hugh umber One have son mentioned to done), in which the parties will ies granted other d over envelope le decides other- Endorsement on " A," or ^'^ sealed packet." May 17, 1873. Papers produced by Mr. Starnes before Select Committee and returned to him subject to be produced to this Committee on their order. (Signed) J. HILLYARD CAMERON, Chairman. J. G. BLANCHET. A. A. DORION. Copy of first Contract between Sir Hugh Allan and his American Associates, dated New York, December 23, 1871, printed at page 249. Q. Certified Copy of Letter frorn Sir Geo. E. Cartier to Sir Hugh Allan. {Private and Confidential.) Dkar Sir Hugh, Montreal, July 30, 1872. The friends of the Government will expect to be assisted with funds in the pending elections ; and any amount which you or your Company shall advance lor tliat purjwse, shall be recouped to you. A memorandum of immediate requirements is below. Very truly yours, Sir Hugh Allan. (Signed) GEO. E. CARTIEK. NOW WANTKD. " Sir John A. Macdonald - " Hon. Mr. Langevin ... " Sir G. E. C. « Sir J. A. (add'l) " Hon. Mr. Langevin (add'l) « Sir G. E. C. - ■ $2r),o()o 1 5,000 20,000 10,000 10,000 30,000 260 CORRESPONDENCE RELATIVE TO THE Oakaoa. xiic foregoing certified to be a true copy of the oripiiial letter produced hy Sir Ilugb Allan belore the Uoyal Commission, re Canada I'acifie Uuiivvay, which original was at his desire allowed to be retained l)y him. (Signed) CHARLES DEWEV DAY, September 10, 1873. Chairman. R. Certified Copy of Letter from Sir G. E. Cartier to Sir Ilwjh Allan. Dear Sir Iluon, Montreal, July .'loth, 1872. I enclose you copies ol' telegrams received from Sir John Macdonald, and with reference to their contents I would say that in my ojMnion the Governor in C!ouncil will a])prove of the amalgamation of your Comi)any with the Interoceanic Company under the name of the Canadian Pacific Railway Company, the Provincial Board of the Amalgamated Company to be composed of seventeen meml)crs, of whom four shall be named from the Province of Quebec by the Canada Pacific Railway Company, four from the Province of Ontiirio by the Interoceanic Railway Company, and the remainder by the Government: the Amalgamated Company to have the powers specified in the tcntli section of the Act incorporating the Canada Pacific Company, and the agreement of amalgamation to be exticuted between the Companies within two months from this date. The Canada Pacific Company might take the initiative in procuring the amalgamation, and if the Interoceanic Comjjany should not execute an agreement oJ' amalgamation ui)on such terms and within such limited time, I think the contemplated arrangements should be made with the Canada Pacific Company under its Charter. Upon the subscription and payment on account of stock being made as required by the Act of last Session respecting the Canadian Pacific Railway Company, I have no doubt but that the Governor in Council will agree with the Company for the construction and working of the Canadian Pacific Railway with such branches as shall be agreed upon, and will grant to the Company all such subsidies and assistance as they are emj)owered to do by the Government Act. I believe all the advantages which the Government Act empowers the (government to confer ujwn any Company will be required to enable the works contemplated to be successfully carried through, and I am convinced that they will be accorded to the Company to be formed by amalgamation or to the Canada Pacific C!ompany as the case may be. I \\ould add that as I ajiprove of the measures to whicli I have referred in this letter, I shall use my best endeavours to have them carried into eil'ect. Very truly yours, (Signed) GEO. E. CARTIER. The foregoing certified to be a true copy of the original letter produced by Sir Hugh Allan before the Royal Commission re Canada Pacific Railway, which original was at Iiis desire allowed to be retained by him. (Signed) CHARLES DEWEY DAY, September 19, 1873. . Cliairman. 4 ife s. Receipt for House Fees on Canada Improvement Company Bill. PRIVATE BILL OFFICE. House of Commons, Ottawa, June 1, 1873. Fee and Charges on the Rill to Incorporate the Canada Improvement Company. Fee payable under the 58th Rule $100.00 ^, e . ,. ,,.,, f 500 English 2.25 ChargeforprmtuigBiUJ2,^PP^|^^^ .... 1.35 500 English 1.34 Charge for printing Act Translation - 250 French 0.!)7 3.00 $108.91 Received imyment from Hon. J. J. C. Abbott, M.P. . (Signed) ALFRED TODD, Chief Clerk Private Bill Office. CANADIAN PACIFIC RAILWAY. 261 ■ed liy Sir IIurIi J original was at Y DAY, Chairman. Ulan. ily ;i()tli, 1S7'2. (lonald, and witli r in Council will ■ Company undor il Board ol" the lom four shall be npany, lour I'rom lii; remainder by ficd in the tenth ihe agreement of IS from this date, le amalgamation, nalgamation upon mgements should IS required by the , I have no doubt constrnetion and agreed upon, and empowered to do (lovernment Act ired to enable the hvinced that they he Canada Pacific •red in this letter, E. CARTIEK. uced by Sir Hugh 1 original was at :Y DAY, Chairman. Dill. ^, June 1, 1873. ent Company. $100.00 2.25 1.35 1.34 0.!)7 3.00 Canada. $108.5)1 lieceipt for House Fees on Canada Pacific liaihray Company Bill. PHIVATK BILL OFFICE. House of Commons, Ottawa, June 1, 1872. Fee and Charges on the Bill to Incoriwratu the Canada Pacific Railway Comjjany. Fee jiayable under the oSth Rule $100-00 .'JOO English - - - - 9* 60 200 French - - - - 4-75 500 English - - - - 5 -30 250 French - - - - 3-:)8 14-00 Charge lor printing Bill Charge for printing Act Translation $137-15 Received payment from lion. J. J. C. Abbott, IVI.P. (Signed) ALFRED TODD, Chief Clerk Private Bill Office. U. Utter from G. W. McMullen to Hon. J. J. C. Abbott. Dear Sir, Montreal, February 25, 1^73. If before the expiry of ton days alter the termination of the coming Session of Parliament I do not hand you Messrs. Smith and Ilulburt's confirmation of the arrange- ment I have this day made; with Sir Hugh Allan, I authorize the Honourable Henry Starncs to retain the enveloiie No. 2, delivered to him, coiitainhig Sir Hugh Allan's cheque, until I do produce such letter. I have, 5:c., Hon. J. J. C. Abbott. (Signed; GEO. W. McMULLEN. APPENDIX. ivate Bill Office. To the Hon. Lucius Seth Huntington', of the City of Montreal, in the Province of Quebec. Sir, Ottawa, Au-ust 21, 1873. I have the honour to enclose herewith a ])rinted cojjy of the Royal Commission appointing Commissioners to inquire into and report ui)on tlie several mattei-s stated in the Resolution moved by you in tlie House of Commons on tlie 2iid day of April last, relating to the Canada Pacific Railway, and to inl'orm you that the Commissioners therein named will meet in the City of Ottawa, in the Parliament House, on Thursday, the 4th day of September next, at noon, for the purjjose of making iiupiiry and taking evidence concerning the allegations contained in the Resolution and fully set fortli hi tlie Commission. You are requested to lurnish to the Commission, with all convenient dili- gence, a list of the witnesses whom you may wish to examine, in order that they may be duly summoned to appear on the day and at the place above specified, and you are requestetl then and there to proceed with your evidence in the premises. I have, &c., (Signed) CHARLES D. DAY, _____ . Chairman. Sii?, Ottawa, August 21, 1873. I have the honour to inform you, that the Commissioners appointed to inquire into and report upon the several matters contained and stated in a certain Resolution moved by the Hon. Mr. Huntington in the House of Commons on the 2nd April, 1873, relating to the Canadian Pacific Railway, will meet in tlu- Parliament House, in the City of Ottawa, on Thursday, the 4th day of September next, at noon, for the purpose of making inquiry and taking evidence, under tin- authority of the Commission, concerning the allegations and matters contained in that Resolution, and that notice iias been given to the Hon. Mr. Huntington to appear and proceed with his evidence then and there. I have, &e., (^^igned) CHARLES D DAY. Chairman. 'J L 2G2 CORRESPONDKNCE UELATIVK TO THIO hi >. Canai>a. Sin, Montreal, Aii>;iist '2G, 1H7.1. I have the honour to acknowledf;!; the receipt of your letter ol' thi; Ulstol' Aiij^ust instiint, eiu'losiiig ii eojiy ol' the Hoyal C(»iiimisHioii, nppoiiitiii); Cominissioners lo im|uiru into and report upon the heveral matters sliit«'(l in the Uesolution moved l)y me, in the House of Commons, on the '2nd day of April last, and rcciuestin^ nu- to furnish to the Commission a list of the witnesses 1 mij^ht wish to examine, in order that they may he duly summoned to api)ear, and to proeeed with my evidenee. I have to eall your attention to the fact, apparent on the face of the Commission, that it was as a memher of the House of Commons, and from my place in Parliament, that I pn^ferred these chart»es aj^ainst Ministers of the Crown, and memhers of that House, which, on the 8th day of Ajiril hist, entertained the charges, determined lo investigate them itself, and ajjpointed a Select tlommittce to inquire into it and report ujmju them ; and to the further fact, apparent on the Journals of the House, that to the said Com- mittee I fiM'nished a list of some of the principal witnesses, wliose evidence I l)e[ievi; could estahlish my charges, and I have always heen ready to proceed to tlie i)roof thereof lielore the trihunal constituted hy the House for the investigation. 'I'he determination of the Commons to investigate these charges remains unaltered, and I deem it iiuonsistent with my duty as a member of Parliament, and a breach of the undonbtein,ica. I have, &c., The Earl of Dufferin, (Signed) KIMRERLEY. &c. &c. ite. No. 9. f '2 1st of Aiif;ust ioncrs to iiuiuire cd liy me, in thi; lo riiniish to tlio lat they may In; 'ommiHsion, that Parliament, tliat s of that House, eel to iuvestigati! port upon tiiem ; o the said ("om- vitleiiee 1 helievi; the prod' tliereol' >mains unaltered, , and a l)reaeli ol' •ptional tril)uual, iiid so essentially Dmmission issued u-c of, or Hhould ol" the Commons, (piiescence in the muiry. that liindamcntal right and duty of it involves also a sed from creating t is a Commission the ^^tatute Law, e ordinary course leiitly illegal and lan in eonformity the ('ommission 1 sense of puhlic renew the ellbrts :ne Commons of lUNTlNGTON. Muhcrin, 1873. of ()ct()l)er l,' ng passed l)y the )u of Inipiiry into )wcr of examining it course would he Szc KIMRERLEY. CANADIAN PACIFIC RAILWAY. 868 No. 12. Tlie i'^AKL OP KiMnEui.KY to Tho Earl ok DrFFEuiv. ■My IjORO, Downing Street, Xoveinhcr 22, 1S7.1. I iiAVR to acknowledge yonr Lordship's Despatch of the lird instant,* for- warding copies of the evidence taken before the Koyal Conmiission af)pointed to inquire into llie isauo of the Canadian Pacific Hallway Charter. I am glad to learn that your Lordship is of opinion that the Commission discharged •;Ls duty clfectively. I have, iVc, The hiirl of Duflerin, (Signed) KIMHERLRY. (tc. . These papers consisted of the Report of tho Royal Commission, and of the body of evidence it had eolleeted, and of my Despatches to your liordship in relcreneo to tlio Pro- rogation of Parliament on the llUh of August, and to the issue of tlie Commission, together witii your iiOrdship's re|)ly thereto, of October the ntii.f in which you are gootl enough to convey to me, on the part of Her Majesty's (lovernment, your approval of my conduct iu reference to these two transactions. 4. I thought it desiral)lc that these three latter documents shoulil be connuunicatcd to the House of Commons for two reastms. In the first place, they contained a statement of certain facts whi<'li illustrated and supplemented the evidence Uikon before the Commission, and which no one Imt myself was in a position to furnish; and in tlio next, tliev clearly sliowed that whether exception could or could not bo justly taken to tho general course of procethire adopted by my Ministers, no foundation existed ibr the impression which at one time prcvailo(l, that the (Queen's Prerogative had been exercised uncimstitutioiially, or witli partiality, or in the intention of interfering with the privileges of Parliament. It w;ls the more desirable that this should be made patent, as it was currently reported — of course I cannot say with what truth — that instead of raising the main and essential (juestion lus to tlie culpability of the transactions between my Ministers and Sir Hugh Allan, some of the oppoiu'iits of the ( iovermnent were inclining to tiiko a vote on a side-issue in reference to tho I'rorogation of i'arliament on the l.'itli of August, and to the alleged breach of privilege it involved, with a view of binding to their party those Ministerialists who hatl signed tho ^lemorial addressed to me on that occasion. 5. As the ])osition thus proposed to l»e occupied might incidentally commit the House of Commons to an opinion on a Constitutional (luestion which could not l)e sustained, and sus it ^eelllcd of the last importance that the intention of Parliament should not be diverted from what was tho real issue to a subordinate controversy, I thought it well to discourage tlie adoption of this latter alternative — should it be in contemplation — by bringing to the, knowledge of the House of Commons yonr Lordship's Despatch and my own lommunica- tions to which it was a reply. (i. The presentation of these documents to Parliament has licen complained of in some quartei's as evincing a desire upon my part to aiVord imdue assistance to my Ministers. Such an impression could only have been generated in the heal and confusion of a i)arty condict. '1 lie major part of my Despatches consisted of a simple narrative of fa"ts. If • No. 10. t No. 6. Canada. :64 CORRESPONDENCE RELATIVE TO THE CaNAIjA. thcHC lacts wcro true — and their acciiracv cannot l»i! impugned — wliotlicr they told for or agiunst my Ministoi-s, no just man could have wislied them to he withlield. As for any incidental remarks or inl'erences intei'siH'rj'cd throngli the narration, such remarks anil inferences referred to the aspect of atlaii-s as they existed on the IJUh of August, and not to the totally distinct and nllered issues upon which Parliament was proceeding to adjudimte. Y. On Monday, the 27th of October, the House of Commons met at three o'clock in th(; afternoon, and proceeded at once to the consideration of the Speech from the Throne, the debate commencing with an able and malerate speech from 5lr. Mackenzie, in which he moved the siilijoined amendment as an addition to the second paragraph: — "And we have to acipiaint His Excellency that by their course in reference to the investigation of the charges preferred by Mr. Huntington, in his place in this House, and under the facts disclosed in the evidence laid licfore us, His E.xcellency's Advisers have merited tlie severe censure of this House." 8. This amendment raises a jicrfectly fair and direct issue, it goes to the root of the matter, it founds itself upon the evidence taken by the Commission, and neither directly nor indirectly does it im|)Ugn the act of Prorogation. Indeed, on perusing the Report of the discussion which ensued, your Lordship will perceive that the objections which at one time were so vehemently insisted upon in regard to this proceeding have been, so far as. my actinn was concerned, almost entirely pretermitted, that Mr. Rlake stated he would not even refer to them, and that most of the s[)eakers, with an instinctive appreciation of what the exigencies of the case demanded, confnied themselves to the consideration of what are the main substantive charges against my Ministers. !). On the second night of the deliate .Mr. .lames .Macdonald, member for Pictou, an eminent sup|M)rter of the (lovernment, moved a second amendment in the following terms : — "And we desire to tissuro His Excellency that after consideration of the statemeids made in tlu; evidence before us, and while we regret the outlay of money l>y all political parties at Parliamentary elections, and desire the most stringent measures to put an end to the practice, we at the same time lieg leave to express our contin\ied coididence in His Excellency's Advisers, and in their administration of public all'airs." 10. The discussion on the two Ibregoing amendments continued, with the exception of an intervening Saturday and Sunday, for seven siu'cessive days, that is to say, from Monday, the 27th of October, to \Vc(lnesday, the 'tth of November. 11. On the moniing of that day Sir .iohn .Macdonald asked for an interview, at which he inibrmed me that although lie and his friends had had reason to expect a considcralilc majority when Parliament met, some unexpected defections had .since occurred in the ranks of his supi)orters, and that he had just received an intimation from one or two more, which so compromised his pros])ects as to render it his duty to tender me his resignation as well as that of his colleagues. He then repaired to the House of Commons, and brought a debate of almost unprecedented h'ngth and interest to a clo.se l)y the announcement of his surrender of the seals of ollice, and of my having called upon Mr. Alackenzie to form a (lovei'iimcnt in su<'i they told for or Id. ' As for any •h reiimrks and iigust, and not to n^i; to adjiidicati'. ce o'clock in t\w the Throne, the izie, in which he reference to the this House, and s Advisers have ) the root of the neither directly inji the llejtort of ions wliich at one ,e been, so far as. ited he would not )re(iution of what iition of what are iv for Pictou, an in the following of the statements ey by all political s'to put an end to conluli.'nce in His he exception of an lay, from Monday, •view, at which he ct II considerable urred in the ranks two more, which csignalion as well IS, anil brought a nouncement of his kenzie to form a iiii|ii»ssibie to state H> time iM'ibre the ist side were very ilu'S(! calcidations riiaiiic of success Icnhitc on a vote le division would ry single member io vote on thi> uive iM'cn on tin- vsi.'u(ed to nic, as vision on (he day llial,— leaving out \oles v.ould liavi' lie discussion were )f lliree and four oihIju' evrniiig tli>' Ir. liiake iollowed other members ol .iloiiuenl elVorts f n CANADIAN PACIFIC RAILWAY. 265 your Lordship's special notice, as from the report of the proceedings you will yourself be able to judge of the various kind of merit displayed by each. IT). Unfortunately the shorthand writer's notes have to be tslegraped to the principal journals for publication, and as I have already stated to your Lordship W. v previous Dcsimtch, errors and lacunar unavoidably occur during so complicated a process. Notwithstiinding the imperfections arising from tliia source, your Lordship will not fail to perceive that when called upon to deal with a subject of gnivity and moment, there are probably few asse jlics in the world to which in eloquence, dignity, and aljiiity lor Debate, th< Parli'- A'lit of Canada need yield the palm. 1<>. I cannot close this Despatch, which describes the concluding scene of the painful drama of which I have been a spectator, witiiout calling your Lonlship's attention to the fact that the result arrived at, — a residl not oidy hailed with satisfaction by the victors, — but what is of as great sigiiiricance, ac(piie.s('e(l in by the vumpiished, has been reached by a patient adherence to those constitutional princijjles which your Lord.ship has recommended to my observance. 17. If instead of proroguing Parliament on the KUh of August, I had dismissed my Ministers, or compelled them ag-ainsl their will, had that been possible, — into a line of action which .should have evcntiuucfl in their premature overthrow, a cry far more loud and genuinely indignant, than that evoked by prorogation, would have been raised thr<)ughout the country ; and the action of the (Vewn in rashly discarding or ''liandoning untried ni"n whom Parliament had P-comuii'iided U . - coiifidcnee, would have l)oen denounced with C(|ual velicincnce anti far greater reason, as ,i higli-liaii(ifd ait of the Prerogative. Nothing so disturbs the march of justice, so eonlksesan ii-sne, so rehal)ilitatea wrong-doing, as that any irregularity of procedure, any nppearance of shari) practice should "itiate the action tjikeu against the accused, and the destruction of my late Government under sueli circumstances would always have been regarded by its adherents as having i)een brought about l)y vioh-nt means, and through the uncalled for intervention of an imperial oflicer. IS. If my Ministers have now fallen, they have fallen after thoy have had every oppor- tunity of stating their ca.se to the country, and of pleading their cause before a full I'arlia- nient. If the venlict has gone against them, it has done so under circumstances which leave them no ground of complaint against the Representative of the Oown. 19. On the other hand it must be apparent to those who take an adverse view of the conduct of the late Administration, that a result which they would prol)ably designate as the vindication of the national credit and pulilic reputation of the Dominion, has been brought about, not by an ill-considered and hasty exercise of Imperial authority, nor by the application of premature })ressuro from witiiout, but iiy the free and spontaneous action of the l{eprosentativcs of the Canadian people — a coiu'lusion wliich thoy will hail with a satisfaction, proportionate to their power of a|ipreciating the privileges of self-government, and to the importance they may attach to Canada being recorded in history as having proved competent to the guardianship of her highest interests. 20. During the whole of this unfortunate business, I have never doubted but that a strict application of the principles of Parliamentary Goverinnent wouhl be suflicient .to res)lve every difficult^-., iml that a result would be eventually arrived at in harmony with tiie con- victions and wi>i;es of the Canadian people. Had it proved otherwise, I still held in reserve a Consiitutional power e.|ual to any cmergencj-, and in the last resort I should have been (,;;ite jirepared to have exercised it in whatever way the circumstances of the case might have justified. I have, il'c, • The I'iirl of Kimlwrley, (Signed) DUFFERIN. &c. &c. &c. No, 14. The Earl ok Kimheulet to The Eakl op Duffehln. My Loan, November 29, 1 873. I HAVK received and laid before the Queen your Lordship's Despatch of the 7th of November,* reporting the proceedings of the Dominion House of Cmimons on the re-assembling of Parliament, on the subject of the charges brought by Mr. Huntington O&KADA. • No. 18. 2 M u ■260 COUUESPONDENCE, ETC. <\\;;ai)v, aWKll ANIi UttSi, hTAMFOIUI irrRKKT AND (.'UARI.VM CR »UU IIEK NAJIifll't '-TATIONKriV OIKICI.