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It 
 
 THE CAJ^ADIAN PACIRC RAILWAY, 
 
 An Insight into its Management and Policy. 
 
 FACTS AND FIGURES. 
 
 A S<:rlc>< of Uffer. as jmUwJ»d i„ fh. Quebec, {Dominion nf Canado) 
 
 ''H'duraaij Bix^jef," MarcK 1889. 
 

{From the Saturday Budget, Quebec, Ganada.) 
 
 THE CANADIAN PAC[FIC RAILWAY. 
 
 Letter No. I, 
 
 It is not difficult to understand the strong feeling which pervades 
 Canada, with regard to the proceedings lately taken by the Canadian 
 Pacific Railway, to prevent a line not of tlieir system cros.sing thoir 
 track in Manitoba. Many important principles were involved in thi.s 
 simple matter. No one travelling a few miles on a railway car can 
 fail to perceive that the track is traversed by other linos ; and a 
 glance at the map will show that a main line possessing the right to 
 prevent s ich a crossing would virtually make tiie constriictioii of other 
 railways impassible, whenever it was thought fit to exercise this power 
 of repression. 
 
 There has been much feeling, passion, and partizanship shewn on 
 both sides of this controversy : they must be entirely set aside in any 
 narrative of the event What is called for at this hour is a calm 
 dispassionate statement of the facts, so that the true issue involved 
 can be clearly understood, and the important principles which lie 
 beneath the outer event be plainly made known. 
 
 Hitherto for the twenty two years of Confederation the power of 
 granting a railway charter has been fuUv recognized to belong to the 
 Provincial Legislature, and has been accepted by the Dominion Par- 
 liament as being perfectly legal. It has been even unquestioned. 
 Lines of any length, extending over the boundaries of more than one 
 province, have obtained their charter from the House of Commons : 
 more as a matter of convenience than from the theory of receiving 
 wider and more assured privileges. 'I he Provincial charters were in 
 every respect as full and as valid. Had the presentations of the 
 Canadian Pacific in this instance been countenanced, all power of 
 chartering a railway would have been taken from the Provincial Legis- 
 lature not simply in Manitoba, but in Ontario, Quebec and the 
 
Maritime Provinces. The Dominion Government alone Avould have 
 possessed .|o\ver sufficient to call into operation a Provinciiil line of 
 any lengtli extending from one point of the province to another, far 
 distant, involving crossing a main line under Dominicm control. How 
 would such a decision have been accepted.? With the passionate cry 
 of indignation whicli a sense of wrong calls forth. However, techinal 
 and logical such a legal conclusion might be, the country would have 
 been awu^kened by this usurpation of power covertly obtained ; and 
 an issue would have been raised to make all other political relation- 
 ships subordinate to it. It would doubtless have led to a reconstitution 
 of political parties ; so important was the principle at stake. Public 
 opinion certainly in Quebec. Ontario and Manitoba Avould have called 
 for a declaratory statute to make any such condition impossible, and 
 it is by no means improbable that an adverse vote would have given 
 the death warrant to the party in power. 
 
 Equally important is the consideration of the wound to 
 public morality traceable in these proceedings. The point involved 
 was whether a deliberately accepted oblig.ition incurred on receipt of 
 valuable considerations can be set aside on merely technioiil grounds; 
 whether a public company having parted with an important privilege 
 owing tu the receipt of what may be justly described as a large sum 
 of money, can reassert that privilege under another aspect. Whether 
 a solemn engagement with the country is to be faithfully kept, or 
 m*y be avoided through the cunning of the attorney hitting upon 
 another means of reasserting it, whether in short the doctrines of 
 honour and fair dealing and truth, are or are u')t to prevail. 
 
 The facts of the case can be simply set forth : 
 
 In the contract entered into by the Canadian Government with 
 the Canadian Pacific Railway on the 21st of October, 1880, among 
 other considerations, the monopoly wis granted so far as the 
 Dominion could grant it for twenty years, that no foreign line should 
 be constructed to the so ith-west of the main line within fifteen miles 
 of the forty-ninth degree of latitude. The condition is set forth in 
 clause. 15 of the contract. During the debate at the time the opinion 
 was freely expressed, that it was questionable if the Dominion could 
 bind the Province of Manitoba, created with full Provincial rights in 
 1879; in other words, if this legislation couM coerce the F rovince in 
 any such agreement. For whatsoever right appertained to the 
 wealthy Province of Ontario, equally belonged to the struggling thinly 
 settled Western Province. Her rights are identic il with those of her 
 prosperous powerful sister, and the theory that the Dominion House 
 of Commons " as a policy " would attempt to make special arrange- 
 
3 
 
 menis to the injury of Ontario without the cons-^nt of tlie Province, is 
 too ridiculous to need refutation, wliatever the mere lawyer may 
 
 assert. ■•■'■ •- •, > ' ; • . ■. •■ .. . . , ^ . . j 
 
 (Jeneral dissatisfaction with the policy of the Canadian Pacific 
 Railway, led to a desire for a connection to be made from the City of 
 Winnipeg to the southern boundary of the Province by a line of 
 railway, by means of which comnrinicatiun with the Northern Pacific 
 Railway would be obtained ; a connection only to be formed, neces- 
 sarily to be developed, without the charter for the construction of this 
 line which passed the Provincial Legislature, had been vetoed by the 
 Dominion Government, it had been nevertheless determined to per- 
 severe in the construction of the railway, livery means was taken 
 by the Canadian Pacific to prevent the work being carried on. Ground 
 was purchased, over which the line must pass, and possession of it 
 was refused. Every possible impediment was thrown in the wa}'' of 
 its legal appropriation. The opposition was repeated wherever op- 
 portunity offered. Finally the difficulties being removed, the line 
 was placed under contract. : ' • • ; " 
 
 Public feeling threughout the country was much excited During 
 the applicati'^'-i to Parliament in 1885 by the Canadian Pacific for 
 relief, the motion was direculy made for the monopoly clause to be 
 rescinded. It was, however, voted down. From that date, the 
 policy, the wisdom, the justice of the clause in the contract of the 
 Canadian Pacific Railway has been contested by many out of the 
 Province of Manitoba ; within it, the exceptions were tiliose in its 
 favour. In 1888 the dispute came before the i'ominion Parliament, 
 not in its consitutional bearing, not as an abstract power possessed 
 by Parliament, but an arrangement was attained without entering 
 into consideration of what had been done. The necessities of the 
 Canadian Pacific Railway had again made its J^xecutive Committee 
 applicants to the Dominion Parliament for relief. , , . .• 
 
 The term Executive Committee may need some explanation, for 
 the mode ot directing the operations of the line dirt'er from the course 
 which has been hitherto generally followed in the construction of 
 railways. It has i een the custom for the directors of a railway to 
 control its fortunes, and the compound character of thi se selected to 
 tome extent has furnished a guarantee of the coarse which would be 
 followed With the Canadian Pacific, those serving ou the direction 
 have been merely nominal appointments. Tlie impression prevails 
 that they exercise neither control nor ir.'Iuence. Their names are 
 given, and they attend at certain meetings, but so far as the outer 
 world can draw its conclusions from what takes place, the whole 
 
policy of the Canadian Pacific has been determined by tlie Executive 
 Committee elected Irom the directors. Hitherto it ban consisted of 
 Sir George Stephen, i-ir Donald Smith, Mr, Angus and Mr. Van Home. 
 In the first years it included Mr. McTntyre, but he early publicly 
 dipsevered hia connection with the company. Sir George Stephen 
 sent in his resignation a few months back, and published his reasons 
 for doing so. \Vljellier Sir Donald Smith has retired or not cannot 
 be positively taid. 7 he newspapers, however, announce that he is 
 proceediu'g to the south of France for bis henlth. Mr. Angus' name 
 never appears The principal actor is Mr. Van Home, a United 
 States citizen who went from the State of Minnesota to Canada sonio 
 eight years ago. He is practically the one man in power, I'or good 
 or for evil, he has directed the fortunes of tha Canadian Pacific. He 
 selected the location, abandoning that of Mr. Fleming to descend and 
 ascend the terrible grndes of the " temporary track " down the 
 Kicking Horse Pass, he carried the line accross the Selkirks, by what 
 Canadian Pacific writers delight to call the "Rogers Pass" although 
 known and discarded by Mr. Fleming from the dangerous character 
 of the prevalent avalanches, snow and boulder slides. It is he who 
 has developed the Canadian Pacific system by new and expensive 
 railway lin.es ^nd branches to Detroit, and at this date is constructing 
 a line side bv side with the Grand Trunk branch from London to 
 Windsor, 110 miles in length. By a bridge over the St. Lawrence at 
 Lachine, and with a line extending to the State of Maine and travers- 
 ing that JLiiate, has obtained control of a railway to connect with the 
 New Brunswick and Nova Scotia, proposed system under the manage- 
 ment of a company considered to be controlled by Sir George Stephen 
 and his friends independently of the Canadian Pacific lines as a com- 
 pany; as a theory to proceed onward to Louisburg, there to form a 
 new seaport. Those who know the country ask how the interest for 
 the bridge over the GutofCanso, which at least will cost some 
 $2,000,000, can be met, and they also maintain the opinion that a 
 bridge over the narrows of the Bras d'or is simply an impossibility so 
 that Louisburg cannot be reached by railway. 
 
 The merits of this policy and the present condition of the Cana- 
 dian Pacific is universally looked upon as the creation of Mr. Van 
 Home, the one man in power, the originator of the new station in 
 Montreal, who is solely responsible for all that takes place w'th regard 
 to the railway. It was Mr. Van Home who negotiated with the 
 Government in the commencement of 1888. Whether the necessities 
 of the Railway Company made it imperative for some pecuniary relief 
 to be obtained, or whether doubts began to be felt that the rights ot 
 Manitoba would find an echo in the other provinces, and if at Ottawa 
 
law could not be found in the Statute book to relieve the Province ; 
 legiBlfltion would be battled for toobtain it, and the right of construct- 
 ing Provincial lines would be fully established, the Canadian Pacific 
 Eailway accepted a compromise on the Dominion Government guaran- 
 teeing fifteen millions of 3^ per cent land bonds in the plainest lan- 
 guage the Canadian Pacific Railway abandoned its monopoly in the 
 North-West. The position of tliat company consequent on this 
 arrangement was net forth by Mr. Blake in the following words in his 
 addi'ess to the Supreme Court on the 2l8t November last. Every 
 shred of this right of monopoly by the railways being voluntarily 
 ceded on this occasion : — 
 
 " It is notorious," remarked Mr. B'ake, "thai disputes tool; place 
 
 * * * as to the actual and implied obligations of the Gov- 
 ernment and of the Parlinment of Canada towards the Canadian 
 Pacific Ptailway Company *> * % with reference to the 
 Province of Manitoba. Tt is notorious that for many years that 
 Province had been asserting its rights under the constitution * * 
 
 * * to charter Provincial railways which should nm in the 
 specified direction and enter the prohibited territory of fifteen miles. 
 It is notorious that agitation and discontent had ensued upon the re- 
 peated disallowance of those acts of the Executive of Cannda, and that 
 the executive action of the Government of Canada had been ratified 
 and confirflied by the Parliament of Canada. All these disputes 
 culminated last session, in an arrangement which is upon the statute 
 book whereby the clause in question was erased from the contract 
 with the Canadian Pacific Failway Company for certain considerations 
 which the Government^ with the assent cf Parliament agreed to give 
 in the shape of a guarantee ; and therefore all the obligations of the 
 Parliament of Canada and of the Executive of Canada whether 
 actually expressed or implied, whether more or less extensive, weie 
 entirely blotted out and the Canadian Pacific Railway Company had 
 no longer any special or specific, or particular right to call lor inter- 
 venticm or inaction on the part of the Parliament of Canada by virtue 
 of its contract (tStrong J.,) or the Executive of Canada ? 
 
 Mr. Blake — Yes, either executive or legislative. That is all 
 blotted out. The Company has no legal and no moral right to come 
 forward and say it is to be considered in any other position than any 
 other individual or corporation on the face of the land with reference 
 to this matter any more." 
 
 Argument of Mr. Blake before the Supreme Court, p. 31. 
 
6 
 
 LkttkrNo. ir. 
 
 By the condition of nflairs thus described, not only in the Pro- 
 vince of Manitoba, but throughout the Dominion among those with 
 whom the subject had attracted attention, it was considered that tlio 
 action of Parliameiit had linaliy settled the (juestion, and that the 
 Provincial railways would be permitted to carry out the policy de- 
 tennined on without further opposition. 
 
 'J he abandonment by the Canadian Pacific Eailway of its mo- 
 nopoly, had hi en nrraistiikable, unqualilied, and (Kjmplete, and all 
 that was looked for, was, that the Company would honorably fulfil its 
 obligationis, and accept the inevitable consequences to which their 
 engagements would leaii. 
 
 The contrary has proved to be the case. - 
 
 The line constructed under the authority of the Manitol»a 
 Govern»nent, in connection with the Northern Pacific could only be 
 looked upon ns the lirfct siep towards the development of a system 
 independent of that of the Canadian Pacific. Consequently on the 
 completion of the line runnirg south to the boundary, two branches 
 have been projected, one to run to the south of the /\fsiniboine, 
 crossing the river to portage la-Frairie. At this place an independent 
 line has been constiucted to the north west; the Manitoba and North 
 Western which hitherto has been a feeder to the Canadian Pacitic 
 Railway. But the connection of this line with the newly constructed 
 ( branch would attain for it an outlet to the Northern Pacific, a second 
 branch is proposed to leave the first constructed line nearer the 
 bonndary and proceed to Beaconsfield, whence turning north westerly 
 it will run 1o Brandon 135 miles from Winnipeg. h\ addition 
 engineers are examining a location to prolong the line westerly from 
 Beaconsfield to the touris river. 
 
 It is necessary fully to explain what the cause of dispute really 
 is between the newly constructed lines and the Canadian Pacific 
 Railway. It has been lost sight of in the multitude of words used 
 during the contest and consequently it is only imperfectly understood. 
 
 'I he claim has been put forward by the lines, having a charter 
 from the Manitoba Government that thev nossess the rij>ht to con- 
 struct a line tween the points named, and consequently when they 
 meet a railw., . intersecting their line, they are at liberty to cross the 
 track provided they do sj safely in accordance with law. Jn the 
 Dominion of Canada, they are some hundreds of such crossings; on 
 the Continent of iSorth Americi several thousands; and with the 
 observance of the precautions laid down by law, there is perfect 
 unanimity from danger. The principle observed is that all trains 
 
npproacliing Buch a crossing on all otcnHionf, stop for one minute. Tbu.s 
 the one risk, that ot collision, is avoided. 'J lie iron croesing plate ia 
 a simple contrivance ; the rail is left open on both lines, the opening 
 being protected by guard rails, so the wheels cannot leave the track, 
 the plate being carefully wrought to the angle formed by the junction 
 of the two lines. 
 
 It was to oppose the introduction of this crossing in the track of 
 an unimportant branch of the Canadian Pacific, the Pembena Mountain 
 Railway that the difficulty took place. To speak of any inconvenience 
 or danger, or additional expense is totally beside the question; for 
 the latter is borne by the latest constructed railway. On the Pem- 
 bena branch there are but four trains a week only. Even on the 
 Canadian Pacific main line, there is only one passenger train up and 
 down, likewise one freight train each way, the latter being often 
 cancelled. Consequently the argument of expediency is not permis- 
 sible. I'he crossing itself is a very small matter, but it has been 
 made to embrace an important principle nothing less, in short, than 
 an attempt to stay the construction of a system of railways, which the 
 Canadian Pacific justly recognizes to be a rivalship to its own. 
 
 When the Canadian Pacific accepted the terms on which it aban- 
 <loned its privileges, the managers must clearly have understood the 
 consequences involved in that act. They must havj known that 
 Manitoba was not lighting for shadows. They must have foreseen 
 the construction of lines similar to those they are opposing, neverthe- 
 less they abandoned their rights with deliberation, and any oppo- 
 sition on their parts to lines chartered by the Province on any 
 pretence whatever, is a direct violation of their acceptance of the 
 agreement. Who will not ask if it be not a wound to public morality, 
 when acompany on technical grounds endeavors to reassert privileges 
 for the abandonment oi which it received the highest money consider- 
 ation ? .; ; . ;. .,. 
 
 What were thoss technical grounds? 
 
 In the same session of 1888, in which the guarantee of the 
 fifteen millions of land bjnds was vote i to the Canadian Pacific 
 Vtailway ; by a somewhat singular coincidence the Railway /Vet was 
 amended, and it was according to the assumed meaning of the clause 
 of the act that the Canadian Pacitio Railway endeavored to reassert 
 their privileges of monopoly. The attempt has been to introduce a 
 constitutional doctrine on the subject of the simple matter of a railway 
 crossing, a mere arrangement by which tv."^ railways running in 
 different directions can proceed each on its way uninterruptedly. 
 
 By the Imperial North American Act the power of the several 
 Provinces are defined, and what is not precisely set forth as appertain- 
 
8 
 
 ! ! 
 
 ing to the Province comes within the rule of the Dominion. Among 
 the ])uwers given to the former is the right of executing local works 
 and urdertakings with the exception of works 'd.eclared by the 
 Parliament of Canada to be for the general advantage of Canada." To 
 object to a Province constructing a railwr^-y for the reason that it 
 crosses another track, is to declare the railway crossing plate to be ot 
 such paramount importance that the line is not permissablej an 
 objection contradicted by our daily experience. 
 
 There has been a great deal of mystification of this simple matter 
 and it is surprising to us that the able civil servants in the railway 
 and canal department did not correctly see this point Or did they 
 fee it and the inlluence sustainining it, and suggest the course of 
 bringing it before the bupreme Court to obtain the unanimous, satis- 
 factory, and unqualified answer to the query submitted, which the 
 Court has given? i<y the Consolidated Railway Act of 1870 ten 
 railways were brought into the category of being •• for the general 
 advantage of Canada," and so were placed under Dominion Control. 
 
 Among these, the Canadian Pacific Eailway, not only the main 
 line, but also "branch lines or railways connecting with or crossing 
 them or any of them/' The meaning of the original specification of 
 the powers in the Imperial Act to our mind is very plain — that in the 
 event of a work being proposed by a Province and held to be of such 
 a character that it shnuld be undertaken by the Dominion, that the 
 work could be taken from Dominion control — and carried on by the 
 Central Government. 
 
 It never could have meant that a work should be declared "of 
 advantage to Canada," and by that means its construction should ba 
 stopped, the Province being prevented from undertaking it, while the 
 Dominion refused to take Inrther proceedings with regard to it. Ex- 
 tend the theories which have been propounded concerning this clause, 
 to the reductio ad absurd am the Dominion Parliament could declare 
 every Provincial railway or any Provincial w -rk of 'whatever 
 character to be in the category named and to make all Provincial 
 effort impos3ible. 
 
 The present difficulty has arisen simply from the bad English 
 used in the Railway Act of 1883, and as we have remarked by a 
 strange coincidence affirmed in. the Act of 1888 — at the time the 
 fifteen million guarantee was given in which we read—*' branch lines 
 or lailways connecting with " or crossimj them.'" The words we 
 italicize are simply tneaningless nonsense. A branch line has a definite 
 signification. It sets forth in general parlance, ali«e forming part of 
 the system of subsidiary lines connected with the ma^n line. The 
 words added are evidently meant to be explanatory of the term 
 
branch lines, written by one who did not understand what he was 
 writing about. 'I he meaning evidently is, that the branch line ao 
 called, must be directly worked in connection with the main railway, 
 and that a line not connected with it could not be called a branch. 
 The crossing, as we have shewn, has no bearing upon the case, an'^ 
 any attempt to .nlerfere with anindependent line, crossing one of the 
 ten lines uamtd in a legally approved nuinner is a wanton exercise of 
 tyranny at variance with railway necessities, opposed to comuion 
 sense, totally exceeding the powers given to the Dominion by the 
 IJritish North American Act, in no way warranted by any provisions 
 of railway oconomy, and in itself covertly striking at the Provincial 
 auconomy; so strongly and so generally entertained, that no publij 
 man would have the courage to avow opposition to it for to do so. It 
 the would drive him from political life. We put it to any one having 
 least knowledge of political life, if anyone dare present himself before 
 a constituency avowing contradictory opinions to those we express. 
 
 Nevertheless it is precisely in the spirit of c/i?ca«e that the 
 Canadian Pacific has attempted to regain the privileges which the 
 company ceded at the last session of *-*arliar t. Can any other 
 language be applied to this proceeding than tuat it is a deliberate 
 attempt to violate a soIcmuii engagement ? 
 
 It is not necessary to enter into the <letail of the events which 
 took place at Headiugly, the point at wiiich the Canadian Pacific 
 em[)loyes torcibly prevented the crossing plate being put in position 
 by the Provincial line. A large force of men were gat\*^red to resist 
 at all hazirdsthe attempt. A locomotive was placed at the spot 
 selected. At one time events looked threatening, as if there would be 
 bloodshed. They have little weight on the argument, more than they 
 show the determination of tiie Canadiaii Pacific Railway to defend its 
 position by physical force. Better counsels, however, ultimately 
 prevailed, and the dispute found its way into the courts. 
 
 We consider that in this emergency the duty of the Dominion 
 Government was perfectly plain. They should have in no way re- 
 cognizfid the Canadian Pacific Railway in the case as differently to 
 other railways. If the railway had offered reasonable objections to 
 the mode of crossing, they should have been listened to; but if the 
 plan proposed was satisfactory, it should have been accepted. Every 
 now and then the railway committee is appealed too for similar 
 crosaii g permissions. 'J he one duty imposed is to see that every 
 possible condition to insure public safety is observed, and that no 
 injury be doue to the property of the railway to bii crossed. We have 
 stated the grounds on which we consider any other consideration as 
 extra, judicial and un\ arrantable. We trust our proposition may be 
 
 2 
 
10 
 
 disputed, so that tho point will be thoroughly argued out, and 
 defli.itely settled It must appear astounding that the Canadian 
 Pacific Railway should have been permitted to object under the 
 special provisions of the Kaihvay Act to .my crossing of its line. If 
 tlie objection had to bo urged, it should have been solely advanced by 
 the Government on Dominion reasons. 'The Canadian Pacific had no 
 contention of any kind soever, and yet the question has been 
 submitted to the ^'uprenie Court at the instance of counsel for the 
 Canadian Pacific Railway, a company without a shred of privilege. 
 
 Ihis conduct of the Canadian Government has caused mucxx 
 adverse criticism. The Week, of Toronto, of the 29th of November, 
 a purely literary paper in no way committed to political opinions or 
 party views, and certainly not unfavourable to the present adminis- 
 tration, thus powerfully exposes the conditioQ of public feeling on the 
 subject : — 
 
 "There is, however, one aspect of the controversy which possesses 
 an interest of its own, independently of the legal issue,. Did the 
 Canadian Pacific Railway Company have in view the present conten- 
 tion \\hen they were negotiating with the Dominion Government 
 for the surrender of their monopoly ? Did the Dominion Govern- 
 ment have that contention distinctiv in view 1 Assuming that thev 
 did — and the contrary assumption would not be complimentary to 
 their astuteness— how is the fact to be reconciled with good faith, 
 not only to the Manitoba Government, but to the Dominion Parlia- 
 ment ? Or, if we give the company the benefit of the President's 
 plea and admit that as their transactioti was exclusively with the 
 Dominion Government they were under no obligation to show their 
 hand to the Manitobans or to Parliament, how can Sir John xi. 
 Macdonald and his colleagues free themselves Irom the imputation of 
 want of frankness to the Manitoba commissioners on the one hand 
 and to Parliament on the other ? It would be absurd to d^ny that 
 the arrangement made with the company for the extinction of the 
 monopoly was made at the urgent instance of Manitoba, or that the 
 consent of Parliament to the guarantee of the Company's bonds was 
 given simply and solely in view of the necessity of redressing the 
 grievances and complying with the demands of that Province. In 
 other words the one motive of Parliament was to secure for Manitoba 
 the right to the tree construction of railways within its own borders. 
 If the Dominion Government knew or believed, as it is now tolerably 
 certain they must have known or believed, that both the Government 
 of Manitoba and the people's representatives in Parliament were being 
 deceived, or were deceiving themselves in the matter, and that the 
 consideration in return for which the iruarantee was voted would 
 
mm 
 
 n 
 
 actually be withheld ffom Manitoba under the operation of the General 
 Rail\v;iy Act, was the transaction characterized by the frankness and 
 good faith which are to be expected from those entrusted with the 
 control of Canadian Legislation ? Equity is surely as worthy of being 
 considered in such a matter as law. We should like to iiear the 
 course of the Canadian Government defended on the side of equity." 
 
 The question submitted to the Supreme Court denuded of 
 technical verbiage was whether the statute of the Province of Mani- 
 toba authorized a railway to cross the Canadian Pacific Pwailway in 
 face of the provisions of the Dominion Railway Act. 
 
 'ihe case came before the iSupreme Court in Ottawa on the 21st, 
 2'2nd and 23rd November last. Mr. Blake and Mr. C. Robinhon 
 addressed the Court on the part of the C.madian Pacific Railway, Mr. 
 Mowat and Mr. Daltou McCarthy on the part of Manitob.i. The report 
 of the argument fortunately has been published. A perpetual memo- 
 rial of the contention. The counsel for Manitobi took purely the 
 legal view that the railways and its branches has been brought by 
 Parliament, which was omnipotent, within the control of the Domi- 
 nion, and that Manitoba could not give authority to croc, o Dominion 
 railway totally setting out of view that the crossing is unimportant 
 and without influence on the railway policy of the Government in 
 any way. Mr. Mowat argued that the powers of the Province to 
 charter railways were iully admitted, and even it ever considered 
 doubtful had been legalized by Parliament and that they would be 
 negatived if a railway could be stopped at any point of its course. 
 That there was no power given by the North Americaji Act to 
 negative any work of the character. " That it is utterly inconceivable 
 that there was the slightest intention on the part of the Dominion 
 Parliament to prevent any Province building the road " Mr. Mowat 
 wa8 desirous of adducing instances of the Railway Committee having 
 permitted Provincial Railways to cross railway lines declared to be 
 '• for the advantage of Canada." But the Bench would not entertain the 
 argument. It was remarked that if the railway knew all about it 
 what was the use of asking their opinion? If their former decisions 
 (lid not bind the railway Committee, could the Bench be expected to 
 respect them ? The fact of such things being done had no bearing on 
 the subject. It was evident that the Bench determined on first 
 principles to face the question in its uirect bearing and import, and 
 the country owes the[n a debt of gratitude that they have had, the 
 courage and patriotism t) do so. The decision of the Court is an 
 epoch in our constitutional legislature. 'Ihe judgment was given by 
 Chief Justice ISir William Ritchie. The Court declares itself 
 unanimously of the opinion that the said statute of Manitoba was and 
 is valid and effectual^ conferring authority upon the Railway 
 
12 
 
 Commission in the statute of Manitoba to construct such a railway as 
 the Portage extension of the Red River Valley crossing the Canadian 
 Pacific Railway, the Railway Conimittes first approving the crossing, 
 etc., etc. 
 
 fcuch a decision sets fully at rest the cruestion. It is said that the 
 Car.^c^'an Pacific Roilway talk of taking further proceedings. We 
 learn that an appeal as such is not possible against the answer given. 
 The greatest enemy of the Canadian Pacific Railway could desire to 
 see them perform no greater act of fatuity. We repeat in our humble 
 judgment they have no lonis standi in any court with regard to the 
 crossing of their line by any provincial line, "i'hey have no ground 
 to make an application of any character whatever, legal ingenuity for 
 the hour may suggest. It must be the Dominion Government only 
 ■who can take exception to any such proceedings. And there is we 
 repeat nothing negative in the powers of the Dominion. The only 
 course open in order to stop the construction of any Provincial line, 
 would be a parliamentary declaration that the iron plate with its 
 special provisions for public eafety in some special case, is for the ad- 
 vantage of the Dominion, so that the Provincial line can be stayed in 
 accordance with Dominion caprice or from some other cause. What 
 a memesis would follow such an act of madness ! 
 
 All lovers of good Government, all who desire to live under con- 
 stitutional rule, all who are opposed to injustice and to the exercise 
 of executive partizanship, all honest thinking raei: must rejoice that 
 this difficulty has been created, and that its complications have been 
 solved by the first court in the Dominion. Those who may have 
 hitherto hesitated to understand the necessity of a highly constituted 
 bench summarily to decide such disputes, may now understand the 
 useful functions it can perform. It may be remarked that during the 
 three days the case was being tried, the court was crowded. Its 
 generally empty benches could scarcely accomodate those who were 
 present. By no one among this varied attendance could the leaning 
 of the court be traced. Many felt that it was not in favor of Provin- 
 cial rights. Mr. Mowat may be said to bear the palm in the argument. 
 His address was wider less technical, and more statesmanlike, and in 
 accordance with equity, and tthe homely Everyday doctrine, that an 
 engagement is binding on those who make it. He has the greater 
 satislaction that his argument has prevailed. Not simply for an hour, 
 to pass away when the seat of the struggle is furgotten. 1 he 
 contention must remain on record as a caufse celehre and the memorable 
 judgment of the court, will hereafter become inseparably entursed 
 with the provisions of our constitution to form an unimpeachable 
 commentary on Provincial powers and rights, and the limit imposed 
 to executive pretension. 
 
13 
 
 Letter No. III. 
 
 The events described liave had the effect of attracting attention 
 to the Canadian Pacific Railway in the view of penetrating the power 
 and influence which the Company has endeavoured to exercise. That 
 pretension wa3 to rise superior to the legislation of a province : to 
 set a clear demarcation on its enterprise : to limit its efl'ort in tbe 
 development of its resources. So long as the contract with the railway 
 gave a monopoly of traffic, it could only be looked for that the condi- 
 tions would be enforced. But when by the clearest agreement, that 
 monopoly had been abandoned for full consideration, that it should 
 have been persevered in, can only hi regarded as a violation of 
 decency. It has been shown on what ridiculous pretension the effort 
 lias been made to impede a province of the Dominion, in a legally 
 conceived railway policy. That it should have been permitted an 
 hour by the Dominion Government shows a failure to understand the 
 true issues involved. Was there equal ignorance on the part of the 
 executive managers of the Canadian Pacific, in this attempt with an 
 attorney's smartness to enforce a principle which once asserted, it was 
 confidently hoped however vicious in its essence, there was ,i power 
 behind to_sustaln ? 
 
 One of the remarkable facts connected with the Canadian Pacific 
 is the ignorance in which the public have been kept, regarding the 
 'laracter ot the railway, its engineering features and its condition 
 ,jid economy. In Mr. Fleming's day we had long elaborate reports. 
 He found betore him a wilderness of which little was known more 
 tfiaii mere generalities; and concerning which there was everything 
 to learn. For many previous years the Hudson's Bay Company had 
 been chary of information in order to retain in their grasp this 
 preserve for the fur bearing animals in connection with their monopoly 
 of trade with the Indians. The general belief was that it was a 
 valueless uninhabitable territory, where the winters reduced human 
 existence to the hybernation of the bear or the beaver. By degrees 
 this theory passed away, and in the end the masters'ip of the territory 
 was transferred to the"Dominion. The geography however remained 
 unknown. Accordingly when the proposed railway was discussed 
 there arose different views as to the route to be followed and with 
 regard to the terminus on the Pacific. It is not our object lo revise 
 any of these disputes and allubion to them is only made to show that 
 the record of them exist, in Mr. Fleming's full and lucid reports. Any 
 one with some hour's study can there learn all the arguments in favor 
 of Burrard's Inlet and Bute Inlet, the impossibility of a railway 
 connection over Nunez Island to Vancouver Island j also the 
 
 wsama 
 
14 
 
 II. 
 
 1 1 
 
 unanswerable argiment in fav^oiir of tl'.e route selected by Mr. Fleming 
 by Yellow Head Pass. Indeed during the wliole period 01' Iuh holding 
 office as chief engineer, we had lull reports of what was being done, 
 and the public had nothing to learn. 
 
 Since his retirement we are entirely without information. No 
 special report, has been made by the Railway Department, or if made 
 it has not been published, and nothing more supijrficial than the 
 statements in the departmental reports can be possible No sitisfac- 
 tory reasons have ever been given for the change from the low pass 
 and the easy grades with the fieedoni from snow obtainable by the 
 route by the Yellow Head Pass to the extremely heavy grades at 
 Kicking Horse I'ass. of wliat is called "the temporary line," and the 
 dangers of the Selkirk range from mud and snow slides, the monument 
 of the dread, which remains in the series of massive snow sheds 
 constructed to escape these avalanches. H any one lact of British 
 Columbian geography was known it was the low level of the Y'ellow 
 Head Pass as the gate of the Province. It Avas the mode of entrance 
 by which the territory was approached and its interior penetrated. 
 Not simply from the east, but alike from the west, canoes ascended 
 the Kiver Columbia to the northern bend, known as the boat 
 encampment, and ascending the tributary stream, they found their 
 way to iellow Head Pass to obtain access to the Jb'raser and other 
 parts of the territory. 
 
 There has never been any valid reason given in accordance with 
 common sense and sound engineering principles, as they are understood 
 by laymtn, for the abandonment of this pass, and the route leading to 
 it. 'ihe grades throughout, were limited one in one hundred 53 leet 
 to the mile, with curves of a large radius none being less than about 
 a quarter oi a mile. 
 
 On the Kicking Horse route the grades were immediately made 
 more than double in elevation, being raised to IIC feet to the mile. 
 What the curves are limited to, has never been stated. No table of 
 grades and curves have ever been publisiied. The knowledge of their 
 character is that of an unknown land. Mr. Blake endeavored in vain 
 to obtain the information. H has been said that he had the sections 
 sent him to the Committee room. That was not the form in which 
 the information should have been given. A proper descriptive table 
 should have been made m the way such detail is set forth, so that it, 
 can be understood, grades and curves being clattsitied- It has been 
 publicly stated that throughout the whole line the curves are very 
 sharp, some as low as 450 and 500 feet are admitted. Through the 
 mountains they are confessedly of small radius, and the grades of the 
 temporary track are in some eases 3 feet to the 100. The report goes 
 
15 
 
 that the curves become sharjjer as the railway ])aH!Jes west, till the 
 TnountaitiH are reached, and then comes tlie miniminn .of curvature 
 and a formidable maximum of grade. 
 
 Wealth has always had and always will have its influence and 
 the Canadian Pacilic from the patronage it possesses is enabled to 
 wield extraorcfinary power in all directions. Where does this power 
 not penetrate, when it is desirable it should be exerted ? The line has 
 become to be a dangerous question for politicians whose policy is not 
 to disturb matters which sleep, and. we can hope to-day to get no 
 more information through the House of Comn-ons than we did years 
 ago. 'J'he reason assigned for abandoning Mr. Fleming's line, is that 
 a route one hundred miles shorter has been found. It has been 
 however only proved to be about twenty-live or thirty miles less, 
 making allowances for the improvements which could have been 
 obtained on the first location of Air Fleming. But from the increase 
 of grades, and the consequent demand for increased power of traction 
 and expense of working, relatively speaking, the present route is 
 equal to a longer line tlian Mr. Fleming's location, which in this 
 respect had everything in its favour. 
 
 It aiay be said that this is the refurnishing of the rusty arms 
 with which the railway was attacked five years ago. The point of 
 their origin is of little consideration. If they are to ba remembered 
 to-day, it is owing to the aggressive attitude of the railway and the 
 indifference shown by its managers to all public opinion. They act 
 as if irresponsible- In their late difficulty they organized a mass of 
 men and placed them on the ground lo prevent by force the simple 
 introduction of the ordinary iron crossing plate in their line, as if the 
 whole welfare of the Company was at stake on this simple proceeding, 
 examples of which are to be found all over the continent within 
 every ten ijiiles. 
 
 The country desires a much fuller report of the condition of the 
 Canadian Pa.ilic Railway from Calgary to Fort William, and from 
 Selkirk to Kaiuloops, than at present it possesses. The portion 
 executed by the Government is known in all its characteri.>tics. 
 Indeed the company received a large sum of money to complete tUe 
 embankments east of ^elkirk, and the information possessed on this 
 subject needs little addition. 
 
 It is not the case with the Canadian Pacific proper. To obtain 
 the information which the public have the right to expect, it is 
 necessary for statements to- be made of the grades ascending and 
 descending, of the number and radius of ♦' curves, the iron bridges 
 permanently constructed, the wooden bric^is, which cannot b^ held 
 to be permanent, the trestle work, where introduced, the length, the 
 
 ; 
 
16 
 
 1 1 
 
 height, the for;u of constrnction, the date of constiuction, the steps 
 taken to bring these localities to the condition of permanency, in the 
 way of embankiucnt, the extent of siding in each station, what works 
 are required for the completion of the line, and wliat steps are being 
 taken to remedy the condition of the " temporary track." There ought 
 to be no nndiie desire to press upon any railway the full completion 
 of its obligations. All railways require time and expenditure to 
 bring them to a satisfactory working condition, and it is an injustice 
 to exact undue rapidity in the perfection of ihe work. But a country 
 which largely subsidises a railway has a right to exact that the 
 agreements entered into l.e fully fulfilled and to be informed truly of 
 the condition of the enterprizp. 
 
 In the next we will consider the right Canada has to make such 
 demand on general principles. It may be argued that every contract 
 must be f-atisf'actorily lulfilled. The Canadian Pacific Railway has 
 been constructed on the principle that it will compare favorably with 
 other lines to the Pacilio coast, a vague unsatisfactory standard the 
 reverse of elevated. With the advantages we possess of an assured 
 •route by the Yellow Head Pass 3,270 feet above tide water, that we 
 should have abandoned it, can only be regarded as a national misfor- 
 tune. With many disadvantages to contend against, the other Pacific 
 lines have done their best to remedy these extreme grades. The 
 Mullen tunnel and the Bozjman tunnel on the Northern Pacific have 
 been constructed to do away with the extreme grades over the 
 mountains, throu^jh the first summit from the Pacific and the 
 Yellowstone tipur. All that we can learn is now being done on the 
 Canadian Pacific in this direction, is the one effort, the construction 
 of snow sheds over the Selkirk range. 
 
 We have no official statement if any delay has occured from the 
 mud and snow slides on the mountains. No report has been made by 
 the Government, even if any has been demanded and been received 
 in the Railway Department. No one can blame the railway company 
 for not volunteering information on such a subject. The managers 
 command the telegraph and the whole place is under their control. 
 No one can remain in the neighbourhood, if opposed to their policy. 
 The small population is at their mercy. There is nothing to bring 
 any irregularity to public attention. Jf at Winnipeg there is reason 
 to believe that there is difficulty in passing this locality, the mail 
 to Victoria, can at once be transferred to the North Pacific Raihray, 
 and reaches its destination with some hours delay. The whole country 
 west of Winnipeg, is involved in the prosperity of the Canadian Pacific, 
 accordingly the ordinary public learns nothing of what happens in 
 this respect. Stories, however, reached the outer world of the railway 
 
17 
 
 being enciimbored at thfi Selkirks, of loss of life and of delay of some 
 days, ill 'nstances extctiding over three weeks. The public liave a 
 right to know if there is truth or not in these reports. The simple 
 way of giving inforuuitionon the subject is to set out the delays, their 
 date and the length of time they lasted. There may have been no 
 delays. 'J hen the railway has been calumniated and no objection 
 niay be urged ngiinst the route over the Selkirks. It would follow 
 then that the fear of snow and mud slides was illusory, and that the 
 sheds Jconstructed were simply as a wise precaution taken in view of 
 public safety in all respects perfectly successful. 
 
 Public attention has been directed in a slight degree to the 
 subject. The line has been running nearly three years and nothing 
 is ever heard of anything being wrong, and it is not anticipated that 
 difficulty may arise in any form. There are those however, who 
 study e resources of the country, and do not accept the fool's 
 ])aradise of considering that all before them is right on the railway, 
 on the contrary who turn +heir attention to the future and give some 
 examination to prospective consecjuences. It ought clearly to b^^ 
 established, if the Selkirk range is what it has been as.serted to be, in 
 all respects safe and unobjecticnnble. The tomporary grade of the 
 Kicking Horse may be relieved in some form by an expenditure of 
 money, at least so it is confidently t-iatcd. But there are objections 
 and risks which no money can remove. The Canadian Pacific owe it 
 to themselves as well as the public, clearly to establish the character 
 if this is or not the case in the Selkirks, and to set speculation on 
 the subject beyond a doubt. •. . 
 
 The contract of the Canadian Pacific Railway is to complete the 
 work of the railway and thereafter forever efficiently maintain work 
 and run the railway. 
 
 There has been no indication that the company desire to depart 
 from these conditions. But is there anything to prevent them giving 
 .the line over to the Govefninent under circumstances which may 
 occur? Can any one picture the consequences in such a case? What 
 then would be the obligations of the Ooriiinion, its duties, its respon- 
 sibilities, in accepting the ofler ? 
 
 These are very serious questions to be temperately asked. It 
 cannot be denied that our knowledge of the condition of the railway 
 is of a superficial character. From the time ot the contract being 
 passed on the 21st October, 18fc0, the information given to the public 
 has been slight. We do know what consideration the company 
 received. We do know that the company changed the location troul 
 the Yellow Head Pass. We know the line was opened in July, 1886, 
 nearly five years in advance of the time agreed, on 1st May, 1891, 
 
18 
 
 Wc have receivod accounts of the receipts of expenditure in the 
 reports to shareholders and bondholders. 
 
 The stake of Canada in the Pacific Rail way is great ; the situation 
 of tlie lii^e of paratuoiint iinpoitance to the Jioniinion, In the next 
 section, 1 will proceed to examine th-e extent of this interest and what 
 the policy of the railway has beea in other respects, for althoufrh 
 bearing the ranie of the Canadiati Pacific Railway, it hiis extended its 
 interests and connections to such an extent as to put out of view the 
 purposes for which it was incorporated, 
 
 Letter No. IV. 
 
 1 1 
 
 i I 
 I ! 
 
 It is pertinent to examine into the relations between the Cana- 
 dian Pacific Railway and the Dominion, in order that the relative 
 obligations between them may be understood and examined. The 
 contract was signed the 21st Octobei, 1880. Setting aside the detail 
 of the agreement, the Company is bound to construct a railway 
 from Callander station nefir the east end of Lake Nipissing along the 
 north shore of Lake Superior to the constructed line at Lake Superior, 
 and from Selkirk to Kamloops : the ciiaracter of the railway and the 
 materials used in its construction, with the equipment ot the railway 
 to ha regulated by the Union Pacific Railway *'when first constructed." 
 No more extraordinary words were ever introduced into a contrt.ct 
 for nothing more vague can be imagined. At what date, and in what 
 condition was the Union Pacific Railwiy accepted as satisfactory ? 
 The clause places the. country to a great extent at the mercy of the 
 contractors. Any excessive grades and objectionable curves, any 
 abnormal expedient, any vicious principle wiiich has crept into the 
 construction of the United States railway named, by these words, 
 become justified, accepted and unchangeable on Canadian soil. If 
 railway construction had been in the infancy of the art, then some 
 excuse might be found for the acceptance of vague and general 
 obligations. At the present day there is neither ground nor excuse 
 for any such departure from the wise policy exacted by sense and 
 called for by experience. There should have been a specification 
 attached to the contract clearly setting forth all the requirements 
 which prudence should lay down in railway construction. It was an 
 arrangement on which no mystery should have been permitted, the 
 character of the road, the width of its cuts and embank'tnents, the 
 limits of its curvature and grades, the form of tie and the weight of 
 rail, the nature of its bridging and culverts, the conditions under 
 
19 
 
 in the 
 
 t^ituation 
 tlie next 
 :ind Avluit 
 althoufrh 
 LMided its 
 view tlio 
 
 he Cana- 
 relative 
 I The 
 he detail 
 .1 railway 
 ilong the 
 Superior, 
 ' and the 
 ? railway 
 tructed."" 
 . contrt.ct 
 . in what 
 ^factory ? 
 .y of the 
 
 which trcstling wouhl bo permitted, and the step^ to be taken to 
 make them nndiitibly Hiil'e ; all tlieao rec[niyiteH shouhl have 
 ht'cn uniniHtakeably .specified. 'J'ho record of tliis contract must 
 (!ver remain a disirredit not to those who dratted the agreement in 
 the interest of the coiiipany, for the cunning of these few words is 
 dimply unfathomabhi, hut to those who represented the Dominion in 
 ihe transaction and nppeared in tlie House of Commons to defend the 
 agreement and effect its consummation. Of the majority in tlie 
 House vif Commons sustaining the Government, fuw could understand 
 tlie technicality involved in the latitude permitted. On that subject 
 they trusted to the txecutivo. The specious argument that the 
 matter miuht safely be left to a company who were assuming obliga- 
 ^tions for ever, had weight to bear down all opposition. Nearly nine 
 years have passed since the acceptance of the conditions. Looking 
 iiI)on the event as a matter of history, the Dxtent to which tlie 
 Dominion has placed itself in the power of the company is apparent, 
 by the clause that whatsoever can be proved to have been admitted 
 on.the Union Pacific, however objectionable, however discordant with 
 true principles of construction is representative of what the Canadian 
 Pacific is held to i)erform. 
 
 No argument in favour of the Dominion can be advanced that 
 subsequent improvements have been introduced to sustain an objection 
 to what is inexpedient. However necessary and indispensable such 
 changes in themselves may have been, it cannot be argued that they 
 are required on the Canadian Ptailway. The answer to the Dominion 
 by the directors is plain, they have complied with their contract, 
 they distinctly accepted the condition of the Union Pacific at a certain 
 (late, as that by which they should be regulated." Is the demand of 
 the Dominion ii excess of that requirement ? If it be so, and its 
 execution be desirable the directors will demand payment for carrying 
 out the views of the Government. 
 
 Is the Dominion no entirely at the mercy of the Canadian Pacific 
 in this respect? 'J'he que.'^tion is worthy of examination. On one 
 poin. the Dominion are not responsible : The change of route. The 
 executive managers of the railway abandoned the northern route of 
 Mr. Fletning, selected by the Government, established to be feasible, 
 with every advantage of grade and curvature. On their OAvn impulse 
 and in accordance with their own policy, they entirely changed ihe 
 location. It follows then all the responsibility attributable to this 
 proceeding falls upon the Canadian Pacific Railway. J f they be called 
 upun for instance immediately to amend what is called the " temporary 
 grade " down the Kicking Horse pass, and should it be held to be 
 necessary to place the railway beyond the influences of the mud and 
 
20 
 
 i I 
 
 \\ 
 
 enow nlides, which are paid to be threatened on the location ncrosa tl\o 
 Selkirk range, the country surely cannot bo relerrod to tlie Union 
 Pacific in justification ol'thifi condition, on the plea that at the dute 
 mentioned there were grades fully equal to those the company have 
 introduced and that on that line there is the sair.o danger from nnow. 
 Tije managers cannot tell us that they have fulfilled their contract 
 with the CO jntry, and that if it be determined that the objections 
 specified are to be removed they must demand [)ayment lor the cjst. 
 The reply to any such pretence is plain and unanswerable, 
 country Ibund the contractors for the railway a lino on which nont ... 
 these objections presented themselves. On that line they based their 
 contract with the railway managers. On the vague clause which 
 Parliament accepted the company by its own desire and it is a matter 
 of history, without proper previous investigation, made this change. 
 On the company only the responsibility of the measure rests. Tho 
 change of location, throws on the ccntiactors all rcf-ponsibility for 
 any deterioration of work incident to the physical geography of the 
 country jiassed through by the new location. The Dominion accept 
 no responsibility on this point Indeed it distinctly repudiates it. 
 If the country exacts the removal of these extreme gritdes, it must be 
 at the cost of the company. If public safety demands that the lino 
 over the irelkirks be departed from, it is not the Dominion of Canada 
 which can be called uj on to meet the expenses, for the country was 
 purely passive as to location being made there. Moreover the repre- 
 sentation on which the change of line was permitted has not come to 
 pass. It was represented that the railway would be shortened one 
 hundred miles, whereas the saving of length is little more than a 
 quarter of that distance and relative to the lirst line selected owing 
 to increased curvature and grades, it is longer in t'le view of the 
 railway power exacted its traction and the time taken to make thj 
 journey. 
 
 The obligations incurred by the Government will be best shown 
 by what has been paid. 
 
 A bonus in casli of $25,000,000 
 
 Lands granted, 25,000,000 acres. Of tliis (ixtent of territory 
 
 10,065.70:; acres have been sold, fetcliiiig •. 18,614,693 
 
 14,934,237 remain unsold, value per acre S2 29,868,474 
 
 §48,483,107 
 Government fines given over to the Canadian Pacific, viz., from Lake 
 Superior to Selkirk, and from Kamloop.s to Fort Moody, set 
 forth in Government balance sheet, 1887 30,760,785 
 
 8110,243,952 
 
21 
 
 Thus the tlio company has $7.j, 48;i,107 as a bonus towards the 
 the coniplotion (>!' tho nuiuber oi' miles it has conMtructod, viz., I'roni 
 Callondar to Fort William, G5G ; IVotn Selkirk to Kanilo )ps, l,'i77. 
 Total, 1,93;) miles, at the rate of $38,015 per mile. 
 
 The oporationH ot the Governuient furnish an examiile of cost, 
 which we niiiy profitably consider. It is as follows: '1 hu poitions of 
 line completed by Government are— From Lake Superior to Selkirk, 
 108 miles ; from Kamloops to Fort Moody, 215. Total, G2.'>. 
 
 Thislieavy work may compare with anything which the company 
 had to .nidcrtake, including all charges, all niiscellaneous matter, all 
 the contint^encies alfecting work and chargeable to it on all (ccasions, 
 a considerable item, and especioUy on the part of a Government. 
 The cost was ^oO, 700,785, a trille under $G9,U00 per mile, including 
 -ome imperfect equipment. 
 
 Those figures- may be profitably applied to the Canadian Pacitic . 
 Railway. 
 
 The work may .be divided into three classes : Erom Callondar 
 by Lake Nippissing, popssing north of Lake Huron and north of Lake 
 ("superior, to K'^'^t William, 05(1 miles; from Selkirk towards Calgarry, 
 .-;iy 800 miles ;, inence to Kamloops, 477. Tota^, 1,033. 
 
 In one of i^is communications to the Government, Sir George 
 cjtephens stated that 1,131 miles of railway had been- constructed at 
 a cost of $23,078,020, the average cost per mil . being $20,400, 
 conseiiuentlv of the Dominion bonus there remained to be expended , 
 on the remiuning 8u2 miles $40,405,238, being $50,380 per mile. 
 
 With these figures the liberality of the grant of the Dominion 
 may be estimated. 
 
 The directors of the company issued shares to the amount of 
 $05,000,000, on which during construction five per cent interest was 
 to be paid. 
 In tlio balance slicet of 1885 the cost of the road is set out at... S107.2i~l,4C8.87 
 
 I'.qiiipment 9,344,207.41 ' ' 
 
 Oiiistniction, plant, tools and outfit , • 130,812.38 
 
 heal estate : 415,581.64 
 
 Total $117,141,100.30 
 
 Dtidiicted Governmuiit bonus 73,483,167.00 
 
 rhf balance » $43,657,993.00 
 
 remains to represent the cost of the railway and equipment to the 
 company as the additional money expended, represented by the 
 56 5,000,000 shares. 
 
I'^^U 
 
 22, 
 
 The cost per mile average of the whole line has been about $55,778 
 
 The equipment nearly 4,859 
 
 $G0,G37 
 being in access of the cost of the work of the Government at the 
 terminal point of the Pacific coast, and across the rough and broken 
 country west of the Lake of the woods. At both places the work was 
 exceedingly hoavy and at the time more expensive from its difficulty 
 of acfoss, a disadvantage not experienced to the name formidable 
 extent during the operations of the company, For the work in their 
 case could be approached from both ends. 
 
 'J he figures given by the Canadian Pacific show the important 
 fact that the country iias constructed the greater part of the cost of 
 the line. 
 
 Expended Ijv the Government of Canada at the westevn terminal 
 
 points..' $36,700,785 
 
 Total expenditure of Canadian Pacific Kaihvay as set forth in balance 
 
 sheet 31st December, 1885.. 117,141,100 
 
 Total cost of construction and C(|uipment of line 8153, 'JOl, 945 
 
 Bonus in money and land jiaid l»y tlie Dominion (Tovcrnmcnt 110,242, 952 
 
 Total disbursements of the Canadian Pacific Eailway » $43,657,993 
 
 Consequently the (jovernmont of Canada has borne five-sevenths 
 of the total cost (110-151) the company two-sevenths (44-154) the 
 fee simple of the railway remaining in the hands of the company. 
 
 No mention is made here of the loans and the other money 
 assistance given by the Government to the company. 
 
 Having stated the actual cost of the Railway $55,778 per mile, on 
 the whole length constructed by the company, I revert to the report of 
 Mr. Van Home, Kith fc'epteraber, lb84, and that of a Mr. Peid, of 
 Illinois, dtited Oth September. 'I he one published in the Montreal 
 Herald, the 27th September, 18S4. The letter of Mr. Van Home 
 vouches lor the accuracy of Mr. Reid's statements. 
 
 Mr. Reid's estimate for the heaviest portion of the work is as 
 follows : — 
 
 West Kamloops Lake to Griffin Lake 138 miles, average cost $21,265.. $2,975,970 
 From summit of gold range to summit of rocky range 150 miles, 
 
 average cost ^33,000 4,950,000 
 
 $7,925,970 
 
 Being an average of estiraited cost lor the distance of 288 miles 
 of$27,.':.2U 
 
 'J here is one point in connection with construction which has 
 puzzled railway managers. H there be a subject vrhich has commanded 
 
23 
 
 attention without difference of opinion, it is tliat of mainteninco, and 
 there is a common accord with reji^ard to the principle of carrying it out. 
 'I here is no dispute in this matter as in that of freifrhts, no antagonism 
 as to prospective possible advantage, no struggle for supremacy over 
 a given distiict. There is a common desire to reduce expenses, to 
 bring this necessary outlay within the narrowest limits and to practice 
 the most severe economy. It is, evident that the Canadian Pacific 
 have discovered a new method of carrying on this duty. 
 
 Their public accounts show in the last three years the cost to 
 have been per mile, 3885, $240; 1886, $293; 1887, $401. The 
 indispensable expenditure established by the operations of other 
 companies ranges from $8>]0 to $1200. Taking fourteen of the piincipal 
 lines on this continent, during the last three years the largest annual 
 expenditure has been that of the Boston and Providenca in 1885, 
 ^p250 per mile j the lowest the Chicago, Milwaukee and iSt. Paul are 
 $520 per mile. The Union Pacific averages about $853. The Grand 
 Trunk about $850. The Illinois Central $671. This is the lowest 
 oust per mile reporfed. As a rule it i? al^^ove ratlier than below $1000 
 a mile in instances reaching $Lo(JO a mile. 
 
 With such returns as the Canadian Pacific Railway shew in this 
 respect, the managers must have been the envy of the whole railway 
 interests of the C3ntinent.' It may be inferred that they will be able 
 to realize a handsome douceur by communicating the princi[)!e on 
 which they effect the saving, of course assuming that their answer 
 will be satisfactory. 
 
 We have to-day only dwelt on tne relations with the Canadian 
 Pacific proper, with the country. The additional lines engrafted on 
 the company are in no way involved in the original contract, and 
 cannot properly be brought int) relation with it. 1 v/ill attempt in 
 the next paper tlie examination into these obligations, their character, 
 extent and cost, the outlay they have exacted, and the responsibilities 
 tl 7 entail. My purpose in this paper has been to show the relation 
 of tlie Canadian Pacific Railway proper to the Dominion, in the sense 
 of the reciprocal obligations which have arisen, and under what 
 circumstances they have been contriicted. As has been set forth the 
 contract was to construct the line from Callend ir to Port Moody, less 
 the parts undertaken by the Government viz ,023 miles west of Lake 
 Superior and east of Port Moody, leaving the company to execute 
 J 933 miles, for which the subsidy in cash and lands of $73,483,167 
 has been paid. This was the one contract which alone has to be 
 considered by the Government in any negotiations wit i the Canadian 
 Pacific Kailway, a fact jealously to bi borne in view, never to be 
 departed from. 
 
I I 
 
 IT 
 
 il 
 
 24 
 
 Letter No. V. 
 
 f I 
 f 1 
 
 Il ' 
 
 i I: 
 
 "We have now to turn to the several additional connections of 
 "which the Canadian Pacific Railway has obtained control or has 
 constructed since ils charter was granted, so as to bring its system 
 within a few miles short ot 5,000 miles. 
 
 Tiifcse lines and branches are as follows : 
 
 Miles. 
 
 The Canada Central Hallway extending from Brockville to Callendar 243 
 
 Quebec & St. Martin's Junction and Jiranclies 208 
 
 Montreal to Ottawa cl- ]5ranclie.s 133 
 
 Ottawa to Carleton .Junction 28 
 
 Montreal to Toronto 347 
 
 The Credit Valley system 
 
 'Foronto, Grey & Bruce system 192 
 
 St. Lawrence Bridge & St. John's Atlantic ct North Western llailway system 
 
 Prescott to Ottawa 53 
 
 Algoma Branch to St. Mary 
 
 Manitoba & South Western Kailway 
 
 Tt would be of fid van tare if it were possible to consider the trullic 
 returns of the Canadian Pacific Railway apart from the other connec- 
 tions so that its true character coi be known and estimated, as is 
 the case of that of the InteicoloniK ailway. From the circumstance 
 that the company regard the line to the Pacific only as a part of their 
 system, and the results of their operations are given as a whole, the 
 precise inlluence of the Pacific Railway on the commerce of the 
 country can only be imperfectly known. 
 
 We have before us the annual reports of the company, which 
 throw such liglit on its position as we may obtain. 
 
 ]t has been said that the Canadian Pacific railway stock consists 
 of shares amounting to ^05,000,000, on which the sum of three per 
 cent , annual interest, is allowed. This dividend has never been paid 
 out of revenue : $1,950,000. ]n the circular of the 29th December. 
 1883, the President, Sir George Stephen, estimated that an additional 
 two per cent, would be paid during construction, bringing the rate of 
 percentage to five per ctnt. There is nothing ia the accounts to show 
 how much has baen so paid. bo lar as the reports are a guide to us 
 the dividend is a charge upon capital: if the 5 per cent, be paid 
 annually of $3,250,000. 
 
 The returns of the Canadian Pacific for the years 1886 and 1887 
 arc as fcJlows : 
 
 1S80— KarningH, $10,081,803.59— Expenses, $6,378,317.05 -Net 
 revenue, j|3, 703,480.54— Fixed charges, $3,068,041.84. 
 
 1887— Farnings, $11,606,412.80— Expenses, $8,102,294.64- Net 
 revenue, $5,504,118.16— Fixed charges, $3,250,263.81. 
 
 N 
 
M 
 
 25 
 
 These returns give a net profit • 
 
 188G S635,444 70 
 
 1887 253,854 55 
 
 It is proper in view ot the public interest and the rehition of the 
 Government to the llailvvay to analyse these fixed charges :— 
 
 Capital Liabilities. . Amount. lutercst. 
 
 First Movtgago I'.onds, Canadian Pacific Railway $35,000,000 81.750,000 
 
 (Janada Central Itailway... l,82o,3;33 109,500 
 
 I'rovince of Quebec, Quebec, IMontreal, Ottawa & 
 
 Occidental liailway ; 3,500,000 175,000 
 
 Algoma Brancli 3,650,000 182,500 
 
 $43,973,333 82,217,000 
 
 Leased Lines — 
 
 Ontario & Quebec Ttaihvay Debentures 9,890,000 494,50C 
 
 ordinary stock 2,000,000 120,000 
 
 1 .'ebentures issued on — 
 
 •Smith's Falls and Montreal Short Line, Western Ontario ,.',.■ 
 
 racific Line, St. Lawrence Bridge 5,304,667 265,233 
 
 Atlantic and JVorth-Westeni Railivaii — 
 
 St. Lavrence Bridge to St. John's, 1st mortgage......./... 430,000 21,500 
 
 St. John's to Faruham, 1st mortgage , 288,900 14,445- 
 
 Manitoba South- Western liailway 2,544,000 . 127,'20O 
 
 -North Sliore Kailway, Quebec to Montreal Junction 3,936,053 196,802 
 
 St. Lawrence and Ottawa Kailway 973,333 38,933 
 
 Tinnnto, Grey and Bruce Kental 140,000 
 
 interest on $15,000,000, 3} i)er cent Bonds guaranteed iJominion 
 
 Covernmeutin 1888, on security of lands... 525,000 
 
 >"y Total $4,100,613 
 
 Query — 
 
 As to interest on Bonds yet to be issued on account of Expensive 
 Montreal Entrance, say $100,000. 
 
 Also — 
 
 Interest on Expenditure on the Short Line to Lower provinces, 
 in excess of Government guarantee of interest, say : $150,0UC. 
 
 Towards the and of last year, an article appeared in the 
 "Buliionist" of London which attracted great attention in money 
 circles. It set forth ten months of the year's traffic of 1888, was 
 known, and estimating the wiiole year's return on this basis, the total 
 amount for the year was get down at $11,600,412. The working 
 expenses similarly 'ilculated, gave the amount as $7,925,000. The 
 fixed charges were returned at $3,680,138. 
 
 4 
 
 'M 
 
 n 
 
 '.'•"J 
 
msmm 
 
 III! 
 
 ! 
 
 30 
 
 On this basis the estimated surplus was twelve hundred and 
 seventy-four dollars ($1274), when we come to, estimated figures of 
 this extent, giving such a small result, it is by no means certain that 
 the surplus may not be a deficiency. 
 
 Nothing has been said in the above statement of the guaranteed 
 interest on the 65,000,000 of capital shares. It is a well known fact 
 that the sum of §15,942,645 was deposited by the Company with the 
 Canadian Government as the fund for the payment of interest, for 
 ten years from August, 1883. Such shares are described in the oflicial 
 list ot the Stock Exchange, London, as guaranteed by the Dominion 
 Government to 1893. From that date no guarantee is extended. 
 1 here is accordingly no ground for applying to the shares the character 
 of a guarantee more than this limited recognition. Is it likely that 
 it will be renewed ? We do not believe any Government could bring 
 such a proposal before Parliament. 
 
 Last year the Canadian Pacific again appealed to the Government 
 for help. In the fact of the figures we have given of the munificent 
 aid granted by the Dominion, it may be well nsk-ed under what 
 circumstances such an application could have been mule. 
 
 If the emergency had been one affecting the Canadian Pacific 
 Line, there might have been some recognition to the call for syrfl^thy 
 and help. The figures given in these papers shew that the Dominion 
 has actually paid live-sevenths of the r/hole cost of the construction of 
 the Pacific line proper. There are many who consider that the Dominion 
 subsidy was sufficient to build the entire Railway, and certainly not 
 without apparent reason. The published accounts o^'the company, set 
 forth the total disbursements ^o have been under $44,000,000 against 
 $65,000,000 of nominal stock, and $3o,000,000 of bonds. It was not 
 then from any embarrassment in connection with the Pacific Railway 
 that aid was asked. Nevertheless the assistance was given in the 
 form of a guarantee of $15,000,000, 3|- per cent land grant bondi^. 
 This consideration was however only obtained by the removal of the 
 restrictions contained in clause 15, of their original contract, by 
 which the monopoly of traffic to the west of Red River was sacrificed ; 
 a concession which admitted the construction of lines, in connection 
 with other systems, by which the traffic ot the territory will be more 
 or less obtained. 
 
 It was in the face of this clear, well considered and thoroughly 
 understood agreement that the Company endeavoured to oppose the 
 introduction of an ordinary crosf*ing plate, in its South Western branch, 
 so as to prevent the construction of the Northern Pacific branch to 
 Brandon, endeavouring to twist and pervert the clause of a badly 
 written railway act to its own profit. Had it succeeded in the. attempt, 
 
27 
 
 the legislation of the last session of Parliament would have been of 
 no accQunt. Although receiving consideration to abandon its monopoly, 
 the Company Avould have been able to retain it by a contemptible 
 technicality, and it was not from want of effort that the attempt 
 failed. ' - ^.'..i-'i-'" :.' -<:,.• ;:/ ^'y^<: v:^/-^^-: -/-n v;.,. ■ 
 
 For what purpose was this fifteen millions required ? Not for any 
 work in connection with the Pacific Railway, from Winnipeg to 
 liritish Columbia. Large disbursements are undoubtedly required to 
 coiuplete much which is defective in the existing line. All such 
 requirements however, at least for the time are laid aside. The whole 
 energy of the Company is given in endeavouring to complete its 
 system to Chicago • running a line side by side, with the Grand 
 Trunk from London to Windsor, in order to be able to reach Detroit, 
 on a branch of its system, a distance of 110 miles. There is a propo- 
 sition to run a line from Toronto to Niagara, 83 miles, and paragraphs 
 have appeared within the last few days, in the newspapers that the 
 Pacific Company has determined to bridge that river as it has done 
 the Saint-Lawrence at Lichine That it appears the " construction 
 account " is never to be closed, always to be .available and open, as 
 such accounts are. ' 
 
 What claim can this policy make with the Canadian Government ? 
 What is there at stake that Parliament should intervene ? Why 
 should the country come to the rescue again of a company which his 
 lavished its resources in lines having no connection with the scheme 
 for which the company received its charter, was created and was 
 .subsidized. Not one scheme o" the Company but has been subjected 
 to unfavourable criticism. Not one has supplied a national want. 
 'I'lie railway from Toronto to Smith's Falls, from within six miles of 
 llie latter town to within a short distance from Peterborough for up- 
 wards of a hundred miles, passes through a rough broken country, 
 dreary with rock and stunted timber, the land unfit for settlement. 
 When the railway approached Toronto it could enter neither by the 
 east nor west except by the favour of other lines: The consequence 
 wais the acquisition of the Toronto, Grey and Bruce system, but that 
 has been found insufficient and hence the necessity is suggested of 
 carrying on important works to enter Toronto by the Don River. 
 Another consequence of the project, is to carry the Toronto Esplanade 
 an additional width into the Bay to admit of the Canadian Pacfic 
 obtaining a right of way, the expense to be divided in proportions 
 between the railway and the Corporation. All this efiort, this labour, 
 this expense is explained in the one fact, of the necessity of obtaining 
 a direct connection with Chicago. As has been remarked it is 
 difficult to see with what end in view this policy is perserved in more 
 
^^ 
 
 ri 
 
 38 
 
 than to reduce the already low price of freight, to what extent a 
 connection with Chicago can be appealed to ns incident to and as a 
 necessary part of the subsidized Canadian Pacific Railway to tho 
 Pacific in tho interest of the Pominion is certiiinly a hiud matter 
 satisfactorily to explain. Ihere lias been likewise the cll'oit to obtain 
 a connection with tau t Paul with the bridge over the Fault Saint 
 Mary — the line through Canada was constructed at the expense of tho 
 Canadian Pacific, and to make its position in this respect unassailable, 
 it had to obtain a controlling interest in the line through thoJJnited 
 States at a great expenditure. 
 
 We take no account of the lines to the Esist through the State of 
 Maine to Saint John and to connect with lines proposed to run to 
 Louisburg and Sydney, in Cape Breton. They have hitluu'to b^en 
 kept distinct in name from the Canadian Pacific, although the interest 
 which controls them is said to be the same that of the Canadian 
 Pacific. , 
 
 The stock of the Canadian Pacific has four years guaranteed 
 interest of three per cent. The value of such a security is aljout 
 eleven and a halt per cent of the shares it represents, so far as the 
 interest alone is concex'ned. The shares otherwise have to stand 
 upon their merit, ' , 
 
 The history of this enterprize suggests that with prudence and 
 skill it might have been in tho hands of able, conscientious men. 
 Few schemes have been started with more favourable auspices, few 
 promised more assured success. The true policy of the managers of 
 the Canadian Pacific was to have limited its operations to the work 
 before them, and to have identified its existence with Railway 
 performing the service required in the localities ol' their construction 
 and not to have embarked in a dangerous, reckless, imperfectly 
 considered policy of aggression. By means of the Canada tenUMl the 
 Pacific Railway obtained a connection with the Saint Lawrence, with 
 the Grand Trunk and tho main arteries of the country. It was con- 
 nected at Ottawa with the Quebec line. These were its assured and 
 certain feeders of the trade of which it possessed the monopoly. The 
 Company had only to wait for other connection to come to it, as was 
 certain to be the case at Callendar from Toronto, and all other 
 enterprize truly in relation with itself, it had the |3ower of control- 
 ling. 'J'here is however, a potency in the magic words " capital 
 account " difficult to resist. Who can penetrate their intricacies ? 
 Who can fathom the turns and twists, the side issues, the indirect 
 gains and all the " potentiability of wealth " involved in their 
 working, give time only to such operations and the mystery connected 
 with them becomes unfathomable. Those who have watched the 
 
 I ! 
 
20 
 
 operations of the Canadian Pacific can eaf^ily perceive that ilie opening 
 ot' another capital account means another issue of bonds and obligations. 
 But to all things an end must come. Money cannot be found ior ever 
 and the settlement day, not un frequently arrives sooner than it is 
 looked for. It is often precipitated when least expected. Some slight 
 event awakens public attention, which in its character may promise 
 no remarkabla consequence. There is an old proverb, great events 
 spring from small causes, and who can say were the nttem|it of the 
 Canadian Pacific to prevent by force, the introduction of the crossing 
 plate at Headingly to stay the construction of the branc'i of the 
 Northern Pacific and Manitoba, with the Manitoba and North Western 
 ' at Brandon may not lead. No prophesies can penetrate the future. 
 
 ■ f h 
 
 LETTER NO. VI. 
 
 A claim has been advanced on the part of the Canadian Pacific 
 Railway Company to which it is necessary to refer ; and the subject 
 requires delicacy and judgment in Us consideration. I allude to the 
 objections raised on the part of the Company against the condition 
 and character of the Western Sections executed by the Government 
 and given over to the Company : A protest involving either a money 
 demand for the expenses inevitably to be entailed on working and. 
 maintaining the line; or the claim that the shortcomings set forth are 
 to be remedied. The precise tium involved has not been stated, but 
 it is said to reach a very high figure; an opinion warranted by the 
 great expenses already incurred, in the prosecution of the claim. The 
 matter has been referred to arbitration, and for yome monthi, 
 examinations have been made by engineers on one side to prove the 
 allegations advanced by the Canadian Pacific Railway , on the other 
 to sustain the cause of the Department of Railways. Any attempt to 
 influence the decision of the arbitrators would be indecent in the 
 extreme. The case at this date is not open to criticism : indeed the 
 evidence given has not been published, so the merits of the claim can 
 in no way be discussed. In every dispute at law, there are, however, 
 certain preliminary considerations, which are public property and it 
 cmnot be held to be an interference with the course of justice, if an 
 attempt be made to examine into the grounds on which the claim has 
 been preferred. Consequently in the common interest of all concerned, 
 1 propose impartially to examine into the nature of the dispute and 
 the principles which it involves. 
 
f\ 
 
 i ! 
 
 It is to be hoped that a careful record ot the proceedings will be 
 kept ; it is certain that whatever the decision, it will be closely 
 scanned and weighed. 
 
 As no official documents have been laid before Parliament, we are 
 without precJHo information as to the nature of the Company's demand. 
 We are able only to deal with generalities; even in this form there 
 is sufficient to awaken strong public attention. In accordance with 
 the contract the Department ot Railvvayr constructed the heavy work 
 of the most western 215 miles, from Savouna to Port Moody. 1 he 
 contract was carried out bv Messrs. Onderdonk & Co. ; on the com- 
 
 *' 1 
 
 pletion of the work, it was finally accepted, and the railway transferred 
 to the Company as complete fulfilment of the Government obligation. 
 
 The managers of the Canadian Pacilio, so far as their claim can be 
 understood, contend that such is far from being the case, that the line 
 given over to them is inferior in character to what they have aright 
 to expect. When the documents are published, we shall clearly 
 know on what ground the pretension has been advanced. We may 
 then look for the specification in each inatouce of the deterioration 
 of the work represented as apparent and it is to be presumed, in 
 order for the claim to be considered, each item in dispute will set 
 forth the amount of money necessary to repair the imperfection in 
 itself specially detailed. 
 
 The first serious of contracts under which the works wero 
 executed are set forth in Mr. Fleming's report dated 8th April, 1S80, 
 p. p. 318, o24. The first of these contracts was given out on the 16th 
 December, 1879, the last on the 15th of March, 1880. They embraced 
 127 miles from Emory Bay Tale to JSavouna Ferry. When the matter 
 came before Parliament on the 15th April, 1880, Mr. Blake moved as 
 an amendment to bir Charles Tupper's motion, to go into Committee 
 of supply that the work should not be proceeded with. Sir Charles 
 Tupper stated that the amount of the contract was $9,107,000, of this 
 amount, one million of dollars was for contingencies, but he considered 
 that the amount might be reduced by limiting the curvature and 
 increasing the grades, and during the Debate, the proposal was 
 generally accepted that the work should not be to expensively 
 constructed, as at first designed, economy being desirable. The 
 character of the railway was consequently established, at this date, 
 before there was any proposition for a transfer of the Eailvvay to a 
 Company : a clearly defined policy on the part of the Government 
 widely published. The Debate was continued until the 20th of April, 
 when the amendment was negatived by 131 to 49. 
 
 The contract for the continuation of the line 86| miles from Yale 
 to Port Moody, was given out the 15th February, 1882. 
 
31 
 
 The first notice of the policy of the Government, to asaign the 
 construction of the Pacific Railway to a Company, in preference to 
 authorizing the Railway Department to give out the work by contract, 
 took place at a political Pic-nic on the 29th of June at Bath, in 
 Ontario, when Sir Jolm Macdonald, the first Minister, stated that 
 negotiations were being carried on at Ottawa with Capitalists to 
 arrange the terms by wiiich the Railway would be completed 
 
 The meeting of Parliament took place on the 9th of December, 
 1880. Ar*or the speech from the throne had been answered the first 
 Minister laid on the table a message from the Governor General, 
 including the contract entered into with a Syndicate for the con- 
 btiuction of the line. The contract was dated 21st October, 18b0. It 
 did not however receive the assent of Parliament until the 15th of 
 February, 1881. 
 
 The ultimalte transfer of the sections of railway then under 
 contract is set forth in section 8 in these words, " upon completion of 
 the remainder of the portion of railway to be constructed by the 
 Government, that portion shall also be conveyed to the company, and 
 the Canadian Pacific Railway, shall become and be, thereafter the 
 absolute property of the Company." 
 
 Thus prior to the determination of the Government to transfer to 
 a company the construction of the railway, the sections named had 
 been placed under contract, and the work was in progress. 
 
 The presentation of this claim involves the charge that the 
 sections, constructed by the Government, are inferior in many respects 
 to the character of the railway the Company had the right to expect, 
 atid that the Department of Railways has executed the work at a 
 lower standard than the debates in Parliament, and the engagements 
 of the Minister suggested. Tliere does not appear to have been any 
 positive agreement on the subject. Doubtless the Department has 
 exacted a specification of the deficiencies complained of A vague 
 general tone of depreciation is valueless. In a dispute at law, each 
 Item of special damage must be proved, sustained by fiict, and 
 t^stablished by evidence, a deficiency cannot be imaginary. It must be 
 positive, palpable and perceptibly. Any injury either of aggression 
 or neglect, or through inferiority of execution of a contract, admits of 
 clear specification so it can be made known, and be understood, and if 
 established, the value of the remedy may be applied. The wrong 
 must be clearly made known. 
 
 How is the fact of such wrong to be established ? We conceive 
 without injustice this query may be asked. It appears to us that 
 the standard must be sought in the contract between the Government 
 and the Company. The words used there may be profitibly repeated j 
 
 
32 
 
 I 
 
 ii:; 
 
 were tlipy are taken from section throe, *' in order to establish an 
 approximate standard whereby the quality and character of the railway 
 and the materials used in the construction thereof, and the equipment 
 thereof, may be regulated .the Union, Pad/ic llaihnoy of the IJnital 
 Sioic.'i as fJic Sit me ivas wJien firnl constructed w hcrchjj selected and fixed 
 as such standard. 
 
 Have we or have we not in these words the standard by which 
 the Government work ought to be judged ? Is it to be said that in 
 these last 215 miles, appeal is to be made to lines of the character of 
 the New York Central, the Grand Trunk or .«onie Kfiilway in an old 
 Sitthnl part of the Continent, while for the 2oU miles of the 
 remainder of the line, from Callendar to Savouna, the work fvpcuted 
 by the Company is to be in accordance with the Union Pacific 
 Railway, when first constructed. In short may not an appeal be 
 made to the condition of the Canadian Pacific Railway itself, through- 
 out its extent as representative of the work which the Company has 
 the right to exact on the sections executed by the Government? It 
 is plain that wherever sought for this standard isindispensible to the 
 correct determination of what the condition of the section under 
 discussion should be. The work can only be judged by some known 
 and established example. It is not possible to avoid the enquiry 
 according lo what principle its character must be considered, from 
 what i^ource these principles are deduced, and by what argument 
 they may obtain recognition. 
 
 There ought to be and can be no desire to wrong the ('anadian 
 Pacific in any respect. The subsidy given to the railway luis been 
 gencious in the extreme. It may be said to be unprecedented in 
 amount. During the progress of construction every concession has 
 been made and every assistance given to the Company. The country, 
 however, has the right on its side to exact that the agreement into 
 which it has entered be not interpreted, so as to include obligations, 
 unsustainvd by clearly expressed conditions, and that the whole 
 circumstances, under which the engagement has been made, be takeu 
 into full account with the facts, the evidence, and the evident purpose 
 of the contract : and that there be no strained rights claimed, on 
 abstract general principles, A further remark may be mide on this 
 point. Whatever that decision may be arrived at, it should not be 
 placed ' n a money equivalent. No money should be permitted to be 
 paid to the Canadian Pacific, and no compromise listened to, involving 
 a cash settlement. If the complaint that the work accepted be of an 
 inferior ch.iracter, is decided in favour of the Company, the Depart- 
 ment should be held to make good what has been pronounced to be 
 defective. It is not a question of injury or damage committed. The 
 
 : in 
 
88 
 
 pretention is that the work is not equal to the standard agreed on. 
 If the decision be that the factw justify the Haoifio Rnilway looking' 
 for a higher ehiss of roadway, the work must be brought to the 
 aduiitted standard. If it be held expedient that the new work should 
 be executed by ih« company, money only should be paid on the 
 Engineer's estimates as the work proceeds. No sum of money sliould 
 be transferred to tlie coffers (if the railway f*>r future disljursenients ; 
 the payments made should be directly applied to bring the permanent 
 way to the condition in whicti it has been declared the Government 
 was bound to surrender it t • the Compa?iy 
 
 No event in connection with the history of the Pacific Railway 
 has been looked up(Mi with more general interest than the prosecution 
 of this claim we have avoided passing the slighest opinion regarding 
 it and have con lined our narratives to facts and dates. 'he decision 
 once known, then the contention is public property, and with fairness 
 the whole matter may be subjected to criticism, as any other public 
 event We have t'elt, however, ourselves justified in laying down 
 two important principles : one, that it is indispeiisible, previous t > 
 the investigation of the facts, and perfectly independent of them, to 
 establish the standard of the chiracter of the work which the country 
 undertook to perform. Secondly when the report has been m uie il, 
 should be distinctly understood, that if "n favour of the company, no 
 payment of money should be made as an indemnity but that a sum 
 being named to repair the deficiency, that Uie Department of railways, 
 either by the Pacific Railway Company or otherwise shonld take 
 st"ps to make good what is wanting, and the money be only paid in 
 accordance as the work is executed. 
 
 If the Pacific Company has the imperfections of which it com- 
 plains fully remedied, it will receive full justice, 'tiis rectificttion 
 may be little or much ; but be the award what it may it must alone 
 be governed by this principle. .»As any such money has to be voted 
 by Parliament, care must be taken, that it be distinctly set forth in 
 the estimates, how this expenditure is to be made, so thit payment of 
 it be made in accordance with the vote given. 
 
 For the time, we have completed our examination on this 
 subject. It is to be hoped that public attention may be directed to 
 what appears in these papers, so that the situation of the Canadian 
 Pacific, its duties to the Government, its obligations to the Dominion 
 may obtain full attention. Likewise the position in which the 
 Dominion stands towards the Company. It is plain that no further 
 claims for assistance can be fairly made on the country, on the ground 
 of the original contract into which the Ci)mpany entered. The 
 Company has continued its operations in directions which place its 
 
34 
 
 I > 
 
 financial position out of all connection with the Government. The 
 branch from Sudbarv Tiinntion to connect with the railway to 8t. 
 ^'aul, has relitionnhip only to ninety-five miles of the Canadian 
 Pacific, and ace )rdiri;i;ly can neither be called a branch nor a feeder 
 to it. On the contrary it is a distinct route to St. Paul, without 
 Dominion control, and can in no waj' bo legitimately included in the 
 system of the miin line to the Pacific, west of Sudbury. The 
 Montreal and Toronto Railway, the '•"redit Valley system, the con- 
 nection with Chicago, the two lines now being constructed from 
 London to Windhor, and from Toronto to Niagara, each of them side 
 by side with the Grand Trunk ; with the prospect cf a new Bridge 
 at Niagara. None of these extension subjects to come before Parlia- 
 ment, with a demand tor aid No one can look on this reckless 
 construction without pain and misgiving, as injuriously affecting the 
 real resources of the country The Canadian Parliament cannot be 
 called to countenance them, by additional subsidies or extraordinary 
 Legislative loans. What capital account is required for their 
 furtherance must come from other quarters if their projects are to be 
 persevered in. 
 
 / I '.. ' '.;v» - 
 
 '*! ' ;j-; 
 
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 "■ ■■'}■. • ■'II -ii' i'-'l "■'■■■- 
 
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