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ListofWitnesHOs to bo examined .... List of Witnesses summoned * ' ' * * List of Witnesses examined Evidence ^^ List of Exhibits .qJ Exhibits .... ;_ ... 190 ^mr^d^^ 220 , f ' HI DUFPERIN. CANADA. 01. iii vi ix X xi 1 89 90 20 ) 1 VICTORIA, by tho Grace of God, of tho United Kingdom of Grtat Britain and Ireland, Quken, Defender of the Faith, &c„ &c., &c. John A. Magdonald, Attorney Oeucral qf Cunada. To the Honorable Charles Dewey Day, of the City of Montreal, in the Province of Quebec, in Our Dominion of Canada fate one of the Judges of the Superior Court in and for Lower Canada, The Honorable Antoine Poletteoitho Cityoi Three Rivers in the said Province of Quebec, one of the Judges of the Superior Court in and for Lower Canada, and James Robert Gowan of tho Town ofBarrie in the Province of Ontario, in Our sAid Dominion, Esquire, Judge of the County Court of the County of Simcoe, in the said Province of Ontaro and to all others to whom these Presents shall come or whom the same may in any wise concern. Grbetino : Wheaers tlio Honorable Lucius Seth Huntington, of the City of Montreal in the Province of Quebec, a member of the Honorable the House of Commons of Canada, in his place in Parliament, did on tho second day of April, in the year of Our Loi-d One Thousand Eight hundred and seventy three, move the following Resolution : — "That he the said Lucius Seth Huntington, is credibly informed and believes that he can establish by satisfactory evidence, that in anticipation of the Legislation of last Session, as to tho Pacific Railway, an agreement was made between Sir Hugh Allan, acting for himself, and certain other Canadian Promoters, and G. W. McMullen, acting for certain Unitod Statet Capitalists, whereby tho latter agreed to furnish all the funds necessary U>t tho construction of the contemplated Railway, and to give the former a certain per centage of interest, in consideration of their interest and position, the scheme agreed upon being ostensibly that of a Canadian Company with Sir Hugh AUan at its head, — '•That tho Government were aware that these ncgociations were pending between the said parties,— " That subsequently, an undorstimding was come to between tho Government, Sir Hugh Allan and Mr. Abbott, one of tho members of the Honorable House of Commons of ('anada, that Sis Hugh Allan, and his friends should advance a large sum of money for the purpose of aiding the elections of Ministers and their supporters at the ensuing general elections, and that he and his friends should receive the conti'act for the construetion of the Railway, — " That accoi-dingly Sir Hugh Allan, did advance a large sum of money for the Kirposo mentioned, and at tho solicitation and under the pressing instance of inisters, — "That part of tho monies expended by Hie Hugh Allan in connection with the obtaining of the Act of Incorporation and Charter, were paid to him by tho United States Capitalists under the agreement with him, — " That a Committee of seven members be appointed to inquire into all the c ire -.instances connected with the ncgociations for the construction of tho Pacific 205080 1'^ !: Railway with tho iogislation of last soesioa on the subject, and with the granting of the Charter to Sir Hugh Allan and others, with power to send for persons, paporN and records, and with instructions to report in full tho ovidcnco talten beforo, and ail groceedings o^tho said Committee, which said rosolutisn upon a division of th« said [ouBO was lost,-~ And whereas the Right Honorable Sir John A. MacdonaUl, Knight, also a member of the said House of Commons of Canada, in his pla * in Parliament, did, on the eighth day of April oforosaid, move a resolution in tho words following: "That a select committee of five members (of which committee the mover siiall not bo one) be appointed by this House to inquire into, arid rc|K)rt upon the several matters comained and stated in a resolution, moved on Wednesday, the socoad day of April instant, by tho HonorabU' Mr. Huntington, member for the County of iSheffoi'd, relating to the Canadian Pacific Railway, with ])ower to send for iwi-sons, papers and records, to report from time to time, and to report tiio ovidcnco from time to time, and if need be, to sit after the prorogation of Parliament," which said last named resolution was carried. And whereas, by an Act of the Parliumont of Canada passed on the third day of May, in tho yeai' of our Loi-d one thousand eight hundred und seventy-throe, and in tho thirty-sixth year of Owr Reign, intituled " An Act to provide for the examination of witnesses on oath by Committees of the Sensite and House f)f Commons in certain cases," it is amongst other things in effect enacted, "Thit.lonoo thcy have determined not to avail themselves of the libei'ty so given. 26. Tliey had arrived at that conclusion before they were informed of Your Kxcellency's views on the subject, and they feel confirmed and justified iu it, by a com- mimication received before their labors commenced, to which Your Excellency kindly permits them to allude, relating to one or two points on which thej thought it their duty to consult Your Excellency before entering upon tho execution of their task. * Wcv. p. >«, t See List of Witnesses Examlnctl, p. xl, ami LI«t of E-^hlbits, p. 18i>. viu 27. In lliiit communication Your Rxcolloncy woh plooflod to oxproBS the opinion that tho lunctionH of tho CommiHsionorH wcro rather inquinitorial than judicial, and that tho execution of them sliould not bo such aH in any way to prejudice whatever procoodinj^s Parliament might desire to talco when it reBSHemnJod in '^.'^'jer. 28. The (/ommissioners coinciding with Your Excellency in tho view that the terms of the CommiHsion do not require thorn to pronounce judicially on the evidence, couHidor thut their duty will have been fully discharged when they shall have for- wai-dod to tho Secretary of State tho accompanying depositions and documents with this Report, in triplicate, as reijuircd by their instructions — unless a report of their opinion on the result of the evidence should be specially required. All of which is respectfully submitted. (Signed); JloYAL Commission Rooms, Ottawa, October 17th, 1873. CHARLES DEWEY DAY, Chairman, A. POLETTE, Committioner. JAMES ROBERT GOWAN, Commissioner, it f , < 1 is LIST OP WITNESSES TO BE .(..lAMLNKD. Sir Francis Hincks. Geo. W. McMullen- Hon. D. Ii. Macphereon. Hon. Mathow Henry Cochrane. Hon. Asa B. Foster. Hon. Jean Charles Chapais. Norman W. Bethunc. Andrew Allan. Louis Boaubion* Victor Hudon. Edward Lefebvro de BoUefeuille. Hon. Joseph O. Beaubien. Hon. Jean Louis Beaudry. Peter S. Murphy. Charles A. Leblanc. Jackson Bae. James Dakers. Roburt N. Ilftll. JoHC!]»h llamcl. Wm. Blurahnvt. Sir John A. Macdonald. lion. Hector Ti. LanKcvin. Danl. McMullcn. Chas. J. Coum)l. Jean Baptisto Boaiulry. F. "\V. Cumberland. E. E. Burpee. Saiidford Flcmming. H. N. Nathan, Jr, I). W. N: Smith. I). Mclnncs. Hon. A. Campbell. Hon. Peter Mitchell. I|! I LIST OF WITNESSES SUMMONED. Abbott, Hon. J. J. C. Allan, Andre^v. Allan, Sir Hugh. JBeaubien, Hon. J. O. Bcaubicn, Louis. Boaudiy, Hon. J. L. Beaudiy, J. B. Bethune, N. W. Blumhart, W. E. Burpee, Egcrton R. Campbell, Hon. Alexander. Chapais, Hon. J. C^ Cochrane Hon. M. IT. Coiirsol C. J. Cumberland, P, "\V. Dakers, James, Do Bellefeuillo, E. L. i'loming, Sandford. I^08ter, Hon. A. B. Hall, K. X. iraniel, Jose])li. Hincks, Sir i\ Hudon, Victor. Huntingdon, Hon. Lucius Scth. Langevin Hon. H. L. Lc Blanc, C. A. Macdonald, Rt. Hon. Sir John A., K.C.B. MacPheraon, Hon. D. L. Martin, F. C. McGree\y, Hon. Thomas. Uclnnos, J). McMnllen, George W. McMuUen, Rev. J). McMullen Danl. Y. Mitchell, Hon. Peter. Murpliy, P. S, Xorris, jr., George. Ouimct, Hon. G, Perkins, John A. Rae, Jack.son. Smith, Charles M. Starnes, Hon. Henry. White, jr., Thomas. zi LIST OF WITNESSES EXAMINED. l'A(JE. AbboU;iron. J.«J. C 15G Allan, Andrew 14 Allan, Sir Hugh 129 Beaubicn, Hon. J. 48 Bcaubien, Louis 18 Boaudry, Hon. J. L 33 Bcaudry, J. B 45 Bothunc, N. W 22 Blumhart, W. E 173 Burpee, Egorton R 78 Campbell, Hon. Alexander 83 Chapais, Hon. J. C 61 Cochrane, Hon. M. H (35 Cour8ol,C. J 40 Cumberland, F. W 67 Dakers, James 38 ])e Bellefcuillc, E. L 15 Fleming, Sandford 127 I'AGK. Hall, RN 74 Hamel, Joseph 7B Hincks,SlrF , 3 Hudon Victor 17 Langovin, Hon. H. L 121-183 Lo Blanc, C. A 41 Macdonald, Et. Hon. Sir J. A., K.C.B. 90 MacPherson, Hon. D. L 24 Martin, F. C 175 Mclnncs, D.. 72 McMullen, Eev. D 50 McMullen, Danl. Y 53 Mitchell, Hon. Feter 94 Murphy, P. S 35 Ouimct, Hon.G 185 Eao, Jackson 46 Starnos, Hon. Henry 1 White, Thoman, jr 178 xu DEPOSITIONS Taken before the Honourable Charles Dewey Day, late one of the Judges of the Superior Court in and for Lower Canada, The Honourable Antoine Polette, one of the Judges of the Superior Court in and for Lower Canada, and James Robert G-owan, Esquire, Judge of the County Court of the County of Simcoe, in the Province of Ontario, Royal Commis- sioners appointed by Commission addressed to them, under the Great Seal of Canada, bearing date the fourteenth day of August A,D., 1873. At the Parliament Buildings, Ottawa. S. J. Vankoughnet, Esquire, D.C.L. Secretary. FIRST DAY. Thursday, 4th September, 1873. The Secretary read the Commission. The shorthand-writer sworn was Matthew Hutchinson. Province op Ontario, ") f IN TTIE MATTER OF THE COMMISSION. City of Ottnu-a. ) Ajipointing Charles Dewey Day, Antotne Polette, and James Robert (Jowan, OommiHsionors to enquire into und report upon the scvora! matterH stilled in a certain Resolution moved by the lion. Mr. IIuntinoton in the House of Commons on the second day of Apj'il, A. D. IStS, relating to the Canadian Pacific Railway, Present : The Commissioners. On this fourth day of September, in the j'car of our Lord one thousand eifi;ht hundred and seventy-three, personally came and appeared before us, the above named Commissioners, The IIonble. HENRY STARNES, of tho Cily of Montreal, Banker, who i)eing duly sworn, dcposeth and saith : I received a Subpoena duces tecum to appear before tho Commissioners and produce tho papers described therein, and I hereby produce them to be fyled in this matter. The said papers wei-o placed in my possession for safe keeping; by Mr. Abbott on behalf of Sir Hugh Allan and Mr. McMullon. In producing tliem in compliance with the orders received from the Commission, I beg to state that I object to their being opened without the consent of Sir Hugh Allan. I think it my duty to make this objection as they were placed in my possession for safe keeping. They are returned as they were placed in my hands as they wore when I first received them. Tho superscription " Henry Starnes, Sir Hugh Allan, G. W. McMullen " was put on by myself, they were placed in my hands a day or two before Sir Hugh Allan's departure for England to bo loft with mo. There are three distinct parcels, one to Mr, McMullen, one to Sir Hugh Allan and one addressed to myself. Th«y W'crc handed to me by Mr, Abbott on behalf of Sir Hugh Allan, Mr, McMullen was also present at tho time I received them from Mr. Abbott. I have no knowledge of what those papers contain. I have no objection to the package being opened providing Sir Ilngh Allan's consent is obtained, (Hon. Mr. Abbott hereupon produced a written consent that the said package of j)apors bo opened by tho Commissioners.) Qvcsiion — Have you any knowledge in relation to such ncgociations as are des- cribed in the charges mentioned in the Commission in this matter, as being carried on between Sir Hugh Allan and Mr. McMullen for tho purposes designatetl in this Conimission ? Aiiswer — I ha\e no personal knowledge. Question — Were you a member of an election committee in 1872, in conjunction with Mr. Boaudry and ]\Ir. Murphy ? Aiisu-cr — I was requested to go upon that committee but did not attend regularly. I am aware that money was received for election purposes, I might state that I was requested by the late Sir George E, Cartier to act on tho committee as Ijo felt I that the elections would bo hotly contcstod and that ho was awaro that his oppo- nents were well furnished with antplo means, and it would ho necessary to figiit. them with money. I objected as I did not wish to take any part. lie however felt that there was a desire to make tho elections by moans of Railways, and he was determined to have nothing to do with that, as ho wished to make his election upon his own merits, and it would be necessary for mo to get friends to subscribe and to get as much money as wo possibly could. I went round and got subscriptions. lie then told mo that Sir Hugh Allan would subscribe liberally and I believe Sir Hugh Allan did subscvibe very largely, but his subscription did not come exactly to my knowledge. I cannot say how all the money came but it was deposited with mo, and l)y what moans I do not' exactly know. It was placed in tho Bank of Avhich I am President and paid out by cheques. This money was derived from other subscribers as well as from Sir Hugh Allan. Tho bulk of this money came from Sir Hugh Allan, I understood. Various parties subscribed in smaller or larger sums. I have no original receipts which wore given by tho Election Committee. When the receipt was published in the Montreal now j)apors, I was astonished as I hatl for- gotten all about it. I was surprised, for I had signed it I suppose in the hurry of tho election ; I might have signed more than one. 1 know nothing about the two lettoi's referred to in tho newspapers in connec- tion with this receipt. I have no knowledge as to where either of those letters now is. The money was not paid upon any specific conditions contained in these letters. There was no condition as far as I know. I signed this receipt inadvertently, and know nothing at all about it till it was ]iublished in tho newspapers. I havo no idea or knowledge in whose bands those letters now are. I was not induced to give that receipt on account of any jmrticular undertak- ing. I believe there were more than one receipt given. I havo reason to believe there wore. I don't know what amount was derived from Sir Hugh Allan's subscription, ex- cept what passed through my hands, and I cannot say now what that amount was. When I first joined tho Committee, I understood it was to look after Sir George Cartior's election, but afterwards the committee seemed to assume tho control of elections outside of Montreal, to what extent I cannot say. I don't know of any other information that would facilitate tho object of this inquiry. I cannot state exactly the amount I received for the support of tho elections, but I think it was about sixty to seventy thousand dollars, which was raised by way of subscriptions and from Sir Hugh Allan. The envelope of the package having boon removotl by consent of tho witness, tho following endorsement was written on tho inner parcel : — " Within ten days after tho end of the coming Session of Parliament, tho Hon. " Henry Starnes is requested to deliver envelope No. " one " to Sir Hugh Allan, and " envelope No. " two " to G. W. McMullen, unless objection bo made by Sir Hugh " Allan to his doing so, in which case ho will open the envelope addressed to himself " and act as instructed therein. (Signed) "HUGH ALLAN, " " G. W. McMITIiLEN. " Montreal, 2filh February, 1873." T know tho handwriting of Sir Hugh Allan, but not that of Mr. McMullen. The lavtor wa« present when the parcel was given me. 8 I havo no objection now, seeing the consent from Sir Hugh Allan, to open the j)ac]f:ige. (The i)ackago was then opened by the witness and returned to the Com- missioners.) And on this twelfth day of September, 1873, the witness ro-api)carcd and made the following addition to his foregoing deposition. In my evidence I stated that the amount of money that passed through r> y hands was $G0,000 to 670,000 — on refer- ence to the books of the bank, I find it was 866,357. And I'urther the deponent saith not, and this, his deposition, having been read to him, lie declares it contains the truth, persists therein, and hath signed. Sworn taken on the fourth of September, ") 1873, and acknowledged on the [■ (Signed) IIy. STAENES. twelfth of said month and year. ) (Signed) CHARLES DEWEY DAY, Chairman. A. POLETTE, JAiMES R0J3E11T GOWAN, Commissiuncrs (I ! IN THE MATTER OF THE COMMISSION. Province of Ontaiuo, City of Ottaica. Appointing Chaklks Dewey Day, Antoinb Polette, and James Kuuekt (Iowan, Commissioners to enquire into and report upon the several mat teis staletl in a certain Resolution moved by the Hon. Mr. IIuntinoton, in the House of Commons on the second day of April, A,D. 1873, relating to the Canadian Pacific Railway. Present : The Commissioners. On this fourth day of Soj)tomber, in the year of our Ijord one tliousand eight luindred anil soventy-thi'ce, personally came and appeared before us, the above natncd Commissioners, Sir FRANCIS IIINCKS, of the City of Montreal, who being duly sworn, deposelh and saith : I ])rosunie that the best course will be to give a narrative of the circumstances beginning before the legislation. In fact it may be well that I should coiiinience from the earliest stage of the ])roceedingfl in regard to the I'acitic Railway. 1 believe the first person with whom I had any conversation that I recollect of on tin.- subject of the Pacific Railway, was Mr, Cyril Graham, a gentleman who aitcd as Coinmissiotier for the Hudson Bay Company, iu the years 1870 anil 1871. On his ictnrn from the United States, he told me that he had been in coninuini- cation with several intlueiitial gentlemen, and that he thought salisfactoiy arrange- ments could be made, by vvhich great economy would be produced with regard (u the construction of the Pacific Railway. That he believed the Aniei-icans would lie ]u-e|>ared to abandon the Western Section of the Northern Pacific J^)ad. carrying it through Canadian territory, if the ''aiuidians would abandon their Eastern StHtion and carry it through United Slates territory by the Sault Stc. Marie. I heard all that he said upon tlie subject, and I must say that it produced some impression upon my mind. ■ I Ml I V P About tho month of May, 1871, Sir John 1{oho sent mo a copy of a lottoi- which he had mldrosscd Sir John A. Macdonald, in which ho intbrmod mc, that persons in London had spoken to him very much in tho samo terms that I have mentioned tiiat Mr. Graham had represented to me, and sug/^esting in tho letter either that wo trros])ond- onco with him. I refer to Mr. Beaty. In the course of that correspondence, ho mentioned his Intention of going to Montreal to induce Sir Hugh Allan to join the schomo. IIo had not at that time been spoken to. I wrote very discouragingly to Mr. Boaty in reply, simply on tho ground that I did not see how it was possible to talk about a scheme which the Government had .lot come to any conclusion upon, as to what assistance they coxild give. I did not see that tho matter was in such a stage as admitted of its being discussed at all. After that I saw Sir Hugh Allan in Montreal, but as I felt that the .suggestion of his name came from Mr. Beaiy entirely, writing with the sanction of Mr. McMullen, I therefore inferred that the suggestion of Sir Hugh Allan came from them, and as I had been the means of preventing their opening communication, I thought it was only fair to give him tho list of names who wore willing to engage in the building of the Pacific Eailway. That conversation with Sir Hugh Allan mu.s+ 1 think have taken place about the beginning of August. I cannot recollect the day exactly, but I do recollect that I told him that Sir John A. Macdonald would bo in town I think, either that evening the next evening. Sir John was passing through to a watering place, and or ) I (I intended to go from the Ottawa boat to tho Quebec boat without stopping in Montreal. Sir Hugh did .see him, I was not present at tho interview, l)ut Sir Hugh told me that he had had a discouraging re[)ly from Sir John, as ho did not think the Government was in a position to enter into nogociations. I afterwards went to the Maritime Provinces, and in October, Sir Hugh Allan came with thcf^e same gentle- men, Mr. McMullen and Mr. Smith having boon in communication with him, with another proposition. At that time there was a considerable number of Monibers of tho Government present. I have scon Mr. McMullen's statements, and he gives the names of nine of those persons, and I presume he gives them correctly. On that occasion Avhat passed was this : The gentlemen were introduced, Sir John A. 5 Macdoimid thoii uskcd Sir Iliigli Allan whothor ho had a pnjpoMilioii lo make to tho CJoverninont. Sir Hugh Allan's ioply was — " If I mako a projvtsition, arc you pre- pared to ontor into nogociationrt on tho subject." Sir John answered th..t " ho was not prepared to do 80," and Sir Hugh Allan rcjoi nod "Then I am not prepared to make any jn'oposition." That was the whole conversation on the subject that took place at that interview. Sir Hugh Allan went shortly afterwards to Kngland, and returned very early in December. When he rctiu-ned I ha*l a conversation with him. 1 muat have been in Montreal in December, although I have no very special recollection of it. Whenever wo met, he was always talking of (ho Pacific Railway, and inasmuch as a groat number of conversations took place of this kind, I think I ought to state, with regard to evidence of this kind, that where two persons have ditteront intor- ests, ami not in a position to understand what is passing in each other's mind, that very often there will be misunderstandings in regard to what passed at these con- versations. My dcsiro was to bo as reticent as possible. I had no proposition to mako on tho part of tho Government, lie, on the other hanil, was most anxious to get the tiovernmcnt to agree to some i)roposition, so as to enable him to make ])rogi-CHS with his an-angoments. I say this, because I observe by letters which have been pub- lislied, that it is alleged that I said something about advertising for tenders, with the view to avoid tho Government incurring blame. Now, I have no doubt whatever, that I did point out to Sir Hugh Allan that it was Avholly impossible for the Gov- ernment to come to any arrangement without tho sanction of Parliament, and it is not improbable that I may have discussed tho question about advertising for tenders, but I could scarcely have told him that wo Avere determined to advertise for tenders, because no such determination was over arrived at. Several conversations took place, and different persons will have different views. I may have suggested to ad- vertise for tenders to find out whether there Avas any other person besides Sir Hugh Allan, who would come forwai*d and undertake the building of tho road. Wo, as a Government, had pledged ourselves to procure the construction of the Pacific Rail- way, and we had also determined to try to do it by tho instrumentality of a char- teretl company. Wo wore anxious to find ont what persona there were in the Dominion who would undertake the building of tho railway, and upon what terms they would be willing to construct it. A number of unauthorized conversations took place with Sir Hugh Allan, but Sir Hugh knew perfectly well that those conversations were unauthorized, and that I was not speaking the sentiments of tho Government. I simply stated what occurred to my OAvn mind in Ihe course of tho conversations. Sir Hugh also knew perfectly well that my views with regard to the construction of the Pacific Railway harmonized a great deal more with Ims own than any other member of tho Government. Ho know that I Avas not opposed individually to the admission of American capitalists. Ho Avas well aAA'are of that from the first. He Avas well aAvaro that my views wore in favour of coming to some arrangements with tho Americans, as there Avould bo economy in the post])onement of a certain section to a later period so as to got one complete road through. We had a good many con- versations, and ho was also aAvaro that some members of the (JovernmontAveromuch opposed to admitting Americans into tho scheme at all. All those conversations took place long before the Session of Parliament — long before any t."hemo Avas do- ter.ninod upon by tho Government. They were had with a view to my getting all tho information 1 could Avith regard to tho best scheme for constructing tho road. Tho next circumstance I would advert to, Avas the final arrangement that the (Jovernment camo to v^rith regard to tho railwaj", Avhich Avas submitted to Parlia- ment. That scheme was decided u])on by the (fovcrnment, affor (he most careful consideration, Avithout any conference Avith anj^ outside persons at all, as to the ex- tent of land and money they Avould give. When Parliament mot, I would say that during the Avhole of 1871, there Avas a Mj i 'Jl i ^'1 T 6 great cool nos.s in tho principal pai'tM of Ontario witii regard to tlio schoiuo. No propositions were nuwio such an those that emanated from Sir JIugli Allan. Notli- ing was done until just about the time of the meeting of rarliamenl. It then Ijecame . evident that there would lo a proposition made to Tarliament for the chartering of more than one comjjany. The Covornment did not think it desirable to oppose any of the charters but to let them take tlieir own course, taking power to cslul>lish a separate company if they should deem it necessary to do so. 1 may observe that during the Session of Parliament, it became m(jre and more clear, and 1 wjis very reluctantly convinced, that it was absolutely necessary to exclude the Americans entirely from the company, and from tliat time I may say this became the settled ])olicy of the Government. Questitm — What date do j'ou give to tiiat ? Answer — The mooting of Parliament. Question — Was that previous to the passing of the Act? Answer — During the time the Act was under consideration and belbre the j)assing of the Act. It was then jxM-fectly understood by all the members of the ( Jovernment that the Americans would li.ivo to be excluded. After the Session of Parliament broke up, alx)ut the 12th or the 15th of June, I think, I went to the West and was engaged in the Election, and I hail no communication with Sir Hugh Allan for a great many weeks, probably months — I must have left Ottawa very early in July, and I wjis not in Montreal after the Session to the l)est of my recollection. I do not recollect seeing any one, and no arrangement of any kind was made by the Government about the Pacific l{iiilvvay. Nothing was to be done until after the elections. The next action taken by the Government was, I think, in the month of September or October, 1872, after the elections wore entirely over, wlien negotiations were commenced with a view of procuring an amalgamation of the two Companies, — the Inter-Oceanic and the Canadian Pacific — Sir Hugh on behalf of his Com- pany wrote accepting the pi'oposition of the Government, that the two Com- panies should bo amalgamated on condition of their being united on fair terms taking the principal gentlemen of both companies. The Committee of the Inter Oceanic Company, of which Mr. Macphcrson was chairman, gave reasons why they could not Join. One of their principal reasons was that Americans were still in the Company. That document was sent to Sir Hugh Allan for his Company to report upon it, and they did report upon it. About the 16th of October, I thpik, a minute of Council was prepar xl, and that minute gave a full and faithful narrative of every thing con- nected with the Pacific llailway and the negotiations up to that time. It was hoped that that minute of Council, as it pledged the Government to ]>revent the Americans coming in, and stated that the Government wouiil take julequate means of doing so, would induce the Inter-Oceanic Company, as it was called, to join in this amalgamation. They still refused, however, and on their final refusal it became necessary for the Government to seo what course they wouKl have to take under the circumstances. Sir Hugh Allan had been very anxious, and my own opinion is that it would not have been an unreasonable demand after the refusal of the other company to amalgamate, that the charter should be given to the Company of >vhich he was chairman. However, the Government, upon a full consideration, determined to adopt aditlerent course of proceeding. J have no doubt they were impressed a good deal by some views of Mr. Macphcrson which ho put forwani very strongly in his correspondence with rogaixi to amalgamation, that no person from British Columbia wore included in the scheme as put forth, and that Sir Hugh had stated that if British Columbia wore introduced the maritime Provinces woulil also require a representation. Mr. Macphcrson thought they should be rci)resented, and I have no doubt these arguments had as great a weight with the other members of the fiovornmont as they had with mo. Finally it was ari-anged that a Company should be incorporated containing thirteen members, divided into fair proj)ortions between the difibi'ont sections of the Dominion : from Ontario, 5 ; from (Quebec, four, and from T each of tho olhor ProvincoH, one, making tliirtccn in all. We ^avo a pfreut deal of conHidoratioii to the wliolc Hchcmc, and finally af^rced upon names after a good i; n.i| 8 and sever know there was one until recently, wljon I saw amon^ tlie pnjtcM-s pub- liHhod that there was Home agreement wliicli I have neverJHoen. I have no knowledge of my own of an agreement between them, and Himjtly knew of the fact lliat Dwy were corresponding with one another. Question — Have you any reason to believe that any of the Members of the (Jov- ornmont wore aware that negociations wore going on ? Answer — I am sure that they did not know of any agreement, l)iit Uiey mnst have known just as I did, that Sir Hugh Allan was nog'ociating with them from the fact that Sir Ilugh Allan came with thom to Ottawa, but they knew of no agreement any more than 1 did, and they never gave any assent to it. Question — Have you in your possession any correspondence rclatiiig to this matter, that you could lay before the Commission ? Answer — I had a correspondence very shortly after these gentlemen visited Ot- tawa in July, ISiTl, with Mr. Beaty who attended them down and introduced them. It originated with Mr. Boaty. He wrote me a letter. I replied to that letter. Jle wrote mo another and I replied to that. I have no objection to lay it before the Commission, except simply, the objection of laying before you a confidential corre- spondence of that kind, nut I don't apprehend that there is anything in it that any great objection can be taken to, and I hereby produce thof +o be fyled. Qucstioii — Do 3'ou mean to contradict, in unqualified terms, that an understand- ing was come to between the Government and Sir Hugh Allan, and Mr. Abbott, one of the members of the Honourable House of Commons of Canatla, that Sir Hugh Allan and his friends should advance a largo sum of money for the purpose of aid- ing the election of ministers and their supporters at the ensuing general elections, and that he and his friends should receive the contract for the construction of the Pacific Railway ? Answer — Yes ; and I would add this, that of course I cannot positively swear with regard to anything that passed between individual members of the Government and Sir Hugh Allan, but I know of my own knowledge that everything connected with the Pacific Railway charter came under my own observation, and I know tliat it was not given with any reference to that whatever. I positively contradict it. Question — Do you know whether such an understanding was come to between those gentlemen — Mr. Abbott and Sir Hugh Allan, and any member of the Govern- ment? Answer — I know of none. Question — Were your relations with Sir Hugh Allan as intimate as those of the other members of the Government, or more or less ? Answer — I should think about tho same, voiy much about the same. Question — Have you any knowledge that any money was furnished by Sir Hugh Allan for the support of tho elections ? Anstcer — Well, I fiu])poso I may say I have that knowledge now, but if I refer back to the period of the elections, No. I am now aware from circumstances T have hoard, and which I suppose tho whole public have got, that Sir Hugh Allan was a liberal contributor to the election fund, I am aware of this from circum- stances that have come since to my knowledge. Question — Had you any knowledge of that at tho time or before the elections ? Answer — No. Not until long after tho elections; a considerable time after. Question — Do you know for whoso election any particular sums were con- tributed? Amwer — I cannot say that 1 do. I have reason to believe that thero was a very large amount contributed for tho Montreal elections. »-• l-l Question — You state that Sir Hugh Allan was not to have any controlling influence in the company; was it not understood that lie was to be President? Answer — I do not know that it was so understood. Of course momhorH who went in wore perfectly free, I presume, to vote for whoever they ijleased. I did not take any part in tlio conimunication that passed between any of tijoao gentlemen, and I really do not know what passed. I don't know whether they were canvassed by any niomber of the Government on behalf of Sir Ilugh Allan, but I would not be surprised If they Avere. Question — Can you state any certain sum of money that was contributed by Sir Hugh Allan? Ansicer — No, I cannot state o; my own knowledge. I cannot give hearsay evidence. Question — Have you any knowledge that any sum of money was offered to any member of the Government for the purpose of influencing him in connection with the Pacific Eailway? Ansircr — I am perfectly convinced there was nothingof the kind. Question — Or any other inducement or advantage ? Answer — None. This may be a proper time to explain a circumstance which has been referred to in the papers, which seems to imj^ly that I desired some inducement of some kind. Reference was made to my having stipulated for a situation on the Pacific Railway for one of my sons. Now I desire to explain exactly what passed. When I wrote my letter very hastily, I at the moment really had forgotten the circumstance which made very little impression upon my mind, but I afterwards distinctly recollected it. My youngest came in October, ISTl, to pay a visit to his friends. He then held an offl(^e in British Guiana, and came here on leave of absence. I was . .xious to keep him in CV.uada, and to establish him in business. Some time during the fall of 1871, and while Sir Hugh Allan was absent from the countr}', a friend in Montreal isuggestcd to mo the idea of purchasing out a forwarding business, which was likely to become vacant in consequence of the death of a gentleman, who died in the latter part of Novembth", 1871, and it was suj^posed that his businejs after his death would disposed of. This matter hatl heen brought under my consideration, and I took the opportunity of Sir Hugh Allan's being in Ottawa, to consult him on the subject. He was on a visit for three or four days at Rideau Hall, in January, eighteen hundred and seventy-two (1872), after his return from Eiigland. The cause of my having any conversation with him, was simply to ask his advice with regard to this business, as 1 considered him more competent to give an opinion than any one that I knew of. Ho strongly advised me to ha\e nothing to do with it, and at the end of the conversation, 1 simply said, if you hear of any opening for my son, I would be glad if you would bear him in mind. Ho made the remark that when the Pacific Raihv.ay is started, there will be plenty of opportuniticM, and so little imi)ortanco did I attach to t'lo conversation that J never mentioned it to my son, and it never crossed Sir Hugh Allan's mind or mine that there Avas any thing corrupt one way or the other, with reference to the conversation. Jf it was wrong at all, I am alone responsible for it, for no other member of the Government knew anything about it, nor did I attach importance to it. Of course 1 have seen Mr. McMullen's narrative, and if there is any thing I have not noticeil, 1 would like to have an opportunity of adding to this statement. I say most distinctly that no such conversation w.is had with me that a round sum of money down would be preferred by me at my time of life. 1 swear most positively that no such conversation ever took place. No such thing was ever men- tioned by mo to Sir Hugh Allan or by him to me. Thuie is a statement that I said something of Sir George Carticr's jealousy with regai-d to the Grand Trunk to the Pacific. Mr. McMullen thought I had a conversation to that ctt'ect with him. I can I 10 only Hftv that I Imvo no recollection of any bucIi converHation. I don't think It is at nil likely that I had Hpokon to him about Sir George Cartior's views on the Buhject, but it in quite correct to say that Sir Goorgo was very strongly opposed to the Americans having any interest in the scheme. Most unquestionably the Americans never received any i)lwlges of any kind or description, as stated by Mr. McMullen. Question — Did you not mention a memorandum of which you had taken a copy, given you by the Americans? Answer — I took a copy of the names but not of the memorandum, and those .1 handed to Sir Hugh Allan. There was no money received or 'paid by the Government for or in consideration of giving the contract. There is mention made in Mr. McMullon's letter that I received a specific sum of $4,800 from Sir Hugh Allan. I deny this in the most positive terms. I rocoivod no sum of money whatever. Question — By Sir John A. Macdonald through the Chairman. Can you state when the elections commenced generally, and when they ended ? Answer — My impression is that they commenced about 15th July, or perhaps the beginning of July, and I should say from memory that they ended about the middle of August. Question — Up to the time of the retui'n of the writs of the elections which took place in September, was there any policy suggested to tlio Government, or before the attempt of the amalgamation of the two companies. Answer — None. Question — During all that period was it or was it not understood that a strenuous attempt should be made to effect an amalgamation of the two companies. Answer — Certainly, and much later I had reason to believe that there was good ground to expect that an amalgamation would take place. During tno whole period the elections were going on, and until long after, per- haps as late as the beginning of October this was the case. Question — In October, were or wore not the efforts of the Govcrnmont renewed to affect an amalgamation of the two Companies. Answer — Yes. Question— -Vf as there any suggestion from any person to the Government that you are aware of, or was it the policy of the Government to issue a charter under the Government Act till after the failure of all attempts at amalgamation ? Ansicer — Certainly not. Question — Then the charter which was issued and is now in existence is based on a Policy which was only adopted by the Government in October or November after the attempt to amalgamate had proved a failure ? Answer — Yes, I should bo inclined even to put it to a later period. The arrange- ment of the new Company took a considerable time. I presume that it was about the latter end of November that the policy of the Govei'nmont to work by means of a company of that kind was decided upon. And further, for the present, deponent saith not. And on this fifth day of September, 1873, reapj jared the said witness who desires to give some explanation of his answer to the quet-'tion on a preceding page of his deposition, and gives the following explanation : I wish to answer this question at greater length. I never heard of any sugges- tion to the Government to issue a charter under the General Act, and the Government never contemplated issxiing such a charter till they became satisfied that it was impos- sible to effect an amalgamation between the rival companies. i u Tho corroHiK)H(loncc nlludoJ to in my foregoing clepoHition i.s in the words following: Letteu Mabkei) '' B." Confidential. TottoNTO, 17th July, 1871. Sir Francis IIincks, Ottawa, Out. Dear 8ir, — I have been thinking over tho suggestion about tho introduction of Homo of our Canadian Capitalists into tlio Canatlian Pacific lial.way Conij)any iuid thought it proper to write to you for tho purpose of having your views upon tho matter, and especially to have the names you would sugg )♦. (>ur Amoi-ican friends have no objection, on the contrary they arc anxious to moe: tho reasonable views of yourself or tho (fovemmont on tliat point. You will oblige, therefore, by naming such person? ,is you think proper to have associated in the matter, either from per- sonal or polilical considerations. Those who have already done r.nytliing in tho way of a formation of a company, or with that object in view, wo would bo specially glad to deal with. AVo have autliority to a certain extent to distribute some shares in tho concern, which if they would not be of any profit would not be any loss to tho holders, and no money is re<[uired. If you could make it convenient to writo by return mail it would be convenient that wo might consult with one of the American Gentlemen now here. Yours truly, (Signed) JAMES BRATY,Jr. Letter Marked "C." Ottawa, 20th July, 1871. ConftdentiaL Mv Dear Sir, — I have been almost constantly confined to Uio house since I rocoivotl your letter of tho soventeonth, and having at once sent you a telegram, that would enable you to assure your friends, that no sucli arrangement as you suggested would be practicable, I put off writing until I could do so more satisfjvctorily. It strikes mo that you fail to appreciate the suggestion relative to Canadians being induced to interest themselves in the projected railway to the Pacific. I am inclined to believe that some Americans of capital and influence might bo induced to take hold of tho scheme, but in ray judgment they will find it oxpediont, if not abso- lutely necessary, to associate themselves with Canadians of equal position and moans by whoso instrumentality this very gigantic scheme can be brought favour- ably before British capitalists. Any scheme requiring large aid from Government will be viewed with groat jealousy by tho public. It is not the business of tho Gov- ernment to name pai-ties nor to suggest to any one that they would like particular Eorsons brought into a scheme. The government have to consider propositions rought before it on their mer'ts, and will be expected, I think, to seo that tho Cana- dian promoters of any scheme are not only able, but willing to put money into it, — a most indispensable condition which you seem not to attach any imj)ortance to. I fear that you are going altogether too fast when you refer to an authority to distribute shares in a company which has not even boon forned, and tho projectors of which are not yet in a position to take the most initiatory step. 1 inforrixl from what I heard from tho American gentlemen who lately visited Ottawa, that tho}- had come under a complete misapprehension of facts, and that they believed that Mr. Waddington and Mr. Kersteman had had some previous understanding with the Government. You may rely on it that one of the main difficulties in the present scheme, is that Canada is, as it wore, represented by Mr. Kci'stenian chiefly, who is looked on by those with whom I have conversed, as a " man of straw." It is clear that men of this type would only be taken hold of by capitalists on the ground of thoir having influence of some kind, for which they must be paid, and if jiaid, the payment must come from the public chest eventually. The American gentlemen who have means expect, and have a right to expect, a good contract, but it is clear that if they have to subsidize Canadians, their demands will bo hitjhor. A great mistake has, 1 fear, been already made, and your letter induces me u" think that you contemplate proceeding further in a wrong direction. The first step will bo for the Government to determine what aid they will give in land and mci'^^^, and things would have gone much smoother if that had been decided before any appeal had been made to capitalists on the other side. When terms have been agreed to, then the names to be inserted in a charter will become a matter of consideration and negociation. This is the view which I take, but you will understand that I am merely giving you my own ideas and without consultation. I know, however, that there is great anxiety that this work should get into first-rate hands. Yours faithfully, (Signed) F. IIINCKS. Confidential. Letter Marked "D." Sir Francis Hincks, Ottawa, Ont. Toronto, 24th July, 1871. ^^y Dear Sir, — I am much obliged to you for your last letter and the observations you ibake therein. I had a keen appreciation of the proprieties and necessities of the case when I understood the natter. You must notice, however, that 1 never saw Mr. Waddington until I met him on my way to Ottawa ; and I believe I had only spoken to Mr. Kerstemun about two or three times before that Wednesday when I started for Ottawa upon a notice received two hours before in the Court House that I was expected to go. I learned pretty nearly all I knew on my way down. I had just one conversation that amounted to any thing before I left, with Mr. K. I then perceived that the whole matter was disorganized and required complete recon- struction as far as Canada was concerned, but I could not then back out. I was up to that point only introduced as a lawyer, and of course had to attend to my clients' behests. I oould not do even what I thought prudent at Ottawa. The very suggestions made pressed themselves upon my attention from the very begioning; ; but how to arrange them and how to meet obstacles of the present position I could not then determine. When I returned home with the knowledge I had made, I made up my mind both from the standpoint of public policy and the legal standpoint, that no Senator or Member of Parliament could be in the Company much less be on the Board as a Director. This settled one question directly, at the samb time it opened up new difliculties. The field is very limited for selection when yoo exclude the Senators and Members of Parliament, and where to appeal wns another grave question. Of course we do not now seriously contemplate to have on the Board cither Mr. W. or Mr. K., although they have both done a kind of service that must bo acknowledged. My own view was, and T think it is or will be your view, that names must be presented to the Canadian and general public that will at the least have the appearance of not only being willing hut able to command the money or capitai necessary to build the ror.a, and which will meet with the approval of Parliament. These name are few and far between in Canada. Taking the cue I received, I at once upon my return entered into negociation with Mr. Laidlaw, who I now am fully aware has been to some extent in communication with » I o gentlemen in Montreal, such as Allan, Stephen, and King, to the same end that wc have in view, although nothing substantial has been done. The probabilities arc, I will go with him to Montreal before the end of a week or two on this subject. What it may result in I can- not tell. It must not be imagined, however, that the present organization, although imma- tured and incomplete, is to be despised. I assure you that it is not either in this country or the United States. We do cot mean to make any fuss about subsidizing Canadians. Cana- dians will be quite willing to come into any undertaking that thcj think will pay, and wc do not intend, whatever may be the end, to go into anything else. Wc have room for others, and mean to get them, and there are shares still open, and we do not expect men to associate in an important enterprise of this sort without substantial inducements. They will not do it for amusement, that I have learned in my short life. As to such men as Waddington and Kersteman, being representativo men, it is not thought of. They will, however, put them- selves forward, and no one that I know of can prevent them ; but all that will, if it is not already, be satisfactorily arranged. There are a few men to be thought of in this connection in Ontario, Gzowski, Laidlaw, Manning, McGivern, and Adam Brown, of Hamilton, Wilson, of I'icton, arc presentable. Then in Quebec, Hugh Allf-n,. Geo. Step' in, King, of IJank of Montreal, and one or two more that some one else couid name would bo all that on first sight can lay claim to Mny notoriety or availability in this direction. Many business men might be suggested both here and there if time permitted, but these are prominent, yet after all they are very few, and of others how many would be willing to take stock with tlic Grand Trunk before their eyes. Even some of these names are not the most popular in Ilailroad connection. As the matter now stands I am the representative of the American gentlemen who are interesting themselves in the road. And except for the waywardness of Mv. Waddington, would be the only medium of communication for the Canada gentlemen. I myself am of the opinion that there is plentv of time before the surveys arc complete or before Parliament sit^ ui consider all these questions; still such a Company as will be necessary for this puriiofle to accomplish a work so extensive and important cannot be arranged in a month even ; so time had better be taken by the forelock. There is no doubt very crude notions have been entertained about this matter, but I think they are now pretty well disn Issed. I am satisfied, however, unless the Government grants are very substantial, few will be incliucd to engage in an enterpaisc of such magniiadc. I remain, Yours very truly, (Signed), JAMES BKATY, An. Confident int. Letter Marked "E."' Ottawa, 20th July, 1871. My Dkar Sir, — T have received your letter of the 2-lth inst. I nolo that you had yourself arrived at the conclusion, before coming to Ottawa, that "the whole matter was disorganized and required complete reconstruction." You mention your intention of proceed- ing with Mr. Laidlaw to Montreal to sec certain parties. Mr. Laidlaw is represented to be a shrewd business man, and yet from your account he is about to sec persons regarding n scheme the advantages of which neither ho nor you can have the slightest idea of; at least I certainly am wholly ignorant at this moment what aid in land and money the uovernment will recommend the Parliament to grant. How any one under such circumstances can look to men of business about being concerned in a .scheme, I am at a loss to comprehend, and I ani persuaded that owin5SI0N i'RovxNOE OP Ontario City of Ottawa Appointing Charles Dewey Dat, Antoine Polette and James Robert Gowan, Commissi -^ners to enquire into and report upon the several naatters stated in a certain Resolution moved by the Hon. Mr. Huntington in the House of Commons on the second day of April, A. D., 1873, relating to the Canadian Pacific Railway. Present : The Commissioners. On this fourth day of September, in the year of our Lord one thousand eight hundred and seventy-three, personally camo and appeared before us, the above- named Commissioners, ANDREW ALLAN, of the city of Montreal, who being duly sworn depofcth and saith : I know Mr. McMuUcn by sight, but I have never spoken to Him. I have hoard the charge read and 1 have no knowledge of any such agreement as mentioned in it having been made by Sir Hugh Allan and Mr. McMuUen as representing certain American capitalists, I have no knowledge of the subject at all. I have no know- ledge that any agreement was ever made of the kind between Sir Hugh Allan and G, W. McMullen relating to the furnishing of funds necessary for the construction of the Pacific Railway, George W. McMullen acting for certain United States Capital- ists. Question — Have you any knowledge relating to this matter of the Pacific Railway and the charges that have been road to you ? Answer — I have no knowledge of any kind relating to the matter. Question — Have you any knowledge that any money was advanced by Sir Hugh Allan to promote the elections r Answer — I have not. I know nothing personally of the matter all. The only thing I know is from what I have learned from reading the newspapers. I am a brother of Sir Hugh Allan, and his partner in business. Question — By Sir John A. Macdonald through the Chairman — Have you been in the habit of discussing those matters with your brother ? 15 Answer — I was not. Wo never spoko about it at all until these matters were pub- lished in the newspapers. And further deponent saith not, and this, his deposition having been read by him he declares that it contains the truth, persists therein, and hath signed Sworn and taken the on fourth day of Sop torn- ^ ber, and acknowledged on the eleventh '. of September, eighteen hundred and | seventy-three. (Signed), ANDEEW ALLAN. ITAEIO, ") \ca, ) IN THE MATTER OF THE COMMISSION Province op Ontario, City of Ottaici Appointing Charles Dewey Day, Antoine Pollette, and James Robert Gowan, Commissioners to enquire into and report upon the several matters stated in a certain Resolution moved by the Hon. Mr. Huntington, in the House of Commons, on the second day of April, A.D. 1873, relating to the Canadian Pacific Railway. Present : The Commissioners. On this Fourth day of September, in the year of our Lord one thousand eight hundred and seventy-threo, personally came and appeared before us, the above named Commissioners, E. L. DeBELLEFEUILLE, of the City of Montreal, Advocate, who being duly sworn, deposeth and saith : I have heard the charge read. Question — Have you any knowledge of an agreement between Sir Hugh Allan and Mr. McMullen, acting for certain American capitalists, with a view to furnishing funds by the Americans, for the building of the Pacific Railway ? Atiaicer — I have none. Not the least. Question — Have you any knowlcdso of any ncgociations whatever between Sir Hugh Allan and Mr. McMullen ? Answer — I know nothing personally, except what appeared in the public newspapers. I knew nothing of it before it appeared in the public prints. Question — Did you take a part in the late elections of last summer ? Answer — I did in some Counties, but not in Montreal East. Question — Are you aware that any sums of money were supplied from any source whatever, for the purpose of carrying on the elections in Lower Canada ? Answer I know that Sir Hugh Allan did advance some money for the elections, but don't know what amount. That advance was made some time in August I think. Question — To whom was the money paid ? The witness objects to this question, inasmuch as he does not see any relation between the question and the accusation which the Commission is instructed to enquire into. Objection over-ruled. gnod). CHARLES DEWEY D iY, Chairman. A. POLETTE, JAALES ROBERT GOWAN, Commisaioners. . 16 Answer — I know of only one sum of money which was paid, and only one person who received money namely — Louis Beaubien, of Ilocholaga. It was paid to hira for tho purposes of his election. Question — Do you know of any money that was paid for tho promotion of Sir Gcorgo Cartier's election ? Answe7' — I do not know it personally, but I was not a member of the Committee of Sir George Oartier. Question — Do you know what amount was advanced to Mr. Louis Beaubien for his election ? Answer — Ho got a cheque for seven thousand dollars from Sir Hugh Allan. I have no personal knowledge of any fuvther sums being advanced by Sir Hugh Allan. This sum advanced to Louis Beaubien was made in September, I think, and I can now remember that he was paid this amount after ho was elected. I am positive of that now. Question — Why w as it given to him then ? Ansiccr — To pay the expenses made in his election, and I now well remember Mr. Beaubien gave his note for it. I think he had to refund it. I don't know what delay he would have given liim to pay it. 1 could not say from what source this money was derived, I only saw the cheque of Sir Hugh Allan. I don't know where the money came from. Qucsticn — Have you any knowledge whether this money was advanced at tho request of any member of the Government ? Answer — No ; I think that I was tho first person and only one, to ask Sir Hugh Allan to assist Mr. B dubien. Question — Have you any documents in your possession which would throw light on tho subject of the enquiry before the Commission ? Answer — I don't see that I have. I was acting as Secretary of the Canada Pacific Railway, and the documents I have are documents regularly fyled. A good deal of correspondence took place between tho Canuda Pacific Company and the Inter-Oceanic Company in 1872. which is in my possession as guardian. They may have some bearing on the accusation in relation to its fiiat part as regards its connection with the Americans. But so far as tho Pacific Railway Company is concerned, I deny most positively any such connection. I have not got the said correspondence with me, but all the documents contained in it must be in the hands of the Government and have boon laid before Parliament. To Mr. Abbott through the Chairman. I was Secretary of the Canada Pacific of which company Sir Hugh Allan was Presi- dent, and under tho instruction of the President and the Board, I published un advertise- ment in the newspapers in all the principal towns in the Dominion stating that stock books had been opened and any body who wished to subscribe could go to such places and do so. The public were invited to subscribe for whatever amounts they would desire to take in the stock of the Canada Pacific Company. That was during tho summer of 1872. I was named Secretary in -June. I attended to that business in July, 1872. These books were opened in the towns of tiic different Provinces of the Dominion. The advertisement was published and the books were sent by me, and they remained there for I think thirty days to enable any person desirous of subscribing in them to do so within tho delay mentioned. The books were returned to me with a certificate of the Agents, stating if Shares had been subscribed and to what amount. The whole stock wa.s thrown open to the public. There was no reservation of the stock. Sir Hugh .W ■ is President of the Montreal Northern Colonization Railway Company, and Mr. Louis Bi- lubien is its Vice-President; and I know that for two and a-half or three years they were voiy intimatol^ connected in order to ensure the success of that railway ; and it may be, si far as I know, in consequence or in consideration of tho friendship existing and such relations between them — Mr. Beaubien and Sir Hugh — that Sir Hugh made this loan of money to help Mr. Beaubien in bis election of 1872. When I asked the money It from Sir Hugh Allan, I did not in the least mention any interests of Sir Hugh Allan or Mr. Boaubicn in the Pacffic Railway. I only considered Sir Hugh as a friend of Mr. Eeaubien, and I thought that, liko some others of his friends, Sir Hugh Allan would help Mr. Bcaubien in the election he had made and which was then completed. I have no papers on this matter except those which came into my hands as Secretary, except a few letters that can have no bearing on this subject at all. I have had no correspondence whatever with the Americans. And further deponent saith not, and this his deposition having been read to him, ho doclnrcs that it contains the truth, persists therein, and hath signed. Sworn and taken before me on the fourth of September, and acknowledged on the ninth of September, one thousand eight hundred and sercnty-thrce. (Signed), E. Lef. DeBELLEFEUILLE. (Signed), CHARLES DEWEY DAY, Chairman, A. rOLETTE, JAMES ROBERT GOWAN, Commissionera, PaoviNCE OF Ontario, ") C m THE MATTER OF THE COMMISSION. City of Ottawa. ) Appointing Charles Dewey Day, Antoine Polette, and James Eobeut Gowan, ConimissioucrB to enquire into and report upon the Hovcrn! matters stated in ,1 certain Rcsoliulon moved by the Hon. Mr. Huntinhton in the House of Commons on the second day of April, A. D. 1873, relating to the Canadian Pacific lljiihvay. Present ; The Commissioners. On this fifth day of September, in the year of our Tjord one thousand eight luMulred and seventy-three, personally came and appeared before us, the above named Commissioners, VICTOR IIUDON, Esquire, of the City of Montreal, Merchant, who being duly sworn, depobcth and saith : I know Sir Hugh Allan. I do not know Mr. McMuUen, 1 have no personal knowledge of any arrangement between Sir Hugh Allan and 0. W. JIcMullcn, having for object the construction of the Canadian Pacific Railway. I took some interest in the elections in Montreal in 1872. I was one of the members of Sir George Carticr's Committee for Montreal East. I am aware that there were sums of money subscribed to carry on that election. Ordinarily in elections we have a committee and friends who subscribe. I do not know the iinnies of the persons who subscribed at this election. I heard that Sir Hugh Allan was to subscribe. I do not know how much he did subscribe. I know sonic of the members of (he conmiittco ; I think all of them subscribed something. A short time before the election 1 learned that Sir Hugh Allan had subseribcd. Sir Hugh Allan was not a member of the (Committee. 1 do not know tbc amount sub- scribed by Sir Hugh Allan, 'jor by any other members of the Committee. 18 I have BO knovrloge of any one having subscribed $20,000 during the elections. 1 have not in my posacstdon any letter or document bearing upon this enquiry. I hayo knowledge of the Bubjtct of this inquiry only by what I have scon in the news- papers, I have no persoaal knowledge on the subjeot. 1 have stated all 1 know in reference to the sums of money subscribed for the elections. And further the deponent saith not, and this, his deposition, having boon road to him, ho declares it contains the truth, persists therein, and hath signed. Swoi n, taken and acknowledged on the > fifth of September, 1873, ) (Signed) V. IIUDON. nod) CHARLES DEWEY DAY, Chairman. <( A. POLETTE, K JAMES R013EIIT GOWAN, Cominlnisioncnj [TAIUO, ^ t-a. ) IN THE MATTER OF THE COMMISSION Province of Ontaiuo, City of Ottaici Appointing Charlks Dewey Day, Antoine Polettf, and James Roheut Uowan, Commissioners to enquire into and report upon the sovoral matters stated in a certain Resolution moved by the Hon. Mr. Huntington in the House of Commons on the second day of April, A.D. 1873, relating to the Canadian Pacific Railway. Present: Thb CoMMissiONEtm. On this sixth day of September, in the year of our Lord one thousand eight hundred and seventy-three, personally came and appeared before us, the above-named Counuissionei>', LOUIS BEAUBIEN, of the city of Montreal, a Member of the Honourable The House of Commons of Canada, who being duly sworn, deposcth and saith : I am a member of the House of Commons. I am Vice-President of the Montreal li them Colonization Railway. I hold no situation or directorship in the Canadian Pacific , 'Iway. I have heard read the charges which the Commission has been appointed to c/"j.;. re into. I know Sir Hugh Allan, and have met Mr. MoMuUen. Q?testion — Are you aware of any agreement or negociation being made between Sir Hugh Allan and Mr. McMullen relating to the matter expressed in these charges ? Anstccr — I am not aware of any. Question — Do you know of any agreement made by Sir Hugh Allan with Mr. McMuUcn acting for United States Capitalists to furnish funds necessary for the construction of the I'auific Railway . Ansicer — No, I have no knowledge of any such transaction. I was one of the Provisional Directors of the Canada Pacific Company, but I only joined when these things arc supposed to have taken place, and have no knowledge of them whatever. Question — Was your connection with the Canada Pacific Railway Company subsequent to the period referred to and before the legblation of last Session. Answer — My name was included among the Provisional Directors when that Company was incorporated , that was the first time I was connected with it. mi 19 The period I refer to was the Session before the last. I was not a member of the Dominion Parliament then. Question — Are you aware of parties who were expected to take up the stock of the Canada Pacific Company ? Ansicer — No, I was not aware. Question — Do you know whether any American Capiatlists were expected to furnish money for the purposes of the Railway. Aimccr — No, I do not. Question — Have you ever, or had you at that time seen any list made out by Sir Hugh Allan as to the distribution c' ' ock ? A7isiccr — No, I had not. Question — Do T understand you to say positively that you know nothing at all relating to this matter expressed in the first clause of the charge which you have just heard read to you? Afuwer — Nothing at all. Question — I see your name signed to a memorandum of the Canada Pacific Railway Company, upon a statement submitted by the Inter-Oceanic Railway Company to the Gov- ernment of Canada, along with the names of Sir Hugh Allan and J, J. C. Abbott. Were you a party to a memorandum of that kind ? Ansica- — I was. It is signed " Hugh Allan," " J. J. C. Abbott," " Louis Beaubien." Question — Had you any knowledge of any negociations concerning the amalgamation of these two Companies ? Ansicer — All I know is what is contained in the Blue Book, entitled — " Charter for " the construction of the Pacific Railway, with papers and correspondence ; " that is all the proposal that I ever heard was made. Question — Did you take any personal part in any of the negociations ? Answer — I signed all these documents after being named by the Company on its com- mittee, which was termed the Executive Committee. Question — Do 1 understand you to say that you signed this document, and took an active part in the negociations which took place between the Canada Pacific Company and the Inter-Oceanic Company? Answer — I took all the part referred to by these documents. Question — Had you any interviews on the subject of the amalgamation? Answer — No. I had none that I remember of. Question — Have you any knowledge of the agreement or understanding described in the charge between the persons connected with the Railway and the Government? Answer — None. Question — Have you any knowledge of any money having been advanced by any persons connected with the Railway in Quebec, for the promotion of the elections ? Answer — I have reason to believe that Sir Hugh Allan advanced a certain amount of money to be used in the elections. Question — What amount ? Answer — I cannot say. (iuestion — Was it a large sum ? Answer — I have no means whatever of judging. Question — Do you know of any specific case in which money was advanced by Sir Hugh Allan, for the purpose of aiding the election of Ministers and their supporters, at the then ensuing elections ? Answer — Not Ministers. I may mention this fact, a friend of mine and a supporter :! • ;1 '! 'I !^ i of the Giivcrimicnt, sometime before the cleotions wanted mc to get up subscription.s for \m election, to a small amount. 1 went to Sir Hugh Allan and he consented to help that gentleman. The Government never knew of it, and the Government don't know of it now, at this present moment. As this was a private matter between Sir Hugh Allan and thiit gentleman — for I state under oath that the Government know nothing about it, — I ^vould not like to give the name of the gentleman. The amount he received was one thousand dollars. The gentleman who advanced the money was Sir Hugh Allan. In my own case Sir Hugh Allan was called upon by one of my friends about three weeks after my election. My election took place on the thirtieth of August, and the money I am going to mention was obtained about the middle of September. My friends called upon Sir Hugh Allan and told him that my expenses had been a little heavy and asked liim to advance money to help mo in paying back the expenses of the election which were borne by myself. He consented to do so. I received the money and gave him a receipt for it. In that receipt it is not stated that the Government would reiaburse Sir Hugh for the amount of it. 1 could not find a copy of that receipt, but I saw it a month ago when it was men- tioned in McMuUen's letter. This morning I was taking it down as well as I could re- member in my memorandum book. If there is any change in the wording of the receipt, I can swear it is not a material change. The receipt is as follows: — " Received from Sir Hugh Allan, the sum of seven thousand dollars, which I agree to repay him within one year, if he bo not sooner re-imbursed along with other sums advanced by him in aid of the elections." This note is due now. The amount of the note was obtained at the solicitation of my friend. The Government never knew of this arrangement at all. I will correct this answer in so far as I have reason to believe that Sir Hugh Allan sub- scribed money to the Central Committee Fund of Montreal, and I was informed that Sir Hugh Allan stipulated that if necessary I would be helped out of the fund. I understood, also, that Sir George Etienne Cartier was opposed to any of the funds being used for that purpose, but I believe that gentlemen on the Committee notwithstanding this gave without Sir George's knowledge some money to my friends. I will state also that I know that Sir Hugh Allan helped two candidates who were believed to be friendly to the Administration. As the Government did not know that they were assisted, and as neither of them arc members of the House, and it being a private matter between them and Sir Hugh, I did not think it necessary to mention it on Saturday in my deposition. I don't think it fair to these two gentlemen to bring their names before the public. I don't know of any other sum advanced by Sir Hugh Allan or by any other person on his behalf. I could not say how much was subscribed for the Montreal elections, but I think there was a list passed round and subscriptions asked ^rom different gentlemen. I don't know anything further that took place. Sir George E. (^artier's Committee was rather against me, I was not on the Committee, but my opponent, Mr. Hudon, was Presi- dent of it, which was sufficient to keep mo off. Queation — Did you apply to .~"r Hugh Allan yourself to aid you in the pnymcnt of your election expenses ? Answer — I suppose I must have said a word for myself at that time. Question — Did you expect before or at the time of your election that this money was to be forthcoming from Sir Hugh Allan ? Answer — No, I expected to be elected by acclamation, and if it had not been for Sir George Cartier, I would have been elected by acclamation. Question — Why did you apply to Sir Hugh Allan for this money instead of some other wealthy gentlemen ? Answer — Sir Hugh Allan was the person more likely than any body else. Question — Had you been in particular relations or in business relation with Sir Hugh Allan. Answer — I was considered as one of the most active parties in t the Americans he referred to would not invest money of their own in the enterprise ; that apparently they had none to invest in such enterprises, for that they had obtained from illurope all, or almost all, the capital employed so far, in constructing the Northern Pacific Railway ; that if they were allowed to hold the "^jaior part of the stock, as he proposed, they would be complete masters of the Canadian Pacific Railway ; and that this would enable them to suboidinate its traffic arrangementp to their interests in the United States, that it would give them control of the settlemeut of the large territory to be granted to the Company in our North West, and, that they might, and possibly would, so manage its settle- ment as to imperil the very peace of Canadi;. Sir Hugh dissented from all these opinions, and in expressing surprise that I should enteitain such narrow views, said that he took a CTjsmopolitan view of tlie question, that in stipulating that a majority o*" the directory should be British subjects, resident in Canada, he h<).d sufficiently guarded Canadian interests. He added that he was unable to state precisely how the stock (10,000,000) would be appor- tioned ; tliat that was then being determined in New York ; that he expected to be fully advised on his return to Montreal, and would communicate the information to me. 1 objected also to the composition of the Canadian Board, as proposed by Sir Hugh Allan, and urged that it did not fairly or sufficiently represent the various Provinces of the Dominion. T 8i\id that Mr. MoTnnes and myself would not be sufficient representation from Ontario, and that there was no representative from British Columbia, the Province of all others most interested in the railway. Sir Hugh said that he considered the Board as proposed a good oae, and that if British Columbia were represented, the Maritime Provinces would also expect to be represented. I replied that I thought they ought to be represented ; that the undertaking was a Dominion one in the broadest sense ;, that all the Provinces should have the opportunity of taking an interest in the company, and of being represented at the Board ; that I was quite certain Parliament would not assent to, or the country tolerate any scheme which would place the Canadian Pacific K "way and its subsidies in the hands of foreigners and rivals. After Sir Hugh's return to Montreal, I received the following letters : — rc«Pi^] Montreal, 27th Feb., 1872. Mv Dear Sir, — The papers which have come from New York indicate the amount r,i stock allotted to !nc as f 1,450,000. This I propo?e to divide in something like the fol- lowing shares : — ' D that t f^unad •anie. visiona I'arliai place our Ai twentit give th( control during the bui with al 2t Hon. D. L. Macpherson $100,000 Hon. A. B. Foster 100,000 Hon. J. J. C. Abbott 100,000 Dopald A. Smith 100,000 Donald Mclnnos 50,000 Andrew Allan , 100,000 JohnShedden 50,000 C. S. Gzowski 50,000 GeorgaBrown 50,000 Henry Nathan 100,000 C. J.Brydges 100,000 T, McGreevy 50,000 H. Allan 500,000 " $1,450,000 This may not be the ultimate arrangement, as I have not yet even proposed the matter to some of the gentlemen, but, if I can arrange it there will not be much change. Please advise me at once if you consent that your name shall appear as one of the Provisional Directors, as I must send in the list to the Government without deiny. Yours truly, (Signed) HUGH AT^LAN. The Hon. D. L. Macpherson. The information in this letter is for yourself alone. To Hon. D. L. Macpherson, Toronto. Montreal, 29th Feb., 1S72. My Dear Sir, — Since writing to you I am informed that the Hon. George Brown will not be a shaieholder at present and I propose to name Mr. Howland in hia place. Yours truly, (Signed) HUGH ALLAN. (Copy drJ.) Montreal, 29th Feb., 1872. informing mo Dkau Sir Hugh, — I 'lavo to thank you for your letter of 27th inst that there had been alloted to you in New York, shares in the Canada Pacific Railway, for ranadians, to the amount of $1,450,000, and mentioning how you propose to divide the ,>ame. Since you asked me to allow my name to appear in the Charter as one of the pro- visional Directors, I have carefully considered your scheme and have become convinced that Parliament will not assent to it in its present shape, or to any scheme wliioh, like it, would place our great Transcontinental Railway forever under the absolute control of our rivals, our American neighbours. This would be effected by giving to them as you do, seventeen twentieths of th j whole stock of the Company. Why should this bo done ? Canada must give the means in money and land to build the Railway. Why shonld we hand over the control and ownership of the line with all its incalculable advantages, direct and indirect, during constrictiou and forever, to foreigner- ? Such an arrangement is not indispensible to the building oi the road, and nothing shoi this in "ly opinion, would justify it. "Second only in importance toobtainii ,j; the railway, is the securing the control of it with all its benefits to our own people. 3 28 " We have in Canada mou of suffioiont ability to carry out this great unucrtakiag suc- cessfully, \7h0se character and means would be ample guarantee to the Grovernment and the country for the fulfilment of their engagements. Money «ronld have to be obtained from abroad, but the securities would be Canadian ind the negotiations should bo directed by Canadians. " The assistance of English and foreign financial agents would be necessary, and for their services they would have to be paid ; but they should have no interests rival or anta- gonistic to the Canada Pacific Railway. I should be quite willing that they and their clients should have an interest in the road, but not a controlling one. " The position of the Canadian Directors under your proposed organization of the Com- pany would be uncomforlable and anomalous, at least so it appeais to me. They would sit ut the Board in virtue of being Canadians, but morely as tlie nominees and the mero agents — of foreign shareholders. " The interest* of these shareholders might oouuict with the interests of Canada,'possibly very soon. Then, if the directors stood by their country, I apprehend they would be required to surrender their seats at the first ensuing election for more subservient men. " Holding these views, ':»hich I expressed to you when you first offered me a directorship, and they have strengthened with reflection, and not seeing my way to occupying a seat at the Board with that feeling of independence so e&s.'!itial to usefulness as adirector of any under- taking, especially one of the magnitude of the Cmadu Pacific llailway, it is u^y duty to decline ♦.he offict. I deem it right to give you my reasons therefor frankly and freely. Thanking you for invitiig my co-operation, I remain, &o.. Sir Hugh Allan, Knight, &c., Montreal. (Signed), (Copy.) D. L. MACPUERSON. 4. Memorandum — Early in July, 1872, I. casually met the Hon. J. J. C. Abbott, of Montreal, at the Queen's Hotel here, and had some conversation with him rcsspccting the amalgamation of tlie Inter-oceanic and Canada Pacific Railway Conpanie^. Wc both understood the Government wished the two Companies to amalgamate, and it was also understood that the Government favored t. Directory of chirteen members (the same number as the Cabinet), of whom I, as President of the Tnteroceanic Company should name five from Ontario ; Sir Hugh as President of the Canada Pacific Company, four from Quebec, and the Government four — one for each of the other Provinces. 3Ir. Ab^^ott said that four was too small a number to enable them to obtain an adequate representation •£ nationali- ties and localities from the Province of Quebec ; that they required six, and wauld liko the numbers to be for Ontario and Quebec seven and six. I replied that as between Ontario and Quebec the proportion of five to four was much less than Ontario was entitled to, while seven to six would make the disproportion stul greater. Finally I said, that if amalgamation would be entertained by tke Intcroceanio Company and if all the other details were satisfac- torily settled, it was possible the Interoceanic Company would not break off ncooiatioua i^^o.; the point as to whether the number of Directors named by c-ch Company rcspectiv ly siiould be five and four, or seven and six. I stated very early in our conversation that there would be feeling of unwillingness on tlio part of the Interoceanic Company to enter into amalgamation at all, many of us doubting whether the objects of the two Companies were the same, curs being to make the Company ulti- mately organised essentially Canadian, while we feared Sir Hugh Allan and his associates still clung to their old alliance with gentlemen interested in the Northern Pacific Railway on con- ditions that would place the Canada Pacific Railway in their hands and under their control. Mr. Abbott assured me that tliis was not the case. I replied that it was a point on which it would be diflici'lt to satisfy the Intcroceanio Company. 2d Mr. Abbott then referred to tbo Presidency of aa amalgamated Company, and inquired if I would agree to Sir Hugh Allan being appointed to that office. In reply I staged distinctly that I would not, that while I did not ; arrogate any claim myself to the Prep'doncy, I should not concede or waive any in favour of Sir Hugh Allan ; that if amalgamatior should take place the new Provisional Bofrd should be left free to elect their President, and that it was not for Sir Hugh Allan and mysc f to arrange in advance who should be President. Mr. Abbott was not satisfied with this, and referred to it again on the following day, remarking that unless the Presidency were promised to Sir Hugh he was afraid no amalga- mation would take place. In the course of the following week when at Montreal on private business, I, in com- pliaaoo with a written request from Sir Hugh Allan, called at his office. He at once referred to the Pacific Railway, and said be understood from Mr. Abbott that the only points of amalgamatiofl on which he (Mr. Abbott) and I differed were the number of Directors to be named by each Company and the question of the Presidency. I replied that these were the only points we had discussed. That I had said to Mr. Abbott, speaking for myself only, that if all the other details of amalgamation were settled satisfactorily, I thought the Interoceanic Company might be induced to consider the necessi- ties of the other company so far as to make the number of Directors to ^e named by each of us respectively seven and six. That with respect to the Presidency I had told Mr. Abbott that if amalgamation took place the choice should be left to the directors, and asked Sir Hugh if he did not think that that would be the proper way. He replied that he could not say that such was his opinion. It Tiight be inferred from what Sir Hugh says in his affidavit published on Saturday lust of ''It Abbott's interviews with nie, thai we had been for days closely engaged in discus- sinor H,it.!= of amalgamation for the companies, and generally maturing a scheme for the *vv,ib'"»i:tl..iv of the Pacific Railway. We had but two brief interviews, and the only subjects d. 5n. '-j ■»'->{) those mentioned in the above memorandum, V ;■ ' acc.js for declining to assist Sir Hugh Allan to carry out -vhat I then regarded, and still r^"^^'' , as most prejudicial to Canada — I might rlniost be justified in saying a con- spiracy agtiiji :t Canada — are contained in my letter to hin quoted abovr. My reasons for opposing the amalgamation of the two companies are set forth in the mem jranda addressed to the Government by the Interoceanic Railway Company, pulUshed in the Toronto Globe in July last, and submitted by the Government to both Houses of Jt-\.rli'.ment. A complete statement of my negociations with Sir Hugh Allan with a view to the con- struction of our great Intcroccanio Railway is now before the people of Canada, to whoso judgment the course which I pursued is unreservedly submitted. I am, sir, Your obedient servant, &c., D. L. MACPHERSON. Toronto, 8th July, 1873. In Sir Hugh Allan's letter, dated 27th July, 1872, ho advised me that the papers he expected to receive from New York, had been received by him, indicating the amount of Stock allotted to him to be $1,450,000, that being, aa I understood, the proportion of the whole amount of 510,000,000, which had been allotted to Canada, and he intimated in that letter how he proposed to divide that amount, namely $1,450,000, among Canadians. Question — Have you got in your possossion the list which ho gave you, giving the names of those among whom this amount of Stock was to bo divided ? Answer — His letter to me containing the list has b0v,n published. I thought I had his original letter with me, but I find I have it not. It is embodied in my published letter, of the 8th July, and is dated 27th February, 1872. My reply to Sir Hugh Allan, dated 20th February, 1872, and referring to his letter, the contepts of which I have just dcscribcd,'i8 embodied in Exhibit " E.'' 30 I am not personally awaro, that Mr. MoMuUoa acted for certain United States capitalists, but understood that he did. Sir Hugh Allan's letter to mo, indicates that three-twentieths of the whole stock had been assigned to Canada, and the remaining scventeeu-twentieths were to be divided among capitalists in the United States. This was in February, 1872, before there wa" any legislation whatever, but in anticipation of the ensuin-: Session. I have no knowledge except what is si ■ "-i SJ-f Hugh Allan's letter, and know nothing about the certain per centago of interest, thai/ >d in the charge I heard read, which Sir Hugh Allan was to receive, \^^ Question — Is it in conformity with your knowledge that Sir Hugh Allan was to be at the head of the proposed Railway company ? Answer — 'Nothing was said at that time by Sir Hugh Allan about his being at the head of the company, that point was not raised in Sir Hugh Allan's conversation with mo then, no personal matters or details were then discussed. . Question — Have you knowledge whether the Government were aware that these negotiations were pending between Sir Hugh Allan and the Americans ? Answer — I had not an absolute personal knowledge, but I understood that the Government were aware of it, and Sir Hugh Allan himself stated to me, that the Government were aware of it. The knowledge which I had in respect to this matter, was obtained from Sir Hugh Allan. Question — In rcferene j to the following portion of the charge, viz : " that subsequently an " understanding was come to, between the Government, Sir Hugh Allan, and Mr. Abbott, " one of the members of the Honorable House of Government of Canada, that Sir Hugh Allan " and his friends should advance a large sum of money for the purpose of aiding the elections " of Ministers, and their supporters at the ensuing General Elections, and that he and his "friends should receive the contract for the construction of the Railway." Have you any knowledge relating to that subject ? Answer — I have no knowledge relating to that subject. Question — Do you mean to say that you know of no understanding between the Gov- ernment and Sir Hugh Allan and Mr. Abbott, relating to Sir Hugh Allan's support in the elections ? Answer — No I have no knowledge of any arrangements between the Government and Sir Hugli Allan and Mr. Abbott, that Sir Hugh was to furnish money for the elections. I have no personal knowledge that the giving of the contract to Sir' Hugh Allan depended on his furnishing money for the elections. Question — There was an oflfei made to you of some of the stock in this contemplated company, was there not ? Answer — In Sir Hugh Allan's letter of 27th February, 1872, my name is put down in the list with others for $100,000, but I was no party to that. Nothing of the kind was dis- cussed between Sir Hugh Allan and myself everything he alleges connected with that is utterly unfounded. I stipulated for nothing and I was offered notiiing. I at no time nego- ciatcd in any way for the insertion of my name as a subscriber of any stock in this company. I state this most positively. Question — Did you give Sir Hugh Allan at anytime to believe that you felt disposed ill uny way to become a party to sucliau arrangomont ? Answer — No; I took exception to his scheme when he first explained it to me, and in reply to Sir Hugh Allan's letter of 27th February, 1872, adviwing tho allotment of Stock in New York of tho Canada Pacific Company, I, by return mail, declined to have anything to do with his scheme. Question — You were, I believe. President of the Inter-Oceanic Railway Company, were you not? Answer — I was. Question — Isco in the printed pamphlet marked "Charter for the construction of the 81 Pacific Railway," which was given to Parliament, your name subscribed to a report of a meeting of the Provisional Directors of the Inter-Occanio Railway Company of Canada, dated 2Gth September, 1872 ; was that an application to the Government for the contract for that company ? Answer — It was informing the Government, that the Company was prepared to treat with the Government, and was organized. That was long after Sir Hugh Allan's application to me ; at the time Sir Hugh Allan had negociations with me, there was no Company in existence. Had it not been for my objections to Sir Hugh Allan's scheme, and my desire in the interests of the country, to frustrate that scheme, I probably would not have appeared in connection with the Canadian Pacific Railway at all. It was only after I found that Sir Hugh Allan would not abandon his American associates, that I proposed to certain gentlemen in Toronto, and elsewhere, to apply for a charter and to bo prepared to do whatever might secui best when the time for action arrived. The gentlemen to whom I addressed myself, agreed in opinion with me, and we petitioned for an Act, incorporating the Inter-Oceanic Company. Question — Was this Intcr-Oceanic Company, formed with a view of defeating the original scheme, with the American Capitalists ? Answer — Yes. Question — Were there any negociations between the Inter-Oceanic Company and the Canada Pacific Company with respect ; o amalgamation afterwards ? Ansica' — There was sometime afterwards. Question — Why was that ncgociation unsuccessful ? Aiiswer — Because the Inlcr-Oceanic Company did not believe that the (^an;"i.a Pncific Company had abandoned their American connections. It is quite true that the Committee of the Canada Pacific Company assured the Government that they never had any communi- cation with Americans. The Inter-Oceanic Company, however, looked upon Sir Hugh Allan as really the Canada Pacific Company, and they had reason to believe that the Ameri- can gentlemen with whom Sir Hugh had been in negociation, still expected that the under- standing which he had with them would be fulfilled, and for that reason the Inter-Oceanic Company declined to amalgamate with the Canada Pacific Company. In the second memorandum of the Executive Committee of the Inter-Oceanic Railway Company, addressed to the Government, they stated " that they deem it their duty to state " to the Government that in their opinion the admitted negociations of Sir Hugh Allan " with gentlemen in the United States, resulting in an arrangement or understanding which " is considered opposed to Canadian interests, and which the undersigned from information " in their possession, and referred to above, have reason to believe is still substantially " existing, will continue to cause the Canadian people to view with suspicion and prevent their " subscribing stock in any company in which Sir Hugh Allan and his associates appear " controlling parties." I give these reasons from the memorandum of the reasons on account of which the Inter-Oceanic Company declined to amalgamate. Ques'.ion — Was there any other reason than Sir Hugh Allan's associations with Americans wliich induced the Inter-Uceanic Company to oppose the Canada Pacific Railway Company ? Answer — I think not, except the reasons which are given iu the memoranda contained in the blue book referred to, endorsed " Charter for the construction of the Pacific Railway with "papers and correspondence." Question — Can you state your grounds for believing in the fact that Sir Hugh Allan was associated with American capitalists ? Answer — I had a statement from himself in the conversation which I had with him at an early period that his associates were American Capitalists. Question — Had you any statement from him at a later period ? Answer — No, I had a conversation with Mr. Abbott, and he assured me that they had dropped the American connection. I told him it would be very difficult to satisfy the Jnter- Oeeanic Company on the subject. I have no knowledge at all relating to the elections in Montreal. ^ 1 1 ( :i s mSSSSSSSSfSS t, 82 Question — Do you remember any other matter which might be of use ia this enquiry ? Answer — The only additional matter that took place at all between the Canada I'aciiic Company and myself was the conversation I have referred to with Mr. Abbott, and what took place then I have also published. It was expressing his desire that an amalgamation would take place. Mr. Abbott I believe was one of the Provisional Directors of the Canada Pacific Company but is not a Director of the present Canadian Pacific Railway Company, lie is Counsel I believe of the Company now chartered. This conversation took place before the Company was chartered ; that is before the Royal Charter was issued. Subsequent to the issuing of the Charter, I had no conversation with Sir Hugh Allan. In 1872, two Acts of Incorpoaation were granted, one to the Canada Pacific Company and the other to the Inter-Oceanio Company. It was these two Companies which it was proposed to amalgamate, that is the Canada Pacific Company, which Sir Hugh Allan wished to amalgamate with the later-Oceanic Company. I had this conversation with Mr. Abbott I think in July, 1872. In that conversation he urged upon me the desirability of amalgamation, and also asked me if, in the event of the subjet' being discussed, and favourably considered, would I consent to Sir Hugh Allan's being J'resident. We also spoke of the number of Directors. The only matter at all per- sonal to Sir Hugh Allan and myself was the question of the Presidency. Mr. Abbott wished that I would consent to the office being filled by Sir Hugh Allan. I told him I would not assent to it in advance, but I set up no claim to the office myself I thought it should be left to the free choice of the Directors if amalgamation should take place. Question — Had you any interview with tl Government or any member thereof with relation to this amalgamation ? Answer — No personal interview — I had a conversation — or probably two or three conversations — with Sir John A. Macdonald, on the subject, in which he urged the importance of amalgamation, putting it on the ground that it was desirable to unite as much as possible the influence and financial strength of the country, but nothing beyond this pjneral expression of opinion. I objected on the ground stated in the minutes of the Intei Oceanic Company, and because I felt quite certain that Sir Hugh Allan continued in association with the Americans, and that this would be fatal to the enterprise in his hands, and that if the Inter-Oceanic Company, joined with the Canada Pacific, it would be involved in failure and disgrace, and I did not wish either the Inter-Oceanic Company or myself to be involved in these. To Sir John A. Macdonald. I include the whole of my published letter, dated 8th July, 1873, in my deposition. In this letter there is contained a memorandum of the conversation which took place in July, 1872, with Mr. Abbott; it is substantially correct, Qtiestion — When was the last occasion on which you had any communication with myself on the subject of the amalgamation. Answer — I think it was in November last at Toronto. Sir John A. Macdonald pressed strongly for the amalgamation of the two companies at that time. I dissented on pretty much the same grounds as those assigned in the memoran- dum of the Inter-Oceanic Company, addressed to the Govcnment. The printed copy of the letter above referred to, of the 8th of July, 1873, and which b marked "E," contains a full and true statement of all the matters to which it relates. And further deponent saith not, and this his deposition having been read to him he declares that it contains the truth, persists, therein and hath signed. Sworn and taken on the sixth day of September, ) 1873, and acknowledged before us Uiis I (Signed) D. L. MACPHERSON. eighth day of September, of said year. ) [Signed] CHARLES DEW^EY DAY, Chairman. A.POLETTE, " JAMES ROBERT GOWAN, Gommissioiws. Pr( App Pres( and s Toe ] 1872. ] acting Eailwl of any above. I Ilonoi the pj clectic liailw had w of the place I corres] were tl ll can Ca l] Carticl \J tion ml was at Comml electiol l[ was usl Mr. I did — itwl 83 > ! IN THE MATTER OF THE COMMISSION Province of Ontario, City of Ottawa. Appointing Charles Dewey Day, Antoine Polette, and James Robert Gowan, (Jommissoners to enquire into and report upon the several matters stated in a certain Eesolution moved by the Hon. Mr. Huntington in the House of Com- mons on the second day of April, A.D., 1872, relating to the Canadian Pacific Railway. Present: The Commissioners. On this eighth day of September, in the year ot our Lord one thousand eight hundred and seventy-three, personally came and appeared before us, the above-named Commissioners, The Honourable JEAN LOUIS BEAUDEY, of the city of Montreal, one of the Members of the Legislative Council, who being duly sworn, deposeth and saith : I was a Provisional Director of the Canada Pacific Railway Company, incorporated in 1872. I have no knowledge of an agreement between Sir Hugh Allan and G. \V. McMuUen, acting for certain American Capitalists, for tho construction of the contemplated Pacific Railway to have funds from capitalists of tho United States. I have no knowledge whatever of any negociations or correspondence having taken place with referenee to the matters stated above. I have no knowledge of an understanding between the Government, Sir Hugh Allan and Honourable J. J. C. Abbott that Sir Hugh Allan and his friends should advance money for the purpose of aiding the election of Ministers and their supporters at the ensuing general elections, and that he and his friends should receive the contract for the construction of the Railway in consideration of such subscriptions. From the short duration of the connection I had with the enterprise of the Pacific Railway, I had no means of knowing, and knew nothing of these correspondence. I have no other knowledge except of what 1 have stated that took place at the meeting of the Board. Nothing took place then that had any respect to the correspondence or negociations with Americans. The question as to what source the means for the construction of tho Pacific Railway were to be derived was not discussed at the meetings which I attended. I have no personal knowledge whatever that these funds were to be expected from Ameri- can Capitalists. I took an active part in the elections of Montreal East in 1872, I was on Sir George Cartier's Committee. When I attended the Committee for the first time there had already been some organiza- tion made, and at the meeting which I attended they asked me to preside over tho meeting, it waa about the commencement of August, 1872. I was told by some of tho members of the Committee that they had a list of subscriptions for the object of defraying the expenses of the election. I did not sec the list of subscription niyself, but at a certain period of the canvassing I was asked by some of the members of the Committee to go to Mr. Abbott, and I went to Mr. Abbott with two other gentlemen, and then signed a receipt for $20,000 to Mr, Abbott. I did not see the money myself. The receipt was signed in IMr. Abbott's office in his presence — it was left with Mr. Abbott. I was given to understand that Sir Hugh Allan was a 't : i'\ m 84 aubscribor to the cleotion funds : the expressions made use of in the receipt then signed by me arc the only conditions that I am aware of. The Honourable II. Starncs and Mr. Mur- phy signed the receipt with me. The only receipt which I signed in connection with these gentlemen is the one above referred to. I have not seen this receipt since. 1 have no personal knowledge of that receipt having passed from Mr. Abbott's hands except what I have seen in the newspapers. I am not aware, personally, of any other sums given by Sir Hugh Allan. That receipt refers to the letters of Sir Qeorge E. Carticr, dated 30th July and 24th August, 1872. I had not seen those letters when I signed the receipt ; but subsequently, the letter of the 30th of July wos shewn to me. It was in the hands of a gentleman who wanted me to state if the article which had appeared the day previous in the Gazette was correct as to the nature of the letter. That gentleman wos Mr. Murphy. I did write a letter in conjunction with Mr. Starnes and Mr. Murphy. I think this letter was handed to the Editor of the Montreal Gazette. The letter which the Chairman read to me just now is the letter which I signed, and the contents of it are true. I have taken communication of a printed copy of the letter referred to, in the following terms : he Sn Extract from the "Montreal Gazette," Juli/ 23rd, 1873. THE PACIFIC RAILWAY SCANDAL. Pkc To the Editor of the Gazette. Sib, — Seeing your Editorial of yesterday in which reference is made to a letter from Sir Qeorge E, ('artier, t» Sir Hugh Allan, dated 30th July last, which letter is referred to in the letter of Sir George E. Cartier, of date 24th August, published by Mr. McMullen, we fe<^l bound to state that we have seen the first mentioned letter, and that your editorial statement that it has no reference, whatever, to the Pacific Railway Company, or to the Pacific Railway contract, is perfectly correct. Apj (Signed), J. L. BEAUDRY, « H. STARNES, tt P. S. MURPHY. July 22od, 1873. I declare the statement contained in that letter to be true, and I make it a part of my deposition. I do'nt know, personally, of any other sum of money subscribed for the Montreal elections, for I did not go round with the list; but I have heard there was — I was told by some members of the Committee that there was a list of subscription. I do'nt know what amount was subscribed, and I do not know either what amount Sir Hugh Allan has subscribed. There was a large sum of money paid to the different Election Committees. I was in the General Committee, and there were sub-committees in every Ward. I had nothing to do with the distribution of the money or with paying the accounts. Considerable sums of money were paid to these sub-committees. Some of the sums of money paid were drawn from the Metropolitan Bank by cheques. I am not aware of what kind of receipts was given for these sums of money. I believe these $20,000 were paid on account of Sir George E. Cartior's letter of the 24th August. When I signed that receipt I thought that Sir Hugh Allan was a subscriber, and it is the only inference which I can draw from the wordirq of the receipt. I had no knowledge whatever of any conditions except what is contain^ ' ,n the receipt. I have no knowledge of any other subscription, except that some friends told me they had subscribed. The receipt was signed and left with Mr. Abbott, and I did not see the money. I did not see the cheque for the drawing of the $20,000 from the Bank. Pre; and PE and Can oft bet^ friei Mit that way the thai 86 And further the deponent gaith not, and thia his deposition having been read by him, he declares it contains the truth, persists therein, and hath signed. Sworn, taken and acknowledged on this eighth "^ day of September, one thousand eight y (Signed), J. L. BEAUDRY, hundred and seventy-three. J (Signed), CHARLES DEWEY DAY, Chairman. " A. POLETTB, " JAMES ROBERT GOWAN, Coittmissioners, i IN THE 3IATTER OF THE COMMISSION Province of Ontario, Citi/ of Ottawa. Appointing Charles Dewey Day, Antoine Polette, and James Robert Gowan, Commissioners to require into and report upon the several matters stated in a certain Resolution moved by the Hon. Mr. Huntington in the House of Commons on the second day of April, A.D. 1873, rclatimg to the Canadian Pacific Railway. Present: The Commissioners. On this eighth day of September, in the year of our Lord one thousand eight hundred and seventy-three, personally came and appeared before us, the above named Commissioners, PETER S. MURPHY, of the City of Montreal, Merchant, who being duly sworn, deposeth and saith : I am a resideui of Montreal. Question — Have you any knowledge relating to an agreement bctv^^ccn Sir Hugh Allan and Mr. G. W. McMullcn, representing certain American capitalists, fo/ the building of the Canada Pacific Railway with American funds ? Answer — I have not. Question — Have you had any paaticular connection with the original Company ? Answer — None at all. My connection was with the Montreal Northern Colonization Railway Company. Question — Had you any knowledge previous to the passing of the Act of incorporation of the Canada Pacific Railway Company as to any negotiations that were going on 1 Answer — No. I don't know Mr. McMuUen by sight. Question — Had you any knowledge of the understanding, subsequent to that period, between Sir Hugh Allan, or Mr. Abbott, and the Government, that Sir Hugh Allan and his friends, should advance a large sum of money for the purpose of aiding the elections of Ministers and their supporters at the then ensuing general election, namely, that of 1872. And that ho and his friends should receive the contract for the construction of the Pacific Rail- way ; were you aware of any such agreement with the Grovernment or with any member of the Government. Have you any knowledge on this subject whatsoever ? Answer — I have no such knowledge whatsoever. Question — Had you any communication with Sir Hugh Allan, or with the Government, that would have enabled you to know ? Answer — I bad not. I know nothing except what I saw in the papers, . rZ ",-,r . v'rTr-; \Ai!iSSm 86 Question — You were interested in the elections of 1872, and took an active part in them, did you not ? Answer — I did, I was a member of Sir George Carticr's CJcncral Election Committee for the Eastern division of Montreal. Question — Do you know of money having been furnished for the carrying on of tho elections there, or in any other part of the City 1 Answer — Yes. There was a large subscription list passed round, and several gentlemen subscribed. Tho largest amount subscribed was that by Sir Hugh Allan, lion, Mr. Stameg stated the other day that it was seventy thousand dollars. My impression is that it did not exceed sixty-five thousand dollars ; that is tho gross amount of all the subscriptions. Question — Do you know of any portion, and if so what portion was subscribed by bir Hugh Allan? Answer — Ilia first subscription was ten thousand dollars. I was one of those who signed the receipt for it. Tho next sum was for ten thousand dollars more I think, but I am not sure. It was for at least ten thousand more. Then there was the last or third subscription, or at least it is the only other one of which I have any knowledge. It was for twenty thousand dollars more. I signed the receipt for it. Question — Is the name " P. S. Murphy," which I sec appended to the printed receipt for 620,000, yours? Answer — Yes. Mr. Betournay's name was also on the receipt for the $20,000 I believe, This receipt is signed "J. L. Boaudry," "Henry Starncs," " P. S. Murphy," " L. Betournay." Ours was the Central Committee. Question — Do you know in whose hands the original of the receipt for the $20,000 now is ? A7isicer — The receipt was given to Mr. Abbott. I was present when it was given, and saw the $20,000 paid. The money was deposited in the Metropolitan Bank. Question — Have you any reason to suppose that this receipt has passed out of Mr. Abbott's hands ? Answer — No ; I have not seen it since. I think it ought to be either in his or Sir Hugh Allan's hands. Question — Do you know whether that money was paid in consequence of any letter i'rom Sir George Cartier ? Answer — The money was paid in accordance with Sir George Cartier's letter of the 24th August, 1872, and upon the conditions contained in his letter of the 30th July, 1872, I saw Sir George's letter of the 30th July. I saw it in Sir Hugh Allan's hands at the time, and I saw it a month ago in Mr. Abbott's hands. It was a little more than a year ago that I saw it with Sir Hugh Allan. Question — You published a letter in conjunction with Mr. Beaudry and Mr. Starncs, in relation to this letter of Sir George Cartier's of the 30th of July, did you not ? Ansioer — Yes. Question — Who has the original of that letter ? Answer — It was sent to the Gazette. Question — Will you take communication of that letter now and state to the Commis- sion whether the allegations contained in it are true ? Answer — The copy now shown to me is a true copy of the original and contains the truth. Question — You state in this letter that Sir George Cartier s letter of tho 30th of July, has no reference to the Paeifir Railway Company or to the Pacific llailway Contract, do you not? Answer — I do. The statement in relation to this matter, published in the Gazette, is perfectly correct. Question — Having seen this letter of the 30th July,' what statement arc you prepared to make upon it ? 87 Aitswo' — Tho Bamc statement as is contained in tlint letter. I state positively that the contents of that letter are true. I examined Sir George Cartier's letter of tho 30th July, and it hod no reference whatever to tho Pacific llailway Company or to tho Pacific Railway contrast. Question — Were there any other sums than those which you have mentioned subf jribed for the promotion of tho elections ? Ansicer — There were. I was a subscriber myself, and there were several other subscribers among w£om was Sir Hugh Allan who was the largest subscriber. The aggregate amount was about $65,000. We had Committees in all the Wards and the expenses were very great, but tho money was not all spent in the Eastern Division. A largo portion was spent in elections elsewhere, I suppose we were robbed as is general in elections. It was a condition of Sir Hugh Allan's subscription that the expenses of Mr. Bcaubien's election should be paid out of tho fund if there was a contest. And if wo had had a surplus tho expenses of Mr. Beaubicn would have been paid, but we were short, and, therefore, it was not done, and that is tho reason why Mr. Beaubien's note remains unpaid. Question — Did the examination of that letter, which was shown to you, by Sir Hugh Allan, purporting to bo from Sir George Cartier, leave the impression on your mind which found expression in that letter? Answer — Yes, Question — Do you know anything of any telegrams, which passed on the subject of these advances bet'veen Sir John A. Macdonald, and Mr. Abbott ? Answe. — I saw them in tho papers only, and know nothing more about them Question — Was there any application to the Committco for the $7,000 which was given to Mr. Beaubien ? Ansicer — No, I believe not. And further deponent saith not, and this his deposition having been read by him he declares that it contains the truth, persists therein and hath sigu?d. Sworn, taken and acknowledged on the day, } month and year first above written, j (Signed), (Signed), P. S. MURPHY. CHARLES DEWEY T^ vv, Ctumnan. A. POLETTE, JAMES ROBERT GOWAN. Commissioners. ' ,* 88 f 1 IN THE MATTER OP THE COMMISSION. PiioviNCE Of Ontario, City of Ottawa. Appointing Ciiarles Dewky Day, Antoine Polette, and James Egbert Oowan, Commissioners to enquire into und report upon the KCTcral matters stated in a certain Resolution moved by the J Ion. Mr. Hjintinqton, in the House of Commons, on the second day of April, A.D. 1873, relating to tho Canadiau racitio Railway. Present: The Commissioners. On this ninth day of September, iu the year of our Lord one thousand eight hundred and seventy-three, personally came and appeared before us, tho above named Commissioners, JAMES DAKERS, of the City of Montreal, who being duly sworn, deposeth and saith : I reside in tho City of Montreal. My occupation there is Secretary and General Manager of tho Montreal Telegraph Company. J know Sir Hugh Allan. I don't know Mr. MoMullon. I never saw him. Question — Have you any knowledge of any nogociation or agreement between Sir Hugh Allan and G. W. McMullen, in relation to the building of the Canada Paoifio Railway ? Anstver — None whatever. Question — Do you mean to say that you have no kind ot knowledge relating to that matter at all ? Answer — Nothing except what has appeared in the public newspapers. Qtiestion — Have you any knowledge of any arrangement or understanding between tho Government and Sir Hugh Allan for the furnishing of money for tho elections in Montreal in 1872? Answer — None whatever except what has appeared in tho papers. Question — Were you in a position to know anything on this subject to which I refer from your office occupation ? Answer — Nothing further than from the messages which passed through our office, but I do not see one out of a hundred perhaps, except there is something of importance brought under my notice. I don't see one tenth of the communications that pass through the office, and of course I had no means of knowing otherwise. Question — Have you any knowledge that money was furnished by Sir Hugh Allan for the elections? Answer — None whatever, except what appeared in the public prints. Question — Have you in your possession any telegrams which passed through your office, between Sir John A. Macdonald and Sir Hugh Allan, or the Honourable Mr. Abbott, iu the month of August, 1872, referring to the elections, or furnishing money for them? Answer — None ; the messages of August, 1872, are all destroyed. Question — Are you able to state whether a message signed John A. Macdonald, dated 25th of August, 1872, and directed to Honorable J. J. C. Abbott, Ste. Annes, and marked " immediate, private," in these words, " I must have another $10,000. Don't fail nic — last time of calling," ever passed through your office ? Answer — I never saw a message of that kind as having passed through our office. There was no such message that I know of, of the 25th August. Question — Have you any knowledge whether a message purporting to be sent from J. J. C. Abbott to Sir John A. Macdonald, directed to him at Toronto, and dated Montreal 26th August, 1872, in these words, — " Draw on me for $10,000," ever passed through your office ? I decll Swc a9 ho ia Fcr ;ht oe, for Dur )tt, ted kcd c — ice. roin real rour Answer. — No ; I have no recollection of liaving scon such a mes8np;c, nor do I know that Buch a mcssaj^o ever passed over the line. Question. — Could these messages have passed through your office without your bring aware of it ? Answer. — Yes. Question. — Arc you positive that all the mossagos of that date, that is the original telegrams of that date, which have passed through your office have been destroyed ? Answer. — Yes, I am positive they have been destroyed — and up to the Tst of January, 1873, they have all been destroyed? Question, — Is there anything in the books of the Telegraph Office in Montreal that would enable you to state if messages in the terms I have referred to ever did pass through office? •>"■' "" Ansicer — Under date the 2(]th of August, the Bignaturo and address taken from a message from lion. J. J. C. Abbott to Sir John A. Maedonald, appears on our books, but what wer J the contents of this message I know not. Question — Is that the only message which is entered in your books, as passing between the same parties ? Answer — There is another address and signature of a message having passed from Sir John A. Macdonald to the Hon. Mr, Abbott, and which appears on our books on the 24th of August, 1872. Question — Have you any means whieli would enable you to state to the Commission, what the contents of these telegrams were ? Ansicer — No means whatever. Question — Are you enabled to state by what particular operator in your office they were sent ? Ansicer — I could not tell through what operator they were sent, and I don't think that any operator who received them, would be able to tell the contents of them at this distance of time. Question — Why are all the orginal telegrams destroyed ? Answer — For want of room ia one cause, and another cause is that we don't want, eighteen months, a year, or six months after, to have our operators dragged up to Court and kept there for a whole day. This is a standing order of the office . To Sir John A, Macdonald through the Chairman : Question — How long has this regulation existed as to the destruction of the telegrams ? Answer... The regulation for the destruction of them has been in existence for a long period. The regulation lor the destruction of them after six months has been in force since January last. One cause for this now regulation is that there is very little room in whichto keep these telegrams. This regulation had no connection with the telegrams that passed relative to the elections in 1872. The recommendation for this six months regulation was made by myself, and had nothing whatever to do with the elections. It was made before there was anything known of this Pacific Railway matter at all. And further deponent saith not, and this his deposition having been read to him, he declares that it contains the truth, pei'sists therein, and hath signed. Sworn, taken and acknowledged on the day ^ month and year first above written, > before, us 3 (Signed), (Signed), JAMES BAKERS. CHARLES DEWEY A. POLETTE, DAY, Chairman, i| JAMES ROBERT GOWAN, Commissioners. 40 ! IN THE ..VIATTEE OF THE COMMISSION Province of Ontario, City of Ottawa. Appointing Charles DeWey Day, Anxoine Polette, and James Hobert Gowan, Commissiontv.j to enquire into and report upon the several matters stated in a certain Resolution moved by the Hon. Mr. Huntington in the House of Commons on the second day of April, A.D., 1873, relating to the Canadian Pacific Railway. Present: The Commissioners. On this ninth day of September, in the year of our Lord one thousand eight hundred and seventy-three, personally came and appeared before us, the above named Commissioners, CHAELES JOSEPH COURSOL, of the city cf Montreal, who being duly sworn, dcposeth and saith : I reside in Montreal, my office is Jadge of Sessions of the Peace for the Province of Queb9 one of the Directors of the Montreal Northern (^lonizatian Itallway, wanted especially t( enow what he thought about the I'ncific, and if an amalgamation could be effected with the . orthern Col zatiou Railway, so as to have the terjuinus of the Pacific Itailway in Montreal. Question — * what time in tne course of the interviews were these remarks made by Sir Gec^o Cartier ? Ansioer — It was just at the time that we were going to leave hi- office. Question — Was it said to you only ? Answer — He did not appear to be speaking to me in confidence at all, it was said ojienly. Question — Do you remember if any other gentleman was near at the time ? Answer — I cannot remember. Question — Can you separate the two occasions, so as to state what was said a the first and what was said on the second occasion 1 Ansicer — It was about the same expression that he used on both occasions. Qucstim — On the first occasion what was it that Sir George said ? Answer — To the best of my opinion it was the very words that I have put into my iore- going deposition. Question — What do you mean by " those energetic words " you refer to. Gi\eas near as possible the very words he addressed to you when speaking of the Pacific Railway ? Answer — The words ho used were as near as T can remember as follows: " Aussi lonijteups que je vivrai ct que je serai dans le Ministere, jamais une snerce " Compa. eighteen hundred and seventy- [ ^^ => ^' three. JEAN BAPTISTE BEATJDRY. (Signed), CHARLES DEWEY DAY, Chainnan. A. POLETTE, •FAMES ROBERT GOWAN, Commissioners. I I 1 46 Pbovince op Ontario, ") [ IN THE MATTER OF THE COMMISSION City of Ottaica. ) Appointing Charles Dewey Day, Antoine Pollette, and James Robert Gowan, Commissioners to enquire into and report upon the several matters stated in a certain Resolution moved bv the Hon. Mr. Huntington, in the House of Commons, on the second day of April, A.D. 1873, relating to tho Canadian Pacific Railway. Present : The Commissioners. On this Ninth day of September, in tho year of our Lord one thousand sight hundred and seventy-throo, personally came and appeared before us, the above named Commissioners, JACKSON RAE, of the city of Montreal, who being duly sworn, deposeth and saith : of I reside in Montreal. My occupation there is General Manager of the Merchants' Bank Canada. "Question — Who is President of that Bank ? yinsii'er — Sir Hugh Allan. Question — Are you connected with Sir Hugh Allan otherwise than in business by any family relations ? Anncer — None whatever. Question — Do you know Mr. G. W. McMullcn ? Answer — I never saw him, and I never hoard of him till the recent correspondence appeared in the newspapers. Question — Have you any knowledge of any negociation or agreement or correspondence bel^teen Sir Hugh Allan or any other person in relation to the constructian of the Pacific Railway, which took place in 1872 ? Ansicer — None whatever. Question — Would your relations with Sir Hugh Allan been likely to have enabled you to have known something of this matter ? Answer — Not necessarily so. Question — No facts connected with that negociation came to your knowledge ? Answer — Nothing ever came under my knowledge connected with any negociations carried on by Sir Hugh Allan in connection with the Pacific Railway. Nothing whatever. Question — Have you a knowledge of any undertaking by Sir Hugh Allan, or by 3Ir. Abbott to furnish funds for promoting the elections in Montreal in 1872 ? Answe7' — I have no rjrsoual knowledge. Question — Have you any i 'ason to believe that any such arrangement was made f Answer — Nothing further tLin mere rumor. Question — Did you take any part in the elections in Montreal in 1872 ? Ajiswer — 1 did not. Question — Are you aware if any sum of money was raised i r tho purpose of aiding in these elections ? Answer — I am not, further than from mere rumor. I had no personal knowledge of it. Question — Do you know whether Sir Hugh Allan ever subscribed any money or furnished any sum of money for that purpose ', Answer — I have only heard such reports. Question — You have not heard that from him ? Answer — No ho has not told me. 4T Question — Have you any knowledge which would induce you to believe that those ruDiours were true ? AnsiPfT — My belief is that the rumors were true, that ho did subscribe money. Question — Would you give the grounds of your belief, if you please ? Answer — Simply from casual remarks of his own, made sometimes to other people in my hearing. Question — Have you any idea of the amount which he furnished ? Answer — I have not. Question — Were any cheques drawn upon his account which would indicate the amount ? Answer — I never saw any. They would not necessarily come under my notice in any way, if Buch existed. Question — Would the fact of payment of money for that purpose, bo apparent on Sir Hugh Allan's account in the bank ? Atiswer — Not upon the account itself. Whether the vouchers or cheques drawn would show it or not, I am unable to state without a personal examination. Questien-^Yon mean to say then that you have no knowledge that would enable you to state what amount was subscribed by Sir Hugh Allan ? Answer — I have not. Question — Do you know to whom the money was paid ? ATuwer — I do not. Question — Have you any knowledge whatever of the application of any money, or the mode in which money given in aid of the elections was pspended by the Central Committee ? Answer — Not the most remote. I know nothing r/hatever about it. Question — Do you know anything of this printed receipt which has been published in the newspapers, signed by Mr. Murphy, Mr. Starnes, Mr. Beaudry, and Mr. Betour"■ first above written. j (Signed) JACKSON RAE. (Signed), CHARLES DEWEY DAY, Chairman. A. POLETTE, JAMES ROBERT GOWAN, Commissioner. Province or Ontario, ") \ IN THE MATTER OF THE COMmSSION City of Ottawa. j Appointing Charles Dewey Day, Antoine Polette, and James Robert Gowan, Commissioners to enquire into and report upon the several matters stated in a certain Resolution moved by the Hon. Mr. IIuntin(jton in the Tlou&e of Com- mons on the second day of April, A. D. 1873, relating to the Canadian Pacific Railway. Present : The Commissioners. On this eleventh day of September in the year of our T^ord one thousand eight hundred and seventy-three, personally came an appeared before us, the above named Commissioners, The Honorable JOSEPH OCTAVE BEAITRIEX, of St. Thomas, in the Province of Quebec, who being duly sworn, deposcth and saith : Question — Where is your place of residence ? Answer — St. Thomas, in the Province of Quebec. Question — Were you formerly, and are you now, a member of the Legislative Council of Quebec ? Yes, and I am now. I held the office of Commissioner of Crown Lands in the Province of Quebec. I know Sir Hugh Allan, I don't know Mr. G. W. McMullen. Question — Are you aware of any agreement or negociations between Sir Hugh Allan and Mr. G-. W. McMullen, or any other person, in relation to the construction oftho Pacific Railway with funds to be furnished by American Capitalists ? Anstoer — None whatever. Question — Do you know anything about any ncgociation or agreement between those gentlemen in 1872, before the Act of Incorporation was passed relating to the Pacific Rail- way ? Ansicer — No sir. Question — Had you any relations with those gentlemen that would enable you to know ? Answer — No; I had no relations with Sir Hugh Allan, before I became a Director of the Canadian Pacific Railway. Question — In relation to the Canada Pacific Railway, the first one which was incor- porated, had you any relations with Sir Hugh Allan which would have enabled you to know of any such agreement or negociations ? Doi tho tert Go^ evei cnal <^ov pron any] Hug] know trans thervj the ( eiecti and '. as Of. Co uti wmmmmmm N, a m- fic ed rs, ice icil ind ific lOSO .all- ow? >r of icor- ;now 49 Answer — No ; I had no conversation with any members of the Government of the Dominion before that. The first knowledge with respect to the Pacific Railway, was when tha company was formed lost winter and the Canadian Pacific Railway Company was char- tered. I was appointed Director of that Company. I was nominated by the present Dominion Ciovernment, Question — Since you have been connected with the Canadian Pacific Company, have you ever had any conversation with any of the Ministers, or any other persona which would enable you to say whether there was such a ncgociation as I have alluded to ? Answer — No, none whatever. I never had any conversation whatever. Question — Do you know Sir Hugh Allan ] Answer — Yes. Question — Do you know of any arrangement or understanding, between him and the (lovemment, or any member of the Government, in relation to the furnishing of funds for the promotion of the elections of Ministers, and their supporters ? Answer — No. Question — Do you reside below Quebec ? Ansicer — Yes. Question — How far from Montreal ? Answer — It must be sixty leagues — one hundred and eighty miles. Question — Have you ever had any communication with any of the Ministers or with any person as to the furnishing of funds for the support of the elections in Montreal in 1872 ? Answer — No, I don't know anything about it. I never received any money from Sir Hugh Allan, or any person acting as the agent or in the interest of Sir Hugh Allan. Question — Were any moneys received from Montreal by subscriptions for the support of Ministers in your neighborhood ? Ansiver — Not that I know of. Question — Do you mean to say that you had no manner of communication, or means of knowing how the money was furnished for the promotion of these elections ? Answer — No. I never came near those men when this affair is said to have been transacted. Question — Do you know for what reason your name was put upon the list of witnesses ? Answer — I do not. Question — Have you any knowledge by which you can account far your name being there ? Ansicer — They may have thought that I was acting in the elections in the interests of the Government or Ministers ; bul there are no grounds for that, for about the time of the election, I ran myself for the County ofMontmagny, which I had represented for a long time, and I never saw during that time Sir Hugh Allan or anj one of the Ministers. Question — Arc you a Member of the Dominion Parliament ? Answer — No, not now. I was defeated for the Dominion Parliament. Question — You are understood to be a Government supporter ? Answer — Yes. To Sir John A. Macdonald through the Chairman : Question — Were you asked by the Ministry to become a Director ? Answer — Yes. Question — By what Minister were you asked ? Answer. — By Mr. Langevin. I reside in the District of Quebec. Question. — Were you not selected as a representative of the District of Quebec interest as against the Montreal interest ? Answer. — It was considered so at the time that I represented the Quebec District. Question hy the Chairman. — How long have you been a member of the Legislative Council, and in public life ? Ansicer. — Seventeen years, I think. I was Commissioner of Crown Lands up to last April. At the time I was appointed 'is t' i :-M 60 on the Board of Directors, I held that office and was a mcnibor of the Quebec Govern- nent. And further deponent saith not, and this his deposition having been read lo him he de- clarer' that it contains the truth, persists therein and hath signed. Swora and taken on the eleventh of September, ") 1873, and acknowledged on the twelfth V (Signed) J. 0. BEAUBIEN. of September of said year. j (Signed), CHARLES DEVVKY DAY, Ultairman. " A. POLETTE, " JAMES EGBERT (iOWAN, Conmim^ioncm. T. TARIO, ") ;a, 3 IN TITE MATTER OF THE COMMISSION PuoviNCB OF Ontario City of Ottaiva Appointing Charles Dewey Day, Antoink Polette, and James Robert ({owan, CommissionerH to onquiro into and report upon the i^evoral matters stated in a certain Resolution moved by the lion. Mr. Huntington, in thoIEoutio of Commons on the second day of April, A.D. 1873, relating to tbo Canadian Pacific Railway. Present . The Commissioners. On this eleventh day of September, in the year of our Lord one IJiousand eight hundred and seventy-three, personally came and appeared before us, the above named Commissioners, Reverend DANIEL McMULLEN, of Picton, Province of Ontario, who being duly sworn, deposeth and saith : Question — You are a clergyman, Mr. McMullen, are you not ? Answer — Yes. Question — Of what denomination ? Answer — Methodist. Question — Is ycvr rpt^idence at Picton ? Answer — Yes. Question — Do you know Mr. George McMullen ? Answer — Yes. Questi'ju — In what relation i^o you stand to him ? Ansiccr — He is my son. Question — Do you know Sir Hugh Allan ? Atmcer — No. I never saw him to my knowledge. Question — Have you any knowledge of a ncgociation in which Mr. G. W. McMullen your son was engaged, in relation to the building of the Pacific Railway ? Answer — I have some knowledge, the most of which I may say I have gathered from what has been published in the press. Question — Have you any other knowledge of a personal character, in regard to this matter, which has come under your personal notice ? Answer — None that I am aware of. ^an^BBBHSMap 61 la I may remark for the information of the Commission, that in tiie ahsencc of my sons I have a licavy burden of domestic care on my hands in the position which T have occupied for a great many years. I have always had great confidence in the ability of my son to manage any business which he understood. I have never sought information I'rom him unless it was under very pressing circumstances, and then it was done chiefly to relieve myself of the bur- den and care which at this time of life I was not prepared to bear. Question — Has your son been in communication with you in respect to this matter ? Ansurr — No ; 1 know nothing beyond what I have read in the public press. lie has always been very remarkable since early boyhood in business matters, nnd was always close and he seldom disclssed any business transaction to the members of my own family. Question — Has he been in the habit of communicating or consulting with you ? Answer — Not in matters of that kind. Question — lias he communicated to you anything in connection with the construction of the Pacific Railway? Ansiver — I have no recollection of a' j communication of that kind except at the period at which it was decided and settled that the Government would exclude the American element from the Company, and that the gentlemen for whom he was acting would have no share in tlie building of the Railway, and supposing that he had spent a very large portion of his time, and that heavy expenses had been connected with it, which he was not well able to lose, and that money had been expended through him on behalt of the persons for whom he was acting, I felt some anxiety lest he might incur some censure for want of energy and fidelity in dealing with the interests of others. I therefore took the liberty — the only time that I think I did make any enquiry into his business matters — of asking him what arrange- ment ws likely to be made for indemnifying himself, and especially the pjirties tor whom he had been acting, so that he would not be exposed to any censure. He assured me that he was fully persuaded and was then in process by which the parties for whom he had acted would be indemnified lor the time and expenses he had incurred. I believe that was the only (juestion tliat I asked him. Question — How did you become aware of the expenditure of money by him ? Answer — 1 became aware of it by supposition ; I supposed that he would incur expense in dealing with this matter, but I have no recollection of him telling me that he did. J enquired of him in order to relieve my own mind, but it is very little I know intimately or accurately, respecting the whole affair, except what I have gathered from what has been published in the public prints. Question — Did he communicate to you any correspondence during the time that it was going on or hold any communication with you on the subject of it ? Answer — I don't recollect that he described any of his correspondence, and I did not nsk for any as I thought it would be interfering, and that perhaps he would feel reluctant to communicate to me anything on the subject, and 1 was therefore a good deal cautious on that ground. It might naturally be thought that I would be intimately acquainted with those matters, but I am not for various reasons, especially those that I have stated. I had enough else to burden my mind and employ my thoughts and attention, and I studiously endeavored to avoid inducing him to communicate anything to me on the subject. Question — You never saw any of the originals of this correspondence, did you ? A7isicer — No. Question — Can you account, Mr. McMullen, for your name being included in the list of witnesses ; are you in possession of any knowledge that would account for it to your own mind ? Answer — The only reason that I am aware of is the close of the speech made by Mr. Huntington at the prorogation. I read it, but I could not give it in detail. But he made the remark there, assigning his reason for placing my name on the list of witnesses. Question — Can j-ou recollect what that reason was in general terras ? Answer — I think he expressed some fear, or suggested to the Committee that perhaps my son might absent himself when called upon to give testimony, and he thought it would f 1 J 52 be better to secure some member of the family — his tuthcr or some of his brotliors — that is the only reason that I am aware of. I am not '.ware of the reason assigned by the Commission by whom I have been sum- moned to appear. It there is, I have not seen it. I inferred that the reason mentioned by Mr. Huntington httj. influenced them. Question — Is tl: :;ie any other Daniel McMullen ? Answer — I have a son who bears my name that has been some eight or nine years in Parliament. His name is Daniel Y. I have but one name. His name is Daniel Yure MoMullen. He resides in Chicago. I am a minister of the Wesleyan Methodist Church. I am Bot in possession of a regular charge. The state of my health obliges me to hold a retired position. My son, Daniel Y. McMullen, is now in attendance here. It happened that at the time I was summoned to appear here he had como on a visit home to his friends, and he cunio with me. I am a stranger in Ottawa. I have resided sixty odd years in Canada, since 1811. I am intimately acquainted with the Western part of the Province, but this is my first visit to Ottawa. To Sir John A. Macdonald, through the Chairman : Quettion — Do you know where your son, Georjjc W. McMullen, is now ? Antioer — He is in Chicago ; he is there now. He went there some three or four weeks ago. He had been in Piotou before that. Question — Is his residence in Pictou or Chicago ? Answer — His residence and domicile is in Chicago. Quettian — IIow long was he in Pictou before he went to Chicago ? Answer — Three or four weeks ; I could not tell to the day. And further deponent saith not, and this his deposition being read to him he declares it contains the truth, persists therein, and hath signed. Sworn and taken on the eleventh day of) September, 1873, and acknowledged on [■ the twelfth of said month and year. ) (Signed), (Signed), D. McMULLEN. CHARLES Di^WEY DAY, Chairman. A. POLETTE, JAMES ROBERT GOWAN, Commissioneri Pa Ap Pro hiin IU.U1 DA. youi Kail is it Alia saw 8ona cont docu moar dato. 18T2, elect signii were 63 Province op Ontario, ") C IN TUE MATTER OF TIIE COMMISSION City of Ottawa. ) Appointing Charles Dewey Day, Antoine Polette, nnd James Eobert (Jowan, Commissioners to cnqiiiro into nnd report n])on tlie Hevern! matters stated in a certain Hosolution moved by the lion. Mu. IIkntinoton in the IIouko of Commons on the second day of April, A. I). 1873, relating to tlio Canadian Pacific Railway. Present : The Commissioners. On this eleventh day of September, in the year of our Lord one thousand eight hundred and Bevonty-thrce, personally came and appeared before us, the nl'ovo nui lod Commissioners, ' 1;^'.JSIEL Y. McMULLEN, of the City of Chicago, who being duly sworn, doposeth and saith : Question — Are you the eon of the last witness Daniel McMulien ? Answer — Yos. Question — Are you a brother of Georgo "W. McMulien ? Answer — Yes. I reside in Chicago. Question — What business are you engaged in there ? Answer — ^Banking, Question — Are you alone or in co-partnership with any person ? Ansuier — My brothers and myself are together. Question — Do you know Sir Hugh Allan ? Answer — No. Question — IIiivo you any knowledge of an agreement or nogociation in which your brother was engaged in 1871, in relation to the construction of the Pacific Railway. Answer — Yes. Question — What is the nature of your knowledge concerning this agreement, 19 it a personal knoweldge or simply derived from what others have told you ? Answer — It is both. Question — ^Will you state what personal knowledge you have of it ? Ansicer — I saw the original contract between the American parties and Sir Hugh Allan. I also saw and read quite a large number of Sir Hugh Allan's letters, and 1 saw nearly all of the documentary evidence that ho has or hatl, that is all tlio ])or- fional knowledge I have ; that is the documentary evidence. I saw the original contract that was signed, I believe in New York. The personal knoAvledge is all documentary, that is with parties directly interested. Question — Can you specify any letters which you saw fron\ Sir Hugh Allan ? Answer — I could not specify any of them so that you would understand what I mean except the first letter that ho wrote from Montreal. I cannot specify them b}- dato. They were dated along from some time in the fall of 1871 uj) to the fall of 18T2. They date from tho beginning of the negociation in 1871 previous to the elections till about the first session of this Parliament. Question — Do you know Sir Hugh Allan's handwriting ? Answer — I think I would know it. I have no positive knowledge that tho signature I saw was his, but the letters camo signed Hugh Allan. Part] of letters were addressed to C. M. Smith of Chicago, and part wore addressed to my brother. .1 I h 1 / 64 Question — Do you know in whoso possession those letters are now that yon speak of? Answer — The only knowledge that I have as to the place of them in from news- paper reports. Quettion — Do you know whether they are or are not in your brothers possession ? Antwer — They are not in his possession. Question — Do you know how ho disposed of them ? Answer — I only know what he told me. I have no crsonal knowledge an t(j how he disposed of them. I can only tell you what he said he did with them. Question — ^What did ho say he did with them ? Answer — Ho said they constituted the package in Mr. Starnes' hands in Mon- treal. Question — Did ho say that all the letters ho had were in that package ? Answer — ^AU of the principal were there ho said. Question — What means have you of knowing Sir Hugh Allan's handwriting ? Answer — No moans at all, only that I know that my brother addressed letters to him, and that letters came back signed Hugh Allan, addressed to my brother. Question — How do you know that your brother wrote to Sir Hugh Allan ? Antwer — I have seen letters "written by my brother addressed to him. Question — Did you ever see the parcel which your brother said he gave into Mr. Starnes' hands ? Answer — "No, Question — Can you designate any j^articular letters which you believe to be fi'om Sir Hugh Allan, besides the one you have mentioned as tlie first one ? Answer— By dates ? Question — In any way they can bo identified. Answer — There were several important letters ; in one of which he gave a rough sketch of the sums of money he had ex|)ended ; and one of the last letters my brother received was in regard to the exclusion of the American element from the Company; and there was another letter, I don't know whether it was in the package or not, giving the amount of stock to be placed in the different parts of Canada. Question — What was the subject matter of the firct letter to which you allude ? Answer — The first letter that I ever saw from Sir Hugh Allan was addressed to C. M. Sirith. It merely stated that his address had been given to him by a member of the Government, and that he thought that the time had aiTived for the American and Canadian parties to get together, A letter is shown to witness. Question — Is that the letter to which you refer ? Answer — No, this is not tho letter. The letter that opened the correspondence was written frora Montreal, this is written from London. 1 think it was i» 1S71, and provious to Sir Hugh Allan sailing for Europe. Tho one now shown lo me was written after tho negociations had proceeded several months. Question — Is that the letter you mean now shown to you ? Answer — No, it is anterior to that. Tho tlrKt letter' that opened tho coiTcwpon- denco, I think, was written either in May or .luno of 1871. Question — To whom was that letter addressed ? Answer — To Charles M. Smith. Question — Did Mr. G. W. McMnllen toll you that that letter was included in tlie package placed in Mr. Starnes' hands ? Answer — He told me that the package contained all tho letters of importance. He did not indicate to me any special letters. Question — Are you confident with rcsjioct to the date of it? Answer — Tho only means I have of knowing is that the negociations had pro- ceeded some two or three months before the Chicago fire, and that was in October, 1871* Ih «7 in all but I were packa Q the let A of Q A Qi and th A) told n pose Ik Q> Ai 65 Don- Questior—Thoro aro somo letters addressed to Mr. Smith in this package; through Avhom thoy were obtained from Mr. Smith ? Answer — I presume they were given to my brother. The relations between Mr. Smith and my brother and myself, are so intimate, that all the correspondence was communicated to us. I handled all the letters of Mr. Smith as well as my brothers, and Mr. Smith handled all my brothers letters in reference to this matter. Question — How nearly can you particularize the date in regard to this matter ? If you cannot say the day say the month ? Ansicer — I think it was early in May, 1871. Question — You don't know Avhero that letter is now ? Ansiver — It was not considered of sufficient importance to take much cai-e of. Question — What other letter do yon recollect ? Answer — There Avas a letter detailing the sums of money that Sir Hugh Allan had spent. • Question — Do you remember the date of that ? Answer — I think it was in February. It was in January or February, 1872. Question — Hero is a letter which reads as follows : " It seems pretty certain that in addition to money payments, the following stock will have to ho distributed : To D. L. Macpherson, $100,000, &c." Is this the letter you refer to ? Answer — No it is another letter. I said that I recollected that letter in addition to the other. Question — " On whom am I to draw for money." Is that the letter. Answer — I believe that is the letter. On examining it I see that this is the other letter. I recollect this letter. This does not refer to the appropriation of stock in Canada. This is one of the lettei's tliat I recollect as having been received by Mr. Smith as coming from Sir Hugh Allan. I saw it after !Mr. Smith received it. Within a day or two after he received it, he either called at our office or we called at his office, and all these letters were read by botli parties. Question — Look at that letter dated 16th September, 1872, and say if it is the letter you refer to relating to the money ? Answer — Yes, this is the letter. Question — Aro there any other letters you can remember of? Ansifcr — I believe that there were two letters that came from Sir Hugh Allan in regard to the breaking up of the arrangements in the fall of 1872. I scarcely think they are in the package but they may be. Question — Why dont you think they wore in the package ? Answer — Because they did not consider them of sufficient importance. Question — Sufficient importance for what. Ansicer — In regard to the scheme, when he ]iut the letters in the package, he put ill all the letters that had important matters in them, in regard to the ncgociations, but I dont think he put them in ; that is loiters which closed the ncgociation. They were too short and abrupt. The letter dated 11th November, is one that was in the jiackage. Question — Look at the other letter noAv shown to you, and say if that is one of the letters you have alluded to. Answer — Yes both of tlio letters noAV shown mo, aro the two letters I have spoken of Qucction — Do these complete the whole series. Answa' — Yes. Question — You said there wore two letters, which were iu)t tliought important, and that you did not sup])ose they wore in the package? Answer — Excuse me, I said that they were not important, I meant my brother told 1110, he had ])ut in all tlio important letters, and from my recollections, I sup- pose lie considered thom of little iinportaiuc, but I seo ho has put them in. Question — Have you coi>ies of all correspondence that passed ? Answer — No. 56 Question — TCas yoiu* brother? Answer — Not to my kiiowlodgo. Question — Do yoii keep a letter book ? Ansioer — Yes. Question — Do you copy important letters received and sent ? Answer — These letters were never copied. "VVo kccj) a letter book in which w© usually take copies of letters received and sent. They may have been copied by hand. Nearly all of the letters that my brother MToto, cither ho or I, usually copied them in letter form. Question — Were they in a particular book ? Answa' — Not in a book at all, but on a sheet of paper. Question — Are these copies in existence ? Answer — ^I don't know that they are. Quc^ion — Were copies of the letters despatched by you, kept ? Answer — Yes, it is the copies despatched by us that I refer to. Question — Were the letters received cepiod ? A7mcer — No, they were simply fyled away. After the contents of the letters received were known to two or three intei-ested in the scheme, my brother usually took charge of them himself. Question — Do you know of any interviews that j-our brother had with Sir Hugh Allan or anybody else in reference to these matters ? Answer — Only what he told me. The only person he ever consulted in my pi'o- sence were one or two gentlemen in Toronto. It was on one occasion when I was with him in Toronto. Wo met Mr. James Beatty and his Nephew. They were the only pei-eons that we conversed with when I was ijresent. Question — You have never been present at any intt '-views between him and Sir Hugh Allan, or any other person representing Sir Hugn Allan ? Answer — I was present at one or two interviews that he had with Mr. Wadding- ton and Mr. Kcrsteman, in Chicago, but I did not consider that they were themselves directly interested. That was at the very opening of the negociations. I live in Chicago. I have been recently in Pictou. I left Chicago on Sunday night. My brother was there at that time. He had not received any subiicena when I saw him. Question — Do you know anything more about thif matter of your own personal knowledge? Answer — Nothing but the terms of the contract. I saw the contract between the New York parties, my brother, Mr. Smith and Sir Hugh Allan. Question — What date was that 1 Answer — It is a year since I saw it. I think it was in the fall of 1871. I cannot designate the date. Question — Was the contract dated ? Ansu-er — I caimot swear positively that it was dated. I have nieroly reference to the time that it was signed. Question — Did you see it signed ? Anscen the contract since. Question — How soon after you left Chicago did you see him in Picton ? Answer — It was sev !rul months. lie left Chicago for the purpose of getting this contract signed, and it was aftci'wards that X saw him in Picton. Qiiestion-~H.ixd you not seen him in the meantime? Answer^.llo camo to Chicago and returned. The document as I understood him, remained in New York for some time, and ho aftorwnnls wont to Now York to got it, and it was when passing through Picton, that ho showed me the Contract, That was the first, and only time I saw it. Question — Do you know, what endorsement was on the package given to Mr. Stames. Answer — No. Quettion — Do you not know anything of it ? MMl 58 /; Answer — All I know of the package is that he told me that the letters were in the package, and that there were two notes addressed to Mr. Starnes, to govern him and his action in regard to the delivery of them. To Sir John A. Macdonald, throngh the chairman. Question — You are a partner of George "W. McMuUen ? Answer — Yea ? Question — I think you have stated that you are intimately ae'•-- Question — What is your occupation there? » ^''■' "' '* ■ Answer — Managing Director of the Northern Railway. Question — Do you know Sir Hugh Allan ? Ansicer — I do. Question — Do you know Mr. George McMullen ? , *■' Anmrr — I do not. Question — Have you any knowledge of any agreement or any ncgociutions between these gentlemen, in relation to the building of the Canada Pacific Railway with American capital ? ■ '. Answer — I have not. Question — Have you any knowledge of any negociations in relation to the construction of the Pacific Railway in the winter of 1872, or the Autumn of 1871 ? Atiswer — Yes. Question — Will you state what that knowledge was? Answer — Do you mean negociations between other parties, or negociations in which I myself was engaged ? Answer by Commissioner. '' " " "' ' ' ' I mean negociations in which Sir Hugh Allan was engaged. Answer by witness. None whatever, except for the purpose of the amalgamation of the Inter-Oceanic Company with that of the Canada Pacific. liMHiiMM G8 i Question — Had you any knowledge of any negociations. having for their oljject, the construction of the Pacific llailway, with Americ in capital at any time? Answer — None. Question — Were you a Provisional Director of the Canada Pacific Company, that was incorporated in the Session of 1872 ? Answer — I was a Provisional Director of the Inter-Oceanic Company, that was incorporated during that Session, but not of the other. Question — Was the Inter-Oceanic Company in some sense the rival of the other Company ? Ansirer — It was the Company commonly known as the Macphcrson Company. Question — Was it antagonistic to the other Company ? Answer — Yes, it was the rival of Sir Hugh Allan's. Question — Are you a Director of the Canadian Pacific llailway Company — the one now chartered. • Answer — I am. Question — Have you any knowledge of any negotiations which took place for the amalgamation of the Canada Paciti'' Eailway Company and the Inter-Oceanic Railway Company ? Answer — I was aware of an effort being made, to bring about that amalgamation, but before the efforts wore exhausted 1 left for England. Question — Wore there any negociations between the two Companies having that end in view — The amalgamation ? Answer — No not to my knowledge — The negociations to which I referrcil just now were those emanating from the Government. My opinion was sought by a member of the Government as to whether snch an amalgamation was possible.. Question. — Who was that member ? Answer. — The Hon. ilr. Campbell, then Postmaster General. Question. — What was your impression as to his views on the subject? Answer. — Mr. Campbell evinced very great anxiety to bring about an amalgamation, and asked my opinion as to the possibility of it, so far as I knew the opinions and views of my colleagues on the Inter-Oceanic Board. Question, — At what time did this conversation take place? Answer. — I think it was about the end of October or early in November, 1872. Question. — Did any amalgamation take place ? . ;:i,, .. , Answer. — No. Question. — Why not ? Answer. — I cannot say of my own knowledge, because the eflForts towards amalgamation had not been exhausted when I was obliged to leave for England, and I was not aware what course these events took after my interview with Mr. Campbell. I was aware that he acted in some measure upon ry advice, my opinion being that an amalgamation was not impossible, and that the majority o my colleagues on the Inter-Oceanic Board would consent to such an amalgamation, provided that they obtained a sufficient guarantee for the exclusion of American influence, to which I had already expressed our objection. Mr. Campbell told mo that those guarantees would he given, and of a nature that would be quite satisfactory to us. I then, although recognizing personal difficulties as between Sir Hugh Allan and Mr. Macpherson, expressed the opinion that the majority of my colleagues on the Inter-Oceanic Board would accept such a guarantee and consent to the amalgamation, That, however, did not prove to be correct. Question. — Was any sufiicient guarantee given to the Inter-Oceatiic Company? Answer. — In my opinion the guarantees that were then .suggested by M". Campbell were amply sufficient. Question — They did not satisfy the Inter-Oceanio Company, did they ? Ansircr — I don't know. I think there were some personal reasons that probably oflfered additional obstacles. Question — How long were those negociations going on, tending to the amalgamation of the two comppuics ? .. msmm. Answer — It must have been for a very short time, because I left immediately after my interview with Mr. Campbell, for Euslaml. QuesHo)L — Are you able to say when they bot^an ? . Answer — My impression is that Mr. Campbell came to mo first, so far as Toronto was concerned at any rate. I don't know that I am aiio to state the date of that conversation with accuracy, for I only remember it as immediately preceding my leaving for England. I think I left tor England early in Movember. Question — Had you any conversation with any other Member < f the Government on the subject? .' Answer — Yes. 1 had a conversation with Sir John A. Macdouald. Question — What was the purport of that conversation? Ansicer — It was after my interview with Mr. Campbell, and I think on my way to England ; the conversation was somewhat similar to that which I held with Mr. Campbell. I think I told Sir John the purport of that conversation, and repeated my own views as to the possibility of an amalgamation. Questim — Was there any conversation especially, as to the exclusion of American capi- tal and of the American element altogether, in your interview with Sir John A. JMacdouald ? Ansicer — Yes ; both with Mr. Campbell and Sir John A. Macdouald. I explained that the American element would have to be excluded, but I thought if there was a suiRcient guarantee given as to that, an amalgamation might be effected. So far aa my knowledge goes, I understood that the Government always held the same views as to the desirability of amalgamation. Question — Have you any knowledge concerning the elections of 1872, in the Province of Quebec, particularly in Montreal ? Ansicer — None. Question — Have you any knowledge of money being subscribed in aid of the elections of ministers and their supporters, cither in Quebec or Ontario ? Ansicer — I have some knowledge of effort& being made for raising money for election purposes in Ontario. Question — Do you know whether Sir Hugh Allan contributed ? Answer — I have no personal knowledge, I have learned it from hearsay, and from the newspapers, but I have no knowledge of my own. Question — Did that information come from any member of the Government or from Sir Hugh Allan? Answer — No; from neither. Question — Were you on any of the election committees in Ontario ? • Answer — No, I was not. Question — I understood you to say that you know absolutely nothing of the elections in the Province of Quebec ? Answer — Nothing whatever. Question — You don't know whether any money was subscribed by any party there? Answer — I do not. Question — Do you know of any money being received from Quebec for the purpose of elections in Ontario ? Answer — No, I do not. Question — Am I right in understanding that the great standpoint of the Inter-Oceanic Company was Canadian influence, and in so far as it was a rival and antagonistic to Sir Hugh Allan's scheme, it was supposed to exclude American influence ; was that the chief and prominent distinction ? A7iswer — That appears in the papers to be the reply which the Inter-Oceanic Company gave to the Government. Question — Was that the fact ? Answer — There is not a question about it. There were some individual reasons also which oflfered obstacles. Question — Do you know anything about the chief object of the Inter-Oceanic Company; l-r»naiP was it based upon any principle, or was it merely with the object of making money or some- thing else 'I Answer — I really don't know. I was invited to join it very early in its history. My impression is that at that time the idea of Canadian and British influence being employed in it was the basis. Question — You were subsequently appointed a director in the Chartered Company, the Canadian Pacific, were you not. Answer — Yes. Question — At whose instance were you appointed ? Answer — I really don't know. The appointment was made during my absence in England. Question — It was a Government appointment was it not ? Answer — Yes. Question — Do you know how your name came to appear ? Ansiver — I have no knowledLre, I have my own suppositions. My suppositions are based upon a conversation that I had with Sir John A. Macdonald before I went to England. The subject of that conversation was to, in the event of amalgamation failing, who might be regarded in Ontario as reliable persons to serve upon the new Board. Question — Did he at that time give any indications that he desired you to act upon this Board ? Answer — We considered a number of names as to their fitness, and 8ir John did me the honor of asking my opinion, and in that list my own name was placed, and I then told Sir John that I gave him carte blanche. Question — You have been a long time connected with Railways ? Answer — Y'es. ■■• ^ \l Question — You have the credit of being sharp in these matters ? Answer — I had no desire to serve upon that Board. ' Question. — Did you gather from Sir John's conversation that it was his desire to seek out competent persons ? Answer. — We parted with the understanding, that as far as I was concerned, if it was thought I could be useful or he desired that I should serve, he might use my name. Question — Were there any gentlemen from the Inter-Oceanic Board named in this Canadian Pacific Company ? Answer — Yes ; Major Walker. Question — Any other? ■ ■ Answer — Mr. Walter Shanly. ' • • , Question — Any other ? ' , Answer — I think there were four ; I forget the last. > Question. — Who is Mr. Walker ? Answer — He is a resident of London, Ontario, and largely interested in oil works in that neighbourhood. Question — Mr. Shauly is an cugineor, is he not ? Ansicer — He is an engineer of the higliest standing, and has large railway experience. My impression is, that there wore others who were on the Inter-Oceanic Board, appointed Directors of the Canadian Pacific Company, but at this moment I do not recollect them. Looking at the list I see tliere were Major Walker, Mr. Shanly, and myself — These are the only ones that I recognize from Ontario. . . ,,, To Sir John A. IVIacdonald through the Chairman. Question — On this occasion, on which yon and I had the conversation anterior to your going to England, do I understand that that conversation wa.s as to tlio formation of a Board in case the amalgamation fell through ? Answer — Yes. Question — And I was negociating to get your opinion as to fitting representatives from Ontario on the Board of the chartered company ? We considered a great many names including your own, did we not. •■ , Answer — Yes. re m 01 nc :ii B eu I w de Sv v Qi^icstton—Yo}i said that if you could bo of use in the Company or out of the CoiiTiany that I might use your name ? ^ Answer — I did. Question — You took part in the Elections in Ontario, did you not? Answer — I did Question — In Toronto and vicinity ? Answer — Yea. Question — Did you subscribe to the Elections at Ontario ? Answer — I helped at the Elections pecuniarily. Question — In subscribing to the Elections did you consider in any way that you were recooapensing the Government for any interest in this llailway, Ansv^er — Certainly I did not. I subscribed and paid as a member of the party. I may just add this that I expressed rather strong reasons originally when I was invited to go on the Inter-Oceanic Board; and to yourself, I think, subsequently, with reference to the possibility of my name being placed on the Board of the present Company, an:l at that ;; terview, anterior to n^y going to England, I said that I had no desire to servo upon that iJoard, that I saw nothing in it : That the terms then described by the Government were not such as to attract anybody to the work, but that I was willing to work as a public servant, I did not consider that the terras were sufficiently liberal. Question — You agreed to serve upon the Board if it was necessary frcrn public and patriotic motives ? Answer — As a public servant. I saw nothing in it. And further deponent saith not, and this his deposition having been read to him, he declares that it contains the truth, persists therein, and hath signed. Sworn and taken on the twelfth day of~~| September, 1873, and acknowledged I on the thirteenth day of said month and year. (Signcl,) F. W. CUMBERLAND. (Signed,) .tr CHARLES DEWEY DAY, Chaiiinan. A. POLETTE, JAMES ROBERT GOWAN, Commissioners. ,«*■ Mmnfm 72 ill II Province of Ontario, ") [ IN THE MATTER OP THE COxMMISSION ' • Citi/ of Ottawa. 3 Appointing Charles Dewey Day, Antoine Polette, and James Robert Gowan, Conimissioners to require into and report upon the several matters stated in a certain Resolution moved by the Hon. Mr. Huntinuton in the House of Commons on the second day of April, A.D. 1873, relating to the Canadian Pacific Railway. Present: The Commissioners^ On this twelfth day of September, in the year of our Lord one thousand eight hundred and seventy-three, personally came and appeared before us, the above named Commissioners, DONALD ^IcINNES, of the City of Hamilton, Merchant, who being duly sworn, deposcth and saith : . I reside in the city of Hamilton. My occupation there is that of a merchant. I know Sir Hugh Allan. I do not know Mr. Geo. MoMuUen. Question — Do you know of any negotiation carried on between these gentlemen, or of any agreement between them in the autumn of 1871 or the winter of 1872 for the purpose of building the Canada Pacific Railway with American capital? Aiisirer — No ; I know nothing about it. I may state that I think it was in the autumn of 1871, Sir Hugh Allan asked mo whether I would consent to become a director of the Canada Pacific Railway, and I consented. I think he told mo in general terms that he was negotiating with some American capitalists, but I know nothing whatever beyond that. I don't think he stated who they were. Question — Do you remember about the time this took place ? Ansurr — No. I do not. Question — Can you fix about the time 1 An,in yourself. I answered accepting the appoint- mcLt. Questioy< — Eave you any partiouUr relations with r?^ Huph ^Vllan "' AiiHwer — N'l ; none. I am .juiti indepoudent of him in basiness matters, except that wo have a joint enterprise in Oorrwall in a manwtactunng company. T know of r-ubscriptioiii. being la^ide at tlit Ust elections in Hamilton. That always happened at elcutiobs, unfortunatoiv. I know that l subscribed Question. — On the right sid* and a; th*" rigJw Ume ? Auwer — Yes; 1 did that . - my own acwwi mu' not on accou-- on the P.ioific M l-nrnBt 74 Railway. Decidedly not. I did not show any great anxiety to get on that Board, or to be connected with that enterprise. Questiun — Was it altogether .'"< a matter of duty and principle that you consented to serve on that Board. Answer — I felt that it was a gnjat ualional undertaking, and if my services would be of any use in its promotion, that it '?as my duty to place them at the disposal of such a public work. And on this thirteenth day of September, 1873, re-appeared the said witness and made the following addition to his foregoing deposition : I desire to add witii rcspoet to some correspondence which was published in the news- papers in which my name was put as receiving by way of gift, as I understood it, the sum of $50,000 of the Canada Pacific stock, I beg to state that Sir Hugh Allan, nor any one else, never made sach an unworthy proposal to me. And further deponent saith not, and this, his deposition having been read to him, he declares that it contains the truth, persists therein, and hath signed Sworn and taken on the twelfth day of Sep tomber, 1873, and acknowledged on thirteenth day of f siid month and year (Signed), ] (Signed), D. McINNES. CIIAELES DEWEY DAY, Chairman, i, A. POLETTE, JAMES EGBERT GOWAN, Cotnmissioncrs. Kftl' ■ ■/» ^-ff'^jr i< \ii hm>i-'' !ft IN THE MATTER OF THE COMMISSION Province op Ontario, ") Clfi/ of Ottawa. ) Appointing (^iarlbs Dewey Day, Antoine Polette and .Tames Rohert Gowan, Commissioners to enquire into and report upon the several matters stated in a certain Ees»>lntion moved by the Hon. Mil. IlTrNTiNGTON in the House of Commons on the second day of April, A. D., 1873, relating to tiie Canadian Pacitio Railway. Present: Tub Commissioners. '.^ On this twelfth day of September, in the year of our Lord one thousand eight hundred and seventy -three, pei'!*i>nally came and appeared before ns, the above named Commissioners, , ROBERT N. HALL, of the Town of Shcrbrooke, in the Province of Quebec, Advocate, who being duly sworn, doposcth and saith : I reside in Sherbrooke. My profession is that of an advocate. I know Sir Hugh Allan. I do not know Mr. G. W. McMulU^n. C>uestion-~-lls.\& you any knowledge of any negociation or agreement between Sir Hugh Allan and Mr. McMullcn, relating to the construction of the Pacific Railway ? Answer — Not the least, no knowledge of it whatever. Question — Have you ever had any conversation with any member of the Government, in relation to any such agreement 'f ^n«u."cr-^I have not. 75 Question — Ilavo you ever hail any means of knowing whether such a negotiation wag going ou with a view to an agreement of that nature ? Answer — I never saw anything to indicate it. Question — la it then a mutter concerning which you know nothing at all'i* ' vl/iswCT' — I have uo knowledge of it whatever, not the least. Question — Have you taken an interest or have you been engaged in Railway enterprises? Answer — I have taken quite an interest in the promotion of Railways in the section of country in which I live. Question — Have you had any interest or taken any part in the movement for building this Pacific Railway ? Answer — I was appointed one of the Directors of the Canadian Pacific Company, that is the chartered Company. ucstion — When did your acquaintance or connection then begin with the enterprise for building this Railway. Answer — It was only a short time before my appointment and before the signing of the contract. Question — Before that did you know anything about it or Lad you taken any interest in the matter ? Answer — I had taken quite an interest in it, although I did not identify myself in any T^ay with its promotion. Question — You had not been consulted by Sir Hugh Allan or any other person in rela- tion to the construction of it ? Answer — No, I had not. I had no connection with Sir Hugh Allan in reference to it. In fact I did not know him before the contract was signed. ]\ly acquaintance with him is only since that time. Question — Did you take any part in Lower Canada in the general electiooB of 1872 ? Ansioer — I did not. Question — Do you know of any money having been subscribed in aid of the election ot Ministers or their supporters ? Answer — No, I do not. There were very few contested elections in the Townships, tb« elections were by acclamation — those at least in the part of the Townships where I reside. Question — Do you know anything of the Montreal elections ? i Answer — Nothing whatever. Question — Do you know whether there was any subscription of money for tho carrying of them on ? Answer — I do not. Question — Do ou know whether Sir Hugh Allan contributed anything in aid of tho Elections, in any part of the Province of Quebec? Answer — I do not — No contribution ever came to my knowledge in any way. ' Question — Are you aware of the reasons for which your name was put on the list of witnesses ? Ansicer — I cannot imagine any reason — I never had any conversation with Mr. Huntington at all — I had no knowledge of anything that tended to support tlic charges made by him. To Sir John A. Question — Do you know at whose instance it was that you became a member of the Board of the Canadian Pacific Railway? Answer — At the instance of tho Hon. Mr. Pope, Minister of Agriculture; at least I understood I was nominated by him. He is the representative from the Townships in my part of tho country. He asked mo to become a Director. Ho said it was desirable that that Section of tho country should bo represented on the Board and asked mo to act. He said there were two representatives from Montreal, and one from Quebec, and he thought therefore that the Eastern Townships should have a representative on the Board. I was in no respect, that I am aware, of the nominee of Sir Hugh Allan. I had no personal acquaintance with Sir Hugh Allan at the time. I had reason to believe that Sir Hugh Allan wished to name another gentleman in my place. That geutle- iMacdonald through the Chairman. •' ii 7t) man was l\Ir. Foster. I understood that ncgociations — at least the si,i?nln<; ol' the contract, was delayed on account of Sir Hugh Allan's pressing the nomination of Mr. Foster. And further deponent saith not, and this his deposition having been road to him ho declares that it contains the truth, persists therein, and hath signed. Sworn and taken on the twelfth day of September, 1873, and acknow- ledged the thirteenth day of said month and year. (Signed), (Signed), llOBT. N. HALL. CHARLES DEWEY DAY, Chainimn. A. rOLETTE, JAMES ROBERT GOWAxN, CummintiioHcr, Province of Ontario, 'i [ IN THE MATTER OF THE COMMISSION City of Ottawa. ) Appointing Charles Dewey Day, Antoins Polette, and James Robert Gowan, Commissioners to enquire into and report upon the several matters stated in a certain Resolution moved by the Hon. Mr. HiiNTiN(iTON, in the House of Commons, on the second day of April, A.D. 1873, relating to the Canadian Pacific Railway. Present; The Commissioners. On this thirteenth day of September, in the year of our Ijord one thousand eight hundred and seventy-three, personally came and appeared before us, the above named Com- missioners, JOSEPH HAMEL, of the city of Quebec, Merchant, who being duly sworn, deposeth and saith : I know Sir Hugh Allan very slightly. I novcr hud any conversation with him. I do not know G. W. McMuUen. Having heard read that part of the charge contained in the Royal Commission, which reads as follows : " That in anticipation of the legislation of last Session, as to the Pacific Railway, an agreement was made bctwonn Sir Hujjh Allan, acting for himself and certain other Canadian promoters, and G. W. MjMuUcn acting for certain United States capitalists, whereby tho latter agreed to furnish ill the funds necessary for the construction of the contemplated railway, and to give tho *'ormer a certain percentage of interest in consideration of their interest and ptsition, the scheme agreed upon being ostensibly that of a Canadian Company with Sir Hugh Allan at ita head." 1 declare that I know nothing of this arrangement. I only know what 1 have seen in the newspapers, nothing more. I am not aware whether the Government knew of tho existence of such an arrangement between Sir Hugh Allan and G. W. McMullcn. I do not know whether there existed any ncgociations between certain persons for tho L'oustruction of the Canada Pacific Railway. No Minister or Member of Parliament spoke to mo on the subject. 1 declare that I only know of this affair through what I have read in the newspapers. 11 IIavinf» heard road tlic other part of the chari^o contained in tlio Coniniisyion, whicli reads as follows : " That subsequently an understanding was come to between the (iovernmont, Sir Hugh Allan and Mr. Abbott, one of the members of the Honorable House of Commons of Canada, that Sir Hugh Allan and his friends should advance a large sum of money for the purpose of aiding tho elections of Ministers auu their supporters at the ensuing general elections, and that ho and his friends should receive the contract lor the construction of tho raihv.iy," I declare that I know absolutely nothing of such an arrangement, except what I have learned through tho press. Sir Hugh Allan never told mo that he liad advanced money for the elections of ministers and their supporters, nor did Mr. Abbott, whom I know very slightly. No member of Parliament or ^liniater, ever told me that Sir Hugh Allan had advanced money for the elections of 1872. I have no knowledge that money was subscribed for tho Montreal elections. As to other places, I am aware that subscriptions are always raised to assist the elections of friends of the Qovernment. I do not know that Sir Hugh Allan subscribed to aid the elections, nor Mr, Abbott either. I do not know if the friends of Sir Hugh Allan advanced sums of money for the elections of ministers or their friends. When 1 say that I do not know that sums of money were advanced for the elections of 1872, I mean sums coming from this source — that is from Sir Hugh Allan. There were moneys subscribed by other friends of tho Government towards the elections, but it was not for the election of ministers. Tho subscriptions I have just mentioned, may have reached five or six thousand dollars for the elec- tion at Kamouraska. I am not aware of any moneys for other elestions. I have never had any conversation with members of Parliament or with ministers, on the subject of subscrip- tions by Sir Hugh Allan or Mr. Abbott, or their friends, for the elections of ministers or their partizans, and no conversation occurred in my presence on the subject. I know ab- solutely nothing of my personal knowledge, of the charges mentioned in tho Koyal Com- mission, I can form no idea of why my name was on the list of witnesses unless it was because I am a friend of the Government. I persist in declaring emphatically that I have no knowledge of any arrangement or understanding such as that mentioned in the charges before the Eoyal Commission, and I declare that I have had no conversation with Ministers or Members of Parliament on this subject, and that they have never spoken about it in my presence. The money subscribed for Kamouraska was subscribed at Quebec and Kamouraska. It did not como from Montreal. And further deponent saith not, and this his deposition having been read to him, ho declares that it contains the truth, persists therein, and hath signed. ■• Sworn, taken and acknowledged on the '\ day, month and year, first above |- writtcn, before us. ) (Signed,) CHARLES DEWEY DAY, '. . . * Chairman. «« A. POLETTE, I « JAMES HUBERT GOWAN, , ,. I ;t I • ■ Commissioners. (Signed,) JOS. HAMEL, ••) , -- 78r :ii !l . Province op Ont City of Ottaw PARIO, '\ a. ) IX T]IE MATTEJl OF THE COMmSSION Appointing Charles Dewey Day, Antoine Dolette, and James Egbert Gowan, ("ommissioncrs to enquire into and report upon the several matters stated in a certain IJesolution moved by the Hon. Mr. Huntington in the House of Com- mons on the second day of April, A. D. 1873, relating to the Canadian Pacific l?ailway. Pretcnt : Tub Commissioners. On this fifteenth day of tScptember in the year of our Lord one thousand eight hundred and iieventy-three, personally came and appeared before us, the above named Commissioners, EGEPtTON R. BURPEE, of the city of St. Jolm, in the Province of New Brunswick, Civil Engineer and Contractor, who being duly sworn deposeth and saith : Question — Are you a member of the Dominion Parliament ? Answer — No. Question — Do you know Sir Hugh Allan ? Answer — I am acquainted with him slightly. Question — Do you know Mr. Geo. McMullcri ? Answer — Yes. Question— Whoa did your acquaintance with Jlr. McIJullen begin^ have you known him any length of time ? Answer— Ho ; I have known him since about the Session of 1872. Question — Were you one of the Provisional Directors upon the Board of the Canada Pacific Railway Company, incorporated during the Session of 1872 ? Answer — Yes. Question — Have you any knowledge, Mr, Burpee, of any agreement between Sir Hugh Allan and Mr. MeMuUen, representing certain American capitalists, for the building of the Pacific Railway with American capital? ju . Answer — I was told by Mr. McJMullen that there was such an agreement. Question — Do you remember when he told you that ? Amwcr — At the same time — the session of 1872* Question — Can you specify more nearly the year, month or day. Amwer — It was about the last of the session. Question — Was it after the Act of Incorporation had been passed or before ? Ansrcr — It was before. Quehfion — What did he say to you on that occasion 1 Ansv;er — I met him a great many different times. He told me there was an arrange- ment made with American capitalists, in connection with Sir Hugh Allan, to build the road ; and he wiished me to become a member of the Company. Question — Did he state if there was any condition of that arrangement by which a certain intjrest was to be paid to Sir Hugh Allan ? Answer — No. There was a condition that Sir Hugh Allan was to bo one of the Company. Question — Do you know who were the American capitalists whum Mr. MoMulleu represented ? Ansicer — I cannot remember them all ; there wai! a large number. There was Governor Smith mentioned. Jay Cooke, and General Cass. 4K''i; 79 ITAN, ill a !om- icifio dred lors, ?ick, lown aada [ugh ftho road ; ich a f the [ullcu 'crnor Question — Did you understand that the Govciiiracnt of the Domiuiou was at that tinio lavorablo to that arrangement ? . ,■ -• ■ , ,» Answer — JNo, I did not. It was rather adverse. * '■■) Question — Did McMullen say anything to you on that subject ? i ; ■• v , >,: . Answer — Nothin,^ definite at all, except that ho wanted the (Jovcrnnicnt to acquiesco. Question — Was thi.s after the agreement to which you iiavo adverted liad been signed? •«;« .' \ .; - .■ . .>. Answer — lie said it had been signed. - - . v " Qucsfio?i — At whoso instance did you become a Provisional Director ? • • Answer — At the instance of Sir Hugh Allan and Mr. Abbott ; but I was for a long time interested in the Pacific llailway. We bad been talking about it for some lour or live years. I was solicited by both the Intcr-Ocoanic and the Canada Pacitio Company to join with them. I " ad a desire to bo interested in tho work, having already spent four or five years in working in connection with it. Question — Were you requested to become a Provisional Director of the luter-Ocoanic Company before you were connected with tho Canada Pacific Company. Ansicer — Yes. Question — Was the Government aware that you had been requested to become a director of tho Inter-Oceanio Company ? Answer — I cannot say that they were. Those !M embers of the (iovernment with whom I had any conversation had always told mo that the two Companies would bo amalgamated ; or at least that was their impression. Question — Who were those members of the Government ? Answer — The Members from the Province of New Brunswick, Mr. Tillcy and Air. Mitchell. Question — What reason had you to believe that the Government was adverse to the introduction of American capital ? Answer — I had been told by Members of the Government that it was intended that tlie Koad should be built with Canadian or British capital. Question — Will you name the gentlemen who told you so ? Answer — I do not remember exactly, but I know that it wag Mr. Mitchell's idea thnt the Road should be so built. Question — Any other beside Mr. Mitchell ? ' - ' - Answer — I think there were several others besides him. I think it was Mr. Tilley's idea also. Question. — Prom your several conversations with members of the Government what was the conclusion that yo^i came to as to the disposition of the Government in tho matter ? AiKwcr — I \:is q^'i^.e convinced that the two Companies would be united. For that reason 1 thou£,ht thiit it ,vas immaterial as to which Company I belonged to. My opinion is from the conversati'ii? I had with Members of the Government that tlie Government was adver&o to the admissi( d of American capital. (Question — Had you any personal knowledge of negociations tending to the amalga'j}a- tion ol' these two companies — the Inter-Occanic and the Canada Pacific ? Answer — No personal knowledge. ^,■. ..\ I took no part in these negociations. .... : •' ;;; ;' Ji.'-i.- i Question — Do you know why the negociations were unsuccessful ? Answer — No. Question — Are you now a member of the Board of Direction of the Canadian Pacific Company ? Answer — Yes. ...,:i v Question — By whom wore you nominated a Director ? Answer — By the members of the Dominion Government for tho Province of New Brunswick, Mr. Tilley and Mr. ]\Litche)l. , Question — That company consists of how many Directors '< - . % ? Answer — Thirteen. Question — Do y»u recollect the date of that charter ? IMAGE EVALUATION TEST TARGET (MT-3) 1.0 12.2 I.I |50 no 1112.0 Mi — 6" 1.8 11-25 il.4 11.6 Photographic Sciences Corporation 23 WEST MAIN STREET WEBSTER, N.Y. US80 (716)872-4503 '^ .\ o^ 80 Answer — I think it was in January, 1873. I cannol r«member precisely. I was here at the time. Perhaps it was February. Questinn — ^When you were asked to become a Director of the Canadian Pacific Com- pany, or rather before you were asked to be so, were you consulted in regard to the terms of the Charter? Answer — I had talked it over with different parties, and I was told what the provisions were, and I also had an opportunity of reading it. Question — When was the contract given under thLi Charter ? Answer — At the same time if I recollect right, or a few days afterwards. Question — Having seen the Charter, what was your opinion in r^ard to it, and the terms of the controct upon it ? Answer^It was to be entirely Canadian under this new Charter. Question — Was th^ Stock subscribed in order to lead to that result ? Answer — It was. It was distributed in the different Provinces in proportion to their population. I was requested to get up one-tiiirteenth of tho Stock, and before I became a member the greater portion of the Stock for New Brunswick was subscribed by other people. Qustim — Then the stock was to be re-distributed by the thirteen Directors in th^ir several Provmces ? Antwer — Yes Question — ^Were there any perscribcd terms on which the Stock should be given out by these thirteen Directors ? Answer Yes ; there was no one allowed to exceed a certain amount, and it was to be kept entirely in the hands of British subjects. It was to be given out to the differebt Directors in proportian to the population of the Provinces which they represented ; for instance, one-thirteenth of the whole Stock was allotted the Province of New Brunswick. Question— Were you prohibited from puttbg any premium upon it ? Answer — ^Ycs. Question — Were these thirteen directors on an equal footing ? Answer — Yes ; so I understood. Question — There was no preference given to any one over the others ? Answer — I never could see any. Question — As a man ezperieneed in the construction of railroads, do you consider the charter to be, or the contract to be, one of a particularly favorable and profitable character ? Answer — I did not consider it satisfactory. Question — Satisfactory to whom ? Answer — I mean that I did not consider it advantageous. I considered it a hard con' tract. Quatiot,, — You stated, did you not, in tho beginning of your evidence, that you are a railroad contractor ? Answer — Yes. Question — Were you induced to take a part in the Directorship of this Company with the hope of making a profit out of it ? Answer — I thought so at first, but when I came into this last company, I could not see much chance for making a profit. I expected in the first place when I was working in con- nection with the road that a profit might be made out of it ; that is years previously, I thought so. Question — Have you any knowledge of any understanding between the Government and Sir Hugh Allan and Mr. Abbott for the furnishing of money for the promotion of elections m 1872 ? Answer — None whatever. Question — Where wore you during the period of these elections ? Answer — In New Brunswick, I ♦' 'ak. Question — You are not in a position to know anything of the matter ? Answer— No. m . P' w CO CO le CO P' sa lii St ei hi c 81 re II- 18 le a or iir be he r? m- th ,1 nd IDS Question — Have you any reason to believe that any money was subscribed in the Province of Quebec or Montreal ibr the purpose of the elections ? Answer — It is a matter of which I have absolutely no knowledge. Questiorc — I suppose you took some interest in the elections in New Brunswick ? Ansvier — In some of them. Question — Do you know if money was subscribed ther" (Signed), CHARLES DEWEY DAY, CItairman. A. polettp:, JAMES ROBERT GOWAN, Commissioncrt, PaoviNCE OF Ontario, Clti/ of Ottawa. ! IN THE MATTER OF THE COMMISSION Appointing Charles Dewet Day, Antoine Polette, and James Robert Gowan, (commissioners to enquire into and report upon the several matters stated in a certain Resolution moved by the Hon. Mr. Hunti.noton in the House of Commons on the s«eond day of April, A.D., 1873, relating to the Canadian Pacific Railway. Present: The Commissioners. On this fifteenth day of September, in the year of our Lord one thousand eight hundred and seventy-three, personally came and appeared before us, the above named Commissioners, The Honorable ALEXAJ^DEE CAMPBELL, who beinj said: duly sworn, deposcth and I reside in Ottawa. I am a member of the Privy Council. I am now Minister of the Interior. I have been a Member of the Government since the first of July, 18b'7; that, is ot this Government. Quettion — Have you any knowledge of an agreement between Sir Hugh Allan and M.' G. W. McMullen respecting the oonstruction of the Pacific Railway with American capital? Atiswer — I have no knowledge of any such agreement. I know Sir Hugh Allan, but I do not know Mr. G. W. McMullen. Question — Are you aware of any negociations being carried o 'Tcen these gentlemen having that end in view, — that is the construction of the Paci^ ..'.way with American capital. Ansicir — Not of my own knowledge. Question — Have you been present at any interviews with lijse gentlemen, or with cither of them, relating to that matter? Answer — None ; I never saw Mr. McMullen in my life, to my knowledge, and have been present at no interview with him. Question — Are you aware whether the Government encouraged any negociations for the purpose of building the road with American capital ? Ansiver — I am aware that the Government did not encourage any such negociations ; that they declined to promote or favour any such arrangement. Question — When did it first como under your notice that any negociations tending tu that end, were going on ? Answer — Merely by rumor. I think cither during or shortly after the session of 1872. I > .1 :\ i iii I i i I I 84 Question — W&s the opinion of the Government decided upon that matter — that of ex- cluding American capital ? Answer — Yes ; decided for excluding it. Question — When was that decision of the Government apparent ? • Answer — I think Bhortly after the end of the session of 1872, it became tlie pronounced policy of the Government to construct the railway altogether by means of Canadian and British capital, and by means also of the amalgamation of the two companies. I think it was mad« apparent shortly after the close of the session of 1872. Question — When you refer to the two companies, do you mean the Intcr-Occauio and the Canada Pacific ? Answer — I do. It waa the policy of the Government to amalgamate those two com- panies, to exclude Americau capital, and to give the charter to the company, to be composed of these two amalgamated companies. Question — Have you any knowledge of the correspondence which took place betwcea Sir Hugh AUan and Mr. McMuUen ? Answer — None whatever. Question — Would you be able to identify any of the letters that passed between them ? Ansicer — Not in the least. Question — Have you read the published letters of Mr. McMullcn — the two letters in the press ? • Answer — I read those whish appeared iu tlio Montreal Herald. I have not read a recent account of an interview which some one had with him in Chicago. Question — Were you present at any of the interviews which the Government had with him? Answer — No. I never saw Mr. McMuUen. Question — Axe you aware whether Sir Hugh Allan ever received any promise, or any encouragement from the Government, in his negociations with American capitalists. Answer — None whatever, so far as I know. Question — Do you know by whom the negotiations for an amalgamation of the luter- Oceanic and the Canada Pacific Companies were originally suggested ? Answer — I do not. Question — Were these negotiations looked upon favourably by the Clovernment, or otherwise ? Answer — Favorably. I myself went to Toronto at the request of Sir John A. Mac- donald about the end of October, 1873, for the purpose of endeavoring to bring about such an amalgamation, and I know that from the end of the session of 1872 — I don't remember exactly what time the session closed — but from that time up to the time of my visit to Toronto, and afterwards — I should say up to the end of November — there were continuous cflForts being made by the Government to bring about an amalgamation of those two com- panies. Besides my visit, efforts were also made by correspondence. After I returned, Sir John Maedonald went himself for a like object. He went some weeks, I think, after I returned. I went up towards the end of October and saw Mr. Macpherson, the President of the Inter-Ooeanio Company. I also saw Mr. Cumberland, who was one of the directors, and I went to London and saw Mr. Oarling, who was another of the directors, and Major Walker, who, I think, was a member of that company, but I am not aware whether he was a director or not. I endeavored to persuade Mr. Macpherson that his objections as to the American element in the Canada Pacific Company were ill founded, and that the guarantees which the Government were prepared to give were so complete and so absolute, that they would entirely exclude the possibility of the company being controlled by Americans. I did not conceive that Mr. Macpherson was afraid of American capital, but that American views might control it, and that the lands which were promised to the company might fall into American hands and be used for American purposes. I endeavored to convince him by the clauses which would be put in the churter that it would be impossible for Americans to get control of it, and that the railway would be really and thoroughly controlled by ('anadians. That was the object which I had in view, and these were the erdcavors which I used. This was late in October. 86 Qiiation — You failed to convince him ? Anaipcr — Yes ; Mx. Maepberson did not hiinsoiC put forward the idea that ho claimed to be at the head of the company, lie stated that ho had no personal objects of his own to gratify, but be was persuaded that if it was not stipulated that Sir Hugh Allan should not be at the head of the company, that American interests would not be excluded. I failed to convince him because of that view which he strongly adhered to. I may add, that during the same visit in the west, I also saw Mr. Gzowski, his partner, on other matters, and I think that I satisfied him that the guarantees proposed by the Government were sufficient for the purpose of excluding American control. I did aot however, succeed in convincing Mr. Maepberson. Question — Did Mr. Macpherson's opinions seem to be shared by all the other members of the Inter-Oceanio company ? Answer — By no means. Mr, Cumberland was quite satisfied that the guarantees were sufficient. Mr. Carling and Major AYalkcr were also Batiefiod. All tlirco of these gentle- men expressed to me the opinion that Mr. Maepberson in holding firmly to these views, after what I had stated to him, would not continue to represent the views of the gentlemen who had formed his company. These gentlemen were satisfied, and they thought that the larger number of the mem< bers would be satisfied that the guarantees were sufficient to exclude American control. Question — Did anything further pass at that conference with Mr. Maepberson ? Ansi'jer — No. My visit failed on the ground that Mr. Maepberson could not believe that, so long as it was not agreed that Sir Hugh ^Ulan would bo excluded from the Presidency of this Company, American interests would be effectually excluded. Question — Did you explain to the gentlemen with whom you had the conference, what the charter was to be. ,^ , , Answer — Yes. The guarantees which we proposed, and which are now in the charter, were that the original stock list should be subject to the supervision of the Government, and that no changoR should take place in that stock list, without the consent of the Government ; that the election of Directors should be subject to the approbation of the Government, and that no changes should take place in the Directory without the consent of the Governmerit. There were also provisions made in respect to the control of the lands. Question — You went up to Toronto to represent the Government ? Answer — I went at the request of the Government ; or, rather, at the rcfjuest of Sir John Macdonald. Question — What time did Sir John Macdonald go there ? Anstccr — Two or three weeks after that, in November. Question — What was the result of the whole negociations ? Answer — We could not convince Mr. Maepberson that these guarantees were sufficient unless it was also conceded, and that we should stipulate to exclude Sir Hugh Allan from the Presidency. But, at the same time, he clearly led uie to understand that he did not himself put forward any particular claim to the Prcsidoucy, but that Sir Hugh Allan should bo excluded from that position. Question — Was Sir Hugh Allan aware of the part the Government was taking for the purpose oi" bringing about this amalgamation ? Ansicer — I do not know. I never had any conversation with Sir Hugh Allan about the Canadian Pacific Railway at all. I presume that he was aware of it, but I don't know it myself. Question — Was any further guarantee suggtsted besides that of excluding Sir Hugh Allan from the Presidency ? Answer — No, not in addition to those which I have mentioned ? Question — Do you know when it was announced to Sir Jlu^b Allan that the Govern- ment would not consent to the admission of the American element in the Company ? Answer — Not of my own knowledge. I apprehend it must have been during the Ses- sion of 1872. Question — After the failure of the negociations for bringing about the amalgamation, what course did the Government then determine upon ? Answer — They determined to avail themselves of the Act which had been passed during li I ^M 86 the previotis Seuioo, in contemplation of suoh an event, and to form a company undtr this Act ; a company composed of the wealthiest and most influential men in the country, giving to each Prorinoe a representation on an analagous basis to that which prcTails in the Privy Council. Five members from the Province of Ontario, four from Quebec, and so on, it being considered that the Privy Council fairly represents the importance and influence of each Province. That charter was granted in consequence of the failure to amalgamate, but very many of its provisions would have found their way into the contract, with either of those com- panies, or into that with the united one, supposing we had de»l< with an amalgamated company. Question — ^\S'hat was the fundamental principle of that charter with respect to tho distri- bution of stock : how was it to bo divided ? Answer — It was an approximation of the representatio'n of the different Provinces com- posing the Dominion. Question — In the choice of the Directors of tho Company ns representative men Arom the difierent Provinces was there any preference or advantage given to one over another ? Ansiccr — Nene : and the desire was to get into the Company men of standing, men of capital and men of Railway knowledge. The Qovernmcnt also desired to procure from the several Provinces the best men of respectability, standing, wealth, or railway knowledge. Question — "Was there any inequality among themselves as to the footing o* which they stood as Directors ? Ansicer — None whatever. Question — ^Were the terms upon which this charter was granted and on which ^^e con- tract was based more or less favorable than the terms contemplated by the Government at the beginning ? Answer — They were the same terms in so far as these terms would be deduced from the Act of Parliament. Where the Act did not prescribe terms the object was to make the char- ter as perfect as possible, and to absolutely exclude the possibility of Americans having any control, and to so frame it as to make it secure the objects we had in view. We spentagrcai) deal of time over it, and so far as my knowledge and ability enabled mc to judge, I believe that that charter was made as perfect in these respects as it could be niade. The charter was intended to exclude American control, to retain control of the lands and money subsidy, to enable tho Government to make a safe disposition of that money, and generally to accomplish the objects which the country had in view in tho granting a charter for the construction of the Pacific Railway. Question — ■What time was tho draft of that charter made ? Answer — The charter, when I was first asked to take any part in it, was in draft, it was 1 should say, about the middle of January. It was completed on the fifth of Febru- ary. It had been mbmitted on behalf of the Government to Sir t^obn A. Maodonald and myself; and en behalf of the railway company, to Mr. Abbott. We spent a great many days over it, discussing the various points ; Some put forward by Mr. Abbott on the part of the company, that such a clause was too stringent, and another clause did not give tho ad- vantages which he considered they ought to have, and so on. These clauses were discussed for several days, Mr. Abbott eonsnlting nor and again with the persons who were to be Directors of the road. Question — On what calculation or data was the price fixed for the construction of this railway. Ahsicct — We did not fix the price ; we fixed our contribution to it. It was fixed by statute that the country should give the company undertaking tho works $30,00(t,000 and 50,000,000 acres of land. Question — On what data were these fixed ? Answer — They were fixed by Parliament. Question — Have you any knowledge personally to state whether tho contract given would be a profitable one to the contractors or not ? Answer — No, I have not. I may state that the data on which the $30,000,000 in money was fixed was 3,000 miles of railway at $10,000 a mile. a( ID « « Ul el th su Pi th su mi M CI CO 8T Francis llincks, Honorable Mr. Question — You bave scon iho printed letters of Mr. McMuUea you say, mih tbo excep- tion of one ? Answer — I bave. Question — Do you know anytbing of the sums of money wbicb aro incutioucd tbere as baviog been disbursed by Sir Hugh Allan ? Answer — I do not. Question — These sums are $8,500, to Sir John Macdonald, and Sir and a large sum of money to newspapers, and a sum promised to the Laugevin ; do you know anything about these sums of money ? Question — Nothing whatever. Question — Do you know anything about the matters alluded to in Mr. Mc^rullon's letters? Answer — No. I was present at none of tbo interviews. I never saw Mr. 3reMullcii. Question — Have you any knowledge that Sir Hugh Allan advanced $200,000 as stated in Mr. McMullen's letter ? Answer — No. Question — Do you know anything about the sums of money alluded to, that is money advanced for tho purposes of the Elections ? Answer — No, I know nothing about those sums — Nothing whatever. Question — Do youknow anything about money payments to different individuals? Answer — No. Question — At the conclusion of this last letter of Mr. McMullen's, I find it printed in these terms: "From Sir George Cartier to Mr. Abbott, dated August 2ith, 1872. In " the absence of Sir Hugh Allan, I shall be obliged by your supplying the Central Coni- " mittee with a further sum of $20,000, upon the same conditions as stated by me at the "foot of my letter to Sir Hugh Allan, of the 39th ultimo. (Signed) George B. Cartier. " P.S. — Please also send Sir John A. Macdonald $10,000 more on the same terms." Do yon know any thing abou^' that letter ? Answer — ^Nothing. Question — Do you know anything about the $20,000 mentioned in it? Answer — I was in Kingston immediately after Sir John A. Macdonald's election, and I understood from him, that a certain sum of money had been contributed towards the elections in Ontario by Sir Hugh Allan. I had no personal knowledge of the matter. Question — Have you ever secp. these telegrams which have been published ? Answer — I have not. Qvation — Have you not seen one from Sir John A. Macdonald to Mr. Abbott in these terms : " I must bavo another $10,000, will be the last time of calling. Do not " faU me?" i4nswer— No. Question— ^ox tho answer of Mr. Abbott—" Draw on me for $10,000." Answer — No. That telegram purports to be sent from Toronto. I did not see Sir John after he lefb Kingston. I know absolutely nthing of them. Question — Have you any knowledge as a matter of fact, that th>.re was any money supplied for the clecticns by Sir Hugh Allan ? Answer — None, except the knowledge I have mentioned. Question — Have you any knowledge concerning the elections in Montreal, and in the Province of Quebec ? Answer — None. Question — Have you any knowledge of any understanding between Sir Hugh Allan and the Government, or any Member of the Government, that money should bo furnished for supporting the elections ? Answer — None whatever. The Government is charged as I understand with having made a corrupt bargain with Sir Hugh Allan. Now I think that I am in a position as a Member of the Government, and having been particularly concerned in this Pacific Railway Charter, to say that there was no such bargain with Sir Hugh Allan or his associates, either corrupt or incorrupt. There was no bargain to give them or any one the Contract at all. m r^=^ 88 Jill I do not believe that Sir Hugh Allan had any sort of understanding beyond that one given by Sir Qeoreo Carticr, which was given by him on one doy and repudiated by Sir John A. Mftodonud on the next. I saw Sir John's telegram to that effect immediately afterwards. Beyond that I do not believe that Sir Hugh Allan had any understanding with the Govern- ment, or that there was any bargain, cither corrupt or incorrupt, to give him or any body else this ooDtraot until the Churter was about being signed, that would be perhaps the end ot January or the early part of February. I am persuaded ho had no such understanding. I say this because the allegation is that a corrupt bargain was made either bctore or during the Session, or at the time of the elections, and I know that during all that time the Govern- ment made no bargain to givo the contract t« any one. I was engaged in Toronto endeavor- ing to bring about the amalgamation of these two companies as late as October, and I know that Sir John A. Macdonald was there for the same purpose as late aa November, and it was nearly the end of November before wo were satisfied that an amalgamation could not be brought about. When I was in Kingston I saw the telegram from Sir George Cartier giving the terms of the arrangement, which, if I rightly remember, were that the amalgamation of the two companies should be brou'^ht about and the contract given to the amalgamated Company, but failing that it should be given to the Oanada Pacific. These facts were communicated to Sir John A. Macdonald, and he immediately sent a telegram back stating that he would not assent, and that he would go down to Montreal. I am satisfied there was no bargain with any one to get the contract until it was absolutely given at the end of January, 1873. Question — That letter from Sir George Carticr, dated 24th August, 1872, which I have read to you, contains an allusion at the close of it, to " the same conditions as the amount written by me at the foot of my letter to Sir Hugh Allan, of the 30th ultimo." Have you seen that letter ? Answer — I have not. Question — Do you know where it is ? Answer — I do not know of my own knowledge. I understood some time ago that it was in the hands of Sir Hugh Allan. I never saw it. To Sir John A. Macdonald, through the Chairman : I was not present at any interviey^s between the Cabinet and Mr. McMullen. I never saw him. I was aware that there were two interviews, but I was absent on both those occa- sions. The charter was the result of the failure to amalgamate. I don't mean to convey the idea that the terms of the contract with the amalgamated company, had there been an amalgamation, would have been different from the terms in the charter. I presume that the charter would have been much the same. We were anxious to make the best charter wc could and to carry out the wishes of the country in relation to the railway. Whether tho amalgamation had taken place or not; whether it had been arranged by the Inter-Oceanic Company or tho Canada Pacific, or by a chartered company, in any case it was the policy of the Government that the terms should be as I have mentioned, and as are contained in the present charter. That was the policy of tho Government immediately after the Session of 1872. Question — You say you were aware, and that you had means of knowing, as a member of the Government, that there was no bargain, corrupt or incorrupt, with Sir Hugh Allan, before the elections or before November ? Answer — None whatever. Question — Could there have been such a bargain without your knowing ? Answer — It could not be without my knowledge. Question — Supposing ony one of tho thirteen ministers had made any agreement with Sir Hugh Allan, would it have been of any value whatever ? Answer — Not unless it had been yourself. It would have been of no value. In such event, I apprehend, if any one of your colleagues could not have concurred in the advice which, in that case, you would have given His Excellency, ho would have been obliged to retire. \ 89 QueUion — Except mygclf, any agrootncnt made by a member of the Government with any party would bo so much wusto paper unless it was ganotioncd by the Government ? Ansicer — That is my opinion. Quettion — If Sir Ooorgo Carticr had made any arrangement with Sir Hugh Allan at Montreal or elsewhere, you say it would have been futile ? An»wer — If Sir George Cartier had made such an arrangement and it had not been accepted by his colleagues he would have been obliged to retire or have given it up and saerificvd his own views. Quistion As a matter of fact, and ir justice to Sir George Cartier'a memory, do you know, as one who was socially and intimately acquainted with Sir George Cartier, what his sentiments were with respect to the introduction of American capital into the Pacific Railway onterprizo ? Angwer — Very strong against the admission of either American capital or control. The idea then was not opposition so much to American capital as to Americans controUinjL^ the road, lie took the extreme ground of excluding An.::rican capital as well as American capitalists. Question — From the conclusion of the session to the granting of the charter did the Government policy vary for a moment with respect to excluding American capitalists and American control ? Ansiver — Not for a moment. I think the only Member of the Government who at any time held diflFercnt views was Sir Francis Hincks, but finding his colleagues unanimous in the other direction ho yielded his views. He saw as well as his colleagues that the feeling of Parliauicnt was decidedly opposed to American connection. Question — Then he yielded to the sentiments of others. Aniwer — Yes ; I think the fixed policy of the Government during the whole period, from the end of the session of 1872 to the time the charter was granted, was to exclude American control, and to give the charter to Canadian or British capitalists, in order to make it a national work, and to carry out national views and objects. Question — Was it not also the fixed policy of the Government that the company which should be entrusted with the building of the Pacific Railway should not be a sectional one. Answer — Yes ; the desire was to embrace important interests in the different Provinces of the Dominion, and to get each Province as much as possible represented by men of stand- ing, wealth, and railway knowledge. This was done in order to prevent sectional jealousies, which might impair the progress of the work. Question — Do you know, as a matter of fact, that the existence of the Government greatly depended upon there being no sectional differences, and would not the Government have been greatly endangered by bringing in a sectional company. Answer — I think so. Question — Would it not have been impossible to exclude either Ontario or Quebec? Answer — Impossible. I believe that was the reason why in the very early stage of the matter, I apprehend before the close of the Session of 1872, it was considered to bo impossible to give the contract either to the Canada Pacific, Sir Hugh Allan's Company, or to the Inter-Oceanic, Mr. Macpherson's Company. If it were given to Sir Hugh Allan's Company it would exclude many representative men from Ontario, Mr. Macpherson's Company being comprised principally, though not wholly, of Ontario men. If the contract were given to the Inter-Oceanic Company it would have excluded representative men from the Province of Quebec, who were in Sir Hugh Allian's Company, and who considered him ns their representative in Railway matters, and who had put him forward as the head of the organization and as the mouthpiece of their views and wishes. I think very early it became quite clear that the Government could not proceed and deal with cither Company but must endeavor to procure an amalgamation, and so deal, if possible, with the Dominion at large. It was a matter affecting not only the interests of the railway, but the political existence of the Government. ill i' I ■I I 12 f 90 I am oonvinoed iliat tho Quobco intorosta could not have booo ezoladcd from any arrangomont for building tho road. Question — If bo, could Sir Hugh Allan have been czoludod ? Anawer — No. Queitbn—yfhy ? Answer — Bocausu ho «as put forward aa a leading repreKotativo man. IIo was a prominent business man and had been largely engaged in promoting tho Northern Colonization Railway and for two or tbrco years ho had put himself forward as the leader of Lower Canada in Uailway matters, and was accepted aa such by Ijower Canada, Qaeition — Are you awaro that a deputation from Lower Canada — Montreal — came up to Ottawa and saw Sir Qeorgo Cartier to insist that Sir Hugh Allan be viewed ns tlic representative man of Lower Canada. An»wer — I was not aware of it. Question — You wore not awaro IJ.at Mr. Iludoii, and Sheriff Lcblane, came to Ottawa for that purpose ? Atuwer — No, I am not. Que$tion — Sir Hugh Allan is ua exceedingly wealthy man, is ho not. Answer — Yes. Question — What is he reputed to bo worth ? Ansictr — From $500,000 to $600,000 a year, I have heard it reported. Question — Reference has been made to Sir Cicorgo Carticr's letter, and to my tclogram to him repudiating his quasi arrangement. You were at Kingston at the time I received his telegram. I suppose you saw it almost at the time I received it? Answer — The same day or the next. Question — Do you remember my repudiating it at once ? Answer — Yes, aud also of your telegraphing that you would go down to Montreal, at once, and of your making preparatory arrangementa with mo to go down if necessary that night. Question — My Election was then going on was it not ? Answer — I think this was during the nomination week. Question — So I made arrangements with you, to enable mo to go down and break up such an arrangement, and asked you to attend to my interests in my absence? Answer — Yes. Question — Did you sec the answer to my telegram ? Answer — Yes. Question — The arrongcment stood according to my previoub telegram ? Ansioer — Yes ; the only thing you said, I think, was that the influence the Government had on the Board would be used to get Sir Hugh Allan made President. Question — You assented to that and thought it reasonable that the wealthiest man in Canada, and the oldest on the Board, should be President ? Answer — Yes ; and also because ho was the f rst person who came forward as a Cana- dian, and took an interest in the project, and was willing to embark his means in it. Question — Had Sir Hugh Allan any special reason for desiring the extension of railways westward ? Answer — I don't know, except that he was largely interested in the Northern Coloniza- tion road. Question — Was he not abo largely interested in steam transportation ? Answer — Yes. Question — Are you not aware that there was an attempt made to get up a rival com- pany in England ? Answer — I have heard so. Question — Under whose auspices ? Answer Of the Grand Trunk Railway, I understood. It was however a mere rumor. Question Did that present a cause of fear to Sir Hugh Allan that the Steamship line might be excluded from the Western traffic ? 91 any ag a nlion lowcr 10 up I t!ic Ltawa id his lal, nt ir that ik up imcnt an in '^ana- ilways oniza- 1 coni- raerc ip line Anstirr — It mny havo boon so. 1 never had any convoraation with him on tliu subject, but I undontood that ho had those views. Question — Are you not aware that ho was also intorpfltin«* himsolf very much, and pres- sing on public attention a road still further west than the Northern Colonization Railway. Tho Toronto and Ottawa Road ? Anstnr — Yes, it was to be a Road to run from hero to Carleton Place and Peterborough, through the interior of lTi)pcr Canada, and come out to tho lake at Toronto. Question — The fact is Sir Hugh Allan had determined upon tho extension of tho Ruil< way system, and desired to connect himself with it? Aiisurr — 1 understood from general report that he .,r , tho idea uf a Railwiiy system from Montreal westward independent of the Grand TrunI J^ailwiiy. To tho Commissioners : I understood you to say that tho terms of the ^ larler were finally settled some time in tho latter '^nd of January ] -ii'o " r — Yes. QHMtion — You mentioned also that you hod scvtial inlerviews with lir. Abbott, as representing that Company. Answer — Yes. Question — And his praying that certain oltcrations might bo made. Answer — Yes. Question — Did that touch tho question of the exclusion of Amcricin control. Answer — It did not. That was a conceded point before wo sat down. Question — Did the Government in any way concede the point in regard to Auicriciin control ? Answer — Not in any way, and he did not desire it. It was a conceded point that it should be excluded before wo sat down, and our desire was to frame a charter so us to make that secure, and ho was equally anxious with us that it should be so. Question — ^What was the nature of tho alterations he suggested ? Answer — I can hardly remember. Ho may have suggested forty or fifty. Question — What principle did they affect ? Ansicer — There was a great deal of detail as to tho mode and rapidity by which tho $30,000,000 were to bo paid, whether tho payment was to depend on the construction of certain sections or upon a certain quantity of labor on several sections, and how fast it was safe for tho Government to pay it out. Ho endeavoured to get stipulations fur this money to bo paid out as rapidly as possible. Sir John Macdonald afd myself, on the other hand, endeavoured not to have the money paid until assured evidence had been effected that value had been received for it by the country. And in the same way with regard to lands, his object being to obtain the land as quickly oa possible, while our desire was that it should bo granted only as the construction of tho road progressed. What I mean to say is that ho endeavoured [to obtain some mode of determining the rate of progress in tho work, more favorable than that of leaving it to the decision of tho Government or its engineer. It was understood that the payments were to be dependent on tho rate of progress. Then as to tho way tho land was to bo dealt with as to tho possibility of its being used, in any way injuriously to the interests of tho country at largo ; as to the modo and rapidity of its being patented and a variety of questions of like nature which must occur in a large national undertaking, came up from day to day. Question — On how many occasions were you present when Mr. Abbott also was present ? Answer — In the discussion of this charter, wo nay have spent the best part of seven or eight days. Question — Were you there on the first occasion ? Answer — I was there every time. Question — On that occasion was there anything said with respect to American control or did ho claim that any alteration should bo made in that part of tho Charter which was to' exclude American control ? Answer — No. It was a conceded point before we sat down, that it should bo excluded, and there was no effort made on his part to get tho charter changed on that point. « s^ :i ! 02 Question. — That referred to Amerioan Capitalists, as well m American control ? Answer — Yes. Whatever Sir Hugh Allan wished, or may have done originally with his friends, Mr. Abhott, as his representative, aud that of the companies said he and they had entirely abandoned any inteution of having Amerioan interests introdaced, and Mr. Abbott, was equally anxious with Sir John Macdonald and myself to prevent the possibility of this control or influence being brought in. Question — Can you state what was the date of the first interview between the members of the Government, and Mr. Abbott, in relation to the final settling the exact terms of the Charter 1 Answer — I should say towards the end of January, probably about the 20th. I do not remember whether the time was given consecutively or not. I think Mr. Abbott may have had occasion to go to Montreal once or twice. Question — In what form was the draft, I mean was it a rough draft ? Answer — It was originally in manuscript, and at the time it was presented to mc, it was m type — in goHey. To Sir John A. Macdonald through the Chairman : I think it was the end of January that Mr. Abbott was put in communication with you and myself, but the communications and negooiations had been going on long before that. What I was asked was as to the interviews which resulted finally in the settlement of the charter. Question — The draft of the charter commenced with a few headings, and by degrees expanded and became more and more worked into details, until at last we sat down and framed the charter '( Ansicer — It was set down in detail, printed in galley, revised and reprinted. I think it was printed four or five times, as the alterations were going on before it was finally settled. I desire to add one word. In that last letter which Mr. McMullen publishes he says, I think, with reference to a bill or note made by Mr. Hillyard Cameron, that it was renewed by the Merchants Bank, and says that the rencwel was at the instance of the Government after a visit of the Postmaster General to Montreal. I was the Postmaster General at the time, and am the person to whom he referred, and I wish to say that the insinuation conveyed by that paragraph is false ; that I knew nothing of the renewal of Mr. Cameron's paper, and that no visit of mine to Montreal bad any reference to any such renewal, nor did I ever ask any one to renew such a note. And further for the present deponent saith not. And on this sixteenth day of September re-appeared the said witness and made the following addition to Ir's foregoing deposition : At the close of my deposition I spoke of a statement which Mr. McMullen had made in a letter that I took some part in having a note renewed which had been made by Mr. Hillyard Cameron. I was speaking from memory as to what Mr. McMullen had stated. Since I gave my testimony I have loolrcd up the state- ment as it appeared in the papers, and I find his statement is not as to the renewal of a note but as to the inception of it. The statement is : '* And now let me add one more fact which " will illustrate the position of the Committee and of the absolute control which the accused •' and their friends have exercised over it. Outside of the amounts which may have been " furnisLer) him by Sir John A. Macdonald, the Chairman of the Investigating Committee " applied through the Premier for a loan of $5,000 whep the elections were all over, and Sir " Hugh Allan supposed that he was through paying, and he objected, but after a personal " visit of the Postmaster General to Montreal, and urgent letters and telegrams of Sir " John, who announced that it was to help us, the thing was done." I desire to say in reference to the inception of the note and thc'original loan, that the insinuation of any visit of mine to Montreal had anything to do with it is false. I know nothing of such a loan, and no visit of mine to Montreal had .-inything to do with it. Question — Did you visit Montreal about that time ? Answer — I can hardly toll. I never spoke to Sir Hugh Allan on the subject, nor to any oflicer of the Merchant's bank. I was not aware uu'al long afterwards that there was such a discount. 93 Quettion — Do jaa know of Sir Jobn Ai Maodonald Iiavlog written to Sir Ilagh Allan in respect to this note ? Answer — I do not of mj own knowledge. Quettion — Do joo know of any telegrams ; did you send any telegrams respecting tbifl matter ? Amwer — None, nor do I know of any having been sent. Question — Do jca know of any application by Mr. Cameron to any member of tbo Oovernment to assist him in obtaining this discount. Aruicer — Not of my '>wn knowledge, but I believe there was some communication on the subject, and that Sir John JdLaodonald did assist him to get this discount ; but I hare no personal kno?rledge of iL And further ior the present deponent saith not. And on this 17th day of September, reappeared the said witness and continued his deposition as follows : The amount which I learned from Sir John A. Macdonald in my conversation with him at Kingston as that which was to be contributed by Sir Hugh Allan to the Ontario Election fund was $25,000. This was after Sir John's own election. Question — Did yoa hear of any other sum being promised by Sir Hugh Allan ? Anstcer — I did not until after these discussions took place in the newspapers. Question — Did you from any other Member of the Government ? Anticer — I did not, until ss I have said, these matters became rife in the newspapers. Question — Do you know at any time of any other suujs being furnished by Sir Hn^ Allan, than the 825,000 ? Answer — Not until those newspaper reports came out. But afterwards I did hear so from the conversation I had with Sir John A. Macdonald himself. Question — Did i* then eomc to your knowledge that further sums had been subscribed by Sir Hugh Allan? Answer — ^Yes ; there were sums in the aggregate, which amounted to $45,000. Question — For the Provmoe of Ontario ? Ansicer — Yes. I desire, with the permission of the Commissioners, to add that on my visit to Toronto and in the interviews I had with 3Ir. Macpherson to bring about the amalgamation between the two companies, I did not dssire to make any stipulation as to who was to be President, nor did I desire to make any stipulation upon the subject of the Presidency. It was Mr. Mac* pherson wbc desired it to be stipulated that Sir Hugh ^-'lan should not be President. Question — Upon the grounds he stated ? Answer — Yes. I desij e to say further that I have had no correspondence whatever, with Mr. Abhott about the a (count or mode of distribution of any election fund of which Sir Hugh Allan was the chief or sole contributor, or of any other election fund whatever. I make thii jtatemeot, as I see in the Montreal Herald it is suggested that such a corre- spondence took place, and I desire to contradict it. Question — Had you any correspondence with Sir Hugh Allan ? Answer — No, not with any body. And further deponent saith not, and this his deposition having been read to him, he declare that it contains the truth, persists therein and liath signed. Sworn and taken on the fifteenth day of Sep- '\ tember, 187.3, and acknowledged on the > seventeenth day of said month and year. J (Signed), . (Signed) A. CAMPBELL. (^HAELES DEWEY DAY, Chairman. A. POLETTE, JAllilES EGBERT GOWiLN, Commitswnert. . 1' I I I 'T as ill 94 k.: " V Province op Ontario, ") \ IN THE MATTER OF TIIB COMMISSION City of Ottawa. ) Appointing Charles Dewey Day, Antoihb Polexte, and Jambs Eobert Gcwan, Commissioners to onquiro into and roport upon the several matters stated in a certain Resolution moved by the Hoi'. Mr. Huntington, in the House of Commons on the second day of April, A.D. 1873, relating to the Canadian Pacific Railway. Present : Tns Commissioners. On this fifteenth day of September, in the year of our Lord one thousand eight hundred and pcvcnty-thrce, personally came and appeared before us, the above named Commissioners, The Honourable PETER MITCHELL of the city of Ottawa, who being duly sworn deposeth and saith : I am a Member of the Privy Council, and Minister of Marino and Fisheries in the Dominion Government. Question — I will read to you the terms of the charge which the Commission is enjoined to enquire into, the first clause of which is as follows : " That an agreement was made between " Sir Hugh Allan, acting for himself and certain other Canadian promoters, and G. W. '' MoMullen acting for certain United States Capitalists, whereby the latter agreed to furnish '■ all the funds necessary for the construction of the Pacific Railway, and to give the former " a certain percentage of interest in consideration of their interest and position. The scheme " agreed upon being ostensibly, that of a Canadian company, with Sir Hugh Allan at- its " head." Have you any knowledge of any agreement or ncgociation of that kind ? Atiswcr — No, not of my own personal knowledge. I have such knowledge as the public orints have lately afforded. Question — Is all your knowledge confined to that which you have derived from the press ? Answer — Entirely bo. Question — Were you not aware at any time previous to the publishing of the correspon- dence that such negociations were going on ? Ansicer — I was aware from public rumors that Mr. McMullen and Sir Hugh Allan had some intercourse in relation to this matter, and that they had talked of arranging some plan by which American capital could be acquired. That information I got from Mr. McMullen himself. Question — You know Sir Hugh Allan and Mr. McMullen, do you not ? Ansicer — Yes ; I know both of them. Qiiesti'^n — And the information you possessed in regard to these negociations was derived from Mr. McMullen himself? Answer — Yes, as to the fact that such negociations were going on. I never had any conversation with Sir Hugh Allan on the subject. Question — Were you present at any intervicivs between the members of the Government and Sir Hugh Allan and Mr. McMullen ? Answer — I was present at one interview with Sir Hugh Allan, Mr. MoMullen, and I think Mr. Smith, but I am not sure whether Mr. Smith was there or not. I don't remember the date, but it was the first interview which Mr. McMullen in his published letter states tha^ I was present ; although I don't know whether it was the first or second iutervicw except from what I have seen in the papers. mm bo ;ht iVO am the icd cen W. ish aer ime ita jlic tbo )on- ad )laa lien vcd any iicnt > ber atcs ccpt 95 I think it was tho interview which McMullcn states in his letter took place early in July, 1871, at which I was present. It will be in the one where he states I was present. Question — This interview at which Mr. McMullen says you were present, took place the 5th October, was that the one ? Answer — I presume so. Question—'Wbat passed on that occasion ? Answer — Not very much. I understood that these gentlemen came there to make some proposition to the Government, and that he asked an interview with the Government for that purpose. They got the interview, and the substance of what took place was, that when the gentlemen obtained the interview, and the ordinary courtesies had been gone through. Sir ilugb Allan was asked by Sir John A. Macdonald if he had any ptoposition to make to the Government. Sir Hugh asked the question in reply, " If the Government were in a position to entertain a proposition if he made one ?" and Sir John, on behalf of the Government, stated " that the Government were not in a position to accept a proposition " if made at that stage of the proceedings, and Sir Hugh Allan then declined to make any proposition. Very shortly afterwards they bowed themselves out in the ordinary course, as there was no business to be done. Quettton — ^Was there any discussion at that time concerning the source from which the capital was to be derived ? Answer — Not between the Council and Sir Hugh Allan and his associates. I think that the discussion that took place during the interview was exceedingly limited, and almost entirely confined to Sir John A. Macdonald and Sir Francis Hinoks, on behalf of the Grovcmment. There was a discussion also amongst members of the Government after they had left. Question — Was Mr. McMullen understood to be representing American capitalists on that occasion ? Answer — I do not know. I understood so myself from what I had heard, but I am not sure whether Mr. McMullen told the other members of the Government or not. I think the convortation was mainly, on their side, confined to Sir Hugh Allan. After they left, the question about American capital was raised and discussed by the cabinet, and the opinion of each member present was given on that occasion. Question — What was the view generally taken ? Ansicer. — With the single exception of Sir Francis Hincks, every gentleman was opposed to the admission in any way of American control, and that Americans should have no interest in the construction of the road. Some gentlemen were against American capital too. My own opinion was exceedingly decisive on that point. At the first interview with Mr. McMullen, I told him that I would never consent to the Americans having control of our national Road. He spoke of the influence of Sir Hugh Allan in the country, and of his great wealth. I said that Sir Hugh Allan was not all Canada, and I told him that I did not think that my colleagues would consent. After that, Mr. McMullen had very little to say to me. Question — It was then the settled policy of the Go/ernment at that time to exclude American capital ? Ansicer — It was, with the exception I have mentioned, and I accepted it as tho settled policy of the Government, 'Question — Do you know anything of the correspondence which took place between Sir Hugh Allan and Mr. McMullen ? Ansicer — Nothing whatever, except what I have seeen in the public prints. I saw none of the original letters. I was told by a member of the Opposition, with whom officially, I am often ^ )Ught in contact, that there was a correspondence of a most domaging character between &.. Hugh Allan and Mr. McMullen. He oftered to show it to me, but the next day he informed me that he could not get it. I could not believe it myself, and 1 felt that there was a misrepresentation made in relation to it. Question — Was this tho only interview at which you were present when Mr. McMullen was also present ? Ansicer — I think so. \ ^ ■1 i I '" 1 I ;, < m u 96 Que$ttion — Have you had any conversations 'with Mr. MoMullen apart from that inter- view? Answer — On two or three occasions when he was here. At the conversation which took place in Chicago, I gave a very decided expression of my own opbion as to Americans being permittted to have any control of our Pacific Railway. On several occasions afterwards, I think when Mr. MoMullen was here, or at least once or twice when he was here, he spoke to me of the progress of their work and seemed to feel very confident about it. I alwaTs told him what my opinion was on the sulaject. ,„f,v; '^. Quation — Are yon prepared to say that the Government or any Member of the Gov- ernment never gave him any encouragement or favor in this project or enterprise, so as to induce him in any way to believe that American capital would bo admitted in the building of the road ? Aiuwer — I am prepared to say the Government never did, and except what Sir Francis Hincks said, I am not aware that any member of the Government did. There was no encouragement nor any insinuation of any kind, that Americans would be permitted to have any interest in the construction of the Railway. I only speak of my own opinion, and of what transpired in the Council Chamber. I am satisfied in my own mind that no expectution could have been held out that American control would be permitted. Question — Have you any knowledge of any negociations that took place for the bringing about of an amalgamation between the Inter-Oceanic and the Canada Pacific Companies ? Antwer — I took no part in such negociations. I was aware that negociations were going on, but what the particulars were I did not exactly know. All I know was this that it was the desire of the first Minister to bring about such an amalga 'nation and that opinion was coincided in by all of his colleogues. Question — Who took an active part in these negociations ? Answer — Sir John A. Maodonald, Hon. Mr. Campbell, and perhaps Sir Francis Hincks ? I dont think Sir Francis took part so much as the others. Of course the other Members of the Cabinet stated their views and approved or dis- approved as it struck their minds at the time that the steps were taken or proposed to be taken. These negociations began, if I recollect right shortly after the elections, or it may have been during the Session of 1872. The Session of 1872 closed, I think, early in June. The result of the negociations, as I understood, and as I learned in the Council, was that they failed. Mr. Macpherson declined to accept the terms of amalgamation as proposed. I had no personal interview with Mr. Macpherson nor with any other gentlemen of the Inter-Ooeanio Company. £ took no personal part whatever outside of what took place in the Council. I took no part in the negociations for amalgamation. Question — Did you take any personal part in the framing of the Charter ? Answer — No. The framing of the draft of the Charter was almost entirely conducted by Sir John A. Maodonald himself, with Mr. Campbell on the part of the Government. The part that I took in the Charter was this : After the first draft was made it was submitted to the Calinet. We wont over the Charter section by section and clause by clause, and spent days over it, sometimes discussing the phraseology and at other times discussing matters of detail. A good deal of dificrcnce of opiDion was manifested by the diflerent members of the Cabinet in regard to the details. But one prominent point was always kept in view as to how we could best accomplish the satisfying of the public mind that American control was excluded from the Charter. Outside of that I took no part in the framing of tlio Charter. Question — The determination of Government to issue that charter — when was it arrived at? Antwer — My impression is that it was immediately after the return of Sir John A. Maodonald from Toronto. I think that was late in the fall of 1872; we had several discussions about it in the CouDoil before that decision was come to. My impression is, although I am not confident wmmmm^ 97 about it, that the determination to issue that charter was fixed upon in the month of Decem- ber, that was after the failure of the negociations, at least that seemed to be the settled senti- ments of the Government, but it may not have been settled upon before January. Question — Was it in consequence of that failure that they determined upon that course ? Anstccr — It was as the only means left open to the Cabinet for carrying out the wishes of Parliament. Question — Was that contract given under that Charter under any more favourable terms than had been previously contemplated by the Government ? Answer — None that I am aware. It was on very much less favourable terms than Sir Hugh Allan asked. My recollection is that Sir Hugh Allan asked a greater amount of money and a larger quantity of land. Question — Had Sir Hugh Allan any advantage over his co-directors? Ansicer — I know of none. As a member representing one of the smaller provinces, my anzicty was to sec that Sir Hugh Allan got no advantage. Both Mr. Tilley and myself, I believe, gave very special attention to that point, and I saw no desire on the part of the Government to give him any special advantage, but on the contrary, looking upon him as a very wealthy man representing the sentiments of a large portion of Quebec, we felt that the great danger was of any man in his position having too much power, for that reason we specially guarded against it. Quettion — Another portion of the charge is, " that subsequently an understanding was come to between the Government, Sir Hugh Allan, and Mr. Abbott, one of the members of the Honourable House of Commons of Canada, that Sir Hugh Allan and his friends should advance a large sum of money for the purpose of aiding the elections of ministers and their supporters at the ensuing general elections, and that he and his friends should receive the contract for the construction of the railway ; " do you know anything about an understand- ing of that kind ? Answer — I do not. Question — Was any such understanding made with the Government ? Answer — None that I know of. None was ever heard at the Council Board when I was there. I know none was made ~'th the Government. What might have taken place with individual Members of the Gov- ernment I cannot say. I could not but have been acquainted with it if it had been made with the Government. The whole course of the negociations and transactions ignored the possibility of any such contract having been made. Question — Do you know whether any such understanding was come to between these gentlemen — Sir Hugh Allan and Mr. Abbott, and any Member of the Government? ATiswer — I do not know of any. Question — Do you know whether any money was in fact subscribed by Sir Hugh Allan or Mr. Abbott ? Answer — I do not know of a dollar being subscribed, except from what I have learned in the public prints. Question — Do you know whether money was subscribed by any person for the promotion of the elections in 1872 in Quebec or in your own JProvince ? Answer — I do not know of a dollar except a small sum I authorized a friend to subscribe for me, to one of the elections in our Province. Question — Do you know of money having been received from Quebec for promoting the elections in your Province ? Answer — I never heard of a dollar having been received ; nor do I believe that there was a single shilling given to our Province for any such purpose. If there was I am entirely ignorant of it. ' Question — Do you know anything of a printed letter purporting to be a letter from Sir George Cartier to Mr. Abbott, dated the 24th of August 1872, which is as follows : " In the 13 ! n i 98 « absence of Sir Hugh Allan, I shall feel obliged, &c.," do yoa know anything about that letter ? Answer — I do not, nor did I ever see it until I saw it in one of the Montreal papers. Question — Do you know anything of the letter alluded to in this letter as being of the 30th of July ? Answer — I do not. I never hcurd of it until I saw it in the public prints. Question — Do you know anything of this telegram which reads " I must have another ten thousand, &o. ?" Answer — I k ^ow nothing of it, or of it or of any other telegram of that character ; I never heard of it until t saw it in the newspapers. To Sir John A. Macdonald, through the Chairman. Question — What was Sir George Cartier's opinion as to the admission of American capital into this enterprise ? Answer. — He was always hostile to allowing American capitalists to be interested in it. His opinions were very decided, and snflfered no variation from the beginning. I learned his opinions by his statements at the Council Board, and also visiting occasionally at his house, and in private conversation with him. I occasionally met him at dinner, and I never found but the one opinion entertained by him. And like myself, he was very decided in bis opinion on this point. Question — Who selected Mr. Burpee to be a Director on the Canadian Pacific Com- pany ? Answer — Mr. Tilley and myself. I never spoke to Sir Hugh Allan in relation to this subject, and certainly not in relation to lir. Burpee's appointment. The ground of our selecting Mr. Burpee was, that we considered him the most prominent representative railway- man in our Province, and that he would act independently of Sir Hugh Allan. We did not wish that the interests of New Brunswick should be overlouked, and we were anxious to select a man that would represent the interests of New Brunswick at that Board. We selected Mr. Burpee for the purpose of watching Sir Hugh Allan, and to hold out against him if he were inclined towards the Americans. Mr. Burpee was aware of this, and I think sympatbieed with that feeling himself. There was one opinion entertained by Mr. Tilley and myself, and that was, that with the great wealth and influence of Sir Hugh Allan the interests of our Province should not be overlooked. Question — Do you know, or do you not, whether Sir Hugh Allan was favourable to Mr. Burpee's appointment when he heard of it ? Answer — T had no means of knowing, but I understood that he was adverse to the selec- tion of Mr. Burpee. I had no conversation with Sir Hugh Allan on the subject, I learned this from outside rumour. And further for the present, deponent saith not. And on the 16th day of September, the said witness re-appcared and made the follow- ing addition to his foregoing deposition. In answer to a question put mc as to the exact views entertained by Sir Francis Hincks in relation to the admission of American capital or control in the building of the Pacific Hallway, I say that I understood Sir Francis had no objection to any person building the road. My impression is, that Sir Francis looked upon the undertaking as one that so far from being a benefit to the contractor would be a loss, and he was anxious that any person would undertake the building of the road. Sir Francis would not, I think, have objected to Americans having control in the building of it. But afterwards Sir Francis coincided in the views of his colleagues, that it was desirable to exclude American control. But previously he looked upon it as so bad a speculation that he would be glad to see Americans or any one else undertake it. He was quite ready to see it built by any person. After the matter, however, was discussed, he coincided in the general views of the majority of the Government. s a s p. MITCHELL. 99 And further deponent gaitli not, and this bis deposition having been read to him he declares that it contains the truth, persists therein and hath signed, ^worn and taken on the fifteenth day of September, ^ 1873, and acknowledged on the sixteenth > (Signed) day of said month and year. ) [Signed] CHARLES DEWEY DAY, Chairman. " A. POLETTE, " JAMES ROBERT GOWAN, Commmioners. ] IN THE MATTER OF THE COMMISSION PuoviNCE OP Ontario, Citi/ of Ottnioa. Appointing Charles Dbwey Day, Antoink Polette, and James Robert Qowan, Commissioners to require into and report upon the several matters stated in u certain Resolution moved by the Hon. Mr. Huntinoton in the House of Commons on the second day of April, A.D. 1873, relating to the Canadian Pacific Railway. Present: The Commissioners. On this seventeenth day of September, in the year of our Lord one thousand eight hundred and seventy-three, personally came and appeared before us, the above named Com. missiouers. The Right Honourable Sir JOHN A. MACDONALD, Knight Commander of the Bath, and Minister of Justice for the Dominion of Canada, who being duly sworn, deposeth and saith : Question — You are aware of the charges relating to the construction of the Pacific Railway, and to tbo raising and distribution of funds for the promotion of the elections in 1872, recited in the Commission ; will you have the goodness 1o state to the Commission all the facts within your knowledge relating to this matter. Answer — I suppose it had better be done as a narrative. In the Session of 1871, Resolutions were passed admitting British Columbia into the Dominion, and it was then provided that a Railway connecting the Pacific with the Canadian system of Railways, should be constructed within ten years. At the same Session there was a resolution passed in the House of Commons, that the road should be constructed by private enterprise, aided by public subscriptions in money and lands. There were no other proceedings that Session except a vote to defray the expenses of surveying the line, but it was understood thiit the Government should prepare and lay before Parliament at its next Session a scheme for the construction of the lioad. The surveys were commenced and carried through during that summer, but the Government took no action for some time with respect to the construction of the Road or the formation of companies for that purpose ; in fact had not prepared a scheme, when I was one day waited upon by Mr. Wad- dington in Ottawa. Mr. Waddington was an English gentleman whom I knew. He formerly resided in British Columbia, and had spent a good deal of money in Railway surveys and explorations, and was an enthusiast in the matter. He told me that by his invitation, as I understood it, some American capitalists from Chicago were coming to Ottawa to make a proposition to tho ii' ^ i 1 \'f m !l 100 Government for the constraotion of tho Paoifio llailway. I told Mr. Waddington that I thought this movement was premature ; that the Government could not make any arrange- ments at all until it had submitted a scheme to Parliament, and obtained tho sanction oi Parliament. lie seemed to be a good deal disappointed, and asked would I refuse to see them. I said certainly not, I would be glad to see them ; and Sir Francis Hincks and myself, we being the only two Ministers then in town, saw these gentleman. We told them that wo thought their visit was premature. Wo said, as a matter of politeness, that we were glad to see that American capitalists wore looking for investments in Canada, but that wo could not enter into any arrangement or receive any proposition from any body until after the next Sedsion. They said that they had communicated with other capitalists in New York and else- where, whose names they mentioned at the time, and, I think, exhibited a list of their names to Sir Francis Hincks and myself, who were ready to to-operate with them if they could make an rrrangcment for tho construction of the road. Some of the names I know, some of them I did not, but have since ascertained that they were all of them men of standing and capital in the United States. QuettioH. — Do you recollect the names of the gentlemen present at the conference ? Answer — There was Mr. Smith of Chicago ; Mr. McMullen was with him, also from Chicago. He was, ho- ver, a Canadian. I think Sir Francis Hinoks mentioned other names, but I cannot recollect them at this uio;urnt. I think there were two others. Quetlion. — Can yoa fix the date of that interview ? Amiter — I cannot without reference. Quettim. — It was the first interview on the subject ? Ajittcer — Tes. The fact of these gentlemen having made this proposition called our attention, and through Sir Francis Hincks and myself the attention of our colleagues, to the necessity of attempting to get Canadian capitalists to enter upon the subject. I first communicated with several gentlemen in Ontario, principally in Toronto, endeavoring to enlist their interest in the enterprise. I told them tliat it was a great pity that a great work of this kind should be carried off by foreign competitors, and if American capitalists could make it a paying enterprise, surely Canadians could do so as well. I spoke to my friends and mentioned the fact that these American gentlemen had come and made this proposition. Sir Francis Hincks, subsequently, on one of his visits to Montreal, saw Sir Hugh Allan on the subject. He did so without any arrangement or instructions from his colleagues or from myself as first minister. He did so on his own responsibility, just the same as I did to any friends that I saw. As I understood he had a communication with Sir Hugh Allan which he stated in his evidence. On Sir Francis Hincks' return to Ottawa, he mentioned that he had this conversatior and I thought he had made a mistake and so did, I believe, most of the members of the Government. At that time it had not occurred to me, or I think to any one, that these American gentlemcn,were in any way connected with the Northern Pacific Railway. That had not occurred to any of us. It certainly had not occurred to me, and the reason why I thought that the action of Sir Francis Hincks was premature, was that I thought that the true plan would bo to endeavor to get up a strong Canadian Company, :a which would be represented the Capital of the different sections of the Dominion, and after a body of Canadian capitalists was so formed, they might extend to tho United States, or to England, and I thooght that it would frustrate that policy, to have communication in the first place with Americans. After Sir Francis Hincks had made that communication, Sir Hugh Allan came to Ottawa, with several of these American gentlemen, Mr. McMuIlcn again, Mr. Smith, and I think Mr. Hurlburt of Chicago. We received them in the Council Room and had some conversation with respect to the Railway, but only as a matter of conversation as to the importance of the road and its great advantage to Canada, and so on ; but the only business that we did was my asking Sir Hugh Allan, who seemed to be the principal spokes- man of the party, if he had any proposition to make. Ho told us that he had an arrange- ment with American gentlemen, some of whom were there, for the purpose of getting up a Company to build the Pacific Railway. I said we were desirous of getting applications and propositions of every sort from all parties who took an interest in the matter. He then asked M 101 ine if wo were prepared to consider and enter upon any such proposition if ho made it. Wo said no wo were not prepared ; wo could enter into no arrangement at that time; we had no authority from Parliament to do so. Sir Hugh Allan sdd, " ], then, am not prepared to make any proposition," and then they left. Question — Do you remember the time of that interview ? Answer — I do not. But I see it stated in one of Mr. McMullen's letters that it was on October the 5th, 1871. Questioii — That is tho interview to which you allude ? Answer — Yes. I cannot say whether this is correct or not, but I have no reason to doubt it. Question — There wore several JMembers of the Government present besides yourself? Answer — Yes. The Cabinet was pretty full. Mr. !^[oMullcn says there wore present Sir John A. Macdonald, Sir Francis Ilincks, Sir G. E. Carticr, and Messrs. Tillcy, Tuppcr, Mitchell, Morris, Aikens and Chapais. I presume his statement in regard to those present is correct. I would say in reference to this, that before that meeting, I see it observed in the letter of the 18th July, signed by Mr. McMullen, which appeared in tho Montreal Herald and Toronto Globe, that he says that the result of tho communication between Sir Hugh Allan and these American capitalis'.s, was an interview in "Montreal parly in September, 1871, by which preliminaries were settled between Sir Hugh Allan, Chark ^ M. Smith and myself, by which Sir Hugh was to receive a large personal interest in the stock, and an amount for distribution among persons whose accession would be desirable, and that the cash instalment on such stock would be advanced and carried on by others." lie goes on to say " that an interview was held by myself with Sir John A. Macdonald at the St. Lawrence Hall the day before we met Allan, at which he expressed the approval of tho Government at the proposed meeting, and requested mo to meet him in Ottawa." Now that is an incorrect statement. I waa at the St. Lawrence Hall, met Mr. McMullen, and he told mo that he was entering into negociations with Sir Hugh Allan ; that they proposed to make a proposition to the Government. I heard his statement, and neither expressed approval or disapproval of it. In September wo were exactly in the same position as when he had previously met us in Ottawa, and the Government were not in a position to enter into any proposition of the kind, because we had not got the sanction of Parliament. I said we would consider any proposition that was made, when it was made. I observe also that Mr. McMullen in tho same letter states *' that at the meeting in October, 5th it " was at once apparent that they were not fully in accord amongst themselves, in consequence '' as Sir Francis Hincks informed me, of Grand Trunk jealousy of Allan represented m the " important personage of Sir George Cartier " This is altogether an erroneous statement ; we were quite in accord among ourselves, we were all in accord that we could not consider any proposition until after wo had the sanction of Parliament; that we were not in a condition to make any arrangement until Parliament had authorized us to do so. In consequence ot its being known that Sir Hugh Allan had entered into this arrangement with American capitalists, it was known to every one — a feeling of fear arose in Ontario especially in Toronto that the Pacific Railway might get into American hands and under American control, or might get into American and Montreal hands, and that in the construction of the Board the interests of Ontario might be forgotten or neglected. This I think added to the urgent request of myself on frequent occasions to a number of gentlemen in Toronto, induced I think tho formation of the Inter-Oceanic (Company. I had spoken to Mr, Macpherson, Mr. Howland, Mr. Cumberland, Mr, Worts, and a number of other gentlemen in Toronto, to try to interest them in it, and the company was formed. Mr. Macpherson took a warm interest in the forming of it early in tho autumn of 1871. The statement had got into tho newspapers, and the impression had gone abroad that American capitalists were not interesting themselves in the Canada Pacific Railway on its own merits, but that they were connected with the Northern Pacific Railway, and were endeavouring to make it subservient to the interests of that Railway ; and the fear arose and spread through Canada, that our railway would bo made subordinate to American interests if they were admitted to any share in the enterprise. I was one of those who P ^i i' I m 205080 I ■■ f B i :ii 102 participfttod in that foar, and it seemed to bo also tlie opinion of my colleagues, including latterly Sir Franeis llinoks when he found that the opinion was generally shared by his colleagues against the admission of foreign capital, and that the object of the Amorioaus in getting control of our railway was to connect it with their systom of railways. I think the GovcruDicnt became as one in the opinion that American capital Bh'onid bo excluded, although we had not come to any formal decision on the matter. During the Session of 1872 we found that those who usually supported the Oovernmont; that the majority of the House of C'ommons were of the same opinion It soon booamo apparent to everyone, I think, to Sir Hugh Allan who was hero occasionally promoting the Bill lor the incorporation of the Canada Pacitio Company, that Parliament would not sanctiou any scheme which would involve the admission of American capital. The Government then came to the conclusion that as there were two great bodies of capitalists, one from ]\fontreal and the other from Toronto, both petitioning for acts of incorporation, I say the Government came to the conclusion to aid in the passage of acts of incorporation of any respectable body of persons who would apply for that purpose ; and then the Government might judge afterwards which of the companies would best subserve the interests of the country, and give them the construction of the Road. At the same time we submitted to Parliament the Government Bill, to which allusion has been made, enabling the Government to give the contract to any company that might bo incorporatoid for the purpose with provisions for the amalgamation of those companies, and with a provision, if it was thought for the advantage of the country that alloyf.1 Charter should be granted, giving the Government tlie power to grant such lloyal Charter. The Government Act contained a clause to enable the Government to grant o subsidy in land and money. There were two acts of incorporation passed, as has already been several times bronght before your notice ; one for the Intcr-Oceanic Railway Company, of which the principal seat was in Toronto, and the other for the Canada Pacific Railway Company, the principal seat of which was in Montreal. So soon as the Session was over, which I think was in June, when Parliament was prorogued, the Government addressed itself to the task of attempting to procure the amalgamation of these two companies. They represented the interests principally of Quebec and Ontario, although I believe both of those companies contained names of gentlemen as Corporators, from the other Provinces. Still it was generally understood that the Inter- Oceanic Company was the Ontario Company, and that the Canada Pacific was the Quebec Company. Tlie poliCT of the Government, from the time of prorogation until now, I may say, had never varied. It was tht.t an amalgamation of these two companies should be procured if possible. We were satisfied that such was the jealousy that had arisen between the two companies, that it would be impossible to give the charter to either of these companies, that h the construction of the Road to either of these two companies. We knew that no Govern- ment could exist that would give the contract to etther section. If it were given to Sir Hugh Allan's Company, the Government would be certain to alienate the support of their Parliamentary friends from Ontario, and vice versa; so that we spared no pains in the attempt at amtilgamation. The Canada Pacific Hallway Board always expressed their willingness to amalgamate. The Inter-Oceanic Board expressed an unwillingness to amalga- mate. Immediately after the Session of 1872, or shortly afler, 1 went to Toronto for the purpose of seeing my friends there who were interested in the Inter-Oceanic Company, and I pressed them as much as possible to acquiesce in the amalgamation. "The elections were to come on between July and September, and we felt as a Government that is was very im- portant to us to go to the country with a scheme perfected and an amalgamation efieoted with the capitalists of Ontario and Quebec, ready to co-operate in the construction of tho Pacific Railway. After talking the matter over with Mr. Macpherson and other gentlemen in Toronto, I wrote to Montreal and I asked Sir Hugh Allan to come up to Toronto, and Mr. Abbott, a Member of Parliament, and who had taken great interest in tho Canada Pacific Railway, also to come to Toronto and discuss the matter with Mr. Macpherson. Sir Hugh Allan wrote me that it was impossible for him to come up, but that Mr. Abbott might. Mr. Abbott did come up, and saw Mr. Macpherson, and you will find in the evidence given by Mr. Mao- phersou a memorandum of the substance of the conference between those two gentlemen. Oi»MrH<> 103 That momorandum I believe to bo substantially correct from the information that I had from both of the gentlemen who attended it. I loft Toronto to go to Kingston, to attend to my own election, iuipresHed with the idea that there were no insupsrablo difficulties in the way of amalgamation. They had approached very nearly caoh other. There were only two points of differonce. The one was the question of the Presidency, and the other was the number of the Directors. With respect to the number of Directors, it was suggested that they should be thirteen. This suggestion emanated from the Gorernmeut. We took the number in the Cabinet, which was thirteen, as a sort of precedent, and it was suggested by the Government that the Board of direc- tion should be chosen in the same way that the Cabinet liad been selected ; that there should be five members of the Board from Ontario, four from Quebec, and one from each of the other provinces. That is a detail in which they varied from the cabinet, as there are no representatives from Manitoba and British Columbia in the cabinet. We thought that would be a fair mode of adjusting the representation of the Board, and adequate to represent the interests of the different Provinces on the Board. 1 think it was Mr. Abbott's proposi- tion on behalf of the Canada Pacific Company, that instead of thirteen there should be seventeen directors for some reason or another ; that it would require a larger number of members to represent all the interests ; but, as will be seen by the memorandum, Mr. Matpherson did not approve of this, but thought that this point might be yielded, although it was not, of course, 80 advantageous for Ontario to have seven representatives as against six from Quebec, as it would be to have five from Ontario against four from Quebec, on a Board of thirteen members. Then, as regards the Presidency, I^Ir. ]\Iacpherson always held to the same position ; that he did not look forward to it himself, he did not press his own claim for it in any way, but he thought that Sir Hugh Allan, from hia having originally made this arrangement with the Americans, if he were placed in the position of President, from his acknowledged wealth and influence, would have too much power oa the Board, and that he might exercise that power in favor of bringing in American Capital. Still it seemed to me, that as that was really the only questlou, that is, the question of the Presidency — that we were very near an amalgamation, and I left Toronto, as I have said, impressed with the idea that that difficulty would be removed or could be removed, and that there would bo an amalgamation. When I was at Kingston, attending to my election, I was communicating I may sny, with Sir George Cartier, giving him an account of the progress I had been making at To- ronto, and my communications were always of an encouraging nature because J believed that the two companies would b« amalgamated and we would get over this difficulty. When I was at Kingston Mr. Maepherson came there either to see me, or was there accidentally, I really forget which, but he was at Kingston, and we had a discussion about it, and I found the difficulty still existing about the Presidency, and I made up my mind that there was no use in attempting to procure the amalgamation before the elections, and that matters should be allowed to stand on the terms as discussed between ^Ir. Maepherson and Mr. Abbott at their meeting in Toronto. I telegraphed Sir George Cartier in that sense. That telegram is set out in the affidavit of Sir Hugh Allan made in ^M ontrcal. I have however got a rough draft of it. The telegram is dated the 2Gth July, and is herewith produced and iyled marked " G. " I may say, with respect to the expression in that telegram, " that this should be accepted by Sir Hugh Allan :" that I had regretted to find that there had been a sort of coolness between Sir Hugh Allan, and Sir George Cartier, and not only between Sir George Cartier and Sir Hugh Allan but between Sir George and his Lower Canadian friends. They had got the idea that Sir George was not so friendly as he ought to have been to the Northern Colonization Road, in which a large number of Lower Canadians took great interest, especially the Montrealers, and of which Sir Hugh Allan was President, and that in fact they had got the impression that Sir George Cartier was throwing cold water on all those enterprises which Sir Hugh Allan had entered upon, and this of course, unless it were removed, would be fatal to Sir George Cartier, and in Lower Canada would lose him Parliamentary support, and, of course, lose the Government Parliamentary i f I 104 support. Tho idea had been industriously spread abroad that Sir Ooorgo, oa being the Solicitor or Counsel of tho Grand Trunk llailwa^ Company, was not anxious to promote any Railway cntcrp/uu that might bo a rival or competitor of that Railway. This was so much tho case that a good deal of feeling had been created respecting Sir Ooorgo Cartior's supposed course of action, and that a deputation which has been already spoken of which I am aware had coino to Ottawa to press upon him so fur as they could tho necessity of taking an aotirc interest in the Northern Colonizatioi. road and other railways, extending the Northern Colonization west, in- cluding tho Pacific Railway, and thot the Montreal interest as represented by Sir Hugh Allan, should not bo ignored. I sent that telegram on the 2Gth of July, and I was glad to receive a communication from Montreal, I am not sure whether it was from Sir Qcorgc himself, or from Kr. Abbott or Sir Hugh Allan, but from one of the three, stating that Sir George had expressed himself with respect to all these enterprises in a manner which satis- fied the Montreal interest, including Sir Hugh Allan and his political friends in Montreal. And I may say here, that it was on hearing thaK that any communication arose respecting election funds. When Sir George Cartier and I parted in Ottawa, he to go to Montreal and I to go to Toronto, of course, as leading members of tho (Jovernment, wo were anxious for the success of our Parliamentary supporters at tho elections, and I said to Sir George that the severest contest would be in Ontario, where we might expect to receive all the opposition that the Ontario Government could give to us and to our friends, at the polls. I said to him you must try and raise such funds as you con to help us, as we are going to have the chief battle there. I mentioned the names of a few friends to whom ho might apply, and Sir Hugh Allan amongst tho rest, aud that ho was interested in all those enterprises which the Government had been forwarding. When, therefore, I ascertained that Sir George had put it all risht with his friends, I then communicated to my friends in Montreal, Sir George and Mr. Abbott, stating I hoped they would not forget our necessities ; that they would see to raise some funds for us in Ontario. On the 30tb., I think of July, I received a letter from Sir Hugh Allan, addressed to mo at Kingston, stating that he had come to an arrangement with Sir George Cartier. He did not send me a copy of tho arrangement itself, but he said he had come to an arrangement and had reduced it to writing, stating generally tho terms of the arrangement. I was not satisfied with this. It was not in accordance with my telegram of the 26th, and although it was exceedingly inconvenient for me, for I was in the heat of my election, and was receiving a most stern opposition, I telegraphed back at once that I would not agree to it at all, but that I would go down to Montreal that night or the next night, and see them, so that there might be no mistake or misapprehension in the matter. It appears that Sir George Cartier saw Sir Hugh Allan at once, and informed him that I objected to tho arrangement that had been made, and that unless the proposition contained in my telegram of the 2Gth July was adhered to, that I would go down to Montreal and discuss the whole matter with them. I then received two telegrams, one from Sir Hugh Allan and the other from Sir George Cartier, which I fortunately kept, which I shall read Tiiis is dated 31 st July. It is from Sir George Cartier. It commences as follows : "I have seen Sir Hugh Allan. He withdraws " the letter written to you, since you make objection to it, and relies for a basis of arrangc- " ment on your telegram to me, of which I gave him a copy, &c." I hereby produce and fyle it marked 11. At the same time I received this one from Sir Hugh Allan, addressed to myself of tho same date. It commences as follows : "I have seen Sir George Cartier to-day. You may return my letter, &o., I hereby produce and fyle it marked " I.'' That was the only arrangement that was ever made between the Government aud Sir Hugh Allan, or the Canada Pacific Railway C^iinpany which he represented, and I had no discassion or conversation in a contrary sense, either from Sir Hugh Allan or any member of his company, or from Sir George Cartier, from that time until this. That was the arrangement that was made, by which till the elections were over, the whole matter connected With the construction of the Pacific Railway, should stand in abeyance, and that after the elections were over an attempt should be made to amalgamate ; and that these two gentlemen 106 Mr. Maopborson, and Sir Hugh Allan, should meet in Ottawa, and form a Provisionnl Board. I 860 that it it) nicutioncd by .Mr. McMullcu in oiiu of his Icttcrn. that th«ro "oh a subsequent arrrao^^omcnt mudo on tho sixth of Auj^st betwcon Sir Ocorgc Cartier and Sir JIugh Allnn. If sucli an arrangement was made J am (|uitc unaware of it, and uiorc than that I do'nt b«lievo it. I am quite satisfied that if Sir George Cartier had made any such arrangement, he would have mentioned it to me. Sir George was a nmn of the highest honor, and between him and mjself there were no political secrets, nnd if he had made any arrangement of thot kind respecting the railway, he certainly would have communicated it to mo. I Observe that Sir Hugh Allan says in one of his letters, which lias been published, dated the Gth or 7th of August, ho "yesterday concluded an arrangement with Sir George Cartier." Tho way I read this is that by yesterday he meint u day or so before, which would bo about the 30th July when he signed these papers. After tho elections were over, wo reuowcd our ntt^u^pts tc promote the amalgamation of the Companies. .,'.... At my request, my colleague, the then I^ostmnstei' General, Mr. Campbell, went to Toronto, with what results you know from his own statement. Karly in November, about the 7 h or 8th of November, I went to Toronto, and once or twice I thought I had succeeded in ovci coming the reluctance of Mr. ^Macpher.son, but after di8;;ussing it with him frequently, and pressing all my views upon him, 1 had at last to leave Toronto unsuccessful in my mission. On my return to Ottawa the (Government then addresaed itself to the formation of a Company under a Royal Charter. As I have already stated the Government were satisfied that it would be in tho highest degree inexpedient and impolitic to grant tho con- struction of the Eoad to cither of the incorporated companies. We came to tho conclusion that we should exercise the power conferred upon us by the Government Act of the Session of 1872, and cnu» avor to form a company in which all tho different Provinces would be re^)rc- sented in one, at I have mentioned. And wc did grant that Charter as is known. In the selection of the first Board of Directors and shareholders, the Government had only the one object : that of getting men who would command the confidence of the country either from being men of capital or being men of known standing, or of being men especially acquainted with the subject of the construction of Kailwoys. The names of various gentle- men were discussed, some were originally selected and afterwards changed. At first the Government thought of some leading men who were in Parliament on account of their wealth and standing. There were several gentlemen who were selected who were members of one House or the othei, but afterwards, on consideration of the whole qutstion, the Government came to the conclusion that it would ho better to exclude all Members of Parliament from the Board. There had been a motion made in the House of Commons during the previous S^sion to exclude members of Parliament from the Company, and some feeling had been shown on the subject. The Government therefore came to the conclusion that under the circumstances it would be better to exclude members of Parliament from the Directory. And now 1 would state the reason, so fiir as I know them, why the gentlemen composing tho Board of Direction were chosen. In Ontario there were five gentlemen selected. Major Walker, of London, was chosen as being a man of standing and wealth, and at the head of the oil interest of western Canada. He had been connected with the Inter-Oceanic Company as a corporator, and ho was selected as representing the western interest. At first wo had asked Mr. Carling, the member for London, to b« a Director, but when we came to exclude members of I'arliament, Major Walker was selected iij Ki stead. Ho was selected without any reference to Sir Hugh Allan, or the Quebec interest at all. I don't know whether Sir Hugh Allan was acquainted with Major Walker before or not. Mr. Jlclnnes was selected as a leading merchant at Hamilton. He was known to Sir Hugh Allan. He was a member of the Canada Pacific llailway Company. He is a western man, and of high standing and character, and the Hamilton interest could not bo 14 106 ignored. Mr. McTnnes was in England at the time, and when selected by myself, I tele- graphed him by cable, and got his answer by letter accepting. Col. Cumberland was selected as being a Bailway man, and a CivU Engineer of high standing, and as being a great personal friend of myseu. He was going to England at the time, and I asked him if he would agree to serve. He said he would rather not, but that I might command him either ic the Company, or out ot the company, if he could be of any service, and I selected him. Mr. Sandford Fleming was selected by myself and he also went on the Board with the greatest reluctance, and it was only by my strong pressure that he consented. I aa&y add that Sir Hugh Allan was strongly opposed to his being appointed in the Board. He did not object to Mr. Fleming, from any personal reason, but he thoughi. that his services as an Engineer, would be of more value to the Company, if he were not i;: tbi. Board. I thought that it would be a great advantage to the Company to have a man of Mr. Fleming's standing- on the Board, and 1 insisted on his appointment. • ,',,^ , Mr. Shanly was the last; he was placed on the Board at my suggestion. I asked him to serve on the Board. He declined at first, and he came to see me especially on tbe Subject and at my earnest solicitation he became a member of the Board. He was a member of the Inter-Oceanic Board. The Directors for Nova Scotia and New Brunswick were selected by 1 ly colleagues in the Government from these Provinces. And 1 believe la both cases without communication with Sir Hugh Allan, and certainly not at his instance. With respect to Nova Scotia, Mr. Collingwood Schreiber, an Upper Canadian originally, but who had been connected with the construction of railways in the Maritime Provinces, was originally selected as a Director to represent Nova Scotia, but afterwards as Governor Archibald had returned frem Manitoba, and as he was a man of high standing and great jpfluenco in Nova Scotia, he was substituted by the Nova Scotia members of the Cabinet for Mr, Schreiber. Mr. Burpee as Mr. Mitchell has said, was chosen by Mr. Tilley and himteltj without any reference to Sir Hugh Allan. As regards the Members of the Board from Quebec, ihcre was first Sir Hugh Allan himself, Mr. Beaudry, a merchant of high standing in Montreal. He may be considered, though I don't in fact remember, as being selected by Sir Hugh Allan, as being his special choice. Mr. Hall was selected by Mr. Pope to represent the Eastern Townships on the Board. Sir Hugh Allan pressed strongly for the appf^intment of Mr. Foster, or a person representing Mr. Foster. 3Ir. Foster himself couM not be a member of the Board after we came to the conclusiou to exclude Members of Parliament, as he was a Senator. Sir Hugh Allan therefore desired to have a representative of Mr. Foster on the Board, but Mr. Hall was selected by Mr. Pope. Hon. Mr. Beaubien, the Commissioner of Crown Lands for Lower Canada, was named by Mr.Cjangevin. He selected Mr. Beaubien to represent the District of Quebec interest as separate from the Montreal district interest. ■ The charter was framed with great care. The principal heads of it were prepared by myself; that is, tbo leading principles of the Charter were jotted down by myself and acquiesced in by my colleagues, and were communicated to the gentlemen whom we had selected to form this Board. We had several meetings, I fancy in December and January, at Ottawa, where these matters were discussed. The provisions of the charter were added to and enlarged from time to time, and at last Mr. Abbott was pelected to meet Mr. Campbell and myself and settle all details of every nature. Mr. Abbott was acting not on his own account, but as I understood, as coun- sel ^r the new company, which was about to be formed. He was early selected as the fej^cal man of the company, and in that capacity he met us and we worked out the details, most painfully worked at them for a considerable time ; had theui printed and reprinted, and at last they assumed the form in which they now are in the completed charter. I think that I have given you a statement of all the facts connected with the promotion of the company and what 1 know of the communications and original arr»r jcnienta with the Americans. I may say, that every precaution that we could think of or that was suggested to us to prevent the Americans getting in either directly or indirectly so as to have control of I w 107 , H the Company, was adopted. In the first place, by the election of tho thirteen gentlemen who were not only Directors of the Company, out were also shareholders and held all the Stock. They were all geatk-men of high standing and Canadians, and certainly would not any one of them be in any way ?. party to handing over the Canadian Pacific Railway to fijreign control. They held the whole of the Stock and not a single share could be transferred for the first six years until the sanction of the Government had been obtained. The reason we selected six years was this — we gave the Company one year — to the first of January next — to raise the necessary foods, and we thought that after five years of active prosecution of the work there woald be ao (ear of the road getting into foreign hands, and that point once gained, the leas the (JoTemment had if, do with the Stock the better, for it would fetter the transfer of the Stock and of course render it less valuable. The uncertainty as to whether a purchaser would be approved of by the Government would operate against the value of the , Stock in the market. . :, l-r'^r^^i-l ^.ZZ'^r ^■.' '"""" Question — Hare you any further stateifiWto mike f*^ "' Answer — Nothing further occurs to me. I can state and propose to take up the question as to the contribution of election funds. As I have already mentioned, when Sir George Cartier went to Montreal from Ottawa, and I went to Toronto, I asked him to endeawr to get what pecuniary help ae could from our rich friends in Montreal; and when I was in Kingston at the time of my own election, I got a letter from Sir Ilugh Allan stating that he would contribute §25,000 to the election fund. He used the expre^ion that be would contribute $25,000 to help the friends of the Adminis- tration in their elections. I may say here that I considered myself a trustee to that fund, and certainly did not apply any of that money to my own election . Question — Have you got that letter ? , ' ' j • r/r ' ' . r \ Ajmccr — >oj I destroyed It. • ,,, y It was simply informing me that he would contribute to that extent. '^ '. I paid the ez])€nses of my own election ; and, in fact, I did not receive' any funds at all from Sir Hugh J flan until after my own election was over. I was at Toronto the most of the period during which the elections were being held, going off occasionally to one place or another to communicate with my friends. I got pecuniary assistance where I could. In Canada wc have not the same organization that they have in l^'ngland. "We have neither a Ileform Club nor a Carlcton Club to manage elect'' ns, and the leaders have to undertake that for themselvej% I found as the contest went on that it was getting more severe ; represratations were coming to me from all parts of Ontario that the Opposition, to use a general expression, had two dollars to our one, and I redoubled my exertions to get subscrip- tions frt m all our friends. Sir Hugh Allan was then in Newfoundland, as I understood, and I wrote twice personally to Air. Abbott, who was acting in Montreal for him, and twice received contributions t.» the extent of 810,000 each. Question — Were thcEe sums both from Mr. Abbott? ','" Atisuer — I am not sore, but I think so. » * Question— Th&t was in addition to the $2.5,000, making in all\45,000 ? Answer — Yes. I see that in one of 5Ir. McMuUen's letters, of the fourth of August, published in the Montreal Herald, he states that " over $100,000 were sent to Sir John A. 3Iacdunala the bargain. He then stated that Sir George sent to Ottawa aud received a telegram from Sir John Maodonald confirming his action. After this Allan said he proceeded paying out money until he had advanced $358,000 in addition to $40,000 drawn from New York." Now this is altogether untrue. He received no such telegram from me. He could not do so, bocanso I never was in Ottawa during that time. I was always in the west attending the elections. From the time I left Ottawa at the end of June or the beginning of July, until the elections were all over, I never was once in Ottawa, and I never made such a communication. It is altogether a falsehood. Then again as to tu.-^ meeting which he alleges to have taken place on the 31 st of De- cember, he says, " on the 31st of December, I had an interview of some two hours duration with Sir John, and placed him in possession of all the facts and showed him the letters which I had from Sir Hugh in regard to the matters as well as the original contracts, and the letters to the New York liailroad President, which were recently published in con- nection wtth other correspondence." He (Mr. McMuUen) came to me and complained very much of the way be had been used ; that he had devoted himself for some time to this sub- ject and had been thrown overboard. He did not show me those papsrs. He read me passages from some of the letters. I recognized some of the passages when I read the correspondence published as some of the passages read. I heard what he had to say and what I then said was that according to his own statement, if his statements were true, and those passages read seemed to carry out his statement that I thought Sir Hugh Allan had not used him well, I said " he ought to have been more frank with you. He could not if he had " tried obtained what he wanted to get. He must have ascertained that last session. He " could not by any possibility have eflFected the purposes you wished him to eF^ct of getting " your associates the American capitalists interested in the company. He could not do so, " the public feeling was so great." The feeling expressed in Parliament, and the policy of the Government were all opposed to it, so that, however willing or anxious, Sir Hugh Allan might be, to carry out that arrangement, it was impossible to do so, and his fault I thought was in not having at onco candidly told the American gentlemen with whom he had made this agreement, that such was the fact. On the 23rd of January, that was a very short time before the contract was signed, and after all arrangements had been made, and the selection of the Directors or most of them had been complete. Mr. McMuUen came accompanied by Mr. Smith, of Chicago, and Mr, Hurlburt, of CL icago, and they went over the story again. They told me that they had been very badly used, and they had in good faith adyanced for preliminary expenses of the Eailway, a sum of money, that is for the preliminary expenses of the Canada Pacific llailway Company which was incorporated. I stated to them that of course Sir Hugh Allan was liable to them for that money, and must it seemed to uic, as a matter of course refund it if he had not already done so. They said they would not put up with such conduct and would see him. I said it is your own aifair. Mr. McMullen said they would seize his ships in Amerit,4n ports and take proceedings against him. I said it was quite open for them to do so. I went so far as to say " I think you are quite ri<:;ht, if I were in your place I think I would proceed against him." They said they would go down to iMontreal, and both Smith and Hurlburt said " you must distinctly understand that we do not come hero for the purpose of black-mailing you or black-mailing the Government, but for the purpose of stating our case. In fact they wanted to know whether, by any chance, they could be admitted to have an interest in the Railway. That was, 1 understood the object of their communication. I said to them that it was utterly impossible ; that American capital must be excluded, and that the Company uust M 110 be fbrmed by Oanadinns, and was, in fact, in process of formatioD, ia the manner in which it now presents itself. They said tiiey would go down and see Sir Ilugh Allan, and return this way and see m^. 1 said I would be very g^d to see them, and if 1 could be of any service in settling matters between Sic Hugh Allan md them, I would be very glad. They did not come this way, however^ but I received a letter from Mr. Smith, of Cbioago, making a great complaint, that t|tcy were excluded, and he wanted to know if I would have any objection to their petitioning the Canadian Parliament for redress. I did not answer that letter. There is a report appearing in the Ghieago Times of September 3rd, which was sent to me, ooutaining an account of an interview between a reporter of that news- paper and Mr. McMuUen in Chicago. Question — Which Mr. McMullen ? ( ,. „ ,,l Answer— 'Mr. George W. McMuUeo. Most of that report repeats what has been alrsady published, but I wish to recall the attention of the Commission to it. He says : " That we went to Montieal in September, 1871 — and arranged preliminaries — Sir Hugh was to be the agent of the Government. Ho was to receive for himself a large interest, jind an amount of stock which was to ))e placed where it would do most good, and the cash instalments on the stock were to be advanced by us." ;,j,j. j^^^ ^ mvu The interviewer asked then—*' Was the Government aware of this? " >,, r.- , . . Mr. McMullen replied : " I tttld Sir John Maodonald all about it before our meeting with Allan. At the Premier's request I visited him after the meeting at Ottawa, and told him everything, and he was well satisfied." As 1 said before, I saw Mr. MbMullen at the St. Lawrence Hall, and he told liie what was doing. 1 heard him. On both occasions my statements were uniform, that the Government could not enter into any arrangement until after Parliament met. He reverts in that interview to a statement that Sir Hugh Allan had informed him that he had loaned $4,000 to me ; that Sir Hugh Allan had said so. "Sometime after this, Allan stated that he had loaned $1,000 and $4,500 to Sir John A. Macdonald and h^ir Francis Hincks respectively, with the knowledge that it was never to be returned." That is untrue. 1 have already explained why I believe that Sir Hugh Allan did not say so, and if he had said so, Mr. McMullen told me a falsehood when ho said that Sir Hugh Allan had never mentioned my name in connection with these transactions. Here is another statement. The Reporter says : " Have you any further proof that the Government was aware of Sir Hugh Allan's bargain with Cartier." Mr. McMullen said ; '' I do not feel at liberty to submit all for publication. I will give a short item that will probably be sufficient. Shortly after the elections were over, and while Sir Hugh Allan waa pressing for a fulfillment of his bargain he began to think that the Government intended to play false. He prepared a complete transcript of all the transaction between him and Cartier and Macdonald, the contracts, supplementary contract, orders for money. telegrams for money, telegrams of Sir John, and memoranda generally, ail ready for publication. On the following morning the (■Jovernment was notified of this, and they yielded to the threat." I can only say that I never heai'd of such a state- ment ; never saw it ; no such threat was ever made, and no communication of the kind was ever made. It is a falsehood complete and entire, without one semblance of truth. Here is another statement which, perhaps hereafter, before this Commission closes, can be more specifically replied to, as it ia not a subject with which 1 am very conversant. The reporter says: " Jiut $400,000 is a pretty good sum of money for one man to lose. Does Sir Hugh really suffer this loss t" Mr. McMullen says " Sic Hugh is rrcsident of the Merchants Bank of Canada, a very lai^e institution, which in its current report shows a Governn)ent deposit, without interest, of over $1,200,009, nnd as all itsfunds are directly under hiif control, it is safe to suspect that up to the present time he is even. 1 understand that anotli ■ Bank in IVIontreal furnished a portion of the sum by discounting not<'8 secured by Alan >i endorsement, and that these are still being carried. This bank also has over $300,009 of I luvcrnment money on the equally liberal terms of no interest." That statement is untrue. I dj not believe the Merchants' Bank have over at any time deposits of over $800,000 without interest. Funds accumulate in the different banks, and any profit goes to the share- h t Ill holders and in no Tray to Sir Iltigh Allah except as he is a shareholder. But the sum of 61,200,000 is altogether false. I think these are all the remarks I have to make. There is one more statement whish I desire to make injustice to Mr. Hillyard Cameron. It is stated that at my pressing instance. Sir Hugh Allan advanced money or discounted a note of Mr. Camorona' of some $5,000. Mr. MoMnllen says : " The Chairman of the In- vestigation Committee, applied through the Premier for a loan of $5,000 after the elections were all over, and as Allan supposed he was through pajring, he objected, but after a personal visit of the Postmaster-General to Montreal, and the urgent tclegraas and letters of Sir John who announced that it was to help us, the thing was done." The circumstance was simply this : Mr. Cameron told me — we are very great friends — that he was very hard-up, and that he wanted some money and was anxious to get a discount, and he asked me if I would drop a line to Sir Hugh Allan asking him to get his note discounted by the 3Ierchants' Bank. I wrote down asking Sir Hugh to use his influence to get a discount for Mr. Cameron for $5,000, and he got that discount. That is all I know about it. That was in January, before this investi- fation Committee, as it is called, was thought of. Parliament did not meet until March. Mr. [untington did not make his oharge against the Government respecting the Pacific Railway, until April, and such an idea as the charge being made or the Committee being struck, had certainly not occurred on the 23rd January, 1873. I have just this fiirthcr to say, that when it was proposed to strike the Committee, there was a good deal of excitement in the House at the time on the subject, as of course you cannot but be aware of, and it was the opinion, or it was believed, as it proved, that there would be a strong party struggle as to the composition of the Committ«e. I suggested some names to be on that Committee, to my friends. Mr. Hillyard Cameron was not one of those whom I suggested, and when I found it had been so arranged by some of our friends, I was disappointed and expressed my disappoint- meot. So that Mr. Cameron was put on that Committee I may lay, without my consent, I having suggested another and a different member of Parliament, and was quite disap- pointed that Mr. Cameron was selected. I feel bound to state this in justice to Mr. Hill- yard Cameron. Qiiestim — 3Ir. McMullen's lett'jrs seemed to allege that copies were given you of certain letters between him and Sir Hugh Allan. Did you see these letters ? Ansicer — On the 23rd of January he saw me and said he would send me copies, and he did send me copies. Question — Are th ie copies of the originals which were afterwards included in the sealed packet ? :'■ ..Ansjrc?'— Yes, I think so. -! 7iio.i; I have got them. Question — Are you able to state whether these copies you have are copies of the originals here? ^/L ' Ansica- — I have got all the copies. ' It would take some time to bring them now as they are at my house. Question — You will produce them to-morrow? Answer — I did not get them on the 23d of January. He promised to send mc copies of all the papers and I subsequently got them. Question — Had you any knowledge that that correspondence was going on at that time ? Ansicer — No. Question — When did you first become aware of it ? Answer — I became aware of this correspondence by seeing it in the Montreal Herald. Of course I was aware of the correspondence at the time I got the copies, and I next saw it in the Montreal Hkrald. And further for the present deponent saith not. And on this cighteentli day of September, reappeared the said witness, and continued his deposition as follows : Question — Have you any knowledge of the sealed packet of papet^ which was placed in the hands of Mr. Stnrnes. Ansirer — The first' I heard of these papers was when application was made on the floor of the IIou-sc by Viv Huntington to have them impounded. I then afterwards saw the packet iii If ;■ i. i!i 112 when it was produced before the Committee by Mr. Starnes. It was sealed and the Members of the Committee who were present put their initials in the vicinity of the seal, but it was not opened. QuestioH— la that envelope now shown to you the one which you saw ? Answer — I have no doubt but that is the one. I recognise Mr. Ilillyard Cameron's writing on it, and also that of Mr. Blanchet and Mr. Dorion. Question — Will you have the kindness to look at the letters contained in that sealed packet, and numbered from 1 to 19, and say whether the copies whieh have been given to you are copies of these letters ? Answer — I would say with respect to these copies, that Mr. McMullen, at the meeting which I have spoken of already, stated to me that he would send me copies of the correspon- dence between Sir Hugh Allan, and Mr. Smith and himself. He did send me copies of that correspondence two or three days after. I see in that correspondence two letters addressed to a gentleman in New York. These letters appeared in the Montreal Herald, and, I think, without the name of that gentleman. His name I see in those papers. These letters belong to that gentleaian, and I do not wish to be a party to making them public, but I will hand them into the Commission. On comparing the correspondence sent me with that in the packet which was placed in Mr. Starnes' hands, I may say that there are two telegrams, and a letter previous to the 8th of December, 1871, the earliest date of any communication in the packet. Question — Do these copies of the correspondence which were sent to you purport to be copies of a correspondence between Sir Hugh Allan, Mr. McMullen, Charles M. Smith, and tliis New York gentleman ? Answer — xes. Question — These otpies have continued in your possession since you first received them ? Answer. — Yes. Question — No copies of them were given by you to any person ? Ansicer — None. Question — I perceive that there are some statements in these letters, several of which I wish to call your attention to. In the letter of the 28th of February, 1S72, Sir Hugh Allan mentions the distribution of stock in the Canada Pacific Railway Company, $100,000 to Mr. Macpherson ; A. B. Foster, $100,000, and so on. Have you any knowledge of an arrangement between Sir Hugh Allan and these gentlemen, of that kind, or o"f any arrange- ment which Sir Hugh Allan proposed to make with respect to the distribution of stock ? Answer — Not the slightest. I never saw this document or knew that Sir Hugh Allan proposed to distribute the stock among Canadians in this proportion ; but I heard from Mr. Macpherson that in a conversation which he had with Sir Hugh Allan, that he had men- tioned or written the manner in which he thought it would be right that the stock in the case of amalgamation, should be distributed in Canada, but the particulars I do not know. Question. — Then there is the letter of the 7th of August, to which you have already adverted in your examination in chief. In the letters of the 6th and 7th of August, two distinct letters. Sir Hugh Allan states that " We (meaning himself and Sir George Carticr) yesterday signed an agreement by which on certain monetary conditions they agreed to form a company of which I am to be President, to suit my views, to give ipy friends a majority of stock, and to give the company so formed the contract for building the road — in the terms of the Act ot Parliament, whiih are $30,000,000 in cash, and 50,000,000 acres of land, with all the advantages and privileges which can be given to us under the Act," Have you any knowledge of what agreement he refers to in that statement ? Amicer — No, the only agreement is the one I have mentioned in my examination, namely : that of the 30th July, to which I objected. Question — You have no knowledge of such agreement being made on the 5th aud Gth August, by Sir George Cartier, or any other Member of the Government ? Answer — No, I don't believe he ever did make such an agreement. Question — Do you know of any agreement which was entered into between Sir Hugh Allan and Mr. McMullen, and certain capitalists in New York, in relation to the construction of the Pacific Hallway ? 113 Ansiver — Yes. Quest ion-A\hen did you first become acquainted with that agreement? Answer — I know that Sir Francis llincks had mentioned to Sir Hugh Allan the names of these gentlemen, and had suggested that Sir Hugh should put himself in communication with them. After that I cannot speak with any certainty. I was not aware that any arrangement had really been come to until shortly before Sir Hugh Allan came with those gentlemen to Ottawa, and then when they came to Ottawa we declined to enter into any discusaion of the matter with them. Question — Did you see the agreement? Answer — Not until I received a copy of it from Mr. McMullcn. Question. — Is it among the papers you handed in ? Answer — Ifo ; I h»ve only given you the correspondence. I also produce and fyle other papers marked " K." hough these I received at the same time as the copies of the corres- pondence, the papers 1 now produce show drafts of Sir Hugh Allan to the extent of $40,000 mentioned in Mr. McMuUcn's letter, and the contract as originally entered into in New York, with a modiiication of it afterwards. Question. — When was the decision arrived at by the Government to exclude American capital ? Answer — I do'nt remember when there was a formal announcement of our policy on that point, but from the time it was first mooted in the press that American capitalists who were seeking to be concerned in the construction of road, were interested in the Ameri- can Northern Pacific Eailway and other United States systems of railways, the Gov- ernment began more and more to doubt the expediency of allowing American capitalists to have anything to do with it. The Government was not favorable to allowing Americans to come in, inasmuch as we foresaw the difficulty of preventing the control of the road, after its construction, from falling into their hands if they were allowed to construct the road. This feeling grew in the country more and more intense as the subject was discussed by the press, and as public excitement and public feeling was increasing against it, the Government individu- ally, and as a body, before Parliament met, came to the conclusion that it was impossible to allow Americans to have any interest in the road. Question— "Was this before April, 1872 ? Answer — Before April, 1872. When Parliament met and I had an ^opportunity of seeing the Members of Parliament, it was then evident that this was the general, almost the universal feeling in the House. Question — Was any encouragement at any time given to the proposal to build the Road with American capital by tlie Government or any member of it ? Answer — No, except the commuMcation I have already mentioned made by Sir Francis Hincks, I am not aware of any communication of any kind between any member of the Government and these gentlemen. On the two occasions when these gentlemen were present in Ottawa I principally conducted the conversation with them, and certainly I gave no en- couragement to Mr. ilcMullen or the American capitalists. Question — Was there any communication or correspondence with Sir Hugh Allan on the subject which would lead him to believe that the Government would favor that mode of build- ing the road 1 . Answer — No, I am certain Sir Hugh Allan when he came up he found out that the Government and Parliament were equally opposed to the admission of American capital. Question — You say when Sir Iiugh Allan came up here he found that out. Can you fix the date ? Answer — No, I don't at all remember. I remember this fact, however, that Mr. Abbott who took a great deal of interest in the promotion of the Bill before the House stated dis- tinctly to me as a member of the Government that he had undertaken it on the solemn assurance that only Canadian capital should be concerned in the cnterprize, and that ho had that assurance from Sir Hugh Allan. Question — When did the Government first determine to unite the interests of Ontario and Quebec and the other Provinces together in one common Company for the building of this Road under the Eoyal Charter ? i!l K ! IS 11 I \ 114 Answer — Immediately after my return from Toronto, in November, I think. I got hero about the 22nd of November. Wc then came to the conclusion that we would not — althongh the Intcr-Uceanic Company had declined to have any amalgamation — give the construction of the road to the Canada Pacific Company, but that wc must issue a Royal Charter. Even if they bad consented to an amalgamation taking place between the two companies it would have been too late to amalgamate under the Act. By the Government Act it is provided that the amalgamation mu!- Question — Was it at that period that the Government determined on issuing the charter of the present Company ? Answer — I returned here about the 22nd November, and of course wc had no time to lose. We immediately addressed ourselves to get up a Company composed of representative men from all the different Provinces who w^ould accept the Royal charter. 115 Que$tion — Was that dotcruiinatioa the result of the fuiluro to bring about the amalga- mation ? Atisiccr — It was. Question — You etatcJ yesterday that the number of Directors in the Company is thir- teen, and the distribution was a good deal governed by the principle which had governed the selection of members of the Cabinet. Was there any inequality of condition or advantages among the several Directors? Amwer — There was not. I forgot iu my statement yesterday one or two points. In speaking of the personnel of the directory I forgort to allude to the two Directors from British Columbia and Manitoba. With respect to Manitoba the Government asked Mr. Donald Smith, a Member of Parliament from that part of the country, the representative man in Canada of the Hudson Bay Company, to be a member of the Hoard. The Government thought it would bo a great advantage to get the assistance and influence of that powerful corporation in England if the Company had to go to that market to borrow, to get them interested in the Pacific Railway, and wo asked Mr. Smith to become a Director, and with that view, and a person greatly interested in the matter, he attended several of the informal meetings that we had. We had a good many of them here, but when the Government came to the conclusion to exclude Members of Parliament, Mr. Smith was, of course, excluded, and we consulted him as to getting a representative man from Manitoba. He recommended Mr. McDermott, whom he represented to be a wealthy merchant in Winnipeg, for whom he acted and from whom he had procured a power of attorney to act. That is how Mr. McDermott was appointed. In the same way Mr. Helmoken of British Columbia was appointed. He is a gentleman of very high standing there, who was one of the delegates to Canada to settle with the Canadian Government as to the terms of Union between British Columbia and the Dominion, and who was afterwards asked to become a Senator, from his well-known high standing and character in British Columbia ; and I know as a matter *of fact that he was asked to be the first Premier since Confederation, by Lieut.-Governor Trutch. He also declined that. He is considered a man of high standing, and, therefore, we asked him to become a Director. He did become a Director, aad Mr. Nathan, a Member of Parliament from British Columbia, representing Victoria, was his attorney. I had forgotten to mention these two things. Then you asked me as to whether there was any advantage of one Director over the others. There was none. The plan upon which the Government acted was this : There were to be thirteen Directors, each to take one thirteenth of the stock, and each to pay up a tenth to form a deposit of $1,000,000 which the Government act required. We stipulated with these Directors, that they aliould be in fact Trustees for their several Provinces ; that they should not hold more than $100,000 each of Stock at first; on which they would each pay $10,000 ; and that they should give an opportunity to the people of their different Provinces to subscribe for the rest of the Stock as they chose. Such subscription being of course provisional, until sanctioned by the Government, as it was a provision that no transfer could bo made of any Share'' without the consent of the Government, and then in case the Stock w as not subscribed in the different Provinces whatever was unsubscribed should be placed iu the open market with the same condition that no person should get any Stock whatever until their names were submitted and approved of by the Government. Question — Who was elected President ? Answer. — Sir Hugh Allan. Question — Do you know whether ho was elected through the influence of the Govern- ment? Answei- — I know that he was not elected through the influence of the Government. I know it in this way; that ibr convenience sake I was made the sole means of communication between the Government and the Provisional Board of Directors. I know therefore that when they met I made no suggestion at all, because it was not necessary that I should do so. They all seemed to assume that Sir Hugh Allan, from his wealth and standing, and having taken it up first, was to fill the position as a matter of course. That seemed to be understood by all the gentlemen. If there had been any doubt about it, I should have carried out what I I 1. 1/ 116 said I would do in my telegram, I would have said I hope you will cloct Sir Hugh Allan, but T did not do so. Question — The Government did not find it necessary, then, to exorcise its influence, pro- mised by your telegram of the 2(ith of July ? Ansicer — They did not find it necessary. I do not remember mnkin Answer — Major Walker of London. Question — Does Sir Hugh Allan, in consequence of being President, enjoy any peculiar advantages, other then the distinction, of course ? Answer — The only advantage ho has is sittting at the head of the table regulating tho proceedings, and having the name of President, but by law he has no advantage, and that view I pressed strongly on Mr. Macr'ierson, and other members of tho Tnter-Ooeanlo Com- pany, and that every Director made his own position on the Board according to his ability. Question — Did Sir Ilngh then in the course of his negooiations in relation to this whole matter obtain from the Governmttnt any advantage greater than these other gentlemen ? Amiccr — No, none whatever. Question — 1 think you say in your exsiinination in chief, that after your telegram of the 26th July — after that arrangement was made — that these arrangements were made between Sir George Cartier and Sir Hugh Allan, with respect to the furnishing of funds for the support of the elections. Did you not state somcthini^ to that eficct ? Answer — No. I did not state that. Question — Have you any correspondence relating to that matter — of the money to be subscrincd in Montreal by Sir '^ .agh Allan ? Answer— ^0, 1 have not. Question — Was Sir Hugh Allan the only one that you mentioned ? Answer — I mentioned other names. I think it hardly fair to mention the names of those other gentlemen. I mentioned Mr. Brydges' name, and Mr. George Stephen's name, and several other names. 1 have no doubt I mentioned Mr. Ogilvie's name, and other friends. Question — Had you any reason for mentioning Sir Hugh Allan's name beyond that which actuated you in mentioning the names of the other gentlemen ? Ansiver — Yes I had. I thought Sir Hugh Allan was especially interested in getting a Railway Parliament returned, and that he was interested in piiataining the Government which would carry out the Eailway policy which they had inaugur ted. Question — Did you consider him then to have a direct personal interest in the result of the elections ? Aimccr — Yes. I considered him to hare a strong personal interest in this way. Sir Hugh Allan had, as is well known, a very large interest in the Steamships line and in getting freights for that line. He knew, as it was well known in the country, that there was an opposition line being got up under the auspices of the Grand Trunk Railway Company to run to England, and it is well known that he was alarmed at this, because he naturally assumed that if the rival line were connected with the Grand Trunk Railway there would be preference given to that line over his own in matters of freight from the west. Sir Hugh Allan, I think I am not wrong in supposing that this excited him very much and that it was the primary cause of his connecting himself with the Northern Colonization Road from 3fontreal west- ward, and encouraging the building of the northern Road between Montreal and Quebec, and the extension of the inner line between Ottawa and Toronto so as to have another and competing line which would give his line of Steamers fair play. I think I am not wrong in believing that this was the origin of his connecting himself so strongly and warmly with these lines, and these lines would not I think, especially the Road from Ottawa to Toronto, be early undertaken unless there was a chance of the Pacific Road going on westwards. I think he had a special interest in this line and the wo«tcrn extension, and besides as he expressed himself to me and every one else no doubt, he had a great pride at bia age and with his 117 moans and standiog in coDnooting himself with this great nntional enterprise. Sir Hugh Allan could have been under no mistake as to his position long before the elections took place with reference to the Pacific Railway. It wos not necessary for him to advance or subscribe one shilling in order to insure to himself, if he thought proper, an interest in the Pacific llailway Company. He knew in the first place that the Oanada Pacific Railway of which he was President, and the representa- tive man from Lower Canada, could not be ignored in any company that was formed to build the Pacific llailway. He must have ascertained early when Parliament met from the feeling in Parliament, that ho could not get for his Company the exclusive right to construct the Road. The interests of Ontario forbade that. His Company could not be excluded, but could only have an interest in common with Ontario. So that without his subscribing a single six- pence to elections, or to any other purpose, he knew quite well that the Quebec interest must be represented to any Railway Company that was formed, and that he was the representative man from Quebec, and would be supported by the whole influence of Quebec as such. The only danger was that the Railway Policy adopted by the Parliament, which had expired, might be reversed by the coming Parliament. He knew that the Policy of the Government in carrying out the Pacific Railway had been strongly opposed by the Opposition to the Government ; that it was argued very strongly that the road was bejond our means, and would over-tax our resources ; therefore, that was the danger to him. He desired to connect himself with the Pacific Railway, which would be the complement of all those other lines with which he had connected himself. And the whole Railway Policy of the Government might be reversed if the Opposition succeeded in carrying the Country. He was therefore interested in exactly the same way — to use an illustration from Engl&nd — he had the same interest in supporting the Government in its Policy in this country, as the great body of licensed Victuallers, in England, have to oppose the present Government there, because they disapproved of some of the legislation of the past, and fear hostile legislation in the* future. I considered that Sir Hugh Allan had a very strong interest in the securing a Government majority in the present Parliament. Question — You said that you received a letter from Sir Hugh Allan, during the progress of your election, subscribing $25,000 for election purposes? Answer — Yes. Stating that he was ready to sulrecribo $25,000. Question — What became of that letter ? Answer — I destroyed it ; it might have been stolen. Question — Did that letter contain any terms or conditions upon which the subscription was made ? Answer — None whatever. Question — Can you recollect the terms in which it was expressed ? Answer — I cannot pretend now to recollect the words, but it was simply stating that he was quite ready to help to assist in the election of the friends of the Government or our West- ern friends ; something like that, to the extent of $25,000. Question — Was that the only letter or communication you received from him on the sub- ject of his subscription ? Answer — That was the only letter I received from him, and I had no personal commu- nication with him on these points at all. Sir George Cartier doubtless had in Mont- real. Question — I think you stated that you received two other sums of $10,000 each ? Answer — Yes. I must retract my statement that they both came from Mr. Abbott. The first $10,000 was from Sir Hugh Allan, and I have no doubt that is the $10,000 mentioned in that communication of Sir George Cartier's. The other $10,000 I got subsequently from Mr. Abbdtt, Sir Hugh Allan being at the time in Newfoundland, I think. Question — These were all the sums ? Answer — Yes. Question — Was Sir Hugh Allan's subscription of the $25,000 before or after the 24th of August ? Ansiver — It was before the 24th of August. It was early in August, I think. Question — I see in that letter of Sir George Cartier's a reference made to terms and h\ ] 'i ■ '. I 118 oondttiona of bis ia a letter of tho 30th of July, and that ia ropoatcd ia tho postscript, llavo you over 800U that letter of tho 30th July ? Ansicer — Never uutil it was alludod to in the puhlicution. I have soon it biiico. Question — In whose hands is it ? Aiuiiver — la Sir Hugh Allan's hands. No doubt he has it to produce. I know tho general contents of it, but I cannot givo it with any dogreo of aceuracy. Question — That is tho letter to which reference is umde in this letter and postscript of Sir George Cartier's, is it ? Aiitwer — I presume so. Question — Because there was one letter of the itUtU July published. It is not that ? Annwer — No, it ia not the published letter. Question — What was the disposal of the money which was sent to you ? Answer. — I used it to aid our friends in the diflfcrent parts of Ontario in their elections. Question — Had you an Election Committee in your election at Kingston ? Answer — I had. Qucstior — Was any portion of it applied to your own election ? Answer — No portion of it whatever. Qticstion — Was any applied to re-imburs« what was expended on it ? Answer — As to rc-imbursing my espensea, I paid every farthing of my own election expenses, unless some of my oonstituenta paid some money that I do not know of out of their own pockets. I paid all the expenses of my own election and did not reimburse myself for any portion of my own election expenses out of these funds. On the contrary, I added to the election fund out of my own limited means to help my friends elsowhcro. Question — Do you know the entire amount Sir Hugh Allan contributed to tho clcctiona both in Ontario and Quebec ? , , Answer — I cannot speak wilu any certainty. Question — The second sum of money received by you, of $10,000, was in consequence, I think, of a telegram which has appeared ? Answer — I would not like to swear that I sent exactly that telegram, because 1 do not remember its terms, but I sent a telegram, and T. havs' uc doubt that this is the telegram. Question — It is given at the end of Mr. MeMnl!;>B i 'jtter? Answer-— Thtii was the second " and last time " i i appose. It says it will be the last time of callipg, so I take it that it refers to the laet .^ J 0,000. I have no doubt it did. Question — That telegram is dated 2Gth August, 1872, addressed to the Hon. J. J. C. Abbott, and signed by yourself. Is that the one you mean, " I must huvc another $10,000 ; will bo the last time of calling. Do not fail me. Answer to day '/" Answer — I have no doubt I telegraphed to him, and I have no reason to doubt that this is a copy of the telegram. Question — Was that telegram answered ? Answer — I have before me this telegram, " Draw on me for $10,000." I don't remember, but I have no doubt he did answer and did send me such a telegram. I did draw upon him for 810,000, and I would not have drawn upon him without authority. Question — Were there any other telegrams between you and Mr. Abbott, or Sir Hugh Allan, vi receipts rolating to money for election purposes ? Answer — No. There were no other tel^rams with Sir Hugh Allan, and those I have referred to. I may have telegraphed to Mr. Abbott in connection with tho elections, but I have no recollection of doing so. I may perhaps now refer to a statement which I see in tho Chicago Times, which I intended to have spoken of yesterday. It is as follows. The reporter asks him : " Can you prove that Sir John Macdonald knew of this bai^ain." Mr. McMullen replied, I can, and will even show his telegrams, ono admonishing Allan to shell out, because ho had a big thing ; another telegram declaring in the most positive manner that he endorsed the arrange- ment made by Sir Hugh with Cartier, and would hold himself bound by it. He confirmed the bargain unreservedly." Reporter asks can you prove that ? Mr. McMullen answers — I will put witnesses on the stand who saw the telegram, one of them a very prominent man and a friend of Cartier's. I will name the man who wrote the second of these transactions. 119 I can only nny tliat I never sent such a telegram. It in quite an untruth. I never sent any tclcgrnni to Sir IIu<,'h Allan, Haylnj; that 1 endorsed any arrangement mado by Sir George (Jartier and iSir llu;;h Allan. I cannot understand how the idea that I sent such a note or tcluj,'rain got abroad, or how Air. McMullen could have got the idea that I sent any such telegram to Hir Hugh, calling on him to ihcll out, for he had got a big thing. I have been thinking how he could invent such a thing, and the only duo I have is simply iliis : I remember in writing or telegraphing to Mr. Abbott, that I said that wc had a great enter- prise before us, and we should fight it out thoroughly. I mado use of some such expression to Afr. Abbott, as it was a great game or great enterprise that wc had before us, which was quite true, wo had a great game in seeking to carry as many elections as wo could in ( Janada, and to secure u majority. That is the only clue which I can think of in regard to that telegram. " A big thing " is an American expression which I never use that 1 am aware of. Question — Do you know what passed betwen Sir Hugh Allan and Sir George Cartier on the subject of this subscription ? Aiwirr — I do not ; I may say that Sir George wrote mo no letters ; he was then iu very bad health sinking under the disease which caused hia untimely death; what communications wc had were by telegraph and they were very short. Question — Was there any understanding that for any subscription more or less, direct or indirect Sir Hugh Allan was to receive any exceptional advantage from the Government? Answer — I say distinctly there was no arrangement that he was to get any advantage of any kind. ! T'- ""•: ' 'i' '''^ ' •"••' Qttestton—Whs ihero afty understanding? Ansicer — No understanding. There was no agreement or understanding to give him any advantage of any kind. Question — Have you any reason to believe that Sir Hugh Allan gave that large subscrip- tion in consequence of an expectation of any kind ? Answer — I have no doubt Sir Hugh Allan gave these subscriptions for the one object of sustaining the Government and their Railway policy in connection with the Pacific Kailway, he being assured that that policy would bo sustained with the inflnence and power of the Government if it remained a Government. To the Hon. Mr. Campbell, through the Chairman : — Question — You have had very many years experience of elections ? Answer — Yes. Q\iesiion — During thirty or thirty-five years ? Answer — During about forty years, from 1836. Qiiestimi — At all elections, 1 believe, there is a certain expenuiturc of money ? A7iswer — Yes. Question — What is the character of that expenditure ? Atmcf-r — It is an uncertain expenditure. There is what they call the legitimate ex- penses, which every candidate has to undertake — the expenses of canvassing, printing and advertising — those are the l^itimate expenses. There is also a very large expenditure, which is very common in this country, although it is contrary to the Statute. It is, iiow- ftver, I believe, so universal that I have never known any serious contest before an Election Committee on tliat ground. I refer to the expenditure for teams to bring the voters to the Polls. My experience has been, with respect to this item, that you cannot get the voters to come to the polls on cither sides unless some efibrt is mado to provide conveyances for them. Question — That constitutes a very serious item ? Ansicer — Yes, I have always understood that to be the chief item. Question — Then thert is more or less treating ? Ansicer — Yes, and dinners and things of that kind, all of which are contrary to tlie Statute, but they generally prevail in Canada. Question — Did you find at the elections which occurred last, in 1872, any particular necessity for spending money ? Ansirer — There was this necessity, that I don't suppose there ever was a Sorter struggle for the mastery tlian that which took place between the two parties, especially in Ontario 120 1.^ Every effort was made on both sides to carry their candidates. There was an unusual amount of exertion put forth; the exertions of the opposition being much greater in 1872 than they were in 1867. Question — The exertions of the opposition ? Anmver — Yes and of course there was a corresponding exertion made by ttie party to which 1 belong. Question — And there was a corresponding increase in the expenditure ? Answer— Yea. Question — You had a very general knowledge of the contest in Ontario 1 Answer — Yes. Question — You found that there was an expenditure of a much larger amount than usual on both side? ? Answer — Of course I am not in the secrets of the opposition, but I found such a concurrent opinion in Ontario from independent sources that money was being spent very largely, unusually so by the opposition, that I had no doubt ibou*> it. Of course some of those statements might have been exaggerated in particular localities, but the same report came from all q^uavters. I have recently seen pUtements that may perhaps at some time see the light verifying that fact. Question — You were at the head of t^e Government during the last elections, and also during tie previous general electicns ? Answer — I was during the election oi 1867, and of the last elections. I have been, i' ni/C at the head of the Government, a uiember of it since 1854, with the exception of the twenty months which Mi. Sandfield Macdonald was in power, and the six or eight days during which Mr. Brown was in power. Question — Is there any other machinery in Canada for raising funds to meet election expenses except the efforts of individuals ? Answei — There is no such machinery here as prevails in England. In each consti- tuency I suppose, the different parties raise a fund, aad they usually have a central fund. Question — There is no such machinery as the Cnrltoc Club and the Reform Club in lilngland, but the head of the government charges himself with doing as much as possible among his friends for the general funds ? 3.w5icer— 'The leaders of parties which divide the < ountry, exercise their influence amongst their friends to raise funds for that purpose. Question — You spoke of the appointment of Mr. Hall, and said that the first name su^ested was that of the Hon. Mr. Foster. Do you mean that the appointment of Mr. Foster was strongly pressed on the Government by any one. Ansicer — Before we settled that there were to bo no members of Parliament on the Board, Sir Hugh Allan and Mr. Abbott both asked that Mr. Foster should be appointed. The Government left that to Mr. Pope, who is a Member of the Government, and he selected Mr. Hall, as I understood on Mr. Foster saying that he would not resign his Senator- ship to become a Director. Question — That was just about the time of the Charter being signed? Ansicer — Yes, Question—TjTp tu that time Mr. Abbott and Sir appointment of ?fr. Foster ? Ansicer — Yes. And if I remember rightly Mr. Foster was offered a po. tion on the Board, if he would resign his Senatorship which I understood he icclined to. I was informed by Mr. Pope of the fact, and he selected Mr. Hall. If I rericmber i ghtly. Sir Hugh Allan desired that if Mr. Foster was not appointed some one representing h.'m should be chosen and he auggested his brother, I wish to make one remark. I stated that when Sir George Cartier and I paru.l, when ho wta^ to Montreal before the electiono, I suggested to him ccrtrin names besides Sir Allan, and I gave him those names. 1 uc not wish it to be understood that I that these gentlemen subscribed. I do not know whether thoj did or not, I merely suggested some friends of tho Conservative party. Hugh Allan had been pressing the Hugh know 121 And farther depon at taiih not, and this his deposition having been read to him, he declares that it cootainF the truth, persists therein and hath signed. Sworn and taken in part on the seven^nth day ^ of September, 1873, and remainder taken on I eighteenth day of said month, and the whole )■ acknowledged on the twenty-second day of | said month and year. J (Signed) JOHN A. MACDOXALD, (Signed), CHARLES DE\7EY DAY, Chairman. A. POLETTE, JAMES ROBERT GOWAX, C'ommissionert. i 1 IN THE MATTER OF THE COM^USSIOX Province or Ontario, City of Oitawa. Appointing Ciiaeles Dewey Day, Antoine Polettb, and James Robert Gowan, Commissioners to enquire into and report upon the several matters stated in a certain Resolution moved by the Hon. Mr. Huntington, in thellouso of Commons on the second day of April, A.D. 1873, relating to the Canadian Pacific Railway. Present : Tux Covk'ssioneks. On this eighteenth day of September, in the j'ear of our Loi'd one thou.'iand eight hundred and seventy-three, personally came and appeared before us, the above named Commiik%ionei:s, The HoNorRABLE ^TLOTOR L. LANGEVIN, of the city of Ottawa, who being duly sworn, depo"'-ui and saith : Questi'ci — You are aware Mr. Langcvin of the terms oi the charge recited in the Com- mission ; the alleged agreement with American capitalists for building the Pacific Railway ; the knowledge of the Government of this agreement, and the subsequent charge that there was an understanding between the Government and Sir Hugh Allan, and Mr. Abbott, to furnish funds* for promoting the elections in 1872, for which they were to receive the contract for brild>i«g the road. You are fauiiliar with these allegations, will you have the goodness to make a hutement in detail, giving all the facts within your knowledge, relating to these charges ? Ansir/>r — Aboct the arrangement for tho contract between Sir Hugh Allan and the American capitalists, I knew nothing until I saw it mentioned in the newspapers. I may say as was said by others, that the Government and the different Members of the Govern- ment, were from thi; Ijeginning opposed to Americans obtaining the contract and the control of the Cuaadian Pacific Railway, with the exception of Sir Francis Hincks, but finding afterwards that his colleagues were unanimous on the subject, he gave up his own opinion, and agreed with us that the company to be formed, should be formed by Canadians or British subjects. The charge made by Mr. Huntington that the Government oi Members of the Qoverument in consideration of funds to be furnished, or paid to the Government or any ^Member or 3[embers of th vernment, made any cgreement, or haJ any understanding with Sir Hugh Allan and M vbbott, or Sir Hugh Allan or Mr. Abbott, or any one else. 122 for the building o2 the Canadian Pacific Railway, or for the obta:ning of the contract, or for any advantage or any gain connected with it ; that charge is false. The Government never had any such understanding, or ever made any such promise or any such bargain, and in so far as I know, and I have no doubt that if it had b-^en otherwise I would have known it, there has been no bargain, no contract, no understanding of that kind between Sir Hugh Allan and Mr. Abbott or either of them, or the Americans on the one side and any member of the Govern- ment on the other. I try to make it as general and as special as possible, because I want to give a completd denial to the charge. I may now say about the giving of the contract to Sir Hugh Allan or to any one else, that the statements made by me here about the action of the Govern- ment are perfectly correct. The Government did not make any arrangement with Sir Hugh Allan, or with any one else, for the building of the Canadian Pacific Eailway until after t*ip. general elec^ious of 1872. Up to that time there was no promise or arrangement of any klf i made by the Government or any member of the Goternment about the building of the roau I may also add that the Government were determined from the beginn'ng to give no advan- tage to one Province over any other. 'Ve knew full well that Sir Hugh Allan was considered by the Lower Canadians as their representative man in this matter. We knew that he had taken from tho beginning a very important part in the promotion of the Railway ! but on the other hand we had to consider that this Railway was not for the Province of Quebec alone, but also for thi other Provinces, I should say for the whole Dominion. On the other hand the Toronto interest was very important. Our Toronto friends were very pressing, and by Toronto friends I mean the financial inteiests of Ontario ; that interest was very pressing, and, of course, they as well as the Quebec or Montreal interests were doing then: best to have the upper hand in this railway. We had therefore to be very careful as a Government, that no preponderance should be given to one Province over the other, but that in giving the charter the interests of the whole Dominion should be considered and taken care of. We therefore did all that we could to bring about aa amalgamation of the two companies ; that is to say the Canada Pacific Railway Company and the Inter-Oceanic Railway Company, the first haying as its representative Sir Hugh Allan, and the other the Hon. Mr. Macpherson. However, the negociations which we had with those two companies failed. We could not induce the Inter-Oceanic Company to amalgamate and therefore we had to decide what course the Gov- ernment should then take. We had only those two companies incorporated by Aotof Parliament. Were we to give the contract to one or the other, we would necessarily have given offence to one flection or the other, and also given an undue preponderance to one Province over the other. The consequence was tliat the (rovernment took advantage sf the clause in the Act relating to the aid that Parliament allowed the Government to give to this undertaking. Wc took advant- age of that clause, and formed a new company, compr sed of some of the leading men of the Canada Pacific Company, and of the Inter-Oceanio Company, adding to them some other leading men of the Dominion. The composition of the new company has already boon described by Sir John A. Macdonald, and I have only to say that I would have only to repent what lie has just said on that poiot. As to the nauios, that is a correct description. The charter of the Canadian Pacific Railway Company was given, I think, iu the first days of February, 1'87.'J, if I am not mistaken. Question — Will you now proceed to the other branch of the subject, respecting (he money furnished for the elections ? Anstcer — As I have already stated, there was no bargain of any kind. T liioan that neither the Government, noi any Member of the Government, so fur as i k;:ow — ai.d I would have known of it if it had been otherwise — made any bargainor agreen.;ntby wlii '\ lo Gov- ernment, or any Member of the Government, wa.« to receive any sum 0/ money, vf any advan- tage from Sir Hugh Allan, or from any one else, for the granting of the charter, or for the influence of the (Jovcrnmcntj or any nicmber of the Government, or for the services of the Government, or of any one of them. Respecting the sums of money that Sir John A. Macdonald had stated as having received for the Ontario Elections, I know nothing. Res- pecting the sums of money furnished to the Montreal Central Election Committee, 1 knew nothing either. During the Session of 1872 I had a conversation with Sir (Icorgo Carticr, my Quebec II) 'm. «l> ^ M^ 128 leader, oa the elections that were comiog on, and I stated to him that wo should divide the work ia Lower Oanada, in order that our friends should be able to refer with certainty to one of us, in case they needed advice or otherwise. It was so understood between us, and I went furth<^r. I told him the experience I had had at previous elections, and that I could not myself prov'de the funds that might be required in my region, without help from the oxterior. T'.dt, of course, I had friends that could help me to a certain extent, but that he was aware t.tat the great wealth of the Province of Quebec was centred in Montreal, and not in Quebec, and that, therefore, I would expect that wlenever he obtained from bis wealthy friends in Montreal, contributions to the election fund for the Province of Quebec /he should remember that I should have a share to help in the election contest of my region — that is, the eastern part of the Province oi' Quebec. Ho promised me that be would do his best. Whilst on this subject I may say, that alluding to the charge that has been made publicly in a letter published in the ilontreal Herald by George W. McMullen — a charge that Mr. Abbott had been authorized by, he does not say whom, to promise me $25,000 for my good will, or for my services, or future services in connection with the Pacific Railway, and that Mr. Abbott had reported having done so ; I may say first, that Mr. ;^ bbott novot told mc that he was authorized to promise me $25,000, or any other sum. Mr. Abbott never promised or offered me anything. He never spoke to me of anything of the kind, and therefore, in so far as I am concerned, that charge is false. I leave, of course, to 3lr. Abbott, who may be examined on a future day. to a^y whether he was authorizt i to do anything of the kind, and whether the charge made against him, that he said he baa promised anything of the kind, is true. So far as I am concerned, 1 say positi.cly that he never spoke to mc on the subject, and never promised me anything at any period. The only time I had a conversation on election matters with Mr. Abbott was, I believe, sometime during the session of 1872, when he, having occasion to come to my department, to see me about some matter connected with a public work in his county, I spoke to him as being one of my best political friends from my own Province, on the prospecic of the electoral contest that was to take place during the summer. 7. told him thai the last contest had been a severe one for me, in so far as my small purse was concerned, and that, of course, my position being more prominent now than it was then I was afraid that the claims or the calls upon me would be still greater, and on that he remarked that it would not be fair that the burden should all fall on my shoulders, but that ""'Brtainly I should be helped by my friends. That is the only conversation I ever had with Mr. Abbott on that subject, and of course it 's one of those conversations I could have had with any other political friend supporting me '\q Parliamcrt or supporting me out of Parlia- ment ; and I may add that Mr. Abbott never spoke to vr^ about the Pacific Railway, or the Bills that were before the House, and he never asKci iry support of any of the measures that were then before the House, or asked whether I would support or oppose them. In conse- quence of the conversation I had with Sir George Cartier, as I stated just now, during the elections of 1872, I received from Sir George Cartier, by the hands of Sir Hugh Allan, $15,000, he (Sir Hugh) stating that he was instructed by Sir George Cartier lo remit me that sum for the election fund of my region. Some time afterwards I received a note from Sir Hugh Allan stating that on my giving a receipt to Mr. Abbott he (Mr. Abbott) was instructed to deliver mc, also by direction of Sir George Cartier, $10,000 additional for the same object. As I was about leaving Ottawa for Quebec, during the elections, and under- standiug that Sir Hugh Allan had gone to Newfoundland, I telegraphed Mr. Abbott at Montreal to be kind enough to meet me on board of the Quebec boat at Montreal, which he did. 1 told him there that I had received a note from Sir Hugh Allan, as I stated just now ; that 1 had asked no money from Sir Hugh ; that the sum of $15,000 that he had sent me before came from Sir George Cartic ; that 1 had understood from Sir George Cartier that any sum of money that ho would send to me would be a portion of the subscription of his wealthy friends in Montreal, and that, therefore, I could not for a nwment think of giving a receipt or of receiving any money on any condition whatever, and that if this sum of $10,000 was not on the same footing ap the $15,000 first sent, I could not receive it. Moreover if there had been any niisunderstandsng ."bout tho first sum, and if that first sum was not a pure gift on the part of the subscribers to the fund, I would go down to Quebec, and would return that amount immediately. Mr. Abbott told mc that there must 11 1 ' f I \ i 124 be some miganderBtftnding, thai he vas sure that there must be no intention of putting any condition or exacting any receipt about this money, So ve parted. Mr. Abbott sent mo afterwards the $10,000 without any condition, and I believe stated that his explanation to me was the proper one. Some time afterwards Sir George Cartier whom I had seen en pas- sant in Montreal, and who had asked me in what position I found myself about the elections in my region, was informed by me that besides my own election and what I had contributed personally to others, I was shor'. tn the amount of 87,500 or $7,600. He told me he thought his Election Committee would /• 'o rrovide for that additional sum ; and somelline after- wards I received it with a note ur Hugh Allan, stating that Sir George Cartier had instructed him to hand me that amc I never had any communication on this subject with Sir Hugh Allan, beyond what 1 uave just stated. By my statement the Commissioners will see that none of that money was employed in paying the expenses of my own election. Question — Did you take as active an interest in the negotiations concerning the build- ing of the Pacific Railway in the earlier stages of it, as other members of the Cabinet ? Anstrer — No. The first negotiations were conducted by Sir John A. Macdonald principally. The negotiations between Sir Francis Hincks and Sir Hugh Allan and others were conducted as coming from himself at the beginning ; and as Sir John Maedonald stated correctly when we heard that he was favourhig the introduction of the American interest in the proposed Railway Company, we expressed our dissent from that action ; and i'roni that moment until the end, the cabinet never wavered on that point, showiDg their determination to exclude AmerioaTis from the Pacific Railway Company. Question — Do you recollect about the time that thf i decision was arrived at ? Answer — The formal decision on that point was, I think, in April or May, 1872, but I am not sure. Previous to the Session of 1872, that determination was arrived at on the part of the Government. Although, perhaps, it was not known to outsiders, yet it was the settled policy previous to the Session of 1872, and when we met Parliament and had an opportunity of seeing the members of the House of Commons, it was clear that any other policy would fail. Question — Were you present at any of the interviews mentioned by some of the wit- nesses, and also in Mr. McMullen'a letter relating to this matter ? Answer — No ; I was not present when the American gentlemen were there. At the first interview I understood that there were only two members of the Govern- ment present — Sir John Macdonald and Sir Francis Hincks. The second interview was re- ported to me on my arrival here, I think I had gone to Montreal or Quebec. Question — You have no recollection of having ever met those gentlemen in conference ? Answer — No ; I never met them. I never saw Mr. George McMullen. Question — Had you ever any conversation with Sir Hugh Allan on the subject of the agreement they had ente )d into ? Answer — No. Question — Then you knew very little of that ? Answer — Very little indeed ? Question — Did you take any part in the efforts which were made to bring about an amalgamation of the Inter-Oceanic and the Canada Pacific Companies ? Anstcer — Nothing more than as a member of the Privy Council. Question — You knew that the negociations were going on ? Ansicer — Yes. The action was determined in the Privy Council before being taken. Question — Respecting the organization of the Canadian Pacific Company and the appointment of Directors. You state that the evidence you would give would be that given by Sir John A. Macdonald ? Answer — Exactly what he gave. The Hon. Mr. Beaubicn, who was specially selected by me, was so selected to represent the interest of the District of Quebec, not as opposed to that of Montreal, but as being distinct from that of Montreal. That was the object I had in view in selecting him from that portion of Lower Canada. Question — Sir Hugh Allan was elected President of that Board ? Amwer — Yes. 1 11 i\ 125 i I) i Question — Have yoii any knowledge of any influence being used to procure Lini that position ? Answer — I am not aware that the Government used any special influence or any influ- ence to bring about his election. Question — Do you know whether his election was unanimous or not ? Answer — I understood it was. Question — You have no personal knowledge on that subject ? Answer — No ; I was not present. Question — Had you any communication with Sir Hugh Allan upon the subject of money to be furnished for the elections before your communication with Sir Gcerge Cartier ? Answer — No, never ; at no time. Question — You had no conversation with him on the subject ? Answer — No. Question — Do you know how much he subscribed in all for the elections ? Answer — No ; I don't know. Question — Have you in your possession the letter that Sir Hugh Allan wrote, to which you have referred ? Ansioer — No. I don't keep any of these letters, nor any letters that arc mere formal letters. It has al"'ay.- been a rule with me as soon as I have finished a letter to destroy it, unless it is an oflScial le.*fir to be fyled in the Department. But my own letters 1 destroy, and I think, by what I h. ve seen since, that I was perfectly right in this. Question — Do you remember the terms of that letter ? Answei' — No, there was nothing special in it. Question — Did it relate to the advance of that $10,000 ? Answer — Sir Hugh Allan stated, so far as I can recollect, that Mr. Abbott would pay me, or hand me, $10,000, and that Sir George Cartier had wished him to send it to me on my giving him a receipt. Question — Was that the only condition in the letter ? Answer — As far as I can recollect there was no other condition than that. Question — You have said, I believe, that you received another letter from Sir Hugh Allan enclosing the last sum you received ? Answer — No, I don't think there was any note with it, if there was any, it was simply stating that, " I send you $7,000, or $7,600, by order of Sir George Cartier." 1 think he must have sent some such a note as that, but I have no special recollection of it. Quettion — You don't remember the terms of the letter? Answer — No, it was nothing more than a mere business letter that might be written by one person to another. Question — He mentioned to you that he had sent you that sum of money ; did he say anything else ? Answer — No. Question — Did ho not say anything else ? Answer — He said, " by the direction of Sir George Cartier," or •' by the wish of Sir George Cartier." Question. — Nothing more than that ? Answer — No. Question — You say you mentioned to Mr. Abbott that unless it was a free gift on the part of the subscribers to the fund you would go to Quebec, and at once return the first $15,000? Answer — Yes. Question — Why did you make that remark ? Answer — Bpcause when I saw that Sir Hugh Allan, in bis letter, stated that Mr. Abbott had $10,000, which he would hand mo, oi send me, or pay me on my sending a receipt, or giving a receipt, I thought that meant that it was not a mere subscription, and therefore thinking that the same thing might apply to the first $1 5,000 that had been sent, and for which no receipt had been given, I stated at once to Mr. Abbott that if this money that had been sent by direction of Sir George Cartier, was not a mere gift on the part of the subscrib- if 126 I Mi! crs, I must return it, and I was going down to Quebec and would return it at once. The reason for that was apparent. The object I had in view when I spoke to Sir George Gartier in the Session of 1872 was to sec that the heavy expenditure of the elections should not fall on me, and that I should not be responsible for the whole amount, and if this had not been a mere gift on the part of the subscribers, I would have found myself responsible for tho whole amount, which I would not undertake to be. , Question — You use the word " gift '' in oj , sition to «' loan " — not a loan but a gift. Ansicer — Yes, that is what I mean. I wish to add in regard to Sir George Carticr on another point. It is that from the beginning he showed his opposition to the introduction of Americans or American capital in the Pacific Railway company to be established or to bo incorporated. He expressed himself so to me more than once, stating, I cannot recollect his exact words but the meaning of the conversation was this, that he would not allow the Americans to build our Railway. Their interests, commercially speaking, being different from those of the Dominion ; and that wo had in Canada and in England men who could find the necessary capital, and wbo would have the necessary skill to build this Railway. He was very positive and never wavered on that point. Question — Do you know anything of tho letter from Sir George Carticr to Sir Hugh Allan of date the 30th July ? Answer — No. I know of no letter except that which has been published in the news- papers. There is one of that date publi^aed. Question — Do you know of any other letter of that date which has not yet been pub- lished ? Answer — No. Question — Did Sir George Cartier mention any such letter to you ? Answer — I never had any conversation with him about that. To the Hon. Mr. Campbell throagh the Chairman : Question — You stated that you concur in Sir John Macdonald's statement of the mode in which the present Directors of the present Company were chosen ? Atisicer — Yes. Question — Did Sir Hugh Allan exercise any influence in the choice of these Directors ? Answer — No, not that I am aware of; and if he had exercised any influence there is no doubt I would have known it from the knowledge I had of the business of the Council. Question — Did not both Sir Hugh Allan and Mr. Abbott press for the appointment of a person in lieu of Mr. Foster, when the Government arrived at the determination that no mem- ber of Parliament should be on the Board, as Mr. Foster's nominee in fact ? Answer — Yes they did. Question — And no such appointment was made ? Ansicer — No such appointment was made. Question — They continued to press ibr the appointment up to the last moment, did they not? Answer — They did. By the Commissioners : Question — Who was the person put forward ? Answer — I think Mr. Foster's brother. Question — And they were pressing for the appointment of Mr. Foster up to ilie last moment, until they were told, in fact, it was no use ? Answer — Yes. Quc.:tion-Bo Sir Hugh Allan exercised no influence in the selection of the persons who are on the Board ? Answer — None whatever. f\ U 127 I) And further doponent saith not, and this his deposition having been read to him he de- clares it contains the truth, persists therein, and hath signed. Sworn and taken on the eighteenth day of" September, 1873, and acknowledged on the twenty sixth day of said mouth and year. (Signed), (Signed), HECTOR L. LANGEVIN. IjKI 41c. CHARLES DEWEY DAY, Chairman. A. POLETTE, JAMES ROBERT GOWAN, Commissioners i Province of Ontario, Citi/ of Ottawa. IN TliE MATTER OP THE COmilSSION Appointing Charles Dewey Day, Antoine Polette, and James Robert Gowan, Commissioners to enquire into and report upon the several matters stated in a certain Resolution moved by the Hon. Mr. Huntington in the House of ("ommons on the second day of April, A.D., 1873, relating to the Canadian Pacific Railway. Present: The Commissioners. On this eighteenth day of September, in the year of our Lord one thousand eight hundred and seventy-three, personally came and appeared before us, the above named Com- missioners, SA.NDrORD FLEMING, of tho City of Ottawa, Civil Engineer, who being duly sworn, deposeth and saith : Question — You reside in Ottawa, I believe ? Ansiver — Yea at present. 1 am a Civil Engineer. Question — Do you know Sir Hugh Allan ? Ansu-er — I know him very slightly. Question — ])o you know Mr. G. W. McMullen ? Answer — 1 do not know him. Question — Have you any knowledge of an agreement between Sir Hugh Allan and Mr. G. W. McMullen, representing United States capitalists for the construction of tho Canada Pacific .T{ailway with American funds ? Ansiver — None whatever, except what I have recently seen in the newspapers. Question — Were you brought in relation to tho parties to that transaction at the time it was going on ? Answet- — Not at all. Quest io7i-— Yon therefore know nothing at a!l about it? Answer — Nothing of iny own knowledge. Question — Have you over had any conversation with Sir Hugh Allan relating to it? Answer — No conversation whatever. 1 i 128 Question — You were I think pno of tho Provisional Directors of the Canada Pacific Itaiiway Company ? Amicer — My name is in tho Charter of tho present company. I was not con- nected in any way with any of the ccrapanies tliat were incorporated by Act of Parliament. Question — When did you first become interested in tho movements for tlic con- struction of the Pacific Itailway ? Answer — In 1871. I was called upon by the Government to conduct tho Burvc3'8. Question — ^That was all your connection with it until you were appointed a Director of the Canadian Pacific Railway Company ? Ansioer — Yes, until I was asked by Sir John Macdonald to consent to be one of the Directors. Question — About what time were you requested to become a Director 1 Anstcer — It must have been in January of this year, 1873. I am not quite sure, but I think it was only about two or three weeks boforo the date of the Charter, the Charter is dated the 6th of Pebruary. Question — How many Directors are there upon that Board 1 Answer — I believe there are thirteen names in the Cliarter. • Question — ^They are all upon an equal footing as Directors ? Answer — Yes. Question — ^Who is President ? Ansicer — Sir Hugh Allan. Question — Were you present at his election ? Answer — ^I was. Question — ^Was there any difference of opinion on his election? Answer — ^I don't think there was. It seemed to be agreed upon by common consent that he should be President. Question — ^What were the motives which induced the unanimous election of Sir Hugh Allan ? Answer— 'He had taken a very active part in the whole affair, and he was one of the wealthiest men, if not tho very wealthiest man. He seemed disposed to embark his capital in this enterprise to a veiy large extent, and it was also thought that he would as President, be better ablo than almost any other man to influence capitalists in England to join in the work. Question — Was it considered an advantage to tho undertaking to have him at tho head of it as President ? Answer— It was then considered so unquestionably. ' Question — You have extensive experience and reputation, and knowledge as an Engineer, Mr. Fleming. Can you give an opinion as to tho pecuniary promise of this enterprise under the Charter. Does it appear to you to be of a profifable character ? Answer — Anything I can say on that head must be very spocalative. I suppose I have had a better opportunity of judging than any other member of tho Board, on account of being connected with tho surveys ; but I always had grave doubts about the financial success of the scheme. Question — Did you acce})t a Directorship from a desire, or with tho expectation of making money out of it ? Answer — I accepted a Directorship because it was pressed on me by tho Premier. I hesitated very much about accepting it, and did not do so solely with the idea of making money out of it. Question — Do you know anything about the general elections in 1873 — about tho raising of funds for the purpose of carrying them on ? Answer — Nothing whatever. I was not in this part of tho country at the time. Question — And nothing has since come to your knowledge with respect to these elections ? Ansicer — Nothing, except what anyone can read in tho public papers. k 129 i Question — You stated tho reasons wliich pcemcd to operate with the Board in Holocting Sir Ilugh Allan as President. Wore they tho reasons which operated with you, that is, liis wealth, his position, his facility for obtaining means and so on ; were these tho reasons which operated with you ? Answer — I think so. Everything pointed to Sir Hugh Allan as the proper man. Question — Had you any other reasons than those you have named, for giving him your Bupjwrt as President? Answer — I never gave tho matter very much consideration. Everything pointed to Sir Hugh Allan as tho proper man to be President of the Company. His name was first on the list of names given in the Charter, and ho had no rival. Question — Was any influence used with joxi personally to induce you to support Sir Hugh Allan as President ? Answer — I am not aware of any. It seemed to be generally understood by everybody that ho should be President. Ho seemed to have no rival. And further deponent saith not, and this his depositiou having been read to him, he declares that it contains tho truth, persists therein, and hath signed. Sworn and taken on the eighteenth day of September, 1873, and acknowledged on the twenty-nintli day of said month and year. (Signed,} (Signed,) SANDFORD FLEMINC CHARLES DEWEY DAY, CJiaimian. A. POLETTE, JAMES ROBERT GOWAN, Commissioners. Province of Ontario, ") [ IN THE MATTER OF THE COMMISSION Cifi/ of Ottawa. ) Appointing Charles Dewey Day, Antoine Polette, and James Robert Gowan, Commissioners to enquire into and report upon the several matters stated in a certain Resolution moved by the Hon. Mr. Huntington, in the House of Commons, on the second day of April, A.D. 1873, relating to the Canadian Pacific Railway. Present: The Commissioners. On this nineteenth day of September, in the year of our Lord one thousand eight hundred and seventy- three, personally came and appeared before us, the above named Commissioners, Sir HUGH ALLAN, of the City of Montreal, Knight, who being duly sworn, deposeth and saith : I am a resident of Montreal. Question — You have taken an active interest in the ncgociations and operations for tho constructing of the Canada Pacific Railway ? Answer — I have. Question — There are a number of letters which have been found in a package entrusted by you and Mr. G. W. McMullen, whom I suppose you know, in the hands of Mr. Starnes, n s 180 and wo desire, in the first place, to prove those letters to bo in your handwriting ; will you take the package and examine it and state if they are so ? Answer — ^AVith reference to the parcel itself it was not I who put it into the hands of Mr. Starnes, or made it up. I cannot swear positively as to the originality of the package. I can, however, identify my own handwriting. Question — These letters now shown to you, were they all written by you to the gentle- men to whom ihey are addressed ? Answer — Yes ; they were private letters for private information, and not for publication at all. Question — Are the telegrams also correct f Answer — 1 ihink so. I have only a knowledge of their general terms. Question — Are there any other contents in that sealed package which you cnn identify ; that is, for instance, the sealed packet and other documents, ono n letter addressed to the Hon. Henry Starnes, is that your letter] Answer — Yes ; that is my signature. Question — Is that Mr. Mc3Iullcn's signature to it also ? Answer — I think so. There is also another envelope here containing a cheque for $17,500, and I hereby produce and tyle it marked " N." Question — What was the letter addressed to Mr. Starnes with the memorandum and agreement ? Answer — The letter is herewith produced and fylcd, marked " 0." Question — You have said that you have taken an active interest in the negociations for the construction of the Canada Pacitic Ilailway. I will now read to you the formal charges that have been made against the Government on that subject, with the view of receiving a statement of what you know about them. Will you have the goodness to state all the facts within your knowledge relating to the subject matter of these charges ? Answer — If the court will permit me, I will read a statement which I have drawn up relating to the matter. With reference to this statement, and any other I may make, I wish the court to understand that at this distance of time — from one to two years — during which many changes have taken place, and as a matter of course, I cannot exactly charge my memory as to conversation about facts and figures which then took place, and therefore I can only state what occurred to the best of my knowledge and belief. The witness then made the following statement : I have for some years past taken a strong interest in the development of railway com- munication throughout the Dominion of Canada, and particularly through the district of country lying to the westward of Montreal, with a view to increasing the facilicies of com- munication between the sea-board and western America. And that, amongst other projects, my attention was early directed to the scheme for constructing a railway between Montreal as the m'.^t westerly Atlantic seaport, and the Pacific Ocean. That in the Autumn of 1871, I learned in conversation with Sir Francis Ilineks, that certain American capitalists had proposed to the Government through Mr. Waddington to organize a Company for the purpose of building the Canadian Pacific Railway, but that no action had been taken upon their proposition. That, thereupon, inasmuch as vo movement appeared to be contemplated in Canada, for the purpose in question, and I doubted if Canadian capitalists could be induced to subscribe to it to any large extent, I obtained from Sir Francis Ilineks the names of the persons who had been communicating with the Government, and immediately placed myself in correspon- dence with them, for the purpose of endeavoring to form a Pacific Company, in advance of the measures which were expected to be taken by the Government at the then ensuing Session of Parliament. That, acco.dingly, after a certain amount of negociation, I visited Ottawa in company with some of these gentlemen, and we had an interview with the Government, referred to by Sir John, on or about the 5th October, 1871. Sir John's account of that interview, accords perfectly with my recollection of what took place. On the 23rd December, 1871, I entered 181 into an agreement with certain Araorioan capitalists. I now produce a copy of that agree- ment, omitting only the names of the other signers, which 1 conceive I have no right unnecessarily to drug before the public. The witness hero reads the agreement, a copy of wliiuh is produced and fyled marked There was also a supplementary contract made at a future day. I had no recollection of this contract until within the last few days and if I liad been asked, would have said I had never seen it. There is no question but that the contract was entered into and that I was one of the signers. Witness here reads sup[)lcmcntary contract, a copy of which is produced and fyled, markud "Q." Neither the Government as a whole, or any member of the Governmuut, ever saw that agreement or had any knowledge of its existence as far as I know, until very recently. On looking at the deed of agreement it will be seen that it was stipulated that the Iload should be built by the route and on the terms prescribed in the Act to be passed respecting it, and it was further understood that in addition to the route north of Lake Superior u branch was to be constructed from Lake Nipissing to Sault Ste. Marie with a branch to Georgian Bay near the mouth of French River. At Sault Sto. Marie the river was to be bridged and the line carried along the south shore of Lake Superior to Duluth where it would join the North Pacific from which line another branch would lead to Fort Garry. Vrom Fort Garry westward to the Pacific it was intended the Iload should proceed on the route afterwards determined by the surveys and it was regarded as a possibility that the northern Pacific when it got as far West as the Missouri River might be defected so as to join the Canadian Pacific, get the advantage of our easier pass through the mountains, and run on its track to some point west of the mountains where they would again separate ; the iSji Northern Pacific passing south to New Westminister, and the Canadian Pacific seeking the ^ shore of the Pacific Ocean at such point as determined by the surveys. I favored this scheme, because it not only gave us such a Pacific Railroad as we might desire, but also the advantage of a direct connection with the States of Northern 3Iiohigan, Wisconsin, Minnesota, and JDakotah, the traffic aiid produce of which would naturally find its way to and from the seaboard through Canada, as being much the shortest, and consequently the cheapest route, even for the traffic of New York and Boston. Thus in place of, as has been alleged, sacrificing the interests of Canada to the United States, these plans, if carried out, would have been a greater benefit to Canada than any other scheme of communication that could be desired, and would I'v: given a double com- munication with Fort Garry. And with regard to this agreement, i uiost distinctly and ex- plicitly declare that neither in the agreement itself, nor in any conversation or negociation connected with it, was there any stipulation, statement, or expressed plan, which had for its object any retardation of the work, or any other parpose, than its completion throughout, at as early a day as would be consistent with reasonable economy in building it. And more parti- cularly I declare that there was no intention expressed or implied, either in the agreement or in the negociations which accompanied it, of placing it in the power of the Northern Pacific Railway, or any other company, or body of men, to obstruct the enterprise in any manner or way whatever. I am bound to say here that these New York gentlemen behaved throughout all my ne- gociations wTlh them in the most honorable and coniistent manner. Although the organization at first gave them a majority of Directors, when it was thought that this might give rise to objection, they at once agreed that the majority should be Rrilish subjects, residing in Canada; and they consented to abide by all the regulations and conditions that the Parliament or Government of Canada might impose upon them. They never pro- posed to make the Road subservient to the Northern Pacific, nor to use it in any way other- wise than for the b-ist interests of Canada. It was arranged that the Americans would advance money for necessary preliminary expenses, and they paid in $40,000 American currency for this purpose. A large portion of this was spent to their perfect satisfaction, but owing to the subsequent changes in the aspect of aifairs I thought it better, without any application from them to j \ 132 return to them the entire amount, and I did so. There was no other money contributed by the Americans in any form or for any purpose to which I was a party. Soon after my return from New York 1 wrote to Toronto with the view of enlisting gentlemen in the scheme, and the first person I applied to was the Hon. D. L. Macpherson to whom I explained the whole scheme, and asked him to join the organization. This be declined to do on the plea of its connection with the Americans. I found the general feeling of the people in Toronto rather cool towards the Pacific Rail' road, because their city did not Ho on the direct line of the proposed Houd, though they could not deny the great merits of the scheme in a public point of view. They feared the western tarffic would by the proposed road be carried past them to Lower Canada. No further stops of importance were taken by myself or associates up to the time of the opening of the Session of Parliament at Ottawa in respect of the projected company, except that 1 placed myself in communication with the Qovornmont, offering to organize a company which would untertake the construction of the road, and discussing tlio question of the facili- ties and aid which the Government would probably recommend to be furnished by the country, and in the course of these discussions and negooiations I endeavored, as far as possible, to secure for myself the position of President of the projected company, which was the positi uiy associates were willing to allow me ; and to which I thought myself entitled from t active part which I took in the great nationul iiterprisc to which the agreement and negooia- tions in question had reference. And as to this point I had reason to believe from the first that the Government was prepared to admit my claim. That when the time for the Session of the Canadian Parliament approached, I applied to Mr. Abbott to prepare the requisite legislation; and shortly after Parliament had opened, I proceeded to Ottawa for the purpose of ascertaining how matters were progressing and what prospect there was of a successful prosecution of the undertaking by myself, and the persons who were then associated with mo. That previous to this time, however, I had communicated with a large number of persons in Canada on the subject of the proposed Company, requesting their co-operation and assistance, and endeavouring to induce them to subscribe for stock to such an extent as I thought fair, considering their position and means. And though I did not meet with any great measure of success in procuring subscrip- tions of stock, yet it was quite as great as I had anticipated when making my arrangements with the American capitalists. In my negooiations with them therefore, I provided for the distribution of the stock which those gentlemen were willing to subscribe, or which I be- lieved they would eventually be willing to subscribe upon the formation of the company, as mentioned in my letter of the 28th February, 1872, already referred to. When I visited Ottawa aa stated in the last paragraph I ascertained by personal observation and communication with the members of the IJouse, that a strong prejudice had arisen against any connection with American capitalists in the formation of the proposed company, the fear expressed with regard to that subject being that such capitalists would find it for their interest rather to obstruct tho Canadian Pacific, and further the construction of the Northern Pacific, than to act in the interests of Canada, by pressing forward tho Canadian Hoad. . And though I did not share this fear, and always believed and still believe that the persons who proposed to be associated witli mo would have gone on with tho enterprise in good faith, to the best of their ability, yet I fouud tho feeling for the moment so strong that I judged it expedient and proper to yield to it, and therefore consented that tho legislation to be presented to the House, should exclude foreigners from the company, and that the Directors should be exclusively Canadian. A Bill incorporating the Canada Pacific tJompany was then introduced into the House by Dr. Grant, who had been a prominent advocate of the Canadian Pacific scheme, and had in- troduced in the last prcMOus Session a similar measure at the instance of the late Mr. Wod- dington and others, who were then interesting themselves in the project. Notwithstanding that the Bill which was so introduced, contemplated by its terms the exclusion of foreigners, I did not feel by any means convinced that the Government would in- sist upon any such condition, believing as I did, and do, that such a proposition was impolitic and unnecessary. I did not, therefore, feel justified in entirely breaking off my connection % 133 . » with luy Amcrioan nasooiatos, although I ncqumntcd them willi the difficullv which might arise it the riovernment took the same position which the majority of the people with whom I conversed at Ottawa appeared to do. 1 was awnro that by the terms of the Bill introduced by the (Tovcniment, they would have a eontrollinj^ power as to the terms of the contract, and I was willing to abido by their decision as to tiio extent of interest, if uny, which foreign- ers might be permitted to hold. And until that decision was communicated to mo, I felt in honor bound by the agree- ment I had made to leave the door open for the entrance of my American associates into the Company, unless the contingency arrived of a distinct prohibition by the Government against admitting them. And in informing them of the progress of the affair in Canada, as I did on certain occasions as an individual and without implicating the Company, of which I was a member, I consider that I was only acting fairly by them. And I did not intend thereby to bind, and as I conceive did not in any way bind or compromise, to my views, the other members of the Canada Pacitio Ilailway (7ompany, with whom I did not think it necessary to communicate at all on the subject of my occasional correspondence with my former American associates, the more especially as th correspondence was entirely private and confidenoial, and, moreover, was written with sui li inattention aa to accuracy of expression as might bo expected in correspondence intended only to be reen by those to whom it was ad- dressed. During my stay at Ottawa I had some communication of an informal character with members of the Government, and I found that they were still disposed to rccognizo the value of my services in endeavoring to organize a company, but in view of the rivalry which appeared to exist in respect to the Pacific scheme, and the strong array of Canadian names which had been obtained by the Inter-Occanic Company as associates in its project, nothing definite leading mc to expect any preference for myself or for the Company which 1 was endeavoring to organize, or indeed anything definite relating to the project, was said by the members of the Government with whom I then communicated. It appeared to mo that while their intentions and opinions had been freely expressed to mo when no Company other than that which I wag proposing to organize was likely to be formed, the presence of compe- tition amongst Canadians for the contract had decided them to allow matters to take their own oourse until they should have been enabled to decide after the formation of the Canadian Companies what line of conduct would be most conducive to the interests of the country. And there was, therefore, very little said or done during the Session which gave me any clue to the views of the Government with respect to the course of action which they would probably ultimately adopt. In order to make my narrative intelligible, it is neccssaay I should recall to mind the Legislation of the Session of 1872, as regards the Pacific Railroad. During that Session two companies were incorporated with precisely similar powers. The Inter-Oceanic Com- pany, of which Mr. Macpherson was a leading member, and the Canada Pacific Company in which I took a prominent part. The Acts of Incorporation of these Companies conferred on them no grant or right to the contract. A third Act was passed, a Government measure which empowered the Government to grant 50,000,000 acres of land, and $30,000,000 in aid of the construction of the Ilailway, and to contract for its constrnction and running, either first with any Company incorporated for tho purpose during that Session, or second, with any two or more companies amalgamated for the purpose, or third, with any Company which the Government might create by letters patent for the purpose. After the Session tho Canada Pacific Ilailway Company, of which I was a member, pro- ceeded to organize and notified tho Government that they were prepared to take the contract for building and running the Pacific Railway on the terms and conditions mentioned in the Government Act. They caused stock books to bo opened in various parts of the Dominion, in conformity with the act, and took such initiatory stops and such other proceedings as were necessary to enable them to act as an organized corporate body. That it soon after became evident to me that the Government would be best pleased to see an amalgamation of the two companies incorporated by Parliament, in order that united action might be secured and the greatest strength obtained in the formation of a Canadian Company. I therefore opened n<^ociations with the Inter-Oceanic Company, for the purpose of endeavouring to effect such an amalgamation, and at the same time the Canada Pacific Company placed 134 ?i itself ia communication with the Government with relation to the same auhject. It was thereupon intimated that the Government were also desirous that the amalgamation should take place. That thereupon, Mr. Abbott, a member of the Canada Pacific llailway Com- pany, proceeded to Toronto to meet Senator Macpherson, and if possible to arrange terms of amalgamation that would be satisfactory to both companies. And after a discussion of the matter during two or three days, in Toronto, between him and Mr. Macpherson, he r'^ported to the Canada Company that there did not appear to be any material difficulty in the way of our amalgamation, except that the chim which I made to be President of the amalgamated compcuy, and to have the nomination of an -jqaal number of the members in the new Board to that nominated by Mr. Macpherson, could not be acceded to. Mr. ^[acpherson's proposal was, that he, aa representing the Jnter-Oceanio Company, should have the nomination of a larger number of nembcrs in the amalgamated company, than I, and that the question of the Presidency should be left to the Board of Directors. With regard to the Presidency, Mr. Abboti. informed the Company that Sir John Macdonald expressed himself as being favour- able to my election as President, and that any influence the Government might possess among the members of the amalgamated Company, would be exercised for the purpose of aiding in my election to that office, and that probably the difficulty as to thi nomination of members to the new Board betwefu myself and Mr. Macpherson, might be obviated in some way. In other respects he reported that he could find no divergence of opinion as to the amalgamation of the two companies between myself and Mr. Macpherson. After receiv ng Mr. Abbott's report of the ncgoc'ations at Toronto, I felt satisfied that no difficulty would occur in bringing them to a Ducces?ful ttrminai.ion. And is the late Sir George Cartier happened to b'j in Montreal shortly afterwards, and I was taking con- siderable interest in his rc-electioa, I met him and had an unofficial conversation with him on the subject of ♦he charter, on several occasions urging ihat the influence of the Government should b2 used to procure the amalgamation upon such terms as I considered would be just to my&^lf and the company over which I presided. On the 29th July, 1872, I received a message from Sir George Cartier asking me to see him the next day. I requested Mr. Abbott to accompany mc, and I discussed the whole question with Sir George, who stated his views fully. He communicated to me a telegram he had received from Siv John A. Macdonald, of which the following is a copy: — Sir George Oartier, Montreal. July 26th, 1872. '• Have seen Macpherson. He has no personal ambition, but cannot in justice to On- tario concede any prefereuce to Quebec ^n the matter of the Presidency, or in any other particular. He says the question nbout the Presidency should be left to the Board. Under these circumstances I authorize you to assure Allan that the influence of the Gov- ernment will be exercised to secure him the position of President. Tho other terms to be as agreed on between Macpherson and Abbott. The whole matter to be kept quiet until after the elections. Then the twc gentlemen to meet the Privy Council at Ottawa and settle the terms of a provisional agreement. This in the only practical solution of the diffi- culty, and should be accepted at once by Allan. Answer. " (Signed) JOHN A. MACDONALD. And Sir George Cartier on that occasion gave me the assurance which he was by that telegram authorized by the Premier to convey to me. That on further discussion with Sir Goiji\";c Cartier as to the cou'sc which the Govern- ment would probably take with regard to the amuigamation and the contract to be granted, T. urged upon him certain modifications of the ter.ns of the above telegram from Sir John Macdonald, and finally Sir George came to entertain the opinion that I was entitled to h.avc certain of those modifications ct needed to mc, and expressed his willingness to recommend it to his colleagues. Being desirous of liaving as definite an expression of opinion from Sir George, as he felt himself justified in giving, I re(jucstcd that he would put what ho stated !l i» 135 li f verbally to mc in writing, and accordingly on the 30th July, 1872, he wrote me the foUowicg letter : " Montreal, 30th July, 1S72. " Dear Sir Hzon. — I enclose you copies of telegrams received from Sir John A. Mac- donald ; and with reference to their contents I would say that in my opinion, the Governor ia Council will approve of the amalgamation of your company with the Inttr-Oceanic company, under the name of the Canadian Pa^'ifio Railway Company ; the Provisional Board of the amalgamated company to be composed of seventeen members, of whom four shall be named from the Province of Quebec, by the Conrtda Pacific Railway Company, four from the Province of C atario by the Inter-Oceanio Railway Company, and the remainder by the Government ; the amalgamated Company to have the power specified in the 10th section of the Act incorporating the Canada Pacific Railway Company, and the agreement of amalgamation to be executed between the companies within two months from this date. " The Canada Pacific Company might tak« the initiative in procuring the amalgamation, and if the Inter-Oceanic Company should not execute an agreement of amalgamation upon such terms, and w'lhin >.'ich limited time, I think the contemplated arrangement should be made with the Canada Pacific Company uiider its charter. " Upon the eabecription and payment on account of stock being mad"*, as rerjtiired by the Act of last Session, respecting the Canadian Pacific Railway Company, I have no doubt but that the Governor in Couniil will agree with the Company for the cousimction and working of the Canadian Pacific Railway, with such branches as shall be agreed upon, and will grant to the Company all such subsidies and assistance as they are empowered to do by the Govemmei:t Act* 1 believe all the advantages which the Government Act empowers the Government to confer upon any company, will be required to enable the works contem- plated to be snccesfet'ully carried through, and I am convinced that they will be accorded to the Company to be formeJ by am^xlgamation, or to the Canada Pacific Company, as the case may be. " I wonld add, thzt as I approve of the measures to which I have referred in this letter, I shall us ■' my best endeavors to have them carried into ett'ect. " Very truly yours, (Signed,) GEO. E. CARTIER." I observe that it has been stated that there wav a postscript to the foregoing letter. I declare positively that there was no such thing uad I now exhibit the original letter to the Commission, in support of what I say, but I do not dispossess myself of it. An authentic copy of which, however, is herewith pr)duccd and fyled, marked "P." I positively declared that up to the date of this letter I had not any understanding of any kind or description with the Qovernnisat, either directly or through any other person than that contained in Sir John Macdonald's telegram of the 2Gth July, which is given above ; and that tclejram and the above letter from Sir George Cartier contained everything that was ever stated or agreed to between any member of the Government and my.self, on the subject of a Pacific Railway project, up to that date. On the ?:>Jie day that 1 received the above letter from Sir George Cartier, I informed Sir John A. "'lacdonald of the substance of it, and asked for his sanction of the view.s which it contained. Bat he declined to concur in the terms of Sir George's letter, telegraphing to hiui, (Sir Qcorgc Cartier) that he would not agree to them, and that he would come down to Montreal and confer with him respecting them. Hereupon 1 immediately informed Sir George Cartier that I. should consider the letter addressed t^. me as b<;mg withdrawn, and to my knowledge Sir George telegraphed to Sir .John that he had «>cen me and that as ho (Sir John) objected to Sir George's letter, it had been withdrawn. I also telegraphed to Sir John on the same day (July 31st.,) to the effect that T had seen Sir George Cartier, and that he (Sir John) might return my letter or regard it as waste paper, and that 1 was satisfied with the telegram of the 2Gth., as expressive of the views of the Gorcmmcat. if i 136 : I These two telegrams arc, I understand, produced by Sir John A. Macdonald with his affidavit. I positively and explicitly declare, that -j:» -opting so far as an understanding between the Government and myself is exjft-essed in ♦ foregoing correspondence, I had no agreement of any kind or description either verbally or in writing, by myself or through any other person, in respect of the contract for the Pacific ^Railway or of any advantage to be conferred upon me in respect of it. In one of njy letters in the published correspondence, dated 6th August, 1872, 1 appear to have said, "Yesterday we entered into an agreement." The word "yesterday"' vas used inadvertantly./or " recently^" or "some days ago." That this was merely a slip of thp pen will appear from the letter following in the published correspondence, and wliich is dated the day after — 7th August — in which, refer- ing to the same agreement, I again use the word "yesterday," There never had been anything that could be called an agreement, except that arising out of Sir John Macdonald's telegram of the 26th July, which remained untouched, Sir George's letter of the 30th July, which I have just exhibited, and my own to Sir John A. Macdonald being considered withdrawn. As we were leaving Sir George said to me, in his usual abrupt manner, " are you not going to assist in our elections," or words to that effect. I replied that as on former occasions I would, no doubt, do so to some extent, but I wanted to know how much he required. He said it was impossible to tell, but from the opposition raised to the Pacific Eailroad project, it might amount to $100,000. I thought this was a large sum, but 1 felt that the interests involved in the issue of the approaching general elections were most important in an national point of view. It seemed to me to be a question whether the policy of the Administration with reference to railroads, canals, harbors, lightrbouscs and Emigration was to be approved of or not ; that policy I thought then, and still think, deserving of the support of all those who would really care for the development of the resources of the country. In addition to these public reasons for giving pecuniary assistance to the Government in the late general elections, I had personal reasons, which will be readily appreciated even by those who cannot understand any higher motives. As a person largely interested in the carrying trade, I could not fail to desire the success of every scheme which would increase the communications with the interior of the continent. In addition to thi?, my feelings were aroused by the p.ttacks on myself personally, as well as on the Governc ^nt, the ground of attack on the latter being mainly on its Pacific Railway policy, and as I approved of that policy, I therefore deterruiuccl to give the Govern- ment all the assistance in my power, and in answer to Sir George'"? request, I ask d him to state to me in writing what he wanted me to do. In the afternoon we again waited on Sir George, and he gave me a letter of which the following is a copy : — Private and Confidential. " Montreal, 30th July, 1872. " Dear Sir Huqf., — The friends of the the Government will expect to bo assisted " with funds in the pending elections, and any amount which rou or your Company shall " advance for that purpose shall be recouped to you. " A memorandum of immediate requirements is below. "Very truly yours. (Signed) " GEO. E. CARTIER." NOW WANTED. ,'Sir John A. Macdonald $26,000 "lion. Mr. Langevin 15,000 "Sir G. E. C 20,000 "Sir J. A. (add'l) 10,000 "Hon. Mr. Langevin 10,000 "SirU. E. C. (add'l) 30,000 n )^ vas u 187 Question — Have you got that letter in your possession ? Answer — I have and I hereby produce it before the Commission but do not wish to dispossess myself of it, an authentic copy is herewith produced and fyled marked " S " As the letter now appears, the memorandum is for $1 10,000, but at the time it was written the three first items amounting to $60,000 only were mentioned. Sir (ieorge said however that they could talk of that afterwards. Accordingly I paid over the three first sums of money to the gentlemen indicated. Afterwards Sir George requested me to send a further amount to Sir John A. Macdonald of $10,000, and $10,000, to Mr. Langevin and 30,000 to the Central Committee of Elections, and the three sums last mentioned in the memorandum appended to the letter, were then added to it by Sir George. I accordingly remitted $10,000 to Sir John Macdonald, $30,000 to the Central Committee and left $10,000 with Mr. Abbott for Mr. Langevin, to be paid upon getting from that gentleman a receipt for it. In Sir George Cartier's letter of the 30th July, namely the one to which J have secondly alluded, there is an undertaking on the part of Sir George that my advances would be paid back to me. I did not see well from what source this money could be repaid, but Sir George held out some hope that his political friends would contribute to make it up. Beyond this there was nothing that I can recall asi to the manner of repayment. On leaving Sir George I said to Mr. Abbott, that I saw no possibility of my ever being repaid these contributions. Neither then nor on any other occasion had I any correspondence with Sir George, as to the repayment of these sums. I left Montreal for Newfoundland I think early in August, and only returned at the end of the month, and except by inf quent telegrams 1 hud no comninnication with Montreal during that time. Among thej. telegrams I ' "1 two from Mr. Abbott informing me that Sir George wanted $20,000 more for the ' nl Committee, and $10,000 for Sir John. I auil "ized Mr . Abboit to pay over these sum liJ jilaced the money at his disp «ri' I think I also received telegrams from Mr. ^Vbbott telling me that Mr. Langevin would sign no receipt and asking my authority to hand him the .ey without any receipt. This last telegram did not reach me in time to be acted inon, and I 1 no since learned from Mr. Abbott that Mr. Langevin gave no receipt. I heard of Sir George's defeat while in Nova Scotia on my way back. In this way on my return I found that the limits of payments which I had first agreed to had bei a exceeded, and with subsequent advances they finally stood as follows : To Sir George E. Cartier's Committee $85,000 To Hon. Sir John A. Macdonald towards election expenses in Ontario 45 000 To Hon. H. L. Langevin towards electoral expenses in Quebec JOO „ , «J 102,600 I also paid for the assistance of other friends of my own in connection with the elections between fl6,000 and $17,000. These sums, with the preliminary expenses on the Pacific and various railroads in which I was engaged, more or less directly connected with the Pacific enterprise, mode up the amount of my advances to about $350,000. After the elections I made another attempt to amalgamate the two companies with the assistance of the Government, by addressing the following letter to the Hon. I). L. Macpher- son : — Montreal, September 5th, 1872. Dear Sir, " I received, some time ago, a communication from the Government, informing me that " it was deemed advisable that our two Companies should unite and form one Company, for " the construction of the Canadian Pacific Railroad, and expressing a hope that the suggestion " would meet with the approval of the two Companies. No doubt you also received a similar « communication. " In conformity with the wish of the Government, the Canada Pacific Railroad Company, I ^' 138 "of which I am President, is prepared to amalgamate with ydlr Inter-Oceanio Company, and " I consider it is for both our interests that tlic amalgamation should take place as sooa as " possible. " I have therefore directed a meeting of the Provisional Board of my Company to be " called for the purpose of authorizing the execution of a deed of amalgamation being agreed " upon. " I understood that the (iovernment would approve of such an amalgamation upon the " following conditions : — " 1st. That either of the charters should be the charter of the amalgamated Company. " 2nd. That the Provisional Directors of the amalgamated company should be seventeen " in number, of whom four should be named by you, four by me, and the remainder by the " Government. " 3rd. That the Board thus constituted should elect the Provisional Chairman or " President. " As the Canada Pacific Company has opened stock books in con^jrmity with the Act, " and has retained them at the different points required by the Act since they were so opened, " I would suggest that the proposed subscriptions should be inserted in those books, subject " to allotment by the Provisional Board, to be constituted under the deed of amalgamation. " And the books could then remain open at such points as may be ordered by the Provisional " Board for further subscription, either in this country or in England. By thus availing our- " selves of the proceedings of the Canada Pacific Company, the time within which the Com- " pany can be regularly organized, will be greatly shortened, and the amalgamated company " will be in a position, at an early date, to proceed with the financial arrangements requisite " for commencing the work next spring. " I shall be happy to hear from you as early as possible on the subject of these sugges- " tions, with any others which you may fed disposed to make, should you entertain the idea " of an amalgamation ; and in tiiat event you might ronsider it desirable to call your Board " together, in order to act in concert with our Board in carrying out the amalgamation as soon " as possible. '•' Arrangements should also be made, and powers obtained, to enable us to negociatc and " execute a contract with the Government. " For this pirpose a meeting at Ottawa ol' ;in Exenitivc from each Company may be ne- " cessary, and I will be prepared to meet you there when rcf|uired. " Hon, D. L. Macpherson, " Toronto, Ont." " Your obedient servant, (Signed) "HUGH ALLAN." This offer was again rejected, and on grouna.i similar to thoso formerly given, and T made no further attempt at auiu' carnation, but the Government cont ued iu their endeavors to induce the Inter-Oceanic Company to amalgamate, till towards the end of the month of November. A little before this time, however, a memorandun was communicated to mo, which had been received by the Government from the Jnter-Occanic Company which appeared to destroy the prospect of amalgamation, and although the Canada Company endeavored to remove the objections mnde by the luter-Oceanic (/ompany, they failed in doing so, and the idea of amalgamation was shortly afterwards finally abandoned. Thereupon the Government informed me that it v^as decided that the contract should not be given to either of the Companies alone, but that the Government would incorporate a new company of the prominent members of the two incorporated companies, and any leading Canadians who might be disposed to join them, and able to give assistance, and could be induced to subscribe the stock in the proportions which the government had decided upon, which proportions are those embodied in the charter. And from that time the efforts of all parties interested in the project were directed towards procuring the association together of i' i' 139 and i' tho most promiQcnt mea of both companies in the now company tu be incorporated under the terms of tho Qovernaient Act of tho previous session. And it was, as the result of these efforts, that the present company was formed, composed, in a majority of instances, of gentle- men with whom I had do communication wl^tever, and not in any respect as the consequence of any understanding between myself and the government. From that time also, communica- tion between myself and my former associates ceased, haviupj finally been broken off by myself, as soon as I ascertained the desire of the Government. ^Vnd I state further, positively, that no money derived from any fund, or from any of my former American associates, was expended in assisting my friends, or the friends of the Government, at the recent general elections. That with regard to tho construction which appears to be intended to be placed upon the statements in the letter referred to as to the preliminary expenses connected with the charter, I state most positively imd explicitly, that I never made any agreement or came to any undei-standing of any kind or description with the Government, or any of its members, as t'' the payment of any sum of money to any one, or in any way whatever, in consideration of receiving the contract for the Canadian Pacific. I declare that I did expend considerable sums of money in various ways which appeared to me to be advantageous to the Company I had organized, and calculated to strengthen my hands in endeavoring to obtain the contract for that Company, but that I did not on any occasion or in any way pay or agree to pay anything whatever to any member of the Government, or to any cue on behaif, or at tho instance of the Government, for any consideration whatever, in connection with the charter or contract. As may be gathered from the letters in question, I considered it to be my policy to strengthen my position as far as I possibly could with my own friends and fellow citizens in the Province of Quebec, and more especially in so far as related to the Montreal Northern Colonization Eailway, which I conceived would at some day be the outlet from the Canadian Pacific to the Port of Montreal. And a considerable portion of the money referred to in those letters was expended by me in furtherance of that project in many ways, and it was with these views in addition to those already stated, I contributed tho money already referred to, but without any under-itanding or condition with the person ■ it. I have already said that my subscription and loans to assist in the elections could not have been a consideration for my getting the Pacific contract as ig alleged in Mr. Huntington's motion, for on the 30th July nr -ng was settled. The plan then contemplated, and for months afterwards, was that of an amalgamation of the Pacific and the Inter-Oceanic Companies ; the plan finally adopted was the granting of a Charter to an altogether new Company of which it is true I was a Director, but in which 1 had little or no choice of my co-directors and no more influence than that conferred on me by the Stock which I might hold. In point of fact some of tlio Directors were scarcely known to me and to the appointment of some I was opposed. So in fact tho Canada Pacific incorporated by the Act of the .Session of 1872 never got the contract and never had anything approaching to a promise of it. The contract was given to a body totally different and including for the most part persons who had nothing to do with that Company. The terms of the Charter, the composition of the Company, the privileges which were to be granted to it, the proportions in which the stock was to be distributed hr.ving been matters for negociation and settlement up to the last moment, and were only closed and decided upon while thot'harter was being prepared in the early part of the present year. And the persons who finally composed the Company were only decided upon within a few days of the issue of the Charter ; 1, myself, being permi'f'^'l 'o subscribe a similar amount of stock to that subscribed by other prominent members of the Company. With reforeiu'o to certain private and confidential letters published in the Montreal Herald and to certain statemcnt.s in those letters which may appear to conflict in some degree with the foregoing, I must in justice to myself offer certain explanations. I desire to state with regard to these letters that tliey were written in the confidence of private intercourse in the midst of many matters engrossing my attention, and probably with less care and circumspection than might have been bestowed upon them had they been intended for 140 Jublioation. At the same time wbile in some respects those letters are not strictly accurate conceive that the circumstances to a great extent justified or excused the language used in them. With regard to the reference repeatedly made in those letters to the American interest in the Stock of the company, as I have already ftated, I had made an agreement with the parties to whom those letters were addressed, associating myself with them in a company projected for the construction of the Pacific Railway. It was a very delicate and unpleasant thing for me bluntly to tell them that I would not carry out the arrangement ; besides, although I came gradually to know how strongly opposed the Government was to the introduction of American capital and influence, and that this feeling had taken possession, to a considerable extent, of the j^blic mind. Still I had never been formally notified by the Government that it was their intention positively to ex- clude foreigners and their capital, in the organization of the Pacific Company. And in consenting to the legislation introduced into the Housv, I thought I was only deferring to a prejudice which I myself considered without foundation. I did not hesitate to intimate that if a suitable opportunity ofiered, they should be permitted to assume a position in the Company as neai-ly like that which they and I had agreed upon as circum- stances would permit. And as I entirely disbelieved the statements that were made as to their disposition to obstruct the Canadian Pacific, and considered that they might be of great use in furthering its construction, especially in the event of a failure of the negocia- tions in England, I had no hesitation in placing myself individually, in the position of favor- ing their admission into the company, if ciruu instances should permit of it. It was in that spirit that what is said in my private letters now published, was written to the gentlemen to whom they were addressed, and if matters had taken such a turn as to permit with pro- priety, of those intentions being carried out, |I should have felt myself bound to adhere to them. But in point of fact, when the discussions as to the mode in which the Company should be formed, were entered upon with the Government late in the Autumn, I came to understand decisively, that they could not be admitted, and I notified them of the fact and that the n^ociations must cease between us, by a letter which has not been published in the Herald, but which was in the following terms: — « My Deae Me. McMullen,— " Montreal, 24th October, 1872. " No action has yet (as far as I know) been taken by the Government in the matter of " the Pacific Railroad. The opposition of the Ontario party will, I think, have the efiect « of shutting out our American friends from any participation in the road, and I apprehend " all that negociation is at an end. It is still uncertain how it will be givca (the contract), " but in any case the Government seem inclined to exact a declaration that no foreigners " will have directly or indirectly any interest in it. But everything is in a state of un- " certainty, and I think it is unnecessary for you to visit New York on this business at pre- " sent, or at all, till you hear what the result is likely to be. " Public sentiment seems to be decided that the Road shall be built by Canadians only. "Yours truly, (Signed), "HUGH ALLAN." I desire also to sl^te further with regard to the envelope, and the papers which it con- tains which were placed in the hands of the Hon. Mr. Starnes shortly before my departure for England with the delegation of the Pacific Railway, that upon being informed by me that all negociations between my former American associates and myself on the subject of the Cana- dian Pacific Railway must cease, large demands were made upon mo, k>y Mr. MoMuUen based partly upon alleged expenditure by him and partly upon a claim by hiin for compensa- tion for his loss of time and service in the promotion of the enterprise, so long as he and his friends remained connected with it. These demands at first wore of so extensive a character I declined altogether to or certain them. I was disposed to return to my American associates any money which they might have expended in the matter, and I was ready to compensate Mr. McMuUcn for the loss of his time and his expenses ; but it appeared to mo that the sum which ' a only. 1 » it con- ure for hat all Cana- pensa- ind his aracter lociates ite Mr. whioh 141 he demanded was much greater in amount than all such disbursements and expenses could possibly have reached. I felt laturally that by trusting to the honor of my correspondents, and writing to them in a manner somewhat inconsiderate, I had placed it in their power to annoy me by the publication of those letters, and I feared that the outcry which might follow their publication in the columns of certain papers which have manifested unceasing hostility to the Canadian Pacific Bailway might injure the prospects of the delegation in England. I there- fore authorised an arrangement to be made with Mr. McMullcn by which a sum very much less than his original demands should be paid to him, the greater portion at onoe, but the remain- ing, and a considerable portion on the delivery of the letters to me, after the present Session of Parliament, should they not be published ia the interval. This was accordingly done. Mr. McMullcn received the greater part of the sum agreed to with him, nun.cly $20,000, and the remainder, namely $17,500 wa3 placed in one of those envelopes in the form of a cheque, the other envelope containing, to the best of my belief, the same letters which have been published in the Montreal Herald together with one or two others which do not appear there, but which would have established the rupture of all negociations between the Americans and myself. And this arrangement was made on my behalf with Mr. McMuUen, without the concurrence or knowledge of any Member of the Government, none of whom were aware that the papers had been deposited in the hands of Mr. Starnes. Question — ^With regard to some of these letters which are in the parcel which you have proved, I see in that of the 28th February, 1872, you name ti number of gentlemen to whom the stock was to be distributed. Had you obtained the cons'tnt of these gentlemen to receive that stock ? Answer — I had not. I did not say that I had in any letter I have written. The mention was that $4,500,000 of the stock that was to be given to myself, Mr. McMullen and Mr. Smith, was to be distributed amongst such parties in Canada as we thought would be bene- ficial to the Company ; but the intention was that they should pay for their stock the same as any one else. It was never contemplated that it should be given without payment. Question — Was this letter intended to convey the idea, or did it convey ' idea, that these gentlemen had accepted the stock ? Answer — I had no such intention. I merely stated that these would probably be the amounts we would have to contribute from our several stocks. I did not intend to convey the idea that these gentlemen had consented to accept, or had accepted it, in any form. Question — Did any of those whose names appear here accept the stock ? Answer — None of them, unless they became Directors of the Canadian Pacific Eailway. Question — Not at that time ? . Answer — ^No, not at that time. Question — I see in your letter of June 12th, 1872, this expression : — " I believe I have got the whole arranged through my French friends, by means you are aware of, and we have now a pledge of Sir George that we will have a majority, and other things satisfactory. I have told you all along that this was the true basis of operations, and anything else was powder and shot thrown away, and I think so still ? " Answer — These were merely matters of conversation, and never amounted to anything like a pledge of any kind. I had been communicating with a vast number of people on the subject, and they generally received what I had to say to them favorably, and I thought I had succeeded in securing the good will of all parties regarding it. Question — There is a letter of the Ist July, directed to Mr. Cass, in which you give a very full account of your proceedings, and a detailed history of the course which you followed for the purpose of obtaining the influence which you desired in Parliament. Will* you ex- plain the expressions which you made use of there \;'ith respect to the means <-'' securing Sir George Cartier and the majority in Parliament ? Answer — There never was any means used to obtain Sii George Cartier or anyone else, except those I liave already alluded to. In conversation with all the gentlemen, and in my intercourse with them from time to time, I was constantly talking to them on this subject, urging them to use all the means in their power, and I generally got their promise to that effect \ but I did not use any improper means to acquire anything of that kind at all. 142 any contract. It was tho It was only a provisionul Question — The impression that would be conveyed by this would bo that you used some objectionable means for the purpose of pnrohasing the support of these men ? Antwer — I did not ; indeed I did not. Question — You state " that Sir George then proceeded to give uio the contract n» required, in a way that there would be seventeen provisional directors, of which Ontario would have eight and we nine, thereby giving us the control. We at once proceeded to organize a Company, and they named me President,'' and so on. What Company was that to which you referred ? Answer — The oris^nal Canada Pacific ; but wo never jj;ot opposite way. In the Provisional Company I was made President, company and was entirely abandoned. Question — Ati I to understand that there was such a projected company which subse- quently resulted in nothing? Anf.tcer — There was, undoubtedly ; but it resulted in nothing. There were only two Ficvisitinal Companies. Question — TLat was the Company you announced in your letter to Mr. Cass? Answer — ^Yes. Question — In the letters of the Gth and 7th August you state that an agreement had been entered into ? Answer — That referred to the letter on the 30th July, and to Sir John A Maodonald's telegram of the 26th July. Question — That, yon state, I think, was an inadvertent statement ? Answer — Yes it alluded to the letter of the 30th July and to Sir John A. ilacdouald's telegram of the 26th July, which was the only agreement ever made ? Question — Sir John's telegram ? Ansicer — Sir George's letter of the 30th July, founded on Sir John's telegram, but it was subsequoitly ubjected to by Sir John and withdrawn. Question. — Then you state in a letter of the 16th July, that Sir George Carticr announced to you that he did not intend to give the contract to your Company and that he never had intended to do so. Js that the first distinct announcement you had ? Answer — Yes ; that was the first distinct announcement. Question — There are several allegations made ; you have no doubt scon the published letters of Mr. McJIullen ? Answer — Some of them, but I don't think I have seen the whole of them. Question — There is one published on the IGth July, in the Montreal Herald, and it contains an allegation with respect to the payment of several sums of money which ho states you alleged to have paid. We will go over these sums in order that you may have an oppor- tunity of statmg what you have to say with respect to them, lie says that he (meaning you) at one time announced that the 88,500 of which he speaks had been lent to Sir John Macdonald and Sir Francis Hincks, in sums of 4,000 and 4,&00 respectively, with a very good knowledge that they were never to be repaid ? Atmccr — No such transactions ever took place. Question — Did you ever make such a statement to Mr. McMullen? Answer — Not to my remembrance. Question — ^Therc is a reference to another sum of $50,000 about which you said you had some conversation with Sir Francis Hincks, and he said that at his time of life he should prefer an absolute payment of $50,000 to a percentage of the ultimate profits ? Anmcer — No such conversation took place. I never spoke to Sir Francis Hincks on tho subject of money in my life, in any form, in this connection. Question — Are you able to state whether you made that statement to Mr. McMullen or not? Answer — I do not recollect any such conversation. Question — As to the conversation with Sir Francis Hincks as to securing for his son the position of Secretary to the Company at a salary of $2,000 ? Answer — That is an entire mistake which Mr. McMullen has made. Sir Francis Hincka applied to me to get his son an appointment in the Warehousing Company at Mon- i\ 148 lie was not author- call your as stated treal. I don't know how Mr. McMuUen came to know anything about it, but Sir Francia Hincks never applied for his son to bo employed on the Pacific Railway, lie was looking for employment for his son, and I was President of the Warehousing Company, and without any reference to the railway or the con tract, he happened to ask me if I knew of anything that would suit his son, and this quite casually. He asked me Bomething about whether there was anytliing in the Warehousing Company likely to Buit him. I said I did not know, and he never got any appointment. Question — As to the allegation that several sums had been paid for different newspapers and 86000 to Attorney General Ouimet ? Answer — I never paid any sum of any kind to Attorney General Ouimet. Question — What about the newspapers ? Ansiver — As to the newspapers I discounted a note for the proprieters of the Mincrve, which they agreed to pay in advertising. I think that was the only transaction I had with any newspaper. Question — What amount was it ? Answer — I think it was $4000. Question — Then there was an indefinite loan of $10,000 to Sir Francis Hincks ? Answer — I never loaned any money to Sir Francis Hincks. Question — In addition to the payments spoken of, Mr. Abbott was authorized to promise Mr. Langevin $25,000 to aid in the elections about Quebec on condition of liis friends assistance ? Answer — I never heard of that before I saw it in the newspapers, ized by me. (^estion — And Mr. Abbott reported that he had done so ? Ansiper — He never reported so to me. X Question — Then there is another portion of this letter to which I wish to ' attention. It is as follows : — " After having Sir George sign the agreement " in the letter of the 6th August, he commenced paying money, but as he told me, having " Cartier's order in each case, and taking his receipt therefore. When making the agree- " ment he had no idea that the amount of money would be excessively large ; and when it " had run up to between $150,000 and $200,000, he became alarmed and told Cartier that " ho must stop paying the drafts which were coming in so rapidly unless the whole Govern- " ment would sanction the bargain. He then stated that Sir George sent to Ottawa and " received a telegram from Sir John Macdonald confirming his action. After this Allan " said he proceeded paying until ho had advanced $358,000 in addition to the $40,000 " drawn from New York. I promised to submit his staloment to my friends in New York, " and leave the matter for them to decide " ? Answer — I was absent from the Province during the whole of that time, therefore, the whole of that is impossible. Question — From what date ? Answer — I left on the 13th of August, and did not return till the 3rd September, and the elections were going on during that time. A large amount of money was paid during my absence and before I went, and there was no money paid that I did noc know of before I left, or did not sanction when I was away, therefore I could not positively have made such a state- ment. Question — Did you at any time tell Sir George Cartier that you must stop paying the drafts which were coming in so rapidly, unless the whole Government would sanction the bargain ? Answer — No, I never had any interview or conversation with Sir George Cartier on that subject. Question — The entire convcrsntion you had with him was that already stated ? Answer — Yes. Question — Do you know if Sir George sent any telegram to Ottawa on this subject, or received any ? Anstvei- — I never saw or heard of any. Question — You stated that the first intimation you received unfavorable to the admission i ' l! Ji ! 144 of your American associates in the enterprise, was that letter of Sir George Cartior's of the 16th July. Answer— YcB, of the IGth July, 1872. Question — Had you at anytime any stock in your name as a cover for the Atucrioan capitalists, either in the Canada Pacific Company or in the present chartered company ? Answer — Nover. No Americans that I am aware of have the slightest interest in the Canadian Pacific, cither direct or indirect. I never had any stock in my name at any time that represented Americans. Question — Can you state particularly the conversation which passed hctween yon and Sir Francis Hincks at the first interview, when it was suggested to you to apply to American capitalists for assistauce f Answer — At this distance of time I could not give any definite statement of the conver- sation, but I can give the general terms. Sir Francis Hinoks came to my office in Montreal, and pointed out to me the fact that owing to the union with British Columbia, a railroad of that kind would have to be built ; and that the Government had begun to enquire as to the means by which it could be built, and he himself was very anxious about it. They were not prepared to do anything, and had not made up their minds respecting it ; but he wished to make enquiry in order to see in what way it could be carried out when the time came. He then stated that he felt very anxious that some of our own people should take it up and not leave it entirely in the hands of the Americans. He had no objection to American connec- tions, but he thought the principal parties in it ought to be Canadians. He told me of an inter- view he had had with Mr. Waddington, Mr. Smith, anu Mr. McMuUen. He strongly recom- mended me to take up the enterprise, as being one which must redound greatly to any person who carried it out. He urged that it was a great enterprise ; if the promoters succeeded they would be conferring a great benefit on the country. I was very reluctant to go into it at all. I felt that it was too large a matter, and too important, for a man with so much business on his hands as myself to engage in ; but he was very urgent, and finally he persuaded me to agree to enter into it. At the same time I was very reluctant to do so. He then said that the best tbiog to do was to put myself in communication with those parties who have applied to us ; you can make your own arrangement with them. You will find those gentlemen at New York, and you will find them more likely to take it up than the people in England, because they have already constructed two railways across the Continent, and are about eommoncing a third. They are much more likely to undertake it than our own people, who do not know anything about it, and who would be afraid of so large a sum. Question — ^Were you induced by that conversation to enter into communication with your American associates ? Answer — I was. Question — Then I suppose you attached yourself rather strongly to the idea of building the Railway oy these means ? Answer — I did. I became, I may say, passionately enamoured of it, and determined that if it could be carried through by any means even by a largo expenditure of my own money, I would carry it through. Question — ^Except from Sir Francis Hincks did you receive any encouragement frosi the Government to enter into communication with your American associates ? Answer — No, never. Question — From no other members of the Government ? Answer — No. They were very reticent on the subject. After two or three months had elapsed when it appeared that the West had taken up opposition to it, the Government began to indicate that they were also opposed to it. Question — Did you ever receive any encouragement from any members of the Govern- ment except from Sir Francis Hincks ? Answer — Never. Question — You felt a good deal disappointed at the result. Answer — I did indeed ; very much disappointed. Question — With whom originated the idea of a new company or the amalgamation of the two companies ? r the irioan ^ 145 Amwer — I think it was with Sir John Macdonald tho wholo of these things originated. Question — That was against your opinion and wish ? Answer — It was. I was satisfied that the first arrangement would have been most suc- cessful. Question — Do you know when the Government became first acquainted with the agree- ment between you and your American usaociates of December, 1871 ? They were not aware of it at that time ? Answer — No, not for long after. Question — Not at tho time of the legislation of 1872 ? Answer — They were aware that negoeiationa were going on and had gone on, but they had never seen the agreement. Question — Did you consider the telegram of Sir John A. Macdonald of the 2Gth July, as the basis of an agreement to be made ? Answer — Undoubtedly that was the basis and the only basis we had to go upon. Question — Has that basis been adhered to or departed irom ? Answer — As far as it oould ')e it has been adhered to. It suggested an amalgamation, and at the meeting at Ottawa p. < t the elections I acquiesced in all the proposals, and wrote to Mr. Macpherson, and requei..ed him to meet me in Ottawa, to carry out Sir John's telegram of the 26th July. Question — By whom was Sir John's disapproval of the letter of the 30th July, communicated to you ? Answer — Sir George Cartier communicated it to me on the 31st July I think ; but I think it was not direct to me, but to Mr. Abbott, and through him to me. Question — I mean the telegrams which followed the letter from Sir George Cartier of the 30 th July ? Answer — I sent a telegram upon the 31st and I think Sir John telegraphed down immediately to Sir George Cartier his objection. Question — You stated that you were a very large subscriber of money for the support of tho elections. That money was subscribed about what period; can you st.'ite the time ? Answer—On the 30th July, I agreed to that amount of $60,000 or $75,000 I think, as stated in Sir George Cartier's letter. He mentioned the amount he required on that date. I agreed to that, and subsequently within a day or two before I left for Newfoundland, he stated that he wanted a further sum, and I sent him over the letter to put down what he wanted, and he did put it down. I agreed to that also. That was the last I heard oi the matter until I had gone to Newfoundland, and when I was in Newfoundland, I received two telegrams, I think from Mr. Abbott, on the subject of money. These telegrams I agreed to. He telegraphed me also with regard to the receipt from Mr. L:ingevin, but I did not get the telegram and did not know of it at the time. Question — The letter of Sir George Cartier, of the 24 th August, of which a copy is published, is in these terms : — " In the absence of Sir Hugh Allan, I shall be obliged by " your supplying the Central Committee with a further sum of $20,000 upon the same " conditions as the amount written by me at the foot of ray letter to Sir Hugh Allan, on the 30th ultimo. « (Signed) GEORGE E. CARTIER " P. S. — Please also send Sir John Macdonald $10,000 more on the same terms." What was meant by these expressions, " the same conditions '' and " the same terms " ? Answer — It is difficult to say what Sir George meant by those words. He was not a man with whom you could talk very much, because in all the interviews with him he gen- erally did most of the talking himself, and you could with difficulty say anything. I never understood exactly what he meant on any of these points. I was quite satisfied that he probably felt that he did not like to be under such very heavy obligations, and would en- deavour at some future time, to make it up by subscription or otherwise. I did not think that he had any very definite idea, and I did not think it would be done. 19 146 I Qitestlim — IIo says, *' as written by luc at the foot of my letter to Sir Hugh Allan, of the 30th ultimo." ? Answer — That is the recouping, I suppose. Q^'Btioti — Did you over receive any other letter from Sir George Carticr, on the sub- ject?" Aiunve) --Never. Questioti, — " The friends of the Government will expect to bo assisted with funds in the " pending elections, and any amount which you or your Company shall advance for that pur- " pose, shall be recouped to you." This ia the letter to which lie refers in the letter of the " 24th August ? " Answer — Yes. Question — This was all the communication in writing between you ? Atmver — That was all the communication I ever had from Sir George on the subject. ^' Question — And you had no further conversation with him than what you have mentioned which took place on the 30th July ? Answer — I think 1 only saw him once or twice after the 30th July, previous to my leaving for Newfoundland. I was very much occupied and during that time wo had no further con- versation on the subject of the money, lie did not require any more then. Question — Had you any understanding with Sir George or any other member of the Government, or derived from any quarter that you were to receive certain advantages for the Bubscriptions which you gave — certain favors from the Government for the subscription which you gave — towards the elections ? Answer — Certainly not. Question — Had you any expectation of receiving any such favors. Answer — No, I hnd not the slightest Question — Have you received any favors from the Government ? Answer — I have not. Question — What is your position in the Canadian Pacific Railway Company ? ArKSwtr — I am President of the Company. Question — Have you any other advantage than that ? Answer — None whatever, except the paying out of money. Question — Were you elected President through the influence of the Government ? Answer — Not to my knowledge. I am not aware that the Government exercised any influence o/cr any one. I was elected unanimously, and many of the persons I had never seen before, and did not know. Question — What was your motive in subscribing so largely ? 1 will ask you a prelimin- ary question. Had you ever subscribed so much in any previous election ? Answer — Never anything like it, and on this occasion I was actuated by a variety of motives. They did not all come into operation at the same time but from time to time. 1 was very desirous to support the present Government in its commercial views. The policy that it had inaugurated was entirely according to my feelings and wishes as being right and proper for the development of the country, and for the advantage of the Dominion. They had undertaken a very large emigration scheme, and very large canal expenditure, so as to make our internal communications superior to any other country, and to bring down all the prod'ice from the west in this directicn, whicli T was very much interested in their doing. They had undertaken to enlarge the harbor of Montreal to a very great extent. They had undertaken and built a vast number of lighthouses all through the Dominion, and their com- mercial policy was of the most enlightened character, and such as I entirely approved of; and I thought it was my duty, therefore, to sustain that policy, and I was to a large extent influenced by that motive, partly, of course, in consequence of my own interest in it, and partly in consequence of the great development of the country which it was sure to bring about. Then again I was interested in the Northern Colonization lioad. I had expended a large sum of moniy in bringing it to the point it had then reached. Its prospects were not so brilliant at that time as they are to-day, and there was some doubt whether it would go on or not, but I saw at once that if the Pacific Railway was built, the Northern Colonization Railway would become a necessity. Montreal especially could not do without it ; could not do without a ,. 147 O direct connection with the PnoiJio. Tlmt road would have carried all the trade which the I'acifio lload mij^ht bring across the Continent for Mhipping by sea. T had a further interest inusmuch as the nioiubors of the present Ciovcrninoiit, were anion^ my own fricnda and aoauaintances ; I had known them for many years, and although 1 am no politician uiysolf, and never voted at a Parliamentary election in my life except once, yet the members of the Government were persons with whom I was always in contact, and I wished to assist them in every way possible. 1 was also interested as being largely engaged in the carrying trade, and I saw that my interest was to support the present (jovcrnmcnt in their position, Qncilion — You had a very large sum of money invested in your steamships and other enterprises in the country '( Answer — A very largo sum. Question — This sum which you gave amounted to nearly §10(1,000; was that not sufficient to cramp you or distress you very much in your monetary iiffairs ? Answer — Not at all j I gave it entirely from my own fuudf. 1 never borrowed any or asked any from any one. I never encroached on the moneys of the firm. I did not oven speak to my brother on the subject, and never drew a shilliug from the firm for the purpose. It was entirely out of my own pocket. Question — Do you know how this money was distributed ; how it was spent? Answer — I know nothing about it. Question — Sir George Cartier's interview with you was on the 3()lh July. "When ho asked you to subscribe, was any allusion made to the contract for the Pacific Railway ? Answer — No, not more than the fact that the letter was written that morning, Question — He did not say "you havo helped us, we will help you?" Answer — No. Question — Did he intimate any thing of that kind] Answer — He did not. Question — Sir Georgo Car tier in bis letter of the 30th July, mentioned about your being repaid or recouped, I think is the word he used. What did you understand by that ; by whom were you to be recouped ? Answer — That is one of the points on which Sir Georgo did not give any explanation.. He talked in his usual abrupt manner about money and he said he would get up a subscription, among the party to pay me back or at least a portion of it. He did not suppose that he would be able to realize the whole of it, but he talked about getting up a subscription to pay back a portion of it. I myself did not believe that anything of the V-ad could be done, therefore I placed no confidence in the statement. Question — Was there anything to justify you in supposing that it would be repaid o it of moneys to be devoted to the construction of the Pacific Railway ? Answer — It was impossible, and it could not have been done if he had. Question — Do you know the Hon. Mr. Foster, Senator? Answer — I do. Question — Was Mr. Foster present at any interviews you had with Mr. McMuUen ? Answer — I could not say in reality, I am not certain. Question — Have you ever had any conversation on the subject of these matters with him, which are stated in Mr. McMullen's letter ? Answer — 1 never had any conversation with him on the subject of the Pacific Railway at all, except that he was very anxious to become a Director, and I was very anxious to have him one. That is the only point on which I had any conversation with him. Hi never spoke to me about any of the other matters referred to, so .far as I remember. Question — Can you not say whether he was present or not at any interview you had with Mr. McMullen ? Answer — No, I cannot say. Question — Did you ever speak to him on any of the subjects respecting those payments of money, or the other allegations made by Mr. McMullen ? Answer — Not that I remember. I think I never did. I may have had a conversation, but in a very slight and indirect manner with Mr. Foster on thi.s subject ; but I don't remem- ber ever speaking to him about it. tj li 148 ' ! Question — You say that you were absent from the 13th of August to the 3rd of Septem- ber ? Answer — I think those were the dates. Question — Have you with you any memorandum from your books showing when the difierent payments were made, and to whom they were made ? Answer — I have not. Question — Can Mr. Abbott state when these payments were made ? ATiswer — I cannot say. He would be more likely t. be able to state them than I would. These different payments were made, I think, as stated ii. the letter published. I think on the 14th of August a further payment was made in my absence. Question — Then all the turns except that amount paid on the 14th of August would, I understand, probably have been paid before you left ? Answer — Not the whole of them ; probably more than one was paid after I left. I think Mr. Abbott paid three sums after the 13th August. Question — Would you have the goodness to look at that letter from Sir George Cartier, of the 30th July. I observe that the body of the letter is not in his handwriting, but the sig- nature is his. In whose handwriting is the body of the letter ? Answer — I think it is Mr. Abbott's writbg. Question — Mr. Abbott stood in confidential relations to you apparently. What were they ? What was the position in which he stood towards you ? Was it as a professional ad riser or otherwise? Answer — Scarcely as a professional adviser, and yet, to some extent, it was so. He was deeply engaged with me in all these railway schemes, and a.s such we had become closely allied in all matters of this kind. He was with me at all th interviews I had with Sir George Cartier, and I did nothing on any point without consulting him. Question — Then he was present at the time Sir George Cartier made this appeal to you to subscribe for the assistance of the Government at the elections ? Answej- — He was, but his recollection of what took place diifers a little from mine. While I think he mentioned $100,000, Mr. Abbott thinks Sir George did not mention any sum, but only spoke of a large sum. Question — Was he present at the interview from the first to the last ? Answer — He was. Question — And had the means of knowing all that passed on the occasion ? Ajiswer — He had. Question — Did he, or did you, or did Sir George suggest a letter of request to be put in written form ? Ansicer — I did. Question — Were the terms of the letter settled at that time ? Answer — They were settled by Sir George nimsclf, I think, without consulting ne. He dictated the letter I think to Mr. Abbott, without allowing any interference. Question — Then this letter was written at the time ? Ansiver — I am not sure whether it was written at the time or during the interval between the morning and afternoon. Question — You saw him again in the afternoon ? Answer — Yes. Question — Was Mr. Abbott present then ? Answe>' — Yes. Question — Was it then that the letter was signed ? Answer — Yes. Question — Had you any conference in the meantime with Mr. Abbott as to the terms of that letter? Answer — I had not. We did not know what Sir George wanted or how he proposed to state it at all. We were not going to dictate to him what ho should say. Question — I should like to hear again if you remembor the way in which Sir Goorge approached the subject of a money subscription ? Answer — It was in a very abrupt manner. As we were going out at the door after 149 )tem- Q the ould. nkon lid, I thiDk irtier, le sig- 1 were iviser 3 was allied eorge ) you While Ojbut d in He tween rms of sed to Joorgc r after ananging the first letter of the 30th July, he turned about and said ; " Will you help us at our elections?" or " are you going to help us?" or something to that cfifect. Question — Did you make a reply ? Answer — I did. Questitm — What mm it ? Answer — I said that I bad been always in the habit of giving something to the Eleetions and no doubt I would do bo on this occasion. Question — ^Who spoke next, what was next said ? ATiswer — I am cot sure, but I think it is possible that I said to him " to what extent will you require aseistance " or " what do you want " and I also suggested that he should put in writing what be wanted. Qtiextion — ^Youi recollection is that he said $100,000 would be wanted ? Answer — Yes, Mr. Abbott thinks he did not mention any definite amount Question — ASUa he named that sum, what did you ask him to do ? Answer — ^To put the request in writing. Question — ^^Why did you wish the request in writing ? Answer — I wi^ed to have some authority for payment, and to know what I was doing ? Question — What purpose did you think that would serve? Answer — Nothing beyond being more satisfactory to myself. Men of business generally require things to I -• done in that way. Question — ^I underetood you that notwithstanding what Sir George Cartier had said about making a snb-cription among his friends, and raising some portion of the same, you yourself had little hupe of being recouped ? Answer — Yery Uttle hope indeed. Question — Why did you think it necessary to have this letter written ? Answer — Simply because, as I thought, as a man of business, I should have an authority for the large sums of money I was going to pay. Question — This then is the only document that you have which relates to any agreement or arrangement in respect of that money between you and any member of the Government, or the only one that was ever executed ? Answer — The only one that I know of. Question — And no understanding or condition was made, though not expressed in writing as to the receipt of that money, or as to the mode in which it was to be recouped, or as to some advantage which was to be given to you ? Answer — None whatever. Question — I observe in the letter of the 7th August you speak very definitely. Have you a copy of that letter with you ? Ansu:er — I have not. Question — The words used are these : — " It is unnecessary to detail the various phases " through which it passed, but the result is that we yesterday signed an agreement by which, " on certain monetary conditions, they agree to form a company, of which I am to be Presi- " dent to suit my views, to give me and my friends a majority of the stock, and to give the " company so formed the contract for building the road on the terms of the Act of Parlia- " ment." You .^xplain that in using the word " yosterday " in your letters of the 5th and 6th of August, written to General Cass and Mr. MoMullen, you merely meant to convey the idea that it was recently, the letters having been written in a hurried manner, you never sup- posing they would be published, and in both you refer to this document and this onK ? Answer — I referred to both letters. Question — And this letter goes no further than what is contained in both documents ? Answer — No further. Question — You say " signed an agreement." You wore aware that any document which Sir George Cartier signed would not bind the Cabinet ? Answer — Yes, I was aware of that. Question — Then why did you use the expression " signed an agreement?" Answer — It was the expression used in the hurry of the moment, undoubtedly the agree- ment was just so made. w i i 1 ' 1 tl |i I 150 Qiwition — Was it upon any opinion you had expressed in a letter of the Ist in which you say : " On a calm view of the situation, I am satisfied myself that the decision of the ques- " tion must ultimately be in the hands of one man and that [man is Sir George Cartier, the " leader and chief of the French party, who has held the balance of power between the other " factions and has sustained and kept in office and existence the entire Government for the " last five years." Did you take what Sir George Cartier did as according to your view of the situation equivalent to an agreement with the whole Government ? Answer — No, I cannot say that I did. I looked upon it simply as an agreement that he would promote our views when the time came, in the cabinet, and until the telegram was made known to me that Sir John Maodonald declined to accede to it, I looked upon it as a kind of agreement. Question — You are still more definite in your letter to Mr. MoMullen of the 6thj wherein you say " He yesterday signed an agreemant by which on certain monetary conditions they "agreed to form a company of which I am to be President ?'' Answer — These were merely expressions made use of in consequence of the communica- tion with Sir George Cartier. I had no communication with the Government at all. Question — And the only documents embodying what you have called an agreement are contained in this letter of the 30th July, by Sir Gteorge Cartier, and one other letter? Answer — The only ones. Question — This letter of the 30th July, will you have the goodness to look at it, the longer letter of the 30th July. In whose handwriting is that letter, the body of it ? Answer — There are two writings in it, and I do not know either of them. Question — When was that signed ? Answer — It was signed, I should think, between twelve and one o'clock on the 30th July. Question — On the occasion of the first interview ? Answer — Yes. Question — On the first interview you say the money was spoken of ? Answer — ^Yes, at close of it. It was immediately after that interview that that letter was signed, and immediately afterwards the money was spoken of. Question — Was anything said about money before the longer letter of ti.o 30th of July was signed. Answer — Nothing whatever. Question — Was Mr. Abbott present on that occasion also ? Ansicer — Yes. Question — I do not desire to press the question which I am about to put, but I should like you to answer it if you have no objection. It seems a very largo .•■um for anyone to give towards such a purpose, and as I only know by report your means and the extent of the capital employed in the various undertakings in which you are engaged in connection with Railway and other great enterprises ; if you have no objection I should like you to give a general statement ot the amount of capital you have in these undertakings. Of course it is a question I do not press if you do not choose to answer ? Answer — I have no objection to answer. I consider that my property invested in various ways connected with the country, in business of all kinds, amounts to about 86,000,000. Question — Then all the interest that you speak of in connection with your investments in this way would be promoted by the policy of the Government ? Answer — It was with that intention that I supported them. Question — Was there any discusssion as to the exact terms of this longer letter before it was signed ? Ansurr — I think there must have been. Question — Do you remember what it was? Answer — I am not qui^e certain what it was, but I think I probably wished to have a larger amount of influence in the Company than the Government were willing to give nic, and I think it was probable that that was the point that wo discussed together. I think it 1^ 151 was entirely tho organization of the Pacific Railway, and I think it only referred to the amount ' f influence I would have in it and notiivog else. Question — Claima made by you for more favorable terms and not. conceded by Sir George ? Answer — Yes. Question — Are you aware that Sir George at one time, according to the evidence before us, had an opinion' entirely unfavorable to the introduction, not merely of American control, but of American capital into this enterprise ? Answer — I am aware that ho had up to the very last moment, when the ultimate contract was signed, and on that day when I had tho interview with him in regard to this matter, one of the conditions was that no American capital or control was to be introduced into it. Question — Did you at any time consider him hostile to the interests you were desirous of promoting? Answer — I did. Question — Up to what period did you consider him decidedly hostile to the interests you thought it desirable to promote ? Answer — Up to the time that a Committee of his constituents came up to Ottawa and visited him, for the purpose of influencing him on the subject. There was a large meeting held of his principal supporters in Montreal, and they entertaining the opinion generally held in Montreal, as to his hostility to the organization we had formed, appointed a Com- mittee to come to Ottawa and assure him, that if he continued that hostility, he would not be re-elected for Montreal. I understood from them afterwards, that Sir George had agreed to abate his hostility and forward the views expressed by his constituents as fa. as possible, but I have no doubt it was that hostility which cause! the loss of his election in Montreal. 1 1 Question — When was that deputation ? Answer — I think it was during the Session of Parliament. Question — That is the one Mr. Leblanc «peaks of? Answer — The same. Question — You used all the influence you possessed in endeavouring to mould public opinion in unison with your own views ; were you in any way instrumental in stimulating the feeling that prevailed in fivvour of views which Sir George did not approve of? Answer — I was no doubt very iufluential in raising public opinion in Montreal, in favor of the scheme, and there is no doubt that meetings were heiJ and means were used, to dif- fuse information, which had a great effect in causing a feeling to arise against Sir George Cartier. Qv.estion — Did you know anything of this deputation waiting on Sir George Cartier during the Session ; did you know anything ofjit before it was formed, or of the intention to form it before it was formed, or when did you first become aware of the appointment of tho Committee ? Answer — I first heard of it in Montreal. There was an intention of sending up a Committee for the purpose. I was aware that they had held a meeting and appointed a deputation, but 1 did not know anything about what the instructions to that Committee were, or what tho action of the Committee was. Question — Wiicn did you first discover that there was a change in Sir George Cartier 's views, or that yielding to the pressure of opinion he was disposed to change them. Answer — In mediately after the deputation called on him. I was at Ottawa within a few days of or at the time tho deputation was here. I hippcued to meet Sir George and I thought I observed some change in respect to his views. Question — Can you fix the date of that ? Aiimrvr — I cannot. Question — Was Parliament in Session at the time you met Sir George? Answer — I think it was. T lliiuk it was within a day or two after that deputation was up here. Question — You wore with a deputation that waited on the Government at Ottawa? Answer — Yes. 152 Question — ^What is yoar reooUeotion of what ocoarred on that ocoasion. What gentlemen were with you represonting the interests you were desirous to promote ? Armoer — ^. Smith, Mr. MoMullen, and myself, I think were the only ones to represent that interest. There was perhaps another, but I thinL there were only three. I think the members of the Grovei-cment numbered altogether nine or ten, and the discussion was participated in by Sir Francis Hmoks and the deputation. Sir Greorge Cartier never spoke during the whole time. Very few of the other members spoko at all. No opinion was expressed by the Government on the subject. Queation — Do you remember what was said ? Answer — I remember that I explained to them the route by which it was proposed to take the Bailway, the advantages it would give to the Provinces, the means by which it could be built and the results that would probably arise from it. I don't think anything was said by any Member of the Government CT<*«pt merely asking explanations on points which they did not quite understand. Question — ^Was that the interview at which you were asked to make some proposal ? Answer — It was. Question — What did you say? Answer — I said " are you prepared to accept t TOposal if I make one ? " Sir Jobu replied " we are not prepared to accept any proposition," then I said " I am not prepared to '* make one." Question — Beturning to the money question once more, I understand you to say that you had no hope or expectation of receiving that money back agaiu ? Answer — Not the slightest. Question — You say you got this paper as i\ sort of business matter, did you make any entry in your Books as to the disbursement of that large sum of money ? Answer — In my own private books. Question — What was the form of the entry ? Answer — I don't keep it in regular style and make entries in it. Question — Is there any entry made which would indicate any source from which you expected to have those large sums repaid to you ? Answer — A considerable portion of the money was expended in the Northern Colonization Road. I do expect to get back some portion of that money because it was l^itiraately expended for Railway purposes. There was a large amount of money expended on the Pacific Railway, I having paid all the preliminary expenses connected with it. I do not expect to get that back ; in all probability I will not. There was a large sum expenied on the Ottawa and Toronto Railway. I think when that cornea to be organized I will get that back. I have paid for surveys and paid the commissioners for getting bonuses from the municipalities, altogether quite a large sum of money, and I expect to get that back. The portion of money paid to assist in the elections directly I don't expect to be repaid. Question — That is the money you disbursed to Sir George Cartier, Mr. Langevia and Sir John ? Answer — ^Yes. Question — And the subsequent moneys, paid through Mr, Abbott ? Answer — Yes, amounting in all to $162,000. Question — Did you make any entry in your books about those pailioular sums. Did you separate them ? Answer — No, I don't think I did. I imagine that my bocks contain merely a memorau' dnm of the payments. Question — And you have no claim in any way for their repayment ? Answer — No, not in the slightest. To Sir John A. Macdonald through the Chairman : Question — As I understand it, then, the agreement between you and the Government, or any member of the Government, may bo considered to be confined to my telegram of the 2Gth July ? Answer — I think so. Question — At the time that that tclogram wop sent to Sir George, on the 26th July, 163 there had been uo conversatioa mih him or any one about helpiog to contribute to the elections ? Answer — No, not at all ; it was after that. Question — It was sfter that, so thtt as far as that agreement was concerned there was no conneotioQ between your subscription to the elections and that tel^am ? Annuer — None at all. Question — ^When Sir George and yourself entered into this agreement of the 30th July, varying the terms of my telegram, its terms ware settled before there was any discussion about money matters? Answer — Yes, immediately after those terms were settled the discussion about money matters came up. Quation — Then his letter, my telegram to him of the 2Cth, and his letter of the 30th July, were all before t'^e conversation took place about the money matter. Then on receiving my tel^ram, or after having ascertained that I objected to the agreement of the 30th July, you replied to me next day that I might treat your letter as waste paper ? Answer — I am not sure what day it was, but it was a day or two afterwards, at all events. Qitettion — You authorized Sir George also, to telegraph me that your letter might be regarded as waste paper, and that the agreement was my telegram of the 26th July ? Answer — I did. Question — Therefore, any sums you may have idvanced to aid in the elections, must have been after you were aware that I had rejected that letter of the 30th July of Sir George ? Answer — I cannot say when the actual payments were made. Question — The agreements were made on the afternoon of the 30th July, and on the 3l8t you replied that your letter was waste paper ? Answer — I am not sure when the payments were made, but I regarded them at all events, as having been paid without reference to that matter. Question — You say that you considered it to be to your interest to support the Govern- ment and its policy in .he various subjects you have mentioned ? Answer — I did. Question — And that there was a danger that that policy might be discontinued or re- versed in case of a change of Government ? Answer — I apprehended it might be so. I did not know that there would be, bijit I apprehended that there might be. Question — Now in that communication in that paper, respecting the recouping, he (Sir George), says, "You or your company." What company does it refer to ? Answer — I am not able to explain what company was meant. I can only judge from analogy. Sir George had said before that the Americans were to have nothing to do witli it, therefore he could not have meant them. The Canadian Pacific Railway Company was not formed except provisionally, and had no fund. The only other company that he could have possibly meant, was my own firm, and t> at never paid any of the money. Question — Sir George did not know of the agreements between jou and the Americans, and could not have any reference to them 1 Answer — No ; he did not know anything about it. Question — You never showed him that agreement, or made any communjcaticn to him on that matter ? Annver — I did not, nor to any member of the Government. Question — And you kept that away even, I take it, from the other gentlemen connected with the Canada Pacific Railway ? Answer — Except talking about it in general terms to Mr. Macpherson and the other gentlemen in Toronto ; there was no knowledge of it whatever. Question — Sir George did not know of it ; you never told bim ? Answer — No, he did not know of it ; at least not from mc. Question — I need not ask you about the loan to rac of $4,000 ? Answer — I have clearly stated that. so 1 1 It r i i . 154 Question — Not a tvord of tiuth in it ? Atwccr — None. Question — Not only no $4,000, but no dollars at all nor cents ? Anstcer — None. Question — You have stated that you did not give authority to Mr. Abbott to make arrangements with Mr. Langevin as spoken of in Mr, McMullcn's letter ? Answer — I do not remember peaking to Sir. Abbott at all on the subject. Question — I remark that you state that you gave a discount to La Minervc newspaper. Was that a business transaction ? Ansiner — A business transaction entirely. Question — Had it any reference at all to the Government or to the Pacific Railway ? Answer — Not the slightest. Question — As a matter of fact, was that arrangement between the proprietors of La Minerve, or with the individuals composing the firm ? Ansxrcr — It was not with the proprietors of La Minerve. It was with an individual and not with the Company. Question—Yon made them a discount at your Bank ? Ansicer — I don't remember whether it was through the Bank or through myself. It was for a small amount ; a mere business transaction. Question — Then there was no agreement ? Answer. — None. Question — Was there any telegram from mo to you approving of or confirming the 'pro- ceedings of Sir George Carticr as stated by Mr. MoMullcn ? Answer — You did not telegraph mc at all that I knew of. Question — You received no telegram from me approving of Sir George Cartier's arrangemeni; and the only acquaintance you have of any telegrams from me was one disapproving of it ? ' ^ Ans wer — Exactly . Question — I see that Mr. McMullcn speaks in this interview about your being a laige gainer, and that you would be recouped by the Government deposits, to a large extent, in the Merchants' Bank ? Ansiccr — The Merchants' Bank has the smallest amount of Government deposits of any Bank of the same class, so that was quite impossible. The Merchants' Bank collects at various points for the Government, where its other agents have no branches, so there is a very small amount there, much smaller than is usual in other Banks. Question — l>o you happen to remember the amount ? Answer — It varies every day. Question — Can you state the average ? Answer— I think it is from 6200,000 to $300,000.' Question — Any profits that might be made on these deposits, to whom would they go ? Answer — To the shareholders of the Bank, of course. Quest/till — And not to Sir Hugh Allan personally ? Answer — By no means. Question — You get your portion ? Ansiver — Yes, my share of the dividend, that is all. Question. — Mr. McMullcn states that you prepared a memorandum, setting forth all the telegrams, correspondence, and everything connected with the Pacific Railway, and threatened the Government to publish it, and that then they came to your terms, is there any truth in that ? Answer — None whatever. Question — Did you ever make any communication approaching to it ? Ansu^er — None whatever. Question — It is altogether a falsehood ? Answer — Entirely. o i> 155 O i> .>■ Question by the Commission. Had you any communication from the Government respecting the suppression of these letters ? Answer — None whatever. Question— Or from Sir John, Sir George, or any other member of the Government? Answer — None whatever. Question by Sir John Macdonald. There is a statement by Mr. McMullcn that I sent you a telegram stating that you had " a big thing," and " must shell out." Did you ever get such a tcksgraui ? Answer — I never got such a telegram. Question — Or anything like it ? . i Answer — No, nor anything like it. Question — When in one of your letters, which has been referred to, to Mr. McMullen, or Mr. Oass, I forgot which, you say " by the means you know of." did you refer to pecuni- ary means, or political exertions by yourself, or how ? Answer — I dont know. Question — What did you mean when you said in your letter of the 1st July, 1872, that means must be used to influence public opinion ? Answer — It meant simply by newspaper articles and means of that kind. Question — Working up the public excitement and so on ? Answer — Yes, the usual way in which such things are done. And further for the present, deponent saith not. And on this 25th day of September, the said tvitnoss re-appearcd aqd made the following addition to his foregoing deposition : In answering the question " Was anything taid about the money before the longer letter of the 30th July was signed." I wish to say that nothing was said about money previous to the terms of it being agreed upon, but reference was made" to it in a later period of the day. And further deponent saith not, and this, his deposition having been read to him, ho declares that it contains tho truth, persists therein, and hath signed. Sworn and taken on the nineteenth day of ") September, 1873, and acknowledged [ (Signed), HUGH ALLAN. on 25th day of said month and year. ) (Signed), CIIAELES DEWEY PAY, Chairman. A. POLETTE, JAMES EOBEET GOWAN, Commissioners, 166 I' i 1 Province op Ontario, City of Ottawa. ) IN THE MATTER OF THE COMMISSION rt'iit I- Appointing Charles Dewey Day, Antoine Polette, and Jaues Koberv Gowan, Commiffiioners to enquire into and report upon the several matters stated in a certain Resolution moved by the Hon. Mr. Hunthioton in the House of Commons on the second day of April, A.D., 1873, relating to the Canadian Pacific Railway. Present: Thr Cohiiissioners. On this nineteenth day of September, in the year of our Lord one thousand eight hundred and seventy-three, personally came and appeared before us, the above named Com- missioners, The Honourable JOHN J. C. ABBOTT, of the City of Montreal, Advocato, who being duly sworn, deposeth and saith : Question — ^You reside in Montreal ? Ansicer — Yes. Quettion — ^You are an Advocate t Answer — ^Yes. Question — And a Merabor of the House of Commons 1 Answer — ^Yes. Queation — Do you know Sir Hugh Allan ? Antvoer — I do. Quettion — Have you been connected with him of late years in railroad operations ? Answer — I have been associated with him in two or three railroad enterprises during the last year or two. Qtustum — Do you know Mr. G. W. McMullen ? Answer — I do. Question — You are aware of the charges relating to the constiniction of the Pacific Railroad, and the furnishing of money for the elections, recited in the Commission. Will you have the kindness to state in detail what yon know of these matters ? Answer — My first interview with Sir Hugh Allan on the subject of the Pacific Railway, was very shortly after the Session of 1871. Then I suggested to h:m that this enterprise would be a fit •bjoct for a gentleman of his position and wealth. To that he replied, " Well, put down your ideas in writing," but this I did not do for reasons which it is unnecessary to mention now. I did not take any further stops then. The next I heard of the Pacific Railroad from Sir Hugh was when ho called on me in Montreal, I think in the month of March, 1872, and asked mo if I would assist him, as he was going to take up the enterprise. I agreed to do so, and shortly afterwards I met Mr. McMullen at his house in tho evening, at a dinner party or something of that sort. Ho (Sir Hugh) then told mo that ho had made an arrange- ment with certain American capitalists to form a company to build this road ; that he had been in communication with tho Government about it, and that he thought they could organise a company that would build it, and that they would get tho contract. As far as I recollect, ho did not show mo either the contract or the sup- plementarj' contract on that occasion. In fact I did not see either the one or the other until within the last few days, except tho contract which I saw for a moment >)> ^ 157 at Montreal in tho early part of this year, at a meeting I had Avith Mr. McMullon and two of his friends, and I have not yet read thorn carefully, lie said that tho Americans had sketched a Bill for tho incorporation of tho company ; that they thought tho best mode of getting the road built was by a corporation, and ho gave me these two Bills as a sort of basis for the preparation of tho Legislation that was required for tho incorporation of the company. I took them, and that was about all that passed on that occasion. I was not told who the people were, and I think did not know until a very considerable time afterwards, except that ono of them was Mr. J. Gregory Smith. I did not know that there had been any formal agreement executed at that time, or if I had heard that there was, I did not k low its nature. It amounted to this, that Sir Hugh Allan, probably recollecting my suggestion to ^ him of the previous year, and knowing that I was frequently engaged in my profcs- ^^ sional capacity, in the organizations of corporations, applied to me to pi-eparo the necessary Legislation for the company to build the road. I undert^k to do that, and shortly afterwards Parliament met. I don't know that I had any further interview or conversation, either with Sir Hugh Allan or Mr. McMullen, until after Parliament met. I came up to Ottawa about tho first week of the Session, and I found that there was a very considerable fooling in the House against the admission of American influence into the Pacific Eailway. In fact I suggested to Sir Hugh Allan and Mr. McMullen that there pro- bably would be such a feeling, and that if they attempted to give to it the character of an American Company, they might not succeed in passing their Bill. When I reached Ottawa, however, I found this feeling much stronger than I had anticipated, and I found then for the first time that a company had been partially organized in , Upper Canada. A number of names had been got which were understood to be 4\ pledged to tho formation of a company to exclude American capital and American control. I conferred with a good many of the Members, and with some of the Ministers in a general way about this, and I saw plainly that no Charter to incor- porate a company to build the road with American capital, or leaving the control of it in the hands of Americans, would be sanctioned by either the House or the Gov- ernment. A short time after this Sir Hugh Allan came himself to Ottawa ; I think I asked him to come, and I told him what I thought was the position of affairs, and that unless he set himself to work to organize a Canadian Company, and abandon his American project, he could not succeed in what he wished to uo. Question — About what time was this ? Answer — About three weeks after the opening of the Session. It must have been about tho end of April, I should suppose. I had two or three conversations with Sir Hugh Allan on this point, and Mr. McMullen himself had been here before that, and I had expressed the same opinion to him. I told Sir Hugh this in tho presence of Mr. McMullen, and after some consideration. Sir Hugh authorized me to proceed with tho preparation of a Bill for the incorporation of a company that would entirely exclude American influence and American capital. I should not say American capital, we could not exclude that if people chose to put it in, but entirely to exclude American influence. And I understood from that moment that any agroement that had been made with American capitalists was at an endi Subse- quently I told Sir John Macdonald our conversation; and I also approached Mr. Macpherson, and suggested to him, that as Sir Hugh Allan and his friends were willing to go into a company composed entirely of Canadians, and entirely under the influence and control of Canadians, it would bo better if he and his party which was strong, should join with Sir Hugh Allan and his party which was also strong, in forming one company for the purpose of taking up this enterprise — that is ono Canadian Company. Mr. Macpherson was not convinced that the connection between Sir Hugh Allan and his American friends had ceased, nor that the influence of those people had ceased in tho comjjany ; and this was one of tho reasons, though not the only reason for his not yielding to my suggestion to form but ono strong company — tho strongest company the Dominion could raise, to proceed with tho 168 buildinpj of tho roml. CoiiHoquontly I thou prcpurcd u Charter for tho Cutiiulu I'acilic l?iiihvay Company, which was the namo ^ivcn to tlio company of which Sir Hugh -A Han was tho proxniiicnt man, and tho Cliartor of tho Intcr-Occanic Coniiia-iy was 8ubso»|Uontly propai'od and printed in nearly tho same language. Question — They were incorporated by statute? Answer — Yes, out tho incorpoi-ation did not take place for a considorablo time after that. I think tho Canada Pacitic Bill was printed first, and tho Intor-Oceanic Bill afterwards, containing tho clauses of tho Canada Pacific Bill, and u few more, and tho matter remained in that position until about tho beginning of Juno. Tho policy of tho Government as 1 understood, during that interval, was not settled Avith regard to those Companies; that is to say, they seemed to bo unwilling that the incori)oration of private companies should proceed until their own measure, laying down tho principles u^wn wnich they were prepared to act in carrying out the enterprise, should have either passed tho Ilouse, or matlo such progress before the House, as would enable every one to know what tho project was reaUy to be. After this took place, the Bills Avero allowed to go before tho Standing Com- mittee on Eailways. Question — The policy of the Government then to exclude American influence was known before these Acts of incorporation were passed ? Answer — It was known in this way, that every one knew that there was a strong feeling on tho part of the Government against American influence. No one know as far as I am aware, that there had been any distinct decision by tho Government, but yet every one in the House distinctly understood, that either the Government, or the greater number of tho gentlemen composing the Government, were opposed to American influence being introduced into tho comijany, and more especially was Sir (Jcorge Cartier known to be opposed to it. I know myself that on several occasions ho expressed himself strongly against the admission of American influence, and appeared to show rather a hostile feeling towards the Allan Company ; and to have the idea that they did intend to take the Americans into thoir organization. For some time he appeared to have that feeling. About tho first a\ eok in June, I think, tho Bills were allowed to go to tho Committee. The Govei-nment Bill having been introduced, and its tei-ms made known, the other two Bills were allowed to go to the Committee, and they were passed in exactly tho same language. I do not think that there was any diflcrenco in them from one end to the other, except in tho names of the coi'porators. The Canada Pacific Company's Bill had boon framed with a clause, excluding absolutely all foreigners from "being members of its Board, but the Inter-Oceanic Company's Bill, as prepared, provided only for tho exclusion of a majority of foreigners from its Board, and permitted a minority of tho company on the Board. Before tho Com- mittee, the form of the clause adopted by tho Inter-Oceanic Company was inserted in the other Bill, and I believe that both stood, and for that matter stand to this day, allowing a minority of foreign Directors ; but up to that time there was this diflercncc, that the Canada Pacific Company had provided for tho exclusion of all foreign Directors. Question — That is, tho draft Bill that you prepared for the Canada Pacific Com- pany expressly excluded Americans ? A7iswcr — Yes, it excluded all foreigners. Question — The other Bill was in tho terras you state, providing for a majority of Canadians ? Answer — Yes. The Bills were read a first and second time and refei-red to tho Committee on Eailways, and in that Committee their terms Avero assimilated to each other in tho form adopted in the Inter-Oceanic Company's Bill. Question — With tho approbation of the promoters ? Answer — Yes ; at least I cannot say that the question was ever submitted to tlic promoters of tho Canada Company's Bill. I was representing them before the Committee, and as the Govornmont were desirous of having the Bills in the same U ^ 159 *^ iS> terms, and ^Ir. Maophovson's Company wore innvillinfc to put in a clause oxfliulin^ foroignoPH, 1 yielded lo tlio siiggCHtion that it would bo bottor not to oxdudo tlu-iu absolutely, and to make the Caniula Company's Hill the same as theirs. Iniinediately after the Session there was a sort of provisional or>. M I think, if not tlio wholo of it; wrote a fow words upon tlio draft, and roqucHtod )no to write it over for liini, wliicli I did either from hiH dictution, or from the draft HO altered hy him. Theae are the two letters which Sir Iliifrh has prodiicwd this morning. J find that my recollection ditt'ers a little, but not materially from that of Sir Hugh. I think that the terms of the tirst letter reforrin/^ (o the ilailway, wore agreed to, hut that it was not writtetj or signed at the first interview; tliat is we wore leaving, and after the terms had been agreed to, Sir (jleorge spoke to him about tlio money in the manner in which Sir Hugh Allan has indicated, and that in the afternoon the two letters were signed. That is my recollection of (he circumstances connected with that. SubHe«piontly, in fact 1 think sometime after this, the question of the amalgamation of the two comiianies was revived. We rec(iivod an informal intimation from the Government, or some Member of the GoverunuMil, that it would be well to have a meeting at Ottawa, I think in the latter end of (he month of September, with the Inter-Oceanic Company, or with loading men from that com- pany, carrying out precisely as I understood it, the telegram of Sir John A. Mac- donuld, of the 26th July. Several members of the Canada ('ompany came to Ottawa accordingly, and some gentlemen I think connected with the Inter-Oceanic Comj)any also came, but of this I am not quite sure. At all events, on our arrival here, or shortly after, wo wore infoi-med that the Inter-Oceanic Company had sent in a mem- orandum giving reasons for declining the amalgamation. Question — Is that tho memorandum published in the Blue Book ? Answer — Yes, tho first one. Wo saw sevorr.' members of the Government about It, and requested to have a copy of that pajior, that we might have Jin opportunity of answering it. Thoy urgocl upon us to endeavour to answer it in such a manner as to remove tho objections of tlio Inter-Oceanic Company if possible, ratlior than got into an altercation with them, and so increase tho difficulties of amalgamation. The paper was not communicated to us at Ottawa, but a copy was sent to us at Montreal. The answer was drawn up as wo thought in a very conciliatory spirit; urging tho amalgamation strongly, and endeavouring to dispose of the grounds of objection raised by the Intor-Oceanic Company, and doing all that wo could to endeavour to bring about an amalgamation. This answer was communicated to the Intor-Oceanic Company, and thoy replied to it I think. Question — Was that the document of tho 12th of October, signed by Sir Hugh Allan, yourself, and Mr. Beaubien ? Answer — Yes ; but I cannot romember the date. We were the provisional Committee. An answer was sent to that, which, I think, is also printed. On seeing that answer we thought that the attempt to amalgamate would prove unsuccess- ful, and I do not think the Canada Compau}- took any further steps to bring about an amalgamation ; but avo were informed that the Government had taken up tho matter and were making an effort, and of Sir John A. Macdonald's visit to Toronto to see Mr. Macpherson ; and the probability at first of his succeeding and afterwards of his failure. These efforts were commenced before the elections, sus- pended to some extent during tho elections, and re-commcnced towards the end of September and carried on untill the end of November, with every desire, I think, on tho part of tho Canada Company to have them successful. After this, I think either at tho end of November or theoeginning of December, lato in tho autumn, at all events, Sir Hugh Allan was informed, and I myself I think verbally, also, that the Govern- ment intcr.dcd to form a Company under the power given them by their Act ; that they did not think that it would be proper to give ihe contract to cither Company incorporated ; that these companies were to a ver^ onsiderable extent sectional, and that tno Company which should got the contract must be one that would fairly represent tho whole Dominion. The Government then stated that they were endeavoring to get together a Company composed of such men as would fairly repre- sent tho wdiole Dominion, and would command confidence hero and in England, where it was supposed tho funds wei'o to be obtained for building tho road. Shortly after this a few of the gentlemen whom tho Government had boon consulting about 21 162 Iho Comjumy, mot in Ottawa, and perhaps 'ivory week or so they met again, their numbers heing increased each limo by persons who wore tlioughtfit to come, and who were encouraged to come iU. I think that in January the number had been pretty nearly filled up, and the framing of the Charter was proceeded with. At the meetings here I had always taken an active part, and given a good deal of attention to the whole subject, and i came gradually to be put forward without any formal appointment to represent those gentlemen in settling the details of the Charter; and the Government corresponded with me on several occasions in that sense, and caused mo to visit Ottawa to meet membei-s of the (Tovornment for the purpose of working up the Charter. And in that way during the month of January, and I think up to the 5th of February, the clauses of the Charter w^ere discussed and the Charter framed after a very groat deal ol' discussion and attention on both sides. It was framed as it now is, and was issue;! about the 5th of February, of this year, in the form which it now assur les. Que»tion — What number of interviews had you with the Government ? Anawer — We had several interviews with the whole Cabinet, but the details of the Charter were settled chiefly with Sir John A. Macdonald and the Hon. Mr. Campbell. I t'on't know whether any nan-ativo I could give you, could proceed fui'ther than that I have given; but any further questions Avhich the Commission may choose to put me 1 will be happy to answer. Qutstion — Did you know of the coiTCspondenco between Sir Hugh Allan and Mr. MoMullcu and Mr. Smith, while it was going on ? Answer — Nothing whatever. I had no idea of it at all. Question — Have you any personal knowledge about these telegrams of the 30tli and 31st of July, to Sir George Cartier, respecting that letter of the 30th of July, embodying the new terms of agreement V Answer — No. I had no knowledge of them until very recently. I was under the impression until some tiiue ago, that Sir John A. Macdonald concurred in Sir George Cartier's lettei*, but I cannot at thi(3 momen*. remember what caused that im- pression. It was without any foundation whatever, I am satisfied now. Question — Were you present at any of the meetings between Sir Hugh Allan and Mr. McMuUon, except the one you have mentioned? Answer — I had an informal meeting on one occasion early in the Session, when .'. informed them — Sir Hugh Allan and Mr. McMullcn — that unless the American pro ject was laid aside, it would bo useless to attempt to carry out their enterprise. I met them both frequently afterwards. Question — You have seen Mr. McMuIIen's published letter of July? Answer — Yes. Question — De you remember the statements made with respect to the pa^-ments of, or pro iiises of sums of money ? Ansuer — 1 don't remember sufficiently well what promise 30U refer to. Question — The first is, that Sir Hugh Allan announced to Mr. Smith and i\Ir. McMullen that $8,500 had been lent to Sir John A. Macdonaid and Sir Francis Hincks ? Afiswer — 1 .vuow nothing whatever of that. Question — It also speaks of $50,000 which Sir Hugh Allan said it Avas nccessar3' to pay to Sir Francis HincUs ? Ansicer — 1 never heard of that excojit in the newspapers. Question — Did you ever heir Sir Hugh Allan mention cither of these sums, or that they were expected by the ])arties to whom they were givi 11 .■* Atiswer — No, never. Question — Then the letter says : " In addition to the payments spoken of, Mr. " Abbott was authorized to promise Mi*. Langevin $25,000 to aid in llie elections " about Quebec, on condition of his friendly assistance, and Mr. Abb >tt reported that " he had done so ? " i*t A 163 Allan •I )? r* Answer — An rcgaitls tliati tlunk it in noccssaiy to mako a statement. In tiio first place the statement in that foi'm is entirely untrue, but it iw (piite Inie tlmt I haee. Mr. Langcvin mentioned to me that at the j)revion» general electionsj he had been obliged to expend a veiy considerable sum of money, not very large in itself, but brce comjjaratv/Iy, and ho said ho did not think it fair that the burden of tho-c elections should rest entirely on him. He saiil he (huught he ought to liavo a share of anj- funds sukscribed in Montreal for election purposes to a^sHiMt in (Quebec, which he hat iiad in lu-cvions elections uud that they could not expect much of a subswrription from (Quebec to help the Government. I agreed with him in thi'diing that it wim unfair that ho should bear the burden ol' (ho (Quebec elections, and I told him that in t^o far as I could have any influence in (he matter I would try that he should have a portion of any funil which might be got up in Montreal for general election purposes. Talking over matters, and J think it is this that Mr. Mc- Mullen speaks of — it came out in conversation that ]irob;ibly (he elections would cost in the Di.strict of Quebec, irrespective of his own, a sum of $i25,0()0(n' $30,000. I told him that a.s far as I could influence the matter I would endeavour to get samething like that amount allotted to the District of Quebec. That is what took place Ixitween Mr. Langevin and mj-self. I did not at that time make any allusion to the position of the Canada Pacific and its charter. I know Mr. Langevin v as a strong Lower Cana- dian, and I thought that his friends wore all in favor of arranging the Pacific matter in such a way that there should bo direct communication with the sealx)ard at Quebec and Montreal, and I assumed that in any matter in which he could support the views of the Lower Canadians he would do so, and wc did not wish anything more. I never said anything more; I never reported that I had made any arrangement with Mr, Langevin, though, no doubt, I did mention it to Sir Hugh Allan, that if wc got up a fund Mr. Langevin should have a part of it to the extent of $25,000. Question — Did j'ou communicate this to Mr. McMullen ? Answer — It is not likely that I would do so ; though Mr. McMullen appears to have become aware of it. But there has been so much spying and betrayal of private documents and alistraction of private letters in the course of this att'air, that it is im- possible to sa^ how Mr. McMidlen became possessed of it. Question — I do not understand you ? Answer — I mean that nearly if not all the papers published in the press relating to this Pacific affair have been obtained by illegal if not criminal means. For instance, the four papers which were published a( (he end of Mr. McMullen's second letter, mast have been obtained by moans which 1 think I may call criminal. Question — What papers do you refei- to ? Answer — I refer to the two telegrams and (he receipts, the one from Sir John Macdonald to me, the one from me to Sir John Macdonald, the letter of Sir George Ciirtier to me, and the receipt of the Montreal Committee to me. Question — In whftsc possesion were (hey ? Answer — These jjai^era were in my possession during the absence of Sir Hugh Allan in Xcwfoundland. Question — Have you them yet ? Answer — Xo. I gave the.n to Sir Hugh Allan when he returncil from Xcwfoimd- land and it is quite obvious, at all events I am convinced ot the fact, that (liose papers were either stolen from the priva(c drawer in which (licv were kept while in my possession, or from the place in which Sir Hugh Allan put (hem. Question — You say Sir Hugh Allan has (hem now ? A.iswer — I don't sa}' he has (hem; I say I gave (hem to him on his return in September, 1S72. I don't suppose these gentlemen had (ho originals in their posses- sion, but they must have obtained them by bribing a contidontial cicik or secretary who had acce.-?.s to them to c<)]>y them. For those reasons I say i don't know how Mr. M''Mullen got his information. It is barely possible that he could have heard it from Sir Hugh Allan or myself. IMHMW 164 I, 1 Question — You wcro acting as confidential agent to Sir Hugh Allan with respect to the money ? Answer — No, I don't think I Avas. Sir Hugh Allan asked rao to assist him in this affair. I think the preponderance of his motive was that my professional practice had led mo in the direction of this kind of business — the organization of companies. I alno took an interest as a public man in this particular Eailway, but I considered I was acting more as the solicitor of Sir Hugh than in any other capacity I can describe. I never was is any sense his agent. Question — I think you were made the medium thi'ough which the moneys were paid for election pui'poses ? Ansu'cr — Only while Sir Hugh was in Newfoundland. I never had anything further to do with the moneys than this. I was present when those letters which I have dcdcribed wcro talked about and signed, and when Sir Hugh Allan left for New- foundland I was made the medium of communication with him with respect to three or four transactions. Question — Did any other sums come into your possession other than those sub- scribed by Sir Hugh ? Answer — None whatever. I had nothing whatever to do with the distribution of the money subscribed for the elections. Question — What was the amount paid through you by Sir Hugh Allan for the elections ? Answer — The first amount was $10,000. Question — At Avhat date? Answer — I think it must have boon about the 8th or 10th of August. It was $10,000 which he left in my hands to be given to Mr. Langevin. He Avrote to Mr. Langovin, I think, informing him that the money was iu my jiossession, and that on his giving me a receipt for it I would pay it. The first I heard of Mr. Langevin's action was his telegraphing mo to meet him on the Quebec boat, which I did, on his way down to (Quebec. He said he had received a letter from Sir Hugh Allan saying that on giving a rcccii^t I would give him the money. Ho said ho could not under- stand wliy such a receipt was asked from him. I told him I did not sec that there was any reason for it either, and I did not think that there was any particular reason. He then said that he would have nothing to do with it ; that ho could not give mo any receipt. Ho did not know what Sir Hugh Allan's reason was for asking it, and at all events he would not give any receipt whatever. It looked to him as if it migiit be said that it was not a free subscription to the elections at Quebec which Sir George Cartior had promised him, andunless it was, he would not take it at all ; and moreover, ho would on his arrival at Quebec return the $15,000 which Sir George Cartior hati previously caused to be sent him. Ho aj^peared to me to be a little excited about the matter. I left him upon his expressing his determination not only to refuse that money but to send back tho $15,000 which was the sum first paid. I telegraphed Sir Hugh Allan saying that Mr. Lant^evin did not feel disposed to give any receipt, and asking bis authority to give Mr. Langevin the money without a recei}»t. I did not get an answer witliin two or three days, and knowing that the elections wore going on, and that tho money would probably be wanted, J took tho responsibility of sending tlie money to Mr. Langevin by express, and wrote him at the same time telling him that 1 Jiad done so. Tlio second sum, namely: — $20,000, was paid to tlie Montreal Central Commit- tee, 1 getting Sir Ihigli Allan's juithority to pay it, by telegraph. The third sum was $io, 000, respecting which, Sir .lohn Macdonald telegraphed me. That I also informed Sir Hugh of, and obtained by telegraph his authority to pay it. I think these were all the siuiis of money I lia Question — You wore in very intimate relations with him on this subject ' Answer — Yes. I did not see him very often, but he seemed to speak to me with- out any reserve. Question — Do you know Mr. Foster ? Answer — Yes, Question — Was ho present at any of your interviews with Mr. McMullen ? A)iswer — I think ho was present at interviews with Mr. McMullen during the Session. He was one of the Directors of the Canada Pacific liailway Company, and Ave desired to get him on the Board of the Canadian Pacific. He is a man of consi- derable railway experience, and I believe of capital. He was entirely in the coi\fi- dence of the Company, and during the Session of 1872 assisted, to some extent, in getting theBill through. And I have no doubt tJiat Mr. Foster, Mv. McMullen, and myself frequently met during that Session. Question — Did you crer have any conversation in Mr. Foster's presence in relation to any sums of money to be paid to the Government or any member of it ? Answer — To the best of my recollection, no. Nothing of tbat sort was ever oon- Icmplatod at all to my knowledge, cither during the Session or afterwards. The election fund, to which Sir Hugh Allan afterwards contributed, was not, I think, spoken of at all during the Session, except as I had previously stated. After the Session I saw very little of Mr. Foster, and nothing at all of Mr. McMullen for acou- .sidcrablo time. Question — Sir Hugh Allan mentioned that iio had never given anything so largo at any ])revious elections. Did it occur to you that this was a very large sum for him to give on this occasion ? Answer — 1 knew nothing of what he had given on jn'ovious occasions, but I cer- tainly thought that this was avery largesum lor him u.givo. Atthe same time itmust be observed that he did not agree deliberately to subscribe the whole of this sum at once. Ho contributed from time to time as the elections went on and as the money was needed. Probably he might luive hesitated at subscril.iing so lani^e a sum at (mco, but the feelings and interests which ho himself has described probably led hptw as the mon y was needed, to continue his contributions to a larger sum than ho/Criginally intended. Question— Do you know of any other facts wliich will throw light on his motives in giving this large sum ? Answer — No, most certainly not. To my own mind Sir Hugh Allan's motives as described by him ai'o perfectly clear. Ho is interested in the carrying tratle to an >*- 1G7 8> >^ enormous extent. About 83,000,000 of his fortune is invested in the eavryiuu tmdc alone. I mean in seagoinjjf steamers alone, lie has also a lari^o anioniit of nionoy invested in the Inland carrying trade. He was forced as lie imai^ined, and not un- willingly, perhaps, to enter into an organization for an cxteuf. Question — Did he think so at that time ? Answer — Yes, certainly. Question — Did it not strike you as strange that he should contribute so largely? Answer — Not at all strange considering his position and his objects. Question — You say that you had several interviews with the Governmont and more particulai-ly with Sir John Macdonald and Hon. Mr. Campbell discussing (ho terms of the Charter before it was finally settled. Did you propose any modifica- tions in the original draft ? Answer — Yes. The work which was done during, I think al*>ut a fortnight of very close application to the charter was of two kinds. One was a very critical examination of the phrases and language of the charter and that to<>k up a good deal of tune. The other did not take up s»> much time, namely, the discutssi^vns of certain modifications which were suggested on both -;ides to the original drsft. I made several suggestions, some of which were approved, and some of which Avero rejected. Question — What was the general nature of the mollifications you suggested ? Ansiccr — I suggested, I remember as one thing of importance, that there should be power granted to the Company to issue a further amount of stock, and Sir Hugh Allan had that very deeply at heart indeed, because he feared that an application to English capitalists to obtain money might be unsuccessful if thoso capitalists were not to have any sJiare in the prospective advantages of the Road. That was dis- cussed at considerable length with the Government, and finally the matter was submitted to the Government itself and Sir Hugh Allan's views in this subject, and my own were overruled. There were several other points on which 1 desired tr. have ^notlifications, for instance the amount of bonds per mile. I thought that it was too small. Question — Did your views prevail ? Antm-er — They did not ])revail in that respect. I remember anotlier subject whicii was co-nsiderably discussed, namoly ; as to the mode and in what proportions the money am. lands were to be paid to the Company for the construction of the Road. The originnl design was that they should be paid on the certificate of the Govern- ment Enjdneer. My idea was that there might be a difference of opinion between the (Tovemment Engineer ami the Company, and I was anxious that there might to some independent (ribinial to which ihe question should be referred and linuUy a \»Bry- guarded clauss. was iutror American control ? Ansicer — Xo ; quite the contrary. From the moment I prepared the Jiiil for the SfHise of Commons, 1 tN>nsidere(l that tlw de*ign of mti-mSsMing American influence ,an«i control into the I »oadwa»s abandonetl. I did not n»gard it ih impossible that it might be rev i veil ; that might depend upon the poSn-y of (ho ttoverument ; but as far as I know the idea of carrying out the Road by American inflncnct' and capital, w.'is abandtmed. My imprieNsion w^ts tlmt Sir Hugh Albui, while he authorized (he organization beii^s, piXHxnxKxl w'"untL -.ii appeared to entertain in his 168 i !, ; !^ ■i own mind tho idea that some time or other wo might bo ol)]igod to have recourse to American capital. That is the way in a\ liicli I account for his having continuoil in ])rivato correspondence with the Amoricnns. So far as 1 and the Company wore con- cerned, there was not the slightest idea of the introduction of American influence and capital. My efforts were directed to framing the charter, or a.ssisting tho CJovern- ment to frame the charter, so as to exclude the possibility of it. Question — ^Were you present in Ottawa at the time the names of the gentlemen who appear in the charter were settled on ? Answer — They were not all settled on at once. It was a work of some time to collect together the Directors of the Company. I am aware that several gentlemen were spoken to, others were corresponded with, several came to Ottawa and saw tho Government; and one by one fit people were selected from one part of tho Dominion or another, until the full complement of thirteen was decided upon. I think tho last ono was not entirely settled upon until within two or three days of the signing of tho charter. I refer to Mr. Hall. He was not finally selected until two or throe days before tho charter was signed, pai'tly because Sir Hugh Allan and myself had urged the appointment of some one suggoated by Mr. Foster, and partly because Mr. Foster himself was desii'ous of being represented on the Board, and partly, I believe, because Sir George Cartier had expressed a wish that Mr. Foster should bo on tho Eoard or represented on it. Question — Did you come to Ottawa instructed by the Company, or prepared to submit any names, as Directors to the Government ? Answer — No. Que&tion — Diil you submit any names ? Amwer — No, 1 never did. Tho only name on the Board that was submitted by any memlxjr ol the Company ? Question — Bo you mean the Canada Comjiany ? Answer — No. Tho Canada company ceased to hnvo any existence I may say ; for the purpose of this Eailway, when the design of amalgamating it with the Jnter- Oceanic Company was abandoned. Question — Still to some extent the interests of the Canada company were repre- sented? Answer — No, not in the slightest degree. When the project of amalgamation was abandoned, several gentlemen independent of any Company were avsked to come to Ottawa to meet, with the view of discussing the details connected with a Company. I have not a very precise idea of the v\-ay they wore got together at first, but I know that five or six gentlemen who desired to no interested in tho formation of a new Company, met at Ottawa, and the Canada Company had no more to do with it than any imaginable Company out of the Realm. Question — Do you know if Sir Hngh Allan suggested any names to the Govern- ment? Answer-^Yes, I know he suggested the name of Mr. Beaudry. Question — Any others ? Answer — No ulhers that were accepted. The only one I believe that Sir Hugh Allan was the means of intnxiuiing into the t'ompany was Mr. Beaudry. To Sir John A. MaciJonald tlirnugh tho Chairman : Question — Speaking of tho terms which were granted to tho Canadian Pacific Railway Company by the charter ; and supposing that Sir Hugh Allan had had no connection in any way with the Company, from what you know of the ])olicy of tho Goverament, and from the oommimications hot ween members of tho Government and yourself and the Board, would not the same torms have been granted? Answer — I have not the least doubt they would. J think the terms of the contract and charter were settled without the remotest i-efei-enco to Sir Hugh Allan any more than to any other member of tho lioartl. I never knew a suggestion of his, however much it might \w pressed, if it appeared unreasonable that was not i-ejccted without ceremony. I don't know of any favor or ooncesaion ever having been made to him. f 169 ^ i ^ Question— Thon you aro Batisfiod that if tlio oonfitruction of the Hoad had boon confided to tho Intci'-Ocoanic Company, they would luivo got tho sanio terms ? Answer — I am quite satisfied of it. Question — Thon these subscriptions for election purposes had no effect on tho Charter? Atiswer — No; so far as I know, and I believe I was in a position to know as much as any one, tho subscriptions for tho elections had no influence whatever upon the negociations. I never heard them referred to. Question — Was it not the case that every effort made by Sir Hugh Allan to get any preponderance to his sectional influence was overruled ? Answer — 1 don't know that ho made any special effort to give a propondcrunco to his sectional interests in tho Canadian Pacific Company, but in tho Canadian Pacific Company, the efforts that ho made wore overruled ; for instance, I kow that he made some suggestions in respect to tho amalgamation, and that they were overruled. Question — There is a quotation made in one of Mr. McMulIcns letters. A series of paragraphs from the paper, €ommunicatco delivered to hiin some time after the risinj^ of the Session in the event of these papers not being published. lie declared to me that there wore no copies of them in existence, except the one which he had given to Sir John A. Macdonald, which is the copy referred to in the paper. JIo undertook also to procure the sanction of Messrs. Smith and Ilurlburt to this arrange- ment, and he wrote 'x letter to Sir Hugh Allan, discharging him from all ol:um3 of every kind and description. I think Sir Hugh Allan har, this letter whieli Mr, Mo Mullen wrote to him. I also produce and fyle the letter which Mr. McMullcn wruic to mo marked " U." Question — Do you know Mr. McMuUen'a hand writing ? Answer— \ think I saw him write this letter. Question— Waa that concession or payment made by Sir Hugh Allan at once or after consultation with you ? Aiwver — It was made after the ncgociation had spread over a couple of weeks I should think, and after several notes and interviews had passed between Sir Hugh Allan and myself. Question — You were negotiating with Mr. McMuUen ? Ajiswer — I was negociating with him on behalf of Sir Hugh Allan as his Solicitor in the matter. Question — What did you say was the motive that induced Sir Hugh Allan to give a sum beyond the actual disbursements which were alleged to be $20,000 ? Answer — la the first place, I think, Sir Hugh recognized the fact that Mr. McMullen and bis friends had really spent a good deal of time about their scheme, and that they had given themselves a good deal of trouble about it. I think he recognized, also, that they should have some remuneration for that. I think he considered that the sum demanded for that was very large, indeed exorbitant, but he thought it was better to settle the matter than to have a great outcry and scandal, while he and the delegation to England were endeavoring to raise money for the Pacific Railway. I imagine that he saw that if these letters were pub- lished an immense deal more would be made out of them than their isiportance warranted by any parties who were opposing the Pacific scheme, and he desired that their publication, if it were to take place might not be until after his return. Question — When did you, Mr. McMullen and Sir Hugh, come to an understanding ? Answer — It is mentioned in the paper which was fyled this morning. Question — As soon as you came to an agreement it was committed to writing ? Answer — Yes. Question — Was it at your suggestion that a portion of the money withheld ? Answer — Yes. Question — You were acting as Solicitor for Sir Hugh Allan ? Answer — Yes. Question — And thouglit it a reasonable and proper precaution to take ? Answer — Yes. I thought it possible that there might be copies of these letters extant, and that no sooner would the money be paid than copies might appear in the newspapors. I thought that the retention of a portion of the money would operate as a check against any- thing of this sort. Question — " Within ten days after the end of the coming Session of Parliamf;nt, Mr. " Starnes is requested " and so on : Why was that time fixed upon ? Ansiver — Just for the same reason as any other time might have been fixed upon in order to give suflBcient time to enable the delegation to go to England and return. The publication then would be better than during the Session of Parliament, as it would create less noise and scandal than during the Session. Question — The date is the 26th of February. When did Sir Hugh Allan leave for England ? Ansiver — I think on the 1st of March. Question — For what purpose ? Answer — As one of the delegation to try to raise funds for the Pacific Railway. Question — When did copies of these papers appear in the newspapers ? Answer — The first time that copies appeared was on July 4th, in the Montreal Ile.raUI, 172 but the oharpo Mr. Iluntington made in the House, was supposed to bo based on some copy which he had of these papers. I understood that hu proposed to read papers which bore u resemblance to these documents. .Question — You say that it was apprehended that the publication of those papers might affect the mission upon which Sir Hugh Allan went homo to raise money. Do you know if it did? Amioer — I am perfectly certain that it did. I was one of the delegation of four — composed of Sir Hugh Allan, Governor Archibald, Major Walker and noyself— and the chief difficulty we met with in England, was the feeling caused by the violence of the pub- lications in this country, the extravagant charges made against the company, causing the belief in the minds of English capitalists that the success or failure of the company depended upon the success or failure of one of the great political parties in this country. People became convinced, as far as I could judge, when these charges were made and reiterated to such an extent, that if the Government maintained themselves in power, the Contract would likely be carried out and the Company go on ; while on the other hand, if the Government were ejected from power, the Contract and the Charter would fall to the ground, and the road would not be built. They felt then that they were not only im- perilling their money on the chance of the saoocss of an enterprise sufficiently difficult in itself, but on the chance of one or the other of the political parties remaining in power. There was more hesitation from that notion, that any successful result would depend upon the success of one party or the other, rather than in view of the difficulty of the under- taking itself. This it was that prevented capitalists in England from subscribing ; in fact that was the reason given by one large firm of capitalists, with whom the delegation made the greatest progress in negociating for the money. Referring to the deposition of Mr, White, I wish to state that the drafl Bill which he supposed I had prepared, and caused to be printed on behalf of the projected American Com- pany, was, to the best of my reeolleotion, the draft Bill in print, which I have already stated, Sir Hugh Allan gave to me when he requested me to prepare the legislation for the Session of 1872. And further deponent saith not, and this his deposition having been read to him, he declares that it contains the truth, persists therein, and hath signed. Sworn and taken on the nineteenth day of September, 1873, and acknowledged on the twenty-seventh day of said month and year. (Signed,) (Signed,) J. J. C. ABBOTT. CHARLES DEWEY DAY, Chairman, A. POLETTE, JAMES ROBERT GOWAN, Commissioners, 173 \ Phovince ov Ontauio, IN TIIK MATTER OF THK COMMISSION Cifij of Ottawa. Appointing Charles Dewey Day, Antoine Polette, and James Rohert Oowan, ComniissionerB to enquire into and report upon the several njuttcrs stated in a certain Resolution moved by the Hon. Mr. Huntinqton in the House of ,i Commons on the second day of April, A.D. 1873, relating to tbo Canadian Pacific Railway. Present: The Commissioners. On this twentieth day of September, in the year of our Lord one thousand eight hundred and seventy-three, personally came and appeared before us, the above-named Commissioners, WILLIAM EDWARD BLUMHART, of the city of Quebec, who being duly sworn, deposeth and saith : I reside in Quebec, but this summer I have resided temporarily in New Brunswick. My occupation is general agent of a company for building railways. I am not an engineer, but attend to the business portion of the agency. Question — Were you residing in Quebec during the years of 1871 and 1872 ? Answer — Yes, Question — Do you know Sir Hugh Allan ? Answer — I don't. Question — Do you know Mr. George W. McMullen ? Answer — No, 1 do not. Question — Do you know anything of an agreement made between those gentlemen relat- ing to the building of the Pacific Railway ? Answer — I do not. Question — Were you in a position to know anything of that matter ? Answer — No. Question — You are then utterly without knowledge relating to that subject ? Answer — Yes. I have no knowledge whatever, except what I have seen in the public prints. Quer.iio/i — Die you take any part in the general elections of 1872 ? • Ansioer — I tlii. Question — VZ-^ro you on any of the committees ? . " Answer — I ivas on several committees, but not the Ger—I do not Question — ^Yon had no other conversntion with him ? Answer — ^Not at that time. In July, 1872, 1 left for Chicago, in order to visit h'.m. I arrived there on the 28th July, 1872, and spent a week there, and then went on out to the prairies. I came back to Chicago, and I thmk it was on my return I staid there about a week and a half. One day Mr. McMullen came into the room and said he had received a letter. Holding it in his hand, he said, " This is from Sir Hugh Allan.'' He re^id me a part of the letter, and he said " Sir Hueh Allan is a tricky fellow and not to be depended upon, but I think we have got him so tightly bound by these letters that he dare not go back on us." Question — ^Is that the whole of the conversation ? Anrcer—Yw. QwsHon — ^Was any allusion made to the part which the Government were taking, or that th* Govenment had taken any part in that agreement ? Answer — No, there was not. Question — Was any allusion made to any members of the Government ? Answer — There was not. There was something said about the elections, but nothing afiecUng the Government. QiKStion — Have you had any communication with Mr. G. W McMullen since that on this subject — since the publication of these letters ? Answer — I have not. I have had a conversation with his brother. Harvard C. McMullen. Question — You have seen those letters of Mr. G. W. McMullen's whicli have been pub- lished. Answer — I have. Question — You had no conversation with him on the subject of those letters ? Answer — Not with him ; only with his brother. Question — Do yon knov anything about the subsequent portion of the charge, as to Sir Hugh Allan's advancing money for the purpose of the elections ? Answer — I do not. of the charge len. Do you n and Mr. G. alien ngreed to , were forming nadian Pacific w:t 3 between Sir le constraotion : — Had a oon- )oke to him on him was aboat mow, and as to load would go I asked him if nadian Pacific 3 on the 28th came back to ilf. tter. Holding trt of the letter, but I think we staking, or that tns, but nothing I since that on dC.MoMuIIen. have been pub- icrs? Iiargo, as to Sir 177 Question — Did you take any interest in the elections in your own part of the country ? Answer — I did. Question — Have you any knowledge of any money being supplied from Montreal for these elections ? Ansicer—-! have not. Question — Of the elections in Lower Canada, I take it you know nothing ? Answer — Nothing except what I have got from the newspapers. Question — Where do you reside ? Answer — At Woodstock. Question — What is your occupation ? Answer — I am a lawyer. Question — Do you know anything more about the subject matter of the charge which you liavo heard read ? Answsr — I do not. Question — Have you ever had any communication with Sir Hugh Allan ? Answer— So. I do not know Sir Hugh Allan. Question— Or with any member of the Government on this subject ? Answer — No. Question — And this conversation which took place with Mr. G. W. McMullen is all that you know about the matter ? Answer — It is, except what I heard from his brother. Nothing more than that. Question — Where was Mr. G. W. McMullen going when you had this conversation with him in April ? Answer — He vvas at home then in Chicago. It was in Chicago it occurred. The first conversation occurred at my father's house in Bcechville, about five miles west of Woodstock. I think he was on his way then to Ottawa, but I am not certain. Question— 1 believe yon mentioned the dates at which these conversations took place, respectively ? Answer — Yes. One was in April, and the other conversation was in July, I think. Question — Have you mentioned the year ? Aiuwer— It was in 1872. Question — What time in July ? Answer — It was in August the second conversation took place. Question — What time in July was the first conversation ? Answer — Tha first conversation was in April. Question — What time in April ? Answer — I cannot say. I am not certain that it was in April, but I think so. Question — What time in August was the second conv«iP"tion ? Ansicer — About the middle of the month. I remained i.. Chicago at that time a week, and from Monday till Saturday I was out on the prairies, and then I returned to Chicago, and left there on_the 21st August. u any papers ? c did not hand it to me, but only read nie a Micnts of it ? I did not pay any particular attention to it at that Question — Did Mr. McMullen si Answer — Nothing but this letter, a portion of it. Question — Do you remember the Answer — I do not know that I do. time. It was a letter that he received in August when I was there, from Sir Hugh Allan. Question — Was any person present besides Mr. McMullen and yourself? Answer — There was not. There were other persons in the house, but we were alone in the drawine-room at the time. It was at his brother's house. Question — Where did he take the paper from ? Answer — I think he had it in his hand when he came in. Question — Was there anybody with him when he came in ? Answer — No, he was alone. Ho had it open in his hand. Question — Was he apparently reading it ? 178 Ansicer — Yes. I was ia the room trhcn he came io. Ho then made the remark to mo that I have mentioned. And further deponent saith not, and this bis deposition having been read to him bo declares that it contains the truth, persists therein, and hath signed. Sworn and taken on the twenty-fourth day of Sep- ") tcmber, 1873, and acknowledged on the [• (Signed) FRED. C. MARTIN, twenty-fifth day of said month and year. ) [Signed] CHARLES DEWEY DAY, Chairman. «' A. POLETTE, " JAMES ROBERT OOWAN, Commissioneri*. i i Province op Ontario, ") C IN THE MATTER OF THE COMMISSION City of Ottawa. ) Appointing Charles Dewey Day, Antoine Polette, and James Robert Cowan, Conimissionors to enquire into and report upon tho severnl matters stated in a certain Resolution moved by tho lion. Mr. Huntington in tho House of Commons on the se.^ond day of April, A. D. 1873, relating to Iho Canadian Pacific Railway. Present : The Commissioners, On this twenty-sixth day of Soptombor, in tho j'oar of our Lord ono thousand eight hundred and seventy-three, personally camo and appeared before us, the above named Commissioners. THOMAS WHITE, Junior, of tho City of Montreal, wbo being duly sworn, deposeth and saith : I am a resident of Montreal. Question — What is your profession ? Antwer — Publisher. Question — Publisher of what ? Answer — The Montreal Qazette. Question — Do you know the charges which are recited in the Commission; are you familiar with them or shall I read them to you ? Answer — I know them. Question — Do you know Sir Hugh Allan ? Answe.' — I do. Question — Do you know Mr. G. W. McMullen. Answer — I do. Question — Have you any knowledge concerning any agreement between Sir Hugh Allan on one side, and Mr. G. W. McMuilcn on the other, representing certain United States capitalists, relating to the construction of the Canada Pacific Railway ? Answer — I have no knowledge of ony formal agreement. I am aware that during the Session of 1872, Mr. McMullen was in Ottawa representing certain American capitalists as he stated, and was interesting himself in the construction of the Pacific Railway. During rk to mo ) hini lie ITIN. irman. ionerm. Go WAN. jrs stated 10 IIOUHO g to the thousand 3 us, the , deposttth are you igli Allan 3(1 States uring the italists as During 179 the earlier part of the Session he was in very frequent commuDication with gentlemen in the House, who were interesting themselves with Sir Hugh AlUn, in this enterprise, and I saw him frequently at that time, and had conversations with him. I am also aware that towards the close of the Session Mr. Abbott, with whom I had frequent conversations, looked upon American connection as abandoned. I am aware too that Sir George Cartier with whom I hud frequent conversations during that Session, was very much opposed to the American connection, for the construction of the Railway, and was anxious lo promote the interests of 31 r. Macphcrson'a Company as an offset to it. I had one conversation with Sir George Cartier especially in which, while professing a desire to see Sir Hugh Allan connected with 'the Company, he expressed his determination to have the Company so formed as to exclude the possibility of American connection. Question — Do you recollect the date ? Anawer — It was whilst the Bills were before the House. Tlie conversation occurred before the close of the Session. It was at his own house and lasted two or three hours. The Northern Colonization Railway, at that time was a prominent quc!^tiou in 3Iontreal, and I was giving it support through the newspaper, and it was in connection with that, that fears were entertained by some of the promoters of that scheme, that Sir George was opposed to it, and that this conversation arose. Quettion' — When did your conversations take place with Mr. McMullen ? Anatcer — In the early part of the Session. I had known Mr. McMullen for some fifteen years. <2"('*t(on— Do you know whether the Government gave him any encouragement in this scheme ? Ansicer — I cannot say. Question — Had you any conversation with any other member of the Government than Sir George Cartier on the subject? Aiisicer — No. Question — Had you any conversation with Sir Hugh Allan on the subject ? Answer— I had conversations with him on general Railway matters. I understood his policy was to unite all the schemes with which he was identified as the easiest way to secure the construction of those in the Provinces of Ontario and Quebec. Question — Were you aware that he was associating himself with, or that negotiations were going on between him and those Americans ? Ansicer — I inferred from the conversations I had with 3Ir. ilcMuUen and Mr. Abbott that =uch was the case, but I had no direct knowledge of any formal agreement. Question — Was Mr. McMullen or any other person present at this conversation you had with Sir George Cartier ? Ansicer — No. Question — Do you know anything more in reference to this branch of the subject ? Answer — Nothing more. Qf8 nearly doublo ight bo allowed mo for tlio clcc- oiufaot 8pcciully ro not surprised otion of Quobeo in that election. wag friendly to vo inc to undcr- ienHs ii Quebec I hlalcil to Mr. lent would ti;I:o battle out them- id Mr. Bouthicr ituro there ? ; it was between ich larger than ' Lower Canada stand it. This ^g boon road icd. ANGEVIN. DAY, Chairman. OWAN, "Commissioner, 185 IN THE MATTEll OF THE COMMISSION day of September, in the year of our. Lord one thousand eight ireo, personally camn nnd appeared before up, flic nlovc named Com- TnoviNcE OP Ontario, ") City of Otiaua. \ Appointing Chaulek Lewey Day, Antoine Poi.ette, and .Iameh lioiiEnx Gowan. Comn isiono' ti enquire into and report upon the several mnttcrs stated in ii ceri...a llesolutiop moved by the Hon. Mr. HrNTiNcrrctN, in the House of Commons, »,a the second day of April, A.D. 1873, relating to the Canadian Pacific P dh.iiy. Present : The Oommi ,8Ioners. On this thirtieth liundred and seventy-three' missioners, The Hon. Gl^D^ON OUIMET, of the City of Quebec, J'rovincid Seeiotary and Member of Public Instruction for the Province of Quebec, who being duly sworn, deposeth and saith : Ilaving heard read that portion of the charge contained in the Royal Commission, which reads as follows : "That in anticipation of the Legislation of last Session, a^^ to the Pacific Rnilway, nn " agreement was made between Sir Hugh Allan, acting for himself, and certain other Canadian •'Promoters, and G. W. McMullen, acting for certain United States Capitalists, whereby the •'latter agreed to furnish all the funds necessary for the construction of the contemplated " Railway, and to give the former a certain per Centage of interest, in consideration of their " interest and position, the scheme agreed upon being ostensibly that of a Canadian Company, " with Sir Hugh Allan as its head," I have no knowledge of such an arrangement and I would add that, from communication with Sir George Etiennc Cortier, Sir Hugh Allan and some of the Directors of the Northern Colonization Railway, I was induced to think the contrary. I do not know G. W. McMullen. I do know Sir II. Allan. I have never had any knowledge touching this arrangement, or any other of the kind. I have no knowledge that the Government entertained the idea of entering into an arrangement of this kind. I say this because of frequent communications witli the late lamented Sir George Cartier, who certainly entertained altogether contrary opinions. I don't knov, that the Government, or any member of the Government, entertained the idea of entering into arrangements with Americans, or of forming any company for the purpose of constructing the Pacific Railway in which American capitalists were to be included. Question — What was the nature of your relations ? Answer — As a member of the Government of the Province of Quebec, I took an active part in the policy inaugurated by that Government in ftivor of the construction of railways within the limits of our Province, among others the Montreal Northern Colonization Kailway. After the formation of that company, the Government of Quebec did me the honour to select me as one of the directors to represent that Government in this Company. Beyond my interest as a member of the Government. I was much interested in the construction of that Railway, as being a proprietor in the city of Montreal, and also as a member in the Locai Legislature for the county of two Mountains, through which the contemplated railway was to pass. I also took an active part with my friends in endeavoring to induce the citizens of 21 186 f ' Montreal to subscribe the million of dollars Trliicli vas asked for tbat great enterprise. TIic question of a depot within or near the limits of the city of Montreal was considered one of vital importance for the town as well as for the Province of Quebec. With a view to securing the success of the railway, we addressed ourselTA to Sir Hugh Allan in his capacity as a great financiei- and as an eminent man in our province, in the hope to secure a more easy and cer- tain result. It was thus, when the Pacific Railway came up as an important political ques- tion in the confederation, that I made efforts with my friends with a view to have this great railway united with the Northern Colonization Railway, that it might pass through the Pro- vince of Quebec and have its depot within or near the city of Montreal ; and it was then that I worked to favor the Pacific Railway, the object being to secure the success of the Northern Colonization Railway. My communications with Sir Hugh Allan were to this effect, and it was equally with the same objects in view that my name appeared as one of the provisional directors in the Canada Pacific Railway's Act of 1872 ; and concerning the appearance of my name in the act of incorporation, I may say that I only knew of its being there after the Bill had passed through the committee, and, as I said before, I was sufficiently favorable to the enterprise not to make any objection, and I made none. This Bill which is 35th Yic, chap. 73, was discussed, I think in the month of May, 1872, and I was then in Ottawa, not only in the interests of the Montreal Northern Colonization Company, but for the purpose of meeting my colleagues in the Quebec Government, the Honourable Messrs. Chauveau, Beaubien, Archambault and Irvine. We had at the time several meetings of the Executtve of Quebec, at Hull. This, then, was the interest which I had in this question of the Pacific Railway, an interest altogether relative to the Northern Colonization Railway. In a conversation which I had with Sir Hugh Allan in April or May, 1872, that gentleman asked me to neglect nothing in the interests ot the Northern Colonization Railway. He also spoke to mo in the interests of the Conservative party, to which he attributed his commercial prosperity in a great mea- sure, and did not hide from me the fact that that party had already made efforts to maintain his steamship company, and that he was convinced the party had made sacrifices in his favor, or words to that effect. I did not fail to tell him that I was doubly interested myself in the success of the Northern Colonization Railway, of which he was President, as well from being a member of the Government of Quebec, as from being member of the county of Two Mountains, and that I should make efforts to have this line traverse the county that I repre- sented. The aid which I gave to Sir Hugh Allan relative to the construction of the Pacific Railway to Attorney-Gen- eral Ouimct for aid rendered at Ottawa" as having been paid by Sir Hugh Allan, and being asked for any explanations on this point, I say in reply: — Having never been asked by the company, nor by any person whatever in its interest, nor by any person for my gerviocs as a lawyer or otherwise, and it being impossible that I should be engaged by the company in any enterprise. Tlio considered one of a view to securing capacity as a great nore easy and cer- ant political ques- to have this great through the Pro- id it was then that s of the Northern I this effect, and it of the provbiional appearance of my here after the Bill ly favorable to the 8 35th Vic, chap. )ttawa, not only in lurposo of meeting luveau, Beaubien, KJuttve of Quebec, 3 Pacific Railway, lonversation which to neglect nothing nc in the interests y in a great mca- ifforts to maintain ifices in his favor, sted myself in the ent, as well from ie county of Two iinty that I reprc- on of the Pacific 'ho was interested explained, la the any one else ever of the Prov ince of ific Railwa}'. 1 because 1 was in atioa Railway. I 9 were members of and to favour the c Pacific Railway, ced thcni to give a question apart " I had not been ng to do with the rest, I cannot see wspnpers, ^ver t!io to Attorney-Gcn- 1 Allan, and being been asked by the ir my services as a 10 company in any 187 quality as Attorney-General, my services as such being of no assistance either in the obtaining of the charter or the contract, having acted only as a friend to the enterprise, as a citizen desiring it to come to a good end, I affirm that 1 never received the sum of $6,000 in ques- tion, nor any sum whatever. I affirm, moreover, that I never had, cither directly nor indirectly, either from the company or from any friends of the enterprise, any promise of money, or of anything else. I never received any sum of money from Sir H. Allan, nor from any one else, either directly or indirectly, as I have already said. I was largely interested myself in the Northern Colonization Railway Company and road. I have in its interest disbursed considerable sums, and undergone much fatigue, but, God be thanked, without recompense, or hope of recom- pense, hoping only that to the Province of Quebec may accrue the benefits which will flow from the construction of the Northern Colonization Railway, I do not know if Sir Hugh Allan paid J-ljOOO to the Mlnerve, nor of the other sums mentioned by McMullcn in his letter as having been paid by Sir Hugh Allan. I do not believe a word of them or of the other charges made by him, I do not know whether the Government or any member of the Government had any knowledge of the negotiations spoken of before between Sir H.Allan and Mr. McMuUen, nor do I know if Sir HmcR h Allan had any negotiations with Mr. McMuUen. The second part of the charges contained in the Royal Commission is as follows : " That " subsequently an understanding was come to between the Government, Sir Hugh Allan and " Mr. Abbott, one of the Members of the Honorable House of Commons of Canada, that Sir " Hugh Allan and his friends should advance a large sum of money for the purpose of aiding " the elections of Ministers and their supporters at the ensuing general elections, and that ho "and his friends should receive the contract for the construction of the Railway." I declare that I know nothing of it. I could say, however, that I had some conversation with Sir Geoi'ge Cartier in June, Jaly and August 1872, in which he spoke to me of Sir Hugh Allan, the Allan Company, the Pacific Railway, and the Northern Colonization Railway. Sir George rebutted the idea of any connection of American capitalists with the Pacific Railway, and said that ho never would consent to such a thing, and that he thought that the roads should be constructed without the aid of American capitalists. While expressing his appreciation of the merits of Sir Hugh Allan, Sir George Cartier did not appear to me to be on very friendly terms with him — that is to say, on terms of personal friendship. Nevertheless, he thought that Sir Hugh Allan, from his position, would be of great assistance to the Pacific Railway. He told me that he wished to see the amalgamation of the Macpherson and Allan Companies, and that he had been unjustly reproached with opposition to the Northern Colonization Railway in favor of the Grand Trunk Railway. 1 remarked to him that I regarded it as unfortunate that his Government had not settled this question of the contract of the Pacific Railway before the «lections, because, I added, that this question would militate against him in the Province of Quebec, and particularly in Montreal East. I said to him also that Sir Hugh Allan had told me that he owed his commercial prosperity in a great moasore to the Conservative party, and that I thought that Sir Hugh or his Company would aid him by influence or otherwise in his election. Sir George thereupon said that he could not entertain much hope that Sir Hugh Allan or his Company, meaning the Montreal Ocean Steamship Company, would come to his assistance, but as for himself (Sir George) he had several times put his portfolio in danger to maintain or obtnin tho subsidy for the Allan Company. Sir George told me this in that energetic language which he ordinarily used, and which is well known to those who were familiar with him. I had the honour to occupy myself in the election of Sir George at the last elections, and, notwith- standing that his friends urgeO him to let us make his election on ^he basis of tho railway policy, and particularly the Pac'fic, he would not consent, saying that he would conduct his election on his own personal n-rits. I have not any knowledge that Sir Hugh Allan advanced a sum of money to aid in the election of Ministers and their supporters. I went a few times to Sir George's Central Elec- tion Committee, but I know nothing of tho distribution of the money. Of course I know from personal experience that it was necessary to spend money on that as on other elec- tions. I 1 i 1 1 '-' 1 188 No members of the Government ever told mo that Sir H. Allan had advanced money for the elections nor did Sir II. Allan ever tell me. This conversation with Sir George Cartier, in reference to the road, that I have mentioned took r>lace at several intervals and I think that the last conversation I had with him was two or three days before the polling in the Eastern Division of Montreal, in which Sir George was a candidate. Question — Do you know the date on which the polling took place? Answer — Late in the month of August. Being ask'^d if I can give any explanation or if I have any idea why my name is mentioned in MoMullen's K>tter, as having received 06,000, I declare that I have no idea how my name came to be mentioned. The charge is wholly false. And further deponent saith not, and this his deposition having been read to him, bo declares that it contains the truth, persists therein, and hath signed. Sworn and taken and acknowledged on the ) thirtieth day of September, 1873. J (Signed,) (Signed,) GED^ON OUIMET. CHARLES DEWEY DAY, Chairman. A. POLETTE, JAMES ROBERT GOWAN, Commissioners. vanccd money for I have mentioned vith him was two :h Sir George was lamc is mentioned lea how my name read to him, ho OUIMET. SY DAY, Chairman. ' GOWAN, Commissioners. 189 LIST OP' EXHIBITS. A. " Sealed Packet " addressed ** Hon. Henry Starnos " and subscribed " Sir Hugh Allan " "G. W. McMuUcn." A 1. Letter from Sir Hugh Allan to Hon. J. J. C. Abbott, consenting to the opening of the sealed packet, dated Montreal, 2nd September, 1873. B. Letter from James Beatty, Jr., to Sir F. Hincks, dated 17th July, 1871. C. Reply of Sir Francis Hincks, dated July 20, 1871. D. Letter from James Beatty, Jr., to Sir F. Hincks, dated July 24, 1871. E. Reply of Sir F. Hincks, dated 26th July, 1871. F* Letter of Hon. D. L. Macpherson to Mail, dated 8th July, 1873, containing his reply to Sir Hugh Allan. G. Telegram from Sir J. A. Macdonald to Sir Q. E. Cartier, dated July 2€, 1872. H. Telegram from Sir G. E. Cartier to Sir J. A. Macdonald, dated 31st July, 1872. I. Telegram from Sir Hugh Allan to Sir J. A. Macdonald, dated Slst Jul;, 1872. J. Copies of a portion of correspondence between Sir H. Allan and C. M. Smith, G. W. McMullcn and George W. Cass. Kt Copy of " First Contract " between Sir Hugh Allan and his American aseociates, dated 23rd December, 1871. Ij, Copy of " Supplemental Contract " between same parties, dated March 28th, 1872. M. Copy of acknowledgment, dated April Ist, 1872, from Jay Cooke & Co., to G. W. MoMullen, of his draft on various parties, to amount of $50,000, setting out drafts numbered 1 & 2, &c. ; also of receipt by G. W, McMullen, of fees ibr Legislation. Nt Cheque by Sir Hugh Allan on Merchants' Bank, for $17,500 in favour of Hon. Henry Starnes, dated February 26, 1873, contained in "Envelope No. two," portion of con- tents of A or « Sealed Packet." O. Memo between G. W. McMullen and Sir Hugh Allan, February 26, 1873, contained in small envelope addressed " Hon. Henry Starnes," portion of contents of A or " Sealed Packet. ' P. Same as « K." Q. Certified copy of Letter from Sir G. E. Cartier to Sir Hugh Allan, 30th July, 1872. K. Certified copy of Letter from Sir G. E. Cartier to Sir Hugh Allan, SOth'july, 1872. S. Receipt for House Fees re. Incorporation of Canada Improvement Company, June 1st, 1872. 11 190 T. Receipt for House Fees re. Incorporation of Canada FaciGc Railway Company, June 1st, 1872. U. Letter from G. W. McMullen to Hon. J. J. C. Abbott, dated February 25, 1873. A. COPIES OF LETTERS AND TELEGRAMS ENCLOSED IN ENVELOPE NUMBER ONE. Number 1 Telegram. Montreal, December 8th, 1871.' C. M. Smith, Banker. I have seen Sir Francis to-day. He says they have determined to advertise, and that it is of no use to visit Otti ;a at present. I write you by mail. (Signed), HUGH ALLAN. Letter No. 2. n 17 Gracechur( London HUR( "^TREET, 1 N, 4th iSov. 1871. J Dear Mr. Smith, — I find a considerable interest manifestfid here by the moneyed men in our scheme of a Dominion Pacific Pailroad, and if we desire to raise funds here to carry on the work I have no doubt they can be obtained. I have not heard anything from the Government on the subject, and I presume nothing will be done till I go back. I purpose to sail sometime this month. * Yours truly, (Signed), HUGH ALLAN. ' Telegram No. 3. Montreal, December 7th., 1871. C. M. Smith, Banker : I do not tBink the Government at Ottawa will bo prepared to deal with us sooner than the eighteenth inst. Sir Francis Hincks is hero and hints at necessity ot advertising for tenders to avoid blame. (Signed) HUGH ALLAN. ly Company, June ry 25, 1873. ENVELOPE erSth, 1871.- ertise, and that it H ALLAN. TREET OV. 1871 u the moneyed men da here to carry on [ presume nothing U ALLAN. • r 7th., 1871. th us sooner than ot advertising for U ALLAN. C. Mather Smith, Banker : 191 Tehgrum No. 4. Montreal, December Cth., 1871. I arrived here this morniug and will be glad to see you as soon as convenient. (Signed) HUGH ALLAN. Letter No, 5. C. M. Smith, Esq. Montreal, 8th December, 1871. Chicago. Dear Sir : — Sir Francis Hincks called at my office this day, and said that while he was as anxious as ever to arrange with ua about the Railroad, the feeling of the Govern- ment is that if they closed an agreement with us without advertising lor tenders they would be attacked about it in the House. 1 think this may be true, and in view of it I see DO use in our going to Ottawa at present. But I think we should meet and arrange preliminaries ourselves, and decide on a course of action. If, therefore, you could come here about the 15th inst. I would go on to New York with you on the 18th., and we could then put the affair in shape. Please advise me if this suits you. Yours truly, (Signed) HUGH ALLAN. N'o. 6 Letter. Montreal, 29th Deer., 1871. G. W. McMuLLEN, Esq., Picton, Ont. Bear Sir, — I have your note from Picton, but I have not heard from New York since I left there. A good many rumors arc afloat regarding railroad matters, and I have good reason to believe that Mr. Brydges is using all the influence he can with Cartier to thwart our views. Not that he has any proposal to make, but he wants to stop the Pacific Railroad altogether, A party in the interest of the Hudson's Bay Co., consisting cf Donald A. Smith, D. Mclnnes, G. Laidlaw, G. Stephen, Daniel Torrance of N. Y., and one or two others, have given notice in the Official Gazette that they will apply for a Charter to make a railroad from Pembina to Fort Garry. That is the only one that affects us. I go to Ottawa on Wednesday next and will return here on Saturday. I will find out there what is going on, but I think we arc sure of Cartier's opposition. Yours, truly, (Signed), HUGH ALLAN. 192 '/.-.! Ill ' -I '! ! i; i No. 7 Letter. Private. MoNTEEAL, Ist Jany., 1872. Dear Mb. McMullin, — I saw Mr. Brydges yesterday and found out pretty nearly what lie will require to join our railway project. His terms are very high, but as they possibly include more than himself, we may have to concede them. lie thinks, however, that the Government will not have the courage to go into the scheme at all, and will shirk it till after the elections. I go to Ottawa on Wednesday and will see what they propose to do. I will write to you as soon as I find out. I intend to return back to here on Saturday night. Wishing you the compliments of the season, I am, yours truly, (Signed), HUGH ALLAN. I have a telegram from you this morning advising that you are going to New York ; I therefore send this I'^ttcr to the St. Nicholas Ilotel there. No. 7. Letter A. Montreal, G Oct., 1871. C. M. Smith, Esq., of Chicago, Metropolitan Hotel, New York, Dear Sir — I enclose copy of the communication sent to Sir John. Everything looks favorable at present at Ottawa. I sail from Quebec to-morrow. Yours trulv. (Signed) HUGH ALLAN. No. 7. Telegram (6). Father Point, Oct. 8th. 1871. C. M. Smith, of Chicago, Metropolitan Hotel. Send to me by mail, care ot Allan Bros. & Co., Liverpool, the names of the parties enr;aged with us in the railroad enterprise. (Signed) HUGH ALLAN. Letter No. 8. Messrs. Chas. M. Smith and Geo. W. McMullen. Montreal, January 24th., 1872. Gentlemen : — My subscription of one million four hundred and fifty thousand dollars to the stock of the proposed Canada Pacific Railway Company includes a sum of two hundred Bt Jany., 1872. nd out pretty nearly ry high, but as they [le thinks, however, all, and will shirk it t they propose to do. c on Saturday night. Gil ALLAN. ing to Tsew York ; I L, G Oct., 1871. n. Everything looks UGH ALLAN. , Oct. 8th. 1871. names of the parlies lUGH ALLAN. ;ory 24th., 1872. 1 fifty thousand dollars , a sum of two hundred 193 thousand dollarE), furnished jointly by you and myself, to be transferred, in whole or in part, to Mr. C. J. Brydgcs, on condition of his joining the organization and glvbg it the benefit of his assistance and influence. In case he refuses or neglects to join before the 15th. of April next, I will transfer at once thereafter to you, jointly, one hundred thousand dollars of the before named subscription, and in case Mr. Brydges' influence and co-operation can bo secured for a less interest m the Railway Company than the before-named amount, then J will transfer to you one half of any residue that remains oS the said two hundred thousand dollars after Mr. Bridges' accession to the Company has been secured. It is however understood that any residue or portion of the two hundred thousand dollars named may be used to secure any other influence deemed by myself and you desirable or important on the same terms as is proposed in regard to Mr, Brydges, and may apply to others in addition to him. Yours truly, Letter Nt. 9. (Signed) HFCn ALLAN. Montreal, 5th Feb. 1872. Bear Mr. McMullen, — I returned yesterday from Ottawa. Everything looks well up till the present time, but I may tell you in strict confidence that there are symptoms of cool- ness between Sir John A. and Cartier, arising from the coquetting of the latter with Blake and Mackenzie to form an alliance and carry the elections next summer, with a view to leavn John A. out in the cold. This would not be quite so favorable for us, but I am going to Toronto on the 7th inst., to look after our interests. We are all right with the Globe. You have not yet sent ae the articles of agreement signed by the parties. Send it immediately as I need it in my n^ociations. I will require you to come down here by-and-by to arrange the construction Company and consult about other matters. In the printed Bill is there not a mistake about the lands and the taxation ? Look at it. Yours truly, (Signed), HUGH ALLAN. G. W. McMullen, Esq,, Chicago. I wrote you, but have not received any answer from you. No. 3 Tdegram (")• C. Mather Smith, Montreal, Feb. IG, 1872. Why is it that McMuUen docs not answer my letter. I will be in Detroit on Wednes- day evcnins', can I meet you there ? (Signed), HUGH ALLAN. Telegram No. 9 (t). 3I0NTREAL, Feb. 19th, 1872. C. M. Smith. I think it is the Douglass Hotel, at Detroit. Don't fail to come. (Signed), HUGH ALLAN. i : 1 1 194 Letter No. 1 C. M. Smith, Esq., Chioaqo. Toronto, 23rd Feby., 1872. Dear Sir : — I find that Mr. Brydges in making a strong attempt by exciting national feeling to get up an opposition to ua in our Pacific scheme. He is endeavoring to ^et up what he calls a purely Canadian Company on the representation that wo are going to make an enormous profit out of it, the most oi which will go to parties in the United States. lie has written to influential men here and in other parts of the country urging them to subscribe stock, merely as security, for they oerer will be called on to pay anything, and he says the government must give a preference to a Canadian Company. I do not know to what extent he has been successful. (Signed) Yours truly, HUGH ALLAN. I W\ No, 11 Letter. Toronto, 24th Feby, 1872, C. M. Smith, Esq., Chicago, 111. Dear Sir : — Since writing to you yesterday, I have seen Mr. D. L. Macpherson of Toronto who is a member of the Dominion Senate and rather an important person to gain over to our side. He has been applied to by our opponents and uses that as a lever, by which to obtain better terms from us. He insists on getting $250,000 of stock, and threatens opposition if he does not get it. You will remember he is one of those I proposed as a Director. I will do the best 1 can, but I think that McMuUen, you and myself, will have to give up some of our stock to conciliate these parties. Yours truly, (Signed) HUGH ALLAN. i ! I No. 12 Letter. Private. MONTREAL, 28th February, 1872. Dear Sir, — It seems pretty certain that in addition to n^oney payments, the following stock will have to be distributed : — Hon. D. L. Macpherson $100,000 Hon. A. B. Foster 100,000 D. A. Ssiith 100,000 C. J. Brydges 100,000 J. J. C. Abbott 50,000 D. Molnnes 60,000 John Shedden 50,000 A. Allan .•. 50,000 C. S. Gzowski 50,000 George Brown 50,000 A. J. Hincks , 50,000 H. Nathan 50.000 T, McOreevy 50,000 $850,000 Feby., 1872. roiting national coring to get up ting to make an Hates. lie bas 3ni to sabsoribe tnd be says the ALLAN. eby, 1872, . Macpherson of WD to gain OTcr rbicb to obtain |ns opposition if ireotor. 11 have to give ALLAN. ary, 1872. ?, tbe following 0,000 3,000 3,000 3,000 3,000 3,000 [),000 3,000 ),000 3,000 3,000 3.000 3,000 ),000 195 To meet this I propose that we give up of oir stock as follows : CM, Smith $250,000 George W. McMuUen 250,000 Uugh Allan 360,000 •850,000 Flease say if thi" is agreeable to you. I do not t^'.nk we can do muoh lees, and may have to give more. I do not think wc will require more than $100,000 in cash, but I am not sure as yet. Who am I to draw on for money when it is wanted ? And what proof of payment will be required ? You arc aware I caunot get receipts. Our Legislature meets 11th April, and I am already deep in preparation for the game. Every day brings up some new difficulty to be encountered, but I hope to meet them all successfully. Write to me immediately. Yours truly, (Signed) HUGH ALLAN. I think you ]fvill have to go it blind in the matter of the money (cash pajr merits. ) I have already paid $8,500 and have not a voucher, and cannot get one. C. M. Smith, Esq., Chicago. \ No. 13. Letter. MoNTRiAL, 4th March, 1872. My Dear Mr. McMullen — Mr. Macpherson of Toronto, and Mr. Brydgcs here, have both notified me to-day (hat they decline to join us in the Canadian Railway scheme. Their reasons arc that the company is too largely American, and that they want to sec it in the hands of Canadians. They tried to detach me from the company we have formed, and get me to join them, which, of course, I declined. I don't know what they can do against us, but I intend going to Ottawa on Monday, 11th inst., and will then try to find out something about it. I will be in Ottawa most of the week. Yours truly, (Signed) HUGH ALLAN. No. 13. Letter (a). Montreal, 15tb April, 1872. Dear Mr. McMullen — The enclosed telegram from Mr. Cass reached me this morning. He wishes you to go to Now York, but I wish to see you before you go. I leave here on Wednesday morning, and will see you on Thursday morning. You will be able to leave for New York on Thursday evening if you desire to do so. Yours truly, (Signed) HUGH ALLAN. ! 1 196 No. 13 Lttter {h). MoNTBBAL, 16th April, 1872. Dear Mr. McMullen. — I must remain here to-night to write my letters for the English mail, whieh I have been rather neglectinjj; of Into. You might make use of your time in seeing such of the Ministers as you can reach, but I wish especially that you would arrange that you and I together should see Sir John A. at eleven o'clock on Thursday, Telegraph me to Preicott Junction, to-morrow, if you can do this. I enclose a letter which came enclosed to me from New York, this day. What can bo the matter there ? I ought to arrive at Ottawa at 4.30, to-morrow aflernoon (Wednesday). Yours truly, (Signed) HUGH ALLAN. Confidential, X". 14 LdUi- G. W. MoMuLLEN, Esq. llussell Hotel, Ottawa. Montreal, 12th June, 1872. Dear Sir, I have this day received a telegram from you dated New York, asking me to meet you in Ottawa to-morrow on important business. I am unable to go, and if the important business refers to the Pacific Railroad Sclieme, I do not think it is necessary I should go. I believe I have got the whole arranged through my French friends by means you are aware of and we have now the pledge of Sir. G. that we will have a majority and other things satisfactory. 1 have told you all along that this was the true basis of operation, and that anything else was powder and shot thrown away, and I think so still. You should come here and see me before you carry out any important transaction, or pay any money. I want you to get a correct copy of the Government Bill and our own Bill, because we have first to consider how far they will suit our friends, and we may have to go to New York to consult them. I will be in town to-morrow and Friday. I will be absent on Saturday, but will return here on Monday, and be here till Friday. Yourd truly. (Signed) HUGH ALLAN. No. 15 Letter. My dear Mb. McMullen, Montreal, IGth July, 1872. I feared you had got entirely lost in the depths of matrimony, but, I am glad to notice by your letter, dated 11th inst., that you have got safe back. Since I saw you last, the Pacific llailroad (Canada) scheme has gone through many phases and its present position is difficult to be described. Sir George Cartier has been in town for some days and I have had several interviews with him. He now tells me that he does not now, and never did, intend to deal with cither Macpher- Lpril, 1872. letters for the lake use of your that you would c 00 Thursday. . What can bo ALLAN. Fuue, 1872. rk, asking me to .aiiroad Scheme, r means you arc and other things d that anything transaction, or id our own Bill, may have to go but will return ALLAN. Fuly, 1872. Ill glad to notice through many interviews with cither Macpher- 197 son's Company or ours, and that ho only allowed them to get incorporated as a matter of amuse- ment. But ho says ho always intended that the Government would form its own Company, who will carry on the work under the orders of the Government according to the riews of the Government cngineert and with money furnished hy the Government, lie Huys that lie and Sir John A. mado up their mind to this long ago, but did not tell any of their colleagues. A kind of negooiation is going on with both Macphcrson and myself relative to the com- position of this Government Company, but it has not come to anything as yet. ^leantinio the period of the elections i.s drawing near, and unless tho matter is arranged satisfactorily I o Lower Canada, Sir George Carticr's prospect of being returned is very slim indeed. I cannot foresee with any certainty tho ultimate result, but the decision cannot be long put off. I will advise you as soon as anything is positively known. (Signed), Yours truly, HUGH ALLAN. (Private and Confidential.) Letter No. IG. 3I0NTREAL, (Ith August, 1872. Dear Mu. McMullen, — I have been hoping from day to-day that some conclusion which I could communicate to you would bo arrived at respecting tho Pacific Railroad ncgo- ciations, but some obstacle to cause delay always intervened. The near approach of the elec- tions, however, and tho stand taken by my French friends that they would lend no help till I pronounced myself satisfied, has at length brought tho matter to a crisis, and 1 think tho game I have been playing is now likely to be attended with success. Yesterday wo entered into an agreement by which the Government bound itself to form a company of Canadians only acc^'^'ng to my wishes. That the Company will make me President and that I and my frienus will get a majority of the stock and that tho contract for building tho lload will be given to this Company in terms of tho Act of Parliament. Americans are to be carefully excluded in the fear that they will sell it to the Northern Pacific. But I fancy we can get over that some way or other. This position has not been attained without largo payments of money. I have already paid over 8200,000, and I will have at least $100,000 more to pay. I must now soon know what our New York friends are going to do. They did not answer my last letter. Yours truly, (Signed) HUGH ALLAN. No. 17 Letter. Montreal, 16th Sept., 1872. Dear Mu. MuMuli.en, — I wanted at this time to have a meeting in New York to see what our friends there wore d'-^posed to do, but to-day I have a letter from General t 'ass stating that he is leaving Nev^ York for Chicago, there to join Mr. Ogdcn, and the two arc going to Pugct Sound. They say no meeting can be hold till 15 November, which will not do at all. 1 hope in ten days or so to have contract signed and would like immediately after to go to England to raise the money to build the line. 1 have disbursed $343,000 irf gold, which I want to get repaid. 1 have still to pay 813,500 which will close everything off. I will go to New York as soon as the contract is signed, say about 7 October, and would be glad to meet you there at that time. Yours, truly, (Signed), HUGH ALLAN. G. W. McMullen, Esq., 553 Washington Street, Chicago, Ills. I I n ■ ' lit ) I ill '', 198 No. 18 Letter. MoNTBEAr., 21th October, 1872. Dear Mb. McMullem, — No action has yet (so far as I know) boon taken by tho QoTcrntncnt in the matter of tlio Paoifio lUilroad. Tho opposition of tho Ontario party will, I think, have tho effect of shutting out our American fnondj from any participation in the road, and I apprehend that negociation is at an end. It is still uncertain how it will bo given (the contract), but in any case tho Qovcrnmcnt seem inclined to exact a declaration that no foreigner will have directly or indirectly any inter- est in it. But everything is in a state of uncertainty, and I think it is unnecessary for you to visit New York on this business at present, or at all till you hear what the result is likely to be. Public sentiment seems to be decided that the road bhall bo built by Canadians only. Yours truly G. W. McMuiLEN, Esq., Picton, Out. (Signed) IIUC; I ALLAN. Letter No. 19. MoNTBEAL, 11th Nov. 1872. Dear Mr. McMullen, — You really know as much about the Pacific Railroad contract as I do, and that is not much. I am assured that the Government have resolved to form a now Company, but under what conditions or who the parties will be I am ignorant. It is said that the whole matter will be arranged by the end of the month, and if so, we will soon know it. I have not changed my views of what it ought to be. Yours truly, G. W. McMullen, Esq. Picton, Ont. (Signed), HUGH ALLAN. Note. For residue of " Sealed Packet " see " N " and " 0." Al. Letter from Sir Hugh Allan to lion. J. J. C. Abbott. MoNTBiAL, 2nd September, 1873. Hon. J. J. C. Abbott: -DiAB Sir, — Referring to the parcel of papers deposited with Mr. Starncs, and whic'.* will no doubt be produced before the Royal Commission, 1 authorize you, on my behalf, to ooneent that it shall bo opened by the Commissioners. But I object to any of the papers in it being used or published unless they are found to contain evidence which can be legully or judicially used in the case. Yourp, truly, (Signed), HUGH ALLAN. October, 1872. I boon taken by tho f tho Ontario party any participation in case tho Qovcrnmcnt ■ indirectly any inter- unnecossary for you it the result is likely )y Canadians only. JO I ALLAN. Llth Nov. 1872. sifio Railroad contract Company, but under that the whole matter it. UGH ALLAN. Abbott. September, 1873. tfr. Stames, and whici* I you, on my behalf, to o any of the papers in hioh can be legally or [UGH ALLAN. 190 B. Letter from James Beatty, Jr., to Sir F. Hincks, dated 17lh July, 1871. (For this letter see deposition of Sir F. Ilincks, page 11.) c. Reply of Sir F. Hincks, daled July 20, 1871. (For thU letter see deposition of Sir F- Hincks, page 11.) D. Letter from James B«atty, Jr., to Sir Francis Hincks, dated July 24, 1871 . (For this letter see deposition of Sir F. Hincks, page 12.) Reply of Sir Francis Hincks, dated 2Cth July, 1871. of Sir F. Hincks, page 13.) (For this letter see deposition F. Letter of Hon. D. L. Macphtrson to Sfail, dated 8th July, 1873, containing his reply to Sir Hugh Allan. (For this letter we deposition of Hon. J). L. Macphsrson- page 24.) o. Telegram from Sir John A. Macdonald to Sir George E. Cartier. July 2Gth, 1872. Sir George Oartier, (Private.) Ottawa, Have seen Macphcrson. He has no personal ambition, but cannot, in justice to Ontario, concede any preference to Quebec in the matter of the P., or in any other particular, lie says the quOTtion about the V. should be left to the Board. Under these circumstances I authorize you to assure Allan that the power of the Government will be exercised to secure him the position of P. The other terms to be as agreed on between Macphcrson and Abbott. The whole matter to be kept quiet until after the elections; then the two gentle- men to meet the Privy Council at Ottawa, and settle the terms of a provisional agreement. This is the only practicable solution of the difficulty, and should be accepted at once by Allan. Answer. (Signed), JOHN A. MACDONALD. m 1 200 H. Telegram from Sir G. E. Cartier to Sir John A. Idacdonald, KiNQSTON, 31st July, 1872. (By Telegraph from Montreal) To Sir John A. Macdonald: Have seen Sir Hugh, he withdraws letter written you since you make objection to it, and relies for basis of arrangement on your telegram to me of which I gave him copy. Matters go on well hcio. Hope they are same with you. Don't think it is necessary for you to come down here Saturday. I want to be out of town on Sunday, but will remain here if you specially desire to see me. Answer. (Signed), G. E. CARTIER. Telegram from Sir Hugh Allan to Sir J, A. Macdonald. KmasTON, July 31, 1872. (By Telegraph from Montreal.) To Sir John A. Macdonald: I have seen Sir Geo. Cartier to-day, you may rcturu my letter or regard it as waste paper, it was not intended as anything official. Your telegram to Sir Geo. is the basis of our agreement, which 1 have no doubt you will approve of. He purposes to go out of town on Saturdiy afternoon, and I am pursuadcd his health will be benefited thereby. (Signed), HI GH ALLAN. J. Copies of a po?'timi of Correspondence hetwcen Sir TTugh Atian and Cl^arks M. Smith, George W. McMullm and George W. Cass, relative to Hie. construction of the Canadian Pacific Railway. Ko, 1 Telegra'^h. Father Point, October 8th, 1871. C. M. Smith (of Chicago,) Metropolitan Hotel, N. Y. : Send to me, care of Allan Bros., & Co., Liverpool, the names of the parties engaged with us in the Railroad enterprise. (Signed), H. ALLAN. aid. t July, 1872. ake objection to it, J him copy, liink it is necessary ly, but will remain CARTIER. I uly 3i, 1872. r regard it as waste leo. is the basis of s to go out of town hereby. 311 ALLAN. ClMrks M. Smith, omsiniction of the iber Btli, 1871. lie parties engaged H. ALLAN. 201 No. 2 Letter. 17 Gracechurch Street, LoMDON, 4th November, 1871. Deae Me Smith,— I find a considerable interest manifested here by the moneyed me# in our scheme of a Dominion Pacific Railroad, and if we desire to raise funds here to carry on the work. 1 have no doubt they can be obtained. J have not heard anything from the Government on the subject, and I presume nothing will be done till I go back. I purpose to sail sometime this month. Yours truly, (Signed) HUGH ALLAN. iVb. 3 Telegraph. MoNTEEAL, December 7th, 1871. C. M. Smith, Banker : I do not think the Government at Ottawa will be prepared to deal with us sooner than the eightinth instant. Sir F. Hincks is here, and hints at necessity of advertising for tenders to avoid blame. ^^.^^^^^ ^j^^jg ^^LAN. No. 4 Telegraph. MoNTEEAL, December 8th, 1871. C. M. Smith : . j , I have seen Sir Francis to-day. He says they have determined to advertise, and that is of no use to visit Ottawa at present. I write you by mail. (Signed) HUGH ALLAN. No. 5 Letter. MoNTEEAL, December 8th, 1871. C. M. Smith, Esq., Chicago : Deae Sie -Sir Francis Hincks called at my office this day, and said that while he was as anxfoi8«Se;erti arrange with us about the llailroad, the feeling of the Government is JLtTtherclosed an "^^^^ ^ith "« without advertising for tenders, they would be attacked a^oit ft inThe House. I think this may be true, and in view of it I see no use in •'"^ 'tfuS^ll ISd mtt and .range preliminaries ou-lve. ""d ^^^^^^^^^^ «P «n»mn Tf fhprpfore vou could come here the i5th, I would go to New lork wiui you Sn S Tsth u'rwr^^^^^^^^^ affair in shape. Please advise me if this suits y"- Yours truly, (Signed) HUGH ALLAN. See copy of Contract entered into in pursuance of the suggostions in this letter. 20 ,! •' // i !;) I I 202 No. 6 Letter. Montreal, 29th December, 1871. G. W. MoMuLLEN, Esq., Picton, Ont. : Dear Sir, — I have your note from Picton, but I have not heard from New York since I left there. A good many rumours are afloat r^arding railroad matters, and I have good reason to believe that Mr. Brydges is using all the influence he can with Cartier to thwart our views. Not that he has any proposal to make, but he wants to stop the Pacific Railroad altogether. A party in the interest of the Hudson's Bay Company, consisting of Donald A. Smith, D. Mclnnes, G. Laidlaw, G. Stephen, Daniel Torrance of N. Y., and one or two others have given notice in the Official Gazette, that they will apply for a Charter to make a railroad from Pembina to Fort Garry. That is the only one that afiiects us. I go to Ottawa on Wednesday next, and will return here on Saturday. I will find out there what is going on, but I think we are sure of Cartier's opposition. Yours truly, (Signed) HUGH ALLAN. No. 1 Letter. Montreal, January 1st, 1872. Dear Mr. McMullen, — I saw Mr. Brydges yesterday, ana found out pretty nearly what he will require to join our railway project. His terms are very high, but as they possibly include more than himself, we may have to concede them. He thinks, however, that the Government will not have the courage to go into th« scheme at all, and will shirk it until after the elections. I go to Ottawa Wednesday, and will see what they propose to do, I will write you as soon as I find out. I intend to return back to here on Saturday night. Wishins^ you the compliments of the season, I am. Yours truly, (Signed) HUGH ALLAN. I have a telegram from you this morning, advising that you are going to New York. I therefore send this letter to the St. Nicholas Hotel there. No. 8 Letter. Messrs. CiiAs. M. S.MiTti and Geo. W. McMullen. Montreal, January 24, 1872. Gentlemen, — My subscription of one million four hundred and fifty thousand dollars, to the stock of the proposed Canada Pacific Railway Company, includes a sum of two hundred thousand dollars, furnished jointly by you and myself, to be transferred, in whole or in part to Mr. C. J. Brydges, on condition of his joining the organization and giving it the benefit of his assistance and influence. In case ho refuses or neglects to join before the 15th day of April next, 1 will transfer at once thereafter to you, jointly, one hundred thousand mber, 1871. New York since e good reason to iwart our views. ilroad altogether. Jd A. Smith, D. two others have make a raih'oad go to Ottawa on what is going on, H ALLAN, ry Ist, 1872. out pretty nearly ' high, but as they thinks, however, , and will shirk it bey propose to do. Saturday night. 11 ALLAN, to New York. I iry 24, 1872. ' thousand dollars, Ics a sum of two ferred, in whole or and giving it the in before the 1.5th lundred thousand 203 dollars of the before named subscription, and in case Mr. Brydges' influence and co-opera- tion >'3aa be secured for a less interest in the Railway Company than the before named amount, then I will transfer to you one half of any residue that remains of the paid two hundred thousand dollars after Mr. Brydges accession to the company has been secured. It is, however, understood that any residue, or portion of the two hundred thousand dollars named, may be ujed to secure any other influence deemed by myself and you desirable or important on the same terms as proposed in regard to Mr. Brydges, and may apply to others in addition to him. Yours truly, (Signed), HUGH ALLAN. No. 9 Letter. Montreal, 5th Feby. 1872. Deab Mb. McMullen. — I returned yesterday from Ottawa. Everything looks well up till the present time, but I may tell you in strict confidence that there are symptoms of coolness between Sir John A. and Cartier, arising from the coquetting of the latter with Blake and Mackenzie, to form an alliance and carry the elections next summer, with a view to leave John A. out in the cold. This would not be quite so favorable for us, but I am going to Toronto on the 7th inst., to look after our interests. We are all right with the Globe. You have not yet sent me the articles of agreement signed by the parties. Send it immediately as I need it in my negociations. I will require you to come down here by and by, to arrange the construction Company, and consult about other matters. In the printed Bill, is there not a mistake about the lands and the taxation ? Look at it Yours truly, (Signed) HUGH ALLAN. G. W. McMuLLEN, Chicago. I wrote you, but have not received any "nswer from you. No. 10 Letter. Toronto, 2-4 Fcby., 1872. C. M. Smith, Esq., Chicago, Ills. Dear Sirt, — Since writing to you yesterday I have seen Mr. D. L. Macpherson, of Toronto, who is member of the Dominion Senate, and rather an important person to gnin over to our side, He has been applied to by onr opponents, and uses that as a lever by which to obtain better terms from us. He insists on getting $250,(100 of stock, and threatens opposition if he does not get it. You will remember he is one of those I proposed as a Director. I will do the best I can, but I think that McMullcn, you and myself will have to give up some of our stock to conciliate these parties. Yours, truly, (Signed), HUGH ALLAN, ii If I i I i!!' I : 204 So. 11 Letter. MoNTEBAL, 28th Fcby., 1872. C. H. Smith, Esq., Dear Sir, — It seem pretty certain that in addition to money payments the following stock will have to be distributed : Hon. D. L. Macpherson 8100,000 Hon. A. B. Foster 100,000 D. A. Smith 106,0»0 C. J. Brydges 100,000 J. J. C. Abbott 50,009 D. Mclnnes 5«,000 John Shedden 50,000 A. Allan 60,000 C. S. Gzowski 50,000 George Brown 60,000 A. S. Hincks 50,000 H.Nathan 60,006 T. McGreeyy 60,000 $860,000 To meet this I propose to give up of our stock as follows : C. M. Smith $260,000 G. W. MoMullen 250,000 Hugh Allan 350,000 $850,000 Please say if this is agreeable to you. I do not think we oau do with less, and may have to give more. I do not think we will require more than $100,000 in cash, but I am not sure as yet. Who am I to draw on for money when it is wanted, and what proof of payment will be required ? You are awaro I cannot get receipts. Our Legislature meets 11th April, and I am already deep in preparation for the game. Every day brings up some new difficulty to be encountered, but I hope meet them all successfully. Write to me immediately. Yours, truly, (Signed), HUGH ALLAN. I think you will have to go it blind in the matter of the money (cash payments). I have already paid $8,500, and nave' not a voucher and cannot get one. See supplemental Contract made in pursuance to requests in this letter, and at other times. No. 12 Letter. Montreal, 12 June, 1872. G. W. McMuLLEN, Esq., Russell House, Ottawa. Dear Sir, — I have this day received a tel^am from you dated New York, asking rae to meet you in Ottawa to-morrow on important business. I am unable to go, and if thet Fcby., 1872. cots the following 100,000 100,000 100,0*0 .00,000 50,009 59,000 50,000 50,000 50,000 50,000 50,000 50,006 50,000 850,000 '260,600 250,000 350,000 1850,000 I, and may have to but I am not euro t proof of payment ition for the game, lope meet them all H ALLAN, ish payments). I etter, and at other 5 June, 1872. T York, asking rae le to go, and if the 205 important business refers to the Pacific Railroad scheme, I do not think it necesary I should go. 1 believe I have got the whole matter arranged through my French friends by means you are aware of, and wo have now the pledge of Sir G. that we will have a majority, and other things satisfactory. I have told you all along that this was the true basis of operation, and that anything else was powder and shot thrown away, and I think so still. You should come here and see me before you carry out any important transaction or pay any money. I want you to get a correct copy of the Government Bill and our own Bill, because we have first to consider how far they will suit our friends, and we may have to go to New York to consult them. I will be in town to-morrow and Friday. I will be absent on Saturday, but will return here on Monday and be here till Friday. Yours, truly, (Signed), HUGH ALLAN. Letter, No. 13 W. Casp, Esq. Liberty Street, New York. Montreal, July 1st, 1872. My Dear Sir : — The negotiations regarding the Canadian Pacific Railroad are now approaching a termination, and I have no reason to doubt they will be favorable to us. I have been given to understand by Mr. McMullen that he has regularly kept you informed of the progress and position of affairs, hence, I have not communicated with you on the subject as often as I otherwise would have done. No doubt he informed you that, thinking as I had taken up the project, there must be something very good in it — a very formidable opposition was organized in Toronto, which, for want of better, took as their cry. "no foreign influence " — "No Yankee dictation " — "No Northern Pacific to choke off our Canadian Pacific " and others equally sensible. So much effect however, was produced both in and out of Parliament by these cries and the agitation consequent on them, that after consulting Mr. McMullen 1 was forced unwillingly to drop ostensibly from our organization every American name and to put in reliable people on this side in place of them. It will be apparent to you that at this point Mr. McMullen and I differed a little as to the means to be adopted to influence the Government itself. Two opposing companies desiring to build the Railroad, were formed, the one from Ontario having the greatest number of names while that from Quebec had the greatest political power. Mr. Mc3Iullcn was desirous of gecuring the inferior members of the Government, and entered into engagements of which I did not approve, as I thought it only a waste of powder and shot. On a calm review of the situation I satisfied myself that the whole decision of the question must ultimately be in the hands of one man, and that man was Sir George E. Cartier, the leader and chief of the French party. This party has held the balance of power between the other factions. It has sustained and kept in ofiico and existence the entire Government for the last five years. It consists of 45 men who have followed Cartier and voted in a solid phalanx for all his measures. The Government majority in Parliament being generally less than 45, it follows that the defection of one half or two thirds would at any time put the Government out of ofifice. It was therefore evident that some means must be adopted to bring the influence of this compact body of members to bear in our favour, and as I soon made up my mind what was the best course to pursue, I did not lose a moment in following it up. A Railroad from Montreal to Ottawa through the French country, north of the Ottawa river has long been desired by the French inhabitants, but Cartier, who is the salaried solicitor of the Grand Trunk Railroad, to which this would be on opposition, has always interposed difficulties, and by his influence prevented it being built. The same reason made him desirous of giving the contract for the Canadian Pacific into the hands of parties connected with the f Si :! I ■ i! i '; '1 111' i i :;. , I 206 Grand Trunk Railroad, and to this end ho fanned the flame of opposition to us. But I saw in this French Railroad scheme, and in the near approach of the general elections, when Carticr as well as others had to go to their constituents for re-election, a sure means of attaining my object, especially as I purposed to carry it through to the terminus of the Pacific. The plans 1 propose are in themselves the best for the interests of the Dominion, and in urging them on the public I am really doing a most patriotic action. But even in that view, means must be used to influence the public, and I employed several young French lawyers to write it up for their own newspapers. I subscribed a controlling influence in the stock and proceeded to subsidize the newspapers themselves, both editors and pro- prietors. I went to the country through which the road would pass and called on many of the inhabitants. I visited the priests and made friends of them and I employed agents to go amongst the principal people and talk it up. I then began to hold public meetings and attended to them myself making frequent speeches in French to them, showing them where their true interests loy. The scheme at once became popular and I formed a committee to influence the members of the Legislature. This succeeded so well that in a short time I had 27 out of the 45 on whom I could rely, and the electors of the ward in this city which Oartier himself represents, notified him that unless the contract for the Pacific Railroad was given in the interests of Lower Canada he need not present himself for re-election. He did not believe this, but when he came here and met his constituents he found to his surprise that their determination was unchangeable. He then agreed to give the contract as required, in this way that there would be 17 Provisional Directors of which Ontario would have 8 and we 9, — thereby giving us the control. We at once proceeded to organize the Company (our Section) and they named me the Presi- dent, D. Molnnes of HamUton, Vice-President; E. L. de Bellefeuillo, Secretary; and the Honorable J. J. C. Abbott, Legal Adviser. We have advertised that the books for subscription of stock will be opened 15th July at the difierent places named in the Act, and we have notified the Government that we are willing to take the contract for building the Canadian Pacific Railroad on the terms and conditions prescribed in the Act. The next thing to be done is to subscribe the stock, which must be done by British subjects only, and ten per cent of the subscription must be paid in Cash, at the time of subscribing. We have the right of subscribing nine seventeenths (9-17) at present, and of taking up whatever the other party may not subscribe at the end of one month. I have arranged in the meantime that if you will send a certificate of the equivalent of $1,000,000 gold having been placed by Jay Cooke & Co to the credit of the Merchants' Bank of Canada, Montreal, in their own Bank in New York, it will accept the cheques for the subscription, but no money will pass till the contract is entered into, and then ten per cent on the amount of Stock awarded us will have to be paid in to the Receiver (Jeneral. Be pleased, therefore, to send me, n^ early as possible powers of attorney to subscribe the stock and Jay Cooke & Co's certificate above mentioned. I have had several letters from England offering to take the whole thing up if we desire to part with it, but it l-^oks to me to be too good to part with readily. If you desire any further information I will go to New York next week, if you desire it, and communicate with you personally. Please telegraph if you wish to see me, and the day. As you may suppose, the matter has not reached this point without great expense, a large portion of it only payable when the contract is obtained, but I think it -vill reach not much short of $300,000. Yours faithfully, (Signed) HUGH ALLAN. I presume you desire that unless we can obtain and secure a majority of the Stock you could not take any, but on this point I wish to be instructed. H. A. V6,\\ us. But I saw I elections, when a sure means of ! terminus of the of the Dominion, n. But even in id several young atrolling influence editors and pro- d on many of the oyed agents to go making frequent he scheme at once Legislature, on whom I could jents, notified him of Lower Canada hen he came here ivas unchangeable, here would be 17 ing us the control, ned me the Presi- lecretary; and the ened 15th July at ment that we are on the terms and le the stock, which n must be paid in iventeenths (9-17) at the end of one e of the equivalent ; of the Merchants' the cheques for the I then tfin per cent jiver (loneral. Be mbscribc the stock ttcrs from England iks to me to be too II go to New York ie telegraph if you reached this point ict is obtained, but CiU ALLAN. ty of the Stock you H. A. 207 No 14 Letter. Montreal, July 16, 1872. Mr Dear Mr. McMcllen, — I feared you had got entirely lost in the depths of matrimony, but I am glad to notice by your letter dated 11th inst., that you have got safely back. Since I saw you last the Pacific Railroad (Canada) scheme has gone through many phases, and its present position is difficult to describe. Sir George Cartier has been in town for some days, and I have had several interviews with him. He now tells me that he does not now and never did intend to deal with either Macpherson'fl Company or ours, and that he only allowed them to get incorporated as a matter of amusement. But he says he always intended that the Government would form its own Company, who would carry on the work under the orders of the Government, according to the views of the Government engineers, and loith money furnished by the Government. He says that he and Sir John A. made up their minds to this long ago, but did not tell any of their colleagues. A kind of negoeiation is going on with both Macphcraon and myself, relative to the composition of this Government Company, but it has not come to anything as yet. Mean- time the period of the elections is drawing near, and unless the matter is arranged satisfactorily to Lower Canada, Sir George Cartier's prospect of being returned is very slim indeed. I cannot foresee with any certainty the ultimate result, but the decision cannot be long put o£f. I will advise you as soon as anything is positively known. Yours truly, (Signed) HUGH ALLAN. No. 15 Letter. Montreal, August 6, 1872. Deab Mr. McMullen, — I have been hoping from day to day that some conclusion which I could communicate to you would bp arrived at respecting the Pacific Huilroad negoeiation, but some obstacle to cause delay always intervened. The near approach of the elections, however, and the stand taken by my French friends, that they would lend no help till I pronounced myself satisfied, has at length brought the matter to a crisis, and I think the game I have been playing is now likely to be attended with success. Yesterday we entered into an agreement by which the Government bound itself to form a Company of Canadians only, according to my wishes. That this Company will make me President, and that I and my friends will get a majority of the stock, and that the contract for building the road will be given to this Company in terms of the Act of Parliament, Americans are to be carefully excluded in the fear that they will sell it to the Northern Pacific, But I fancy we can get over that some way or other. This position has not been attained without large payments of money. I have already paid over $200,000, and I will have at least $100,000 more to pay. I must now soon know what out New York friends arc going to do. They did not answer my last letter. Your truly, (Signed) HUGH ALLAN. 208 M. 16 Letter. m MONTBEAL, 7th August, 1872. G. W. Cass, Esq., New York: Dear Sir, — I wrote you on 1st July, giving you a detailed account up till that date of the events and my movements in connection with the Canadian Pacific Ilailroad. I have not had any acknowledgment of the receipt by you of that letter, but I presume it reached you in due course. The questions I asked you, however, remain unanswered, and I now proceed to inform you of the progress of the negociation since the date of my letter. The policy I adopted has been quite successful. The strong French influence I suc- ceeded in obtaining, has proved sufficient to control the elections, and as soon as the Govern- ment realised this fact, which they were unwilling to admit and slow to see, they opened negociations with me. It is unnecessary to detail the various phases through which it passed, but the result is that we yesterday signed an agreement by which, on certain monetary conditions, they agree to form the company, of which I am to be President, to suit my views, to give me and my friends a majority of the stock, and to give the company so formed the contract to build the road, on the terms of the Act of Parliament, which are $30,000,000 in cash, and 50 millions acres of land, with all other advantages and privileges which can be given to us under the Act, and they agree to do everything in their power to encourage and assist the company, during the whole period of construction. The final contract is to be executed within six weeks from this date — probably sooner. Our opponents are to get the minority of the stock, and they regard us with great jealouhy and dislike in consequence of their defeat, and on that account the Government is obliged to stipulate that no foreigner is to appear as a shareholder, so as to avoid the former cry of selling ourselves to the Northern Pacific, and succumbing to foreign influence. The shares taken by you and our other American friends, will therefore have to stand in my name for some time. We shall got $6,000,000 of the stock out of the whole capital of $10,000,000. I again ask you if the parties are willing to take the reduced amount of stock in the same 'proportions as the amounts signed for previously. As is my duty, I ofi"er it to you, but there are plenty desirous to get it. Ten per cent on the amounts will have to be paid up and deposited in the hands of the Government as security, but will be returned, I think, as soon as the work is fully begun. The expenses incurred in bringing the matter to this point have been very great. I have already paid away about $250,000 and will have to pay at least $50,000 more before the end of this month. I do'nt know that even that will finish it, but I hope so. Of course this will all have to come from the subscribers of the $6,000,000 stock. If you elect to go on with the subscription, I will visit New York about tho end of this month to settle the details with you. Please reply as early as convenient. T am, yours faithfully, (Signed), ITUGU ALLAN. No. 17 Letter. Montreal, 16 Sept., 1872. Bear Mr. McMullen,— I wanted at this time to have a meeting in New York to sec what our friends there were disposed to do, but to-day I have a letter from General Cass stating that he is leaving New York for Chicago, there to join Mr. Ogdcn, and the two are ugust, 1872. p till that date of road. I have not e it reached you nd I now proceed influence I sue- on as the Govern- see, they opened but the result is litions, they agree give me and my itraot to build the h, and 50 millions to us under the iist the company, ecuted within six ard us with great le Government is avoid the former ;n influence. The ave to stand in my 000,000. nt of stock in the it. Ten per cent the Government as n. The expenses have already paid ore the end of this }00,0')0 stock. If I end of this month n ALLAN. S Sept., 1872. in New York to sec from General Cass JD, and the two are 209 going to Puget Sound. They say no meeting can bo held till 15 November, which will not do at all. I hope in ten days or so to have the contract signed, and would like immediately after to go to England to raise the money to build the line. I have disbursed $343,000 in gold which I want to get repaid. I have still to pay $13,500, which will close everything ofl". I will go to New York as soon as the contract is signed, say about 7 October, and would be glad to meet you there at that time. Yours, truly. G. W. MoMuLLEN, Esq., 553 Washington St., Chicago, Ills. (Signed), HUGH ALLAN. Letter No. 18. Montreal, 24th Oct., 1872. Dear Mr. McMullen, — No action has yet (so far as I know) been taken by the Government in the matter of the Pacific Railroad. The opposition of the Ontario party will, I think, have tho effect of shutting out our American friends from any participation in the road, and I apprehend all that negociation is at an end. It is still uncertain how it will be given (the contract), but in any case the Government seem inclined to exact a declaration that no foreigner will have directly or indirectly any interest in it. But everything is in a state of uncertainty, and I think it unnecessary for you to visit New York on this business at present, or at all till you hear what the ' isult is likely to be. Public sentiment seems to be decided that the road shall bo built by Canadians only. Yours truly G. W. McMullen, Esq., Picton, Ont. (The following reply was sent to the above.) (Signed) HUGH ALLAN. Letter No. 19. Picton, Nov. Gth, 1872 My Dear Sir Hugh, — Since the receipt of your letter, the contents of which surprised me considerably, following so soon after our conversation at Montreal, and in view of the fact that the Government seem so much at sixes and sevens about the whole matter, I have of course communicated the substance of it to my friends. They are anxious to know whether such a decision will be arrived at, after the various pledges made, as will debar our Association from participation in the construction of the Railway. Whatever skirmishing may be done by way of talk, they can hardly have an idea that you will prove recreant to your business associates in an arrangement mainly of their own suggestion, (I mean the Government who first requested you to write to Chicago). However much they may be beset with political problems, I do not believe they could get, in any other way, so difficult a one on their hands as they could by taking such a course. Mr. Ogden and party are now back from Puget Sound, and I shall take an early opportunity of meeting them. 1 should like any possible positive information, and in case the affair goes so that our association cither directly or through you, cannot handle it, it would be well to know 27 i , =«8SI V ) I i. ; 1 210 it. But fts the (iioverninent could not expect yoo to go into it and leave the others out entirely, I should tliiiik }()u could have it arranged as wc have several times talked, i. e. the stock held hy you subject to private arrangement with the others. And whatever street rumour may say of public opinion, I should judge that this would do all that is needed. Please let uie hear from you. Truly yours, Sir Huaii Allan, Montreal. Reply to above. (Signed), 0. w. Mcmullen. Lfltcr No. 20. Montreal, 11th November, 1872. Dear Mr. McJLullen, — You really know as much about the Pacific Railroad contract as I do, and that is not much. I am assured that the Government have resolved to form a new Company, but under what conditions or who the parties will be, I am ignorant. It is said that the whole matter will be arranged by the end of this month, and if so we will soon know it. I have not changed my views of what it ought to be, G. W. McMullen, Esq., PiCTON, OnT. Yours truly, (Signed) HUGH ALLAN. K. Copy of 1st Contract between Sir Hugh Allan a7id his American Associates. ' New York, Dec. 23, 1871. The undersigned hereby agree to associate themselves together for the following purposes, to wit : First. — To form the Canadian Pacific Railway Company under a charter substantially as agreed upon, and subject to such modifications or changes as shall be hereafter mutually assented to, which charter is to be procured by ]\Iessrs. Sir Hugh Allan, Charles M. Smith and Geo. W. McMullen from the Parliament of Canada at its approaching Session. Second. — Under and by authority of said charter the undersigned propose to construct the said Railway. For these purposes, we, the undersigned, each for himself and not for the others agree to subscribe in all the gum of ten millions of dollars to the capital stock of the said Canada Pacific Railroad Company as follows : — The various names subscribed to this contract at the end of it except Allan, C. M. Smith and McMullen, and such others as they may associate with them shall subscribe five millions five hundred thousand dollars ($5,500,000) and Sir] [ugh Allan, Chas. M. Smith and George W. McMullen, and such others as they may associate with them, shall subscribe four millions five hundred thousand dollars ($4,500,000) and it is further agreed that the above named parties who shall subscribe for five millions five hundred thousand dollars, shall pay in the sum of ten per centum on the whole ten millions of dollars of stock to be subscribed as aforesaid, into the Banking House of Jay Cooke & Co., in New York city, to the credit of the Canada Pacific Railway Company upon its organization to be used for the construction of said Rail- hers out entirely, cd, t. e. tbo stock er street rumour led. !MULLEN. smbcr, 1872. Pacific Hailroad opany, but under the whole matter H ALLAN. Associates. ec. 23, 1871. following purposes, arter substantially Hereafter mutually Charles M. Smith Session, roposc to construct the others agree to )f the said Canada ^llan, C. M. Smith scribe five millions Smith and George scribe four millions t the above named hall pay in the sum cribed as aforesaid, •edit of the Canada iction of said llail- 211 way and for such other purposes as the Directors of naid Company hereafter to bo elected shall determine, and it is also agreed that on the organization of said Hallway Co., such a By-luw shall be adopted aa will prohibit any further asHcs.smentH on the stock beyond the ten percent paid aa before specified unless ordered by a vote of at least nine tenths ('o) of all the outstand- ing stock of the Company at some regular or special shareholders' meeting. It is further agreed by the parties hereto, that they shall associate themselves together as the Canada Land and Lnprovcmeut Co. which it is proposed shall be hereafter incorporated by the Parliament of Canada, for the purpose of constructing the said Hallway, and for the purchase and sale of lands, and for other needed objects, and that their interests in the said Land and Improvement Co. shall be in the same proportions as their usual subscriptions to the Railway Stock, aforesaid, bear to the whole ten millions of dollars, ($10,000,000) subscribed, and it is agreed that the contracts for building any or all of the various Sections of the Canada Pacific Hallway, when let, shall be let to the said Canada Land and Improvement Co., at fair prices, and to the Canada Land and Improvement Co., shall operate and bo allowed the use of tho said Hallway, during the period of its construction, without charge therefor, except the expense of keeping tho same in good order and repair at their own cost, during such use and control of said Hallway. It is also agreed that the first working capital of the said Canada liand and Improve- ment Company, shall bo the aforesaid one million of dollars, to be paid in on the Railway Stock before named, less any amounts previously expended by order of tho Board of Directors, and shall also consist of such sums or profits as shall thereafter be received by it, from time to time from said Railway Company, for construction and for work done in excess of tho cost of such work, or so much thereof as may be necessary for tho successful prosecu- tion of said work. And it is expressly agreed that the first profits arising from the contracts above referred to, shall be used to reimburse (parties subscribing for $5,500,000) and their associates for the one million of dollars paid by them as a ten per cent instalment on the Railway Stock aforesaid, with interest thereon at the rate of seven per cent per annum. And it is furthermore agreed that all, or at least a majority of all tho stock or interest in both the Canada Pacific Railway Company and the Canada Land and Improvement Company, held by each of the undersigned, shall be placed in the hands of a Trustee (who is to be selected by the undersigned) to be held by him during the time occupied in building the said Railway, or until two-thirds of the owners or representatives of said stock, so held by said Trustees, shall elect to terminate said trust, and the said stock shall bo voted on by the said Trustee or his successor, meanwhile, at all the meetings of stockholders, as he shall be directed to vote by the owners of a majority thereof. It is hereby agreed that after the (jnc million of dollars heretofore mentioned, with the specified interest thereon, has been refunded to the parties advancing it, then all divisible profits of both the Canada Pacific Railway Company and the Canada Land and Improvement Company, shall be divided among the stockholders of each company in proportion to the shares they severally ho.d. It is hereby understood that the names " Canada Pacific Railway Co " and " Canada Land and Improvement Co" arc used for the sake of convenience and in case different names shall be adopted by the Canadian Parliament, or in case they shall fail to autliorizc any such Land and Improvement Co., then this agrccement shall be understood to relate to such Railway as shall be authorized to be constructed in accordance with the provisions hereof across British Territory to the Pacific Ocean, Gulf of Georgia or Straits of Fuca and to the Improvement Company or association proposed to be organized to construct the same, which may be organized under and in accordance with the Laws of any of the States comprising the United States, and its terms shall govern the parties hereto in relation to the same, in the same manner as if the names above mentioned had been used in the said proposed Charters for said proposed organizations. It is understood that no moneys in excess of one hundred thousand dollars shall be drawn from the funds of the proposed Canada Pacific Railway Company until the actual construction of the road beginaWnless by consent of the owners of or subscribers to at least two-thirds of the ten millions of doHjars of stock to be subscribed in accordance with the terms of this contract. The essential conditions of the charter referred to are a subsidy of fifteen thousand "" ll IP ;l:[ :. ! , ■•\ 1 r 1 212 dollars (815,000) per milo for each and every niilo of Road constructed, payable on the completion ot sections of twenty milea, and a grant of lands cnual to twenty thousand acres per mile for all the lload except from Fort Garry East, on the North Shore of Lake Superior to a junction with the section proposed to bo kuilt from Lake Nipissing to the Sault Stc. Mario on which the grant of lands is to be equal to twenty- five thousand acres per mile. The only forfeiture in case of failure to complete the entire Koad within the time specified is to be the right to finish the uncompleted portions, the payments being absolute on the completion of each section of twenty miles. The amounts proposed to bo subscribed by the various parties to this contract are as follows:— Jay Cooke & Co. $1,000,000, D. McLaren «r)00,000, Wm. B. Ogden $637,500, J. Gregory Smith $500,000, O. W. Cass $637,500, H. R. Payson $175,000 Thos. A. Scott 500,000, F. E. Cauda $175,000, C. J. Cauda $150,000, R. D. Rice, AV. G. Fargo, Frederick Billings, Wm. Windowa, B. P. Cheney, A. H. Barney And Thomas Il.Cawficld, or so many of them as become parties to this agreement, in all $1,225,000. Sir Hugh Allan, Charles M. Smith and Geo. W. McMulicn for thomsolvcs and others $4,500,000. (Signed) Jay Cooke k Co., one million of dollors. Wm. B. Ogden, six hundred and thirty-seven thousand, fiva hundred dollars. G. W. Cass, six hundred and thirty-seven thousand, five hundred dollars. J. Gregory Smith, five hundred thousand dollars. D. McLaren, five hundred thousand dollars. Thos. A. Scott, five hundred thousand dollars. H. R. Payson, one hundred and seventy-five thousand dollars. F. E. Cauda, one hundred and seventy-five thousand dollars. C. J. Canda, one hundred and fifty thousand dollars. R. D. Rice, two hundred and thirty thousand dollars. Frederick Billings, two hundred and thirty thousand dollars. A. H. BfiTcey, two hundred and thirty thousand dollars. Wm. G. ?''a:''g'.', for self and B. P. Cheney, two hundred and thirty thousand dollars. Thoruas H C>,nfield, Wm. Windowa, one hundred and eighty thousand dollars. Samuel '' Vi''anson, seventy- five thousand dollars. Walter i{i.achman, fifty thousand dollars. $5,500,000. Hugh Allan, one million four hundred and fifty thousand dollars. Charles Mather Smith, one million five hundred and twenty-five thousand dollars.' George W. McMullen, one million five hundred and twenty-five thousand dollars. -• $4,500,000. Copi/ of Supplemental Contract hetween Sir Hugh Allan andliit American Associates, dated March 28th, 1872. Whereas it appears that the Canadian Government prefer to give a gjross sum of money and a gross amount of land for the construction of the Canada Pacific Railway and the branch thereof from Fort Garry to Pembina or St. Vincent orVhe International boundary line in that vicinity, now therefore the undersigned agree to so alte^ their contract or agreement of December 23rd, 1871, as to agree to take thirty-five millions of dollacJ ($35,000,000) in money (gold) and fifty millions of acres of land in amount, to be selected as proposed, and the money to be paid pro rata per mile as constructed, each mileit^bc counted as the one twenty- five hundreth (^^) part of the whole line to be built, and the land at the rate of twenty thou- sand acres for every mile of railway built, and in case ift the judgment of our associate. Sir Hugh Allan, it should be deemed expedient by him to submit to thfTacceptance of thirty-three milhons of dollars in gold ($33,000,000) and fifty millions (50,000,000) acres of land as G. , ^ 213 compensation for tbo conslructlon ol' said Jloixd, liu is hereby aiitliorixcd to do .so ; iind in caso n further reduetioii in price iu found to be indiHpcii8iU)lo iu order to fiucure the contraet for the conHtruction of the wiid Canada Pacilic Railway, then J, Gregory Smith, Sir Hugh Allan, (i. \V. Me.MuUcn, Geo. W. C'lifs, and Wni. B. Ogden are hereby constituted n Comniittco with authority in fiitjiu or a majority of them to submit to sueh further reduction in the money price to bo paid in tlieir dJHcretion to any sum not below thirty millions of dollars ($30,000,000) as they shall think necessary or advisable, aad the said committee or a major- ity of them shall iiave power to make such assessments, from time to time, for the general purposes of the company not exceeding in all one and one lialf per cent of the amounts agreed to be subscribed by us to the stock of the Canada Pacific IJailway Company as they sliall deem expedient. The said assessments are to be considered os part of the one million dollars agreed to be paid on the stock contracted to bo subscribed by us in the agreement of Decem- ber 23rd, 1871, and to bo subject to the same conditions of payment and refunding with interest as are therein set forth. And wo hereby authorize the said Committee to take sucii otlicr action fur us as they may d«cra necessary in tho premises consistent with the general terms of the contract of Dec- ember, 23, 1871, and as modified hereby. New York, March 28th, 1872. (Signed), Jay, Cooke & Co., J. Gregory Smith, B. P. Cheney for self and W. J. Fargo, 11. D. Rice, Thos. H. Canfield, A. 11. Barney, G. W. Cass, Daniel McLaren, by J. W. Ellis, Frederick liillings, Wm. Windowa, II. R. Payson, F. E. Cauda, C. J. Cauda, Samuel Wil- kison, W. B. Ogden, Walter Ilinchnian, Hugh Allan, Charles Mather Smith, ' Jeorgc W. Mc Mullen. M. Copi/^of adimicledijmcnt from Joy Cooke & Co., to G. W. JlcMullen, of his drafts on various parties, etc. (Copy.) New Yokk, April Ist, 1872. G. W. McMiiLLEN, Esq., Secretary, Canada Pacific R. R. Ex. Committee : Dear Sir, — We have to-day received of you your drafts on variou.s parties to tho amount of $.50,000, which sum we credit to the Executive Committee of the Canada Pacific R. R. Association, subject to the draft of Sir Hugh Allan. Respectfully, (Signed) JAY COOK I'] & CO. t^J No. 1. Jay Cooke & Co., Banker.'*, Corner Nassau and Wall Streets: Pay to myself or order. Fifteen Thousand Dollars. $15,000. New York, May 2nd, 1872. (Signed) HUGH ALLAN. 214 No. 2. Jay Cooke & Co., Bankers, Corner Nassau and Wall Streets : Pay to myself or order, Twenty-five Thousand Dollars. |25,000. New York, May 3rd, 1872. (Signed) HUGH ALLAN. I have also receipts for Fees ob ;,he ^ills of the Canada Pacific R. K. Cpnipany, and the Canada Improvement Company, paid wiih othor things to the Hon. J. J. C. Abbott, and by him settled with Mr. Todd, whose receipt I hold, payment, returned me hy Bank of Montreal, in due course. AIeo my cheque showing the G. W. »IoMULLEN. Ii N. (JEnclossd in Envelope Number Tw«, being portion of contents of " A" or '^ sealed packet."^ Merchants' Bank of Canada, February, 26th, 1873. $17,500.00. Pay Hon. Henry Starnes, or Order, seventeen thousand five hundred dollars cy, (Signed) HUGH ALLAN. To the Cashier. Endorsement on back of above Chequi. Mr. Starnes will please endorse and collect this Cheque, and p?.y proceeds to Mr. McMuUen if he becomes entitled to it by the instructions. (Sd) H. A.* : a O. {Enclosed in small Envelope addressed " Hon, Henry Starnes,'^ hcing portions of contents of " A " or " sealed packet,'') The Honorable Henry Starnes is requested to deli\ er over envelop? No. One to Sir Hugh Allan ; and envelope number Two to Mr. George W. McMullen, unless Sir Hugh AUan claims that the contents of the letters contained in envelope Number One have been divulged, or copies of them have been given to other than one person menfion'^ to Mr Abbott, (which Mr. McMullen declares )ias not been and will not be done), in which case Mr. Starnes will open envelope Number One and haviug hearc' the parties will determine whether the contents of such letters have been divulged, copies ^^ranted other than above, or not. If ho decides that they have not, 1 1 ohall hand over envelope Number Two to Mr, McMullen and the letters to Sir Hugh A. an. If he decides otherwise he is to hand over envelope Number Two to Sir Hugh Allan, tnd the letters also, unless Mr. McMullen pays him Twenty thousand dollars in gold, in whici case he will hand the letters to Mr, Mclaullen and envelope Number Tico to Sir Hugh Allan v»!*h the twenty thousand dollars. And Mr. McMallen declares that the said envelope No One contains all of Sir Hugh Allan's letters in his posse&c'on or under his control. (Signed) G. W.MoMULLEN, HUGH ALL.AN. Montreal 26tb February, 1873. 215 3rd, 1872. ALLAN. (^Endorsement on envtlopc covering above). If Mr. TStarnes is not requested to decide any disputes in regard to the ownership of papers herewith, he is to burn this envelope with its contents unopened, immediately on settlement. Hon. Henry Staenes. Cpnipany, and J. C. Abbott, lie showing the lULLEN. "A" or I- Canada, ,873. )llars cy. : ALLAN. proceeds to Mr. ♦ H. A.* Endorsement on large inner envelope, contained in "A" or " sealed packet," and covering envelopes Nos. One and Two, and small envelope addressed " Hon. Henry Starnes." Within tew days after the end of the coming Session of Parliament, the Hon'. Henry Starnes is requested to deliver envelope number One to Sir Hugh Allan, and envelope number Two to Mr. G. W. McMullen, unless objections be made by Sir Hugh Allan to his doing so ; in which case he will open the envelope addressed to himself and act as instructed therein. (Signed) HUGH ALLAN. Montreal, 26th February, 1S73. a W. McMULLEN. Ejidorsemmt on " A " or " sealed packet." Papers produced by Mr. Starnes before select Committed and returned to him subject to be produced to this Committee on their order. (Signed) 17th May, 1873. J. HILT YARD CAMERON Chairman. J. G. BLANCHET, A. A. DORION. portions of No. One to Sir unless Sir Hugh • One have been lenfion*^ to Mr 3), in which case iB will determine er than above, or iber Two to Mr, e is to hand over McMullen pays to ]\lr. McIiiuUen oliars. And Mr. Allan's letters in jMULLEN, \.Ll.AN. P. Copi/ of first Contract hetween Sir Hugh Allan and his American associates. (Duplicate Original.) New York, December 23rd, 1871. The undersigned hereby agree to associate themselves together for the following purposes, to wit : First — To rorm the Canada Pacific Hallway Company, under a charter substantially as agreed upon, and subject to such modification or changes as shall be hereafter mutually assented to ; which charter i;? to be procured by Messrs. Sir Hugh Allan, Charles M. Smith, and George W. McMullen, from the I'arliament of Canada, at its approaching session. Second — Under and by authority of said charter, the undersigned propoKC to construct the said railway. For these purposes wc, the undersigned, each for himself, and not for the 'crs, agree to subscribe, ii^all, the sum of ten millions of dollars to the capital stock of . said Ci..adr. Pacific Railway Company, ao follows : And such others as they may associate with them shall subscribe five millions five t m I % I :' i m 216 / fidopted as will prohibit any •1 ixB before speoififid, unless jok of the compwayat some hundred thousand dollars (''$5,500,000) and Sir Hugh Allan, Charles M. Smith, and G^eoree W. McMullcn, and such others as they may associate with them, shall subscribe four mil- lions five hundred thousand dollars (|4,500,000), and it is further agreed that the above named ^tarties who shall subscribe for five millions five hundred thousand cRllar^ of said stock, shall pay in the sum of ten per centum, on the whole ten millions of dolls' j of stock to be subscribed, as aforesaid, into the Banking House of Jay Cooke & Co., v. New York city, to the credit of the Canada Pacific Railway Company, upon its organizaticin, to housed for the construction of said railway, and for such other purposes as the Directors of said Company, hereafter to be elected, shall determine. And it is also agt&ilt that on ttie organization of said Railway Company, such a By-Law si ill Vj further assessments on the stock, beyond the ten per ><&< ordered by a vote of at least nine-tenths of all the on.., n? i)) regular or special shareholders' meeting. And it is further agreed by the parties hereto that they shall associate themselves together as the Canada Land Improvement Company, which it is proposed shall be here&rter incorporated by the Parliament of Canada, for the pu'pose of constructing the said railway and for the purchase and sale of lands and for other needed objects ; and that their interest in the said Land and Improvement Company shall be in the same proportions as their several subscriptions to the Railway Stock aforesaid, bear to the whole ten millions of dollars sub- scribed. And it is agreed that the contracts for building any or all of the various sections of the said Canada Pacllc Railway, when let, shall be let to the said Canada Land and Improvement Company at fair prices, and the Canada Land and Improvement shall operate and be allowed the use of the said Railway, during the period of it^ construction, without charge therefor, except the expense of keeping the same in good order and repair, at their own cost, during such use and control of said railway. It is also agreed that the first working capital of the said CanaJn Land and Improve- ment Company shall be the aforesaid one million dollars to be paid i?< ci. ' Jte Railway Stock before-named, less any amounts previously expended by order of the lion^f' if Directors, and shall also consist of such sums or profits as shall thereafter be :• •«- V I " ;. it, from time to time, from said Railway Company, for construction and fo»" ^'''■k do ■ '" • .".ess of the cost of such work, or so much thereof as may be necessary for the suocea^ . ' ^Vv>'*;^cution of said work. And it is cipressly agreed that the first profits arising from the coatract .; before referred to, shall be used to reimburse and their associftes for the one million dollars paid by them as a ten per cent instalment on t'le Railway strck aforesaid, with interest thereon at the rate of seven per cent per annum. And it is furthermore agreed that all, or at least a majority of all the stock or interest in both the Canada Pacific Railway Company and the Canada Land and Improvement Com- pany aforesaid, held by each '^f the undersigned, shall be placed in the hands of a Trustee (who is to be seiccted by tie undersigned,) to be held by him •■'"•ing the time occupicl in building the said Railway, or until two-thirds of the owners o • f^ jei,entatives of said stock, so held by said Trustee, shall elect to terminate said trust; and 'Irs />'kii stock shall be voted on by the said Trustee or his successor, meanwhile, at all the :- siigs of stockholders, as he shall be directed to vote by the owners of a majority thereof it ie hereby agreed that after the one million of dollars, heretofore meniioned, with the specified interest thereon, has been refunded to the parties advaD\ii'ja: U, t'lvr. all divisible profits of both the Canada Pacific Railway Company and the Canad . Laud and * iprovcment Coninany, shall be divided among the Stoekhnlders of each Compary, in propcuou to tue shares tncy severally hold. It is hereby understood that the names "Canada Pacific Railway Company'' and " Canada Land and Improvement Company" are used for the sake of convenience, and in case difteren' names shall be adopted by the Canadian Parliament, or in case they shall fail to authorize any such Land and Improvement Company, then this .agreement shall be understood to relate to such railway as shall be authorized to be constructed, in accordance with the provisions hereof, across British territory to the Pacific Ocean, Oulf of Georgia or Straits of Fuca, and to the Improvement Company or Association propos^ to be organized to construct the same, which may be organized under and in accordance with the laws of any of the States itb, and G^eorce scribe four mil- that the above (ffllar^ of said doll*' J of Btock '■•..New York ik',0, to be^seJ irectors of said ctf that on the rill prohibit any eclfifid, unless ompiH^jr-at some ciate themselves lall be herearter the said railway their interest in I as their several of dollars sub- various sections anada Land and trovement shall its construction, rdcr and repair, id and Improvc- e Railway Stock nf Directors, iind i t, from time to .".ess of the cost \>' T. Recdpt for House Ffes on Canada Pacific Railway Compaiii/ Bill PIJIVATE BILL OFFICE. House or Commons, Ottawa, 1st June 1872. Fee and Charges on the Bill to Incorporate tie Canada Pacific Railway Company. Fee payaWeurder the 58th Rule ^^^^'ra \ ... ■„.,,( 500 English 9.Gb Charge for printing Bill | goo French 4.75 . . ,, f 500 English 5.36 Charge for prnting Act | 25Q French :^-38 Translation _^ll^ $137.15 Received payment from Hon. J. J . C. Abbott, M. P. (Signed), ALFRED TODD, Chief Cleric Primtc Bill Offiee. u. Letter from G. W. Me Mullen to Hon. J. J. C. Abbott. Montreal, Feb. 25th, 1873. Deae Sir —If before the expiry of ten days after the termination of the coming session of ParUament I do not 1 and you Messrs. Smith & Ilurlburt's confirmut.oa ot the arrange.nent 1 have this day made wich Sir Hugh Allan. I auihorize the Honourable Henry fetarn3S to mlthe envdoje No two, delivered to him, containing Sir Hugh Allan's cheque until I do produce such letter. ^ Yours truly, (Signed), GEO. W. McMULLEN. Hon. J. J. C. Abbott. ite Bill Office. I! Mi' \\ ••I \ 1 ufif . m », is ' ' 220 A.i=^:PEisrx)ix. Ottawa, 21si August, 1873. To the Hon. Lucius Seth Huntington, of the City of Montreal in the Province of Quebec. Sir, — I have the honor to enclose herewith a printed copy of the Royal Commission appointing Commissioners to inquire into and report upon the several matters stated in the Resolution moved by you in the House of Commons on the 2nd day of April last, relating to the Canada Pacific Railway, and to inform you that the Commissioners therein named will meet in the City of Ottawa in the Parliament House on Thursday, the fourth day of September next, at noon, for the purpose of making enquiry and taking evidence concerning the allegations contained in the Resolution and fully set forth in the Commission. You are requested to furnish to the Commission, with all convenient diligence, a list of the witnesses whom you may wish to examine, in order that they may be duly summoned to appear on the day and at the place above specified, and you are requested then and there to proceed with your evidence in the premises. I have the honor to be. Sir, Your obedient Servant, (Signed) CHARLES D. DAY, Chairman. Ottawa, 21st August, 1873. Sir, — I have the honor to inform you, that the Commissioners appointed to inquire into and report upon the several matters cantained and stated in a certain Resolution moved by the Hon. Mr. Huntington in the House of Commons on the 2nd. April, 1873, relating to the Canadian Pacific Railway, will meet in the Parliament House in the City of Ottawa on Thursday the fourth day of September next at noon, for the purpose of making inquiry and taking evidence under the authority of the Commission concerning the allegations and matters contained in that Resolution, and that notice has been given to the Honorable Mr. Huntington to appear and proceed with his evidence then and there. I have the honor to be. Sir, Your obedient Servant, (Signed) CHARLES D. DAY. Chairman. ii August, 1873. vince of Quebec. )yal Commission ers stated in the 1 last, relating to lerein named will e fourth day of ice concerning the ission. You are of the witnesses to appear on the e to proceed with S D. DAY, Chairman. 1st August, 1873. ted to inquire into solution moved by 73, relating to the !ity of Ottawa on aking inquiry and ations and matters le Mr. Huntington ES D. DAY. Chairman. Mo.HTBEAL, 2Cth August, 1873. To THE Honorable Charles D. Day, Ch'drm'xn, Ottawa. Sir, — T have the honour to acknowledge the receipt of your letter of the 21st of August, instant, enclosing a copy of the Royal Commission, appointing Commissioners to enquire into and report upon the several mittors stated in the RttS'jlutioa moved by me, in the House of Coiamona, on the 2nd day of April last, and requesting me to furnish to the Commission a list of the witnesses I might wish to esioiine, ia order that they may be duly summoned to appear, and to proceed with my evidence. I have to call your attention to the fact, apparent on the face of the Commission, that it was as a Meinbar of the House of Cominons, and from my place in Parlf 'ment, that 1 preferred these charges against Ministers of the Crown, and members of that Ii luse, which, on the 8th day of April last, entertained the charges, determined to investigat.; them itself, and appointed a select Coiumittee to enjuiro into and report upon them ; and to the further fact, apparent on the Journals of the House, that to the said Committee I furnished a list of some of the pr'ncipal witnesses, whose evidjaoe I balieve could establish my charges, and I have always b^en ready to proceed to tho proof thereof before the tribunal constituted by the House for the investigation. The detenniuation of the Commons to investigate these charges remains unaltered, and I deem it inconsistent with my duty as a me.nber of Parliament, and a breach of the undoubted privileges of the H juse, to recogaizo any inferior or exceptional tribunal, created to enquire into charges still pending before the Commons, and so essentially aflfecting the privileges, dignity and independence of Parliament. I believe that it is a breach of those privileges, that a Royal Commission issued without the special sanction of the House, should take any cognizance of, or should assume to call on ma, to justify words which I have spoken on the fl)or of the Commons, and for which I am responsible to them, and to them alone. I feel that I sUould do no act, which may be construed into aa acquiescence in the attempt to remove from the Com'uons the conduct and control of the enquiry. I believe that the creation of the Commission involves a breach of that fundamental principle of the constitution, which preserves to the Commons the right and duty of initiating and controlling inquiries into high political offjacos ; that it involves also a breach of that fundamental principle of justice which prevents the accused from creating the tribunal and controlling the projeJure for their trial; and that it is a C immission without precedent, unknown to the Common Law, unsanctioned by the Statute Law, providing by an exercise of the prerogative for an enquiry out of the ordlti-.ry course of justic3 into misdemeanour cognizable by the Courts, and consequently illegal and void. Entertaining these views, you will not expect me to act otherwise than in conformity with them, and you will be satisfied that by my non-appearance before the Commission I intend no disrespect to the Commissioners, but am moved by the same sense of public duty which will constrain me at the earliest practicable moment to renew the efforts which I have been making since April last to bring to trial before the Commons of Canada the meu whom 1 have impeached as public criminals. I have thft honor to be. Sir, Your obedient Servant, (Signed) L. S. HUNTINGTOX.