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Tous las autres exemplaires orlglnaux sont fllmte en commenpant par la pramlAre page qui comporte une empreinte d'impreeslon ou d'iilustration et en terminant par la dernlAre page qui comporte une telle empreinte. Un des symboles suivants apparattra sur la darnlAre image de cheque microfiche, seion Ie cas: ie symbols -^ slgnifie "A 8UIVRE", Ie symbols ▼ signifle "FIN". Les cartes, planches, tableaux, etc., peuvent Mre fllmto A des taux do rAduction diff Arents. Lorsque Ie document est trop grand pour Atra reproduit en un seul cl!chA, 11 est fiimA A partir de i'angle supArieur gauche, de gauche A droite, et de haut en bas. en prenant ie nombre d'images nAcessaire. Les diagrammes suivants illustrent la mAthode. 1 2 3 1 2 3 4 5 6 HI i a REPORT 01 THE SELECT COMMITTEE APPOINTED TO mQlHRE INTO ^\i}t Js0ne anlr Bait ot CITY DEBENTURES, In 1852, WITH THE EVIDENCE. TORONTO: OBO. S. THOMAS * CO., FBINTSRS TO TBB COBrOBATION. 1853i IP6 5 ■^ > -; f 07 Mix REPORT or THI SELECT COMMITTEE APPOINTED TO INQUIBB IKTO TUB ISBUE AND SALE OP CITY DEBENTURES IN 1852, WITH THE EVIDENCE. PROCEEDINGS m COUNCIL. Monday, February 7, 1852. The Petition of David Patebson", Esquire, and others, praying for an investigation into the issue and sale of certain City Debentures was presented by Alderman Bell and read as follows : — To ihd Worshipful the Mayor, Ahlermen, and Commonalit/ of the City of Toronto. The memorial of the undersigned inhabitants'and rate payers of the city of Toronto, Respectfully sheweth, that it appears from a discussion that took place at the last meeting of your -worshipful body, as reported in the public press, that £50,000 of city J • iiontures, issued for the construction i;f the Northern Railroad, were dispi sed of for £40,000, and the last named sum alone received by the contractors. That a profit of £10,000 has becu realised on the transaction, and that the matter appears to have been effected through or at the Bank of Upper Canada, and that very shortly afterwards £50.000 City Debentures, actually worth par wore substituted therefor. That great difficulty seems to exist in assertaining who reaped the benefit of the ten thousand pounds discount, or to whom the first £50,000 of Debentures were disposed of or by whom the £40,000 paid to the contractors were provided. That charges of the gravest nature, materially affecting the character, credit, and respectability of the municipality of this city, are publicly made respecting the transaction in question. That if the sum or £40,000 so paid for the first issue of debentures was in any way directly or intUroctly advanced by the bank or others, or procured on the faith or credit of the city or of any engagement by the city to replace the same by any fresh debentures to the amount of £50,000, your memorialists conceive that any profit realised by the transaction should be carried to the credit of the city. That your me> morialists desire to make no charges against individuals, and are solely actuated in their proceeding by a desire to have the true facts of this caae thoroughly investigated, and the interest of the city duly protected. Your memorialists, therefore, most respectfully request that your wor- shipful body will cause the matter in question to be fully investigated, believing that such a proceeding is peremptorily called for, and that if necessary an application be made by the Corporation to the Oourt of Chancery to enforce discovery, or that such of the rate payers as may desire so to do may, at their private cost, be allowed to use the name of the municipality in taking such proceedings as counsel may devise. And your memorialists, &g. Toronto, 27th January, 1852. D. Paterson, John Harrington^ R. H. Brett, James £. Ellis, J. Lesslie, David Maitland) Hugh Miller, Donald McLean, Archibald Taylor, Donald Campbell, John Ewart, Edward Beckett^ John Carter, J. McMurrick, Wm. McMaster, John Ross, Alex. Rennie, jun. H. Jackson, Samuel Heakes, Chas. Robertson, juU; Scott & Laidlaw, Peter Freeland, John Harper, John Easson, Thomas Plummer, Wm. Langley, James Henderson, David Burns, Robert James, jun^ F. W. Coate, William Wakefield, George Bilton, TbomtM Bilton, Oeorge Walker, John Russell, J. R. Armstrong, John Eastwood, T. D. Harris, Oeo. H. Cheney & Co. John H. Ritchj, Wm. Henderson & Co. William Bright, W. Creighton, M. Rossin & Brother, William Mathews, Henry Sproatt, John Wightman, Alex. Rennie, Wm. M. Gorrie, Walter McFarlane, John Ritchey, jun. George Ewart, jun. Samuel Sleigh, Thomas Lailey, James Hutchinson, John MulhoUand & Co. Edward Cooper, William Atkinson, Thomas Paterson, Joseph Rogers, John Crawford, John H. Ha^arty, John Farr, James Leask, Anthony Blachford. W. Hewitt, y emcnt by fimount of 3d by the > your me- are solely ts of this protected. your wor- estigated, id that if Court of re as may e name of vise. Co. Co. er. Co. i Thomas Hutchinson, J. 0. Collins, Geo. B. Wylie, A. & S. Nordheimer, Betley & Kay, Alex. Ogilvie & Co. J. W. Marling, J. Henderson, Bidden & McLean, John Ellis, J. Iredale, Matthew Persy, WiUiam Hall, Thomas Haworth, James Booth, William Steam, J. G. Joseph, ^ J. Charlesworth, J. Carmichael, Henry Cawthra, James Crowther, John Mead & Co. James Leishman, Thomas Burgess, Isaac Hutchinson, Jonathan Watson, Thomas Bell, R. B. Miller, J. A. Torrance, Alex. McPherson, J. W. Lee, J. M. Strange, Barrow & McDonell, Andrew Foulds, Fred. Perkins, John Mitchell, W. J. Macdonell, Bobert Smith, J. Mitchell, John Plenderlieth, H. Fowler, W. H. Dow, R. P. Crooks, Champion Brown, Henry Sherwood, Johii Lander, John Haigh, William Cook, Robert Davis, E. Dack, D. W. Smith, John Griffith, John Thomas, W. B. Adams, Stewart Wells, Francis Thomas, G. Rennick, Charles Baker, Thomas McLean, James Johnston, Angus Dallas, John Russell, James Carless, John McGee, £. D. Dauglas, Thomas Small, F. Draullard, John Buchaa, James Cleland, Samuel Sims, Robert Taylor, Thomas Dexter, John Montgomery, Rufus Skiouer, C. Davis, W. McCracken, George Cline, Alex. Henderson, A. K. Boomer, James Manning, John M. McKay, William Policy, J. Liddell, John Lawrie, John Wilson, P. H. Howard, Wm. Cawthra, W, Burke, P. Paterson, Donald Matbieson, Terence J. O'Neill, George Revill, Robert Simpson, James Murray, Robert Stewart, Robert Briggs, Alex. Stewart, Joseph Sheard, Thomas Ncsbit, A. Hibbard & Co. Wm. Scholes, Matthew Walton, John Mcintosh, B. McClosky, E. V. Wilson, John Clark, Robert D. Patterson, J. Litster, G. K. Burrows, Robert Bell Joy, H. B. Williams, J. C. Griffiths, Thomas Gibbs, Joseph Hodgson, John T. Shapter, And 806 oth*ra. i 6 On the motion of Councillor Romain, Bccondod by Councillor Rogers, it waA ordered, — That the petition of David Paterson, Esq. and others, be referred to a Select Committee, to consist of Aldermen Bell, Denison, Gooderham, and Gowan, and Councillors Ashfield, Green, and Mac- donald ; that the said committee t^e instructed to inquire into the sale of City Debentures for the past year, and to report to this council at ita next meeting. / Monday, February 21, 1853. The Select Committee to whom was referred the petition of David Paterson, Esq. and others, brought up a report, which was received and rc.id, and is as follows : — To the Worshijiful the Maya)', AklcTiinen and Commonalty of the City of Toronto. Tlio Select Committee to whom was referred tlie petition of David Paterson and others, beg leave to submit the following report, with ac- com{»auying evidence, viz. : — Your committee find that the contractors of the Northern Railway received X50,000 of de])cntures from the city' for stock in the road, which they sold at 20 per cent, discount, which appears to your com- mittee to be the full value of the same, as evinced by the evidence of various parties before your committee. It is further apparent that the city interests have not in the slightest degree sufiered by the transaction, and that the contractors of the Northcn Railroad are perfectly satisfied ; and that the Mayor or Officers of the Corporation had nothing to do with the negociation of the rail- way debentures — and further your committee recommend, that the whole, or so much of the evidence given before the committee ns may be considered necesssary for the information of the citizens, be published. All which is respectfully submitted. WM. GOODERHAM, Chairman. Committee Room, February 21. 1853. Alderman Gooderham, seconded by Councillor Lee, moves that the Council do now resolve itself into a commitee of the whole on the report which was ordered. The council resolved itself into a commiittee of the whole on the report. Alderman Carr in the chair. lor Rogers, and others, I, Denison, and Mac- the sale of )uncil at ita 1853. 1 of David ccived and of the of David t, with ac- 1 Railway the road, your com- s'idence of e slightest rs of the or Officers f the rail- that tlie 18 may Ije iblishcd. iirman. that the he report J on the Th« committee Jose ; Aldermaa Can xepoTted that the coaimtt«e bad adopted the report. The report was received. The report was & 'touted. Alderman Oowan, seconded by Alderman Goodemam, movee that it be resolved:— That the petition of David Paterson and others, and the statements of which the committee were instructed to inquire, contains six distinct averments: — First—" That £50,000 worth of City Debentures, issued for the con- fitruction of the Northern Railroad, were disposed of for j£40,000, and the last named sum alone received by the contractors. fkcond — " That a profit of £10,000 has been realised by the trans- action." Third — " That the matter appears to have been effected, through or at, the Bank of Uppei^Canada." FouHh—"- That shortly afterward, £50,000 of City Debentures, ac- tually worth par, were substituted therefor." Fifth — " That great difficulty seems to exist in asccrtiiining the parties who reaped the benefit of the £10,000 discount." Sixth and Lastly — " That charges of the gravest nature, materially afiecting the character, credit and respectability of the municipality of this city, have been publicly made, respecting the transaction in ques- tion." That independent of these, however, in several newspapers of the city and elsewhere, as also in anonymous publications, and by verl)al state- ments, reports have been put into circulation, giving to the transaction a colour of tlie basest malversation luid corruption. That in order to a full understanding of the whole question, it may be necessary fur the information of the petitioners, who have called for and demanded this enquiry, to recite briefly but accurately, the circumstances out of which these transactions arose, so far as the city credit, or the city interests are concerned. That it appears, that in the month of November, 1850, a deputation from the Directors of the ** Ontario, Simcoe and Huron Union Railroad Company" (which for brevity sake may be termed the Northern Rail- road,) waited upon the Finance Committee of the Ctiy Corporation, and strongly urged that a grant of £25,000 should be made from the public funds of the city, to aid in completing that work. That no action was, at the time, taken upon this application: but in a few days afterwards the Board of Trade of the city, by a unanimous voto of that body, strongly urged upon the city council the propriety and necessity of making the required grant. 8 That the council, at a subsequent meeting, complied with the joint re- quest of the directors and the Board of Trade; but in making the grant of £25,000, stipulated as conditions, that the terminus for passenger trains should be erected on a portion of the Market bloek property, then vacant ; such portion to be leased to the company for 99 years, at u nominal rent ; that the line of the road should be carrred along Front and Palace streets, to the full extent of the city water lots ; and that the debentures of the city were to be issued for the same, in proportions of one tenth, as the work progressed. That in the month of August in the following year (1851) a publicmeet- ingof the citizens, presided over by John Arnold, Esq., requested the city council, in addition to the gift of iL25,000 already alluded to, to grant a further aid to the company, to the extent of £35,000, which request, after having been first referred for consideration and report to the com- mittee on finance and assessment, and to the city solicitor, was acceded to by the council. * That for this the corporation was to receive, by way of security, the bonds of the company, payable in ten years, with interest half-yearly. These two sums, making together £60,000, in addition to the condi- tions attached to the previous grant of £25,000, were made further sub- jovt to the conditions of the road being completed from this city to Hol- liind River, within two years from the first day of January then next ensuing ; and that as long as the loan continued, either the mayor of the city, or one of the Aldermen, to be chosen by the council, should be a director in the company. That on the 28th June 1852, the council passed a By-law, embodying these conditions, and authorising his worship the Mayor to cause De- bentures to the extent of £60,000, to be made and issued. In the month of July following, the contractors represented to the Mayor that they were unable to give security upon the road, which was roquiicd as one of the conditions for the loan for £35,000. That after some negociations between the directors, the contractors and the council, it was ultimately agreed between all three parties, that the former arrangements, so far as the amount in aid of the road were con- cerned should be cancelled ; and that in' lieu of the £25,000 gift, and the £35,000 loan, the city should take £50,000 of stock ; this last to be sub- ject to all the conditions in every respect, which applied to the two preceding grants of £25,000 and £35,000 respectively. That on the 11th October the necessary voucher from Mr. Cumberland, the chief engineer of the company, was laid before the city council, certi- fying that the contractors, Messrs. M. C. Story & Co. had expended fSSSjlTOTcurroncy on the work. \i 9 1 the joint re* g the grant of isenger trains roperty, then 9 years, at u 1 t^ong Front and that the )roporti(»ia of El public meet* estedthe city ;o, to grant a lich request, :t to the corn- was acceded security, the lalf-yearly. to the condi- further sub- 1 city to Hol- rythen next ;he mayor of il, should be I embodying cause De* mted to the , which was ractors and ies, that the d were con- lift, and the t to be sub- to the two imberland, inoil, certi- 1 expended That by this certificate the contractors were legally entitled to receive, i at that date, the full amount of £50,000, according to the original terms I of agreement. Tbat immediately upon the receipt of this certificate, a By-law was passed by the city council, authorising his worship the mayor to sub* scribe for, take, hold and receive, the £50,000 stock in the company, and directing him to cause to be issued, and to appropriate the City Deben- tures for the payment thereof. That bonds releasing the city from all claim to the grant of £25,000, and the loan of £35,000, having been executed by the company ; and the board of directors having also agreed to the proposed arrangement, without prejudice to the other parts of the existing agreement, which were not to be afiected in any way, by the substitution proposed; debentures to the full extent of £50,000 were issued by the city cham- berlain, and by that officer deposited in the Bank of Upper Canada, the contractors for the Northern Railroad (to whom the debentures had been assigned by the directors,) having verbally and by written order, directed they should be there deposited, subject to their order. I That in exchange for the debentures so deposited, the city chamberlain ^ received from the contractors scrip, or paid up stock of the Northern Railroad Company, to the extent of £50,000, having the full amount I expressed on the face of the debentures. That when the debentures were first demanded by the contractors, some doubts arose touching the legality of their issue, and to remove such doubts, if possible, the committee on finance u.nd assessment had recourse to the advice of counsel learned in the law. The result of the consulta- tions, held with counsel, appears to have left the question pretty much j as it had previously stood ; the lawyers (Messrs. Mowat and Hagarty ), referred to by the finance committee, being of one opinion, and those referred to by the directors of the Northern Railroad, being of another. Ultimately, upon the urgent request of the directors and the contractors, and with the sanction of their law agents, of their president, Charles Berczy, Esq., and of their present president, Joseph C. Morrison, Esq. M.P.P., the debentures were issued and delivered, as before stated ; the directors and contractors, both verbally and in writing, assuming the entire responsibility of their issue. f That on the 7 th October an act was passed by the Provincial Legislature authorising the consolidation of the city debt, and making various pro visions for the redemption of all outstanding debentures. Some few days after this act received the royal assent, the city chamberlain first heard of its having passed, but was unacquainted with its provisions. At tlie request of the mayor, the chamberlain telegraphed Mr. W. H. Boulton, one of the city members, then attending his parliamentary 10 duties at Quebec, requesting that gentleman to forward to him a cer^ >d copy of the Act. This copy left Quebec on the 20th October, iu> aa received by the chamberlain in the due course of the mail. That after the introduction into parliament of the bill to consolidaiii) the city debt, and before that measure received the royal assent, a letter was addressed by the cashier of the Bank of Upper Canada, to the city chamberlain, tendering on behalf of certain parties in England, to take the whole amount (£100,000) of debentures authorised by the bill, (should it become law,) at par; a condition being, that one half of the whole amount, or £50,000, should include the debentures issued to the Northern Railroad contractors. This offer was submitted to the com- mittee on finance and assessment, and unanimousty adopted by that body. It was subseciuently laid before the city council, and there received a like unanimous concurrence. That the -first averment of the petitioners is contained in the follow- ing yrords: — " That £50,000 worth of City Debentures, issued for the construction of the Northern Railroad, were disposed of for £40,000, and the last-named sum alone received by the Contractors." This statement is not borne out by evidence. Instead of the Contractors re- ceiving but £40,000, as alleged, they received from the City Chamber- lain the whole of the Debentures, amounting in all to £50,000. After having passed out of the hands of the City, and become the sole pro- perty of the Contractors, they alone could exercise coutroul over them ; and no officer of the Corporation could, as such officer, directly or indi- rectly, interfere with their disposal; whether they retained them in their own possession, or whether they disposed of them at a premium, at par, or at a discount, was altogether a matter for their own considera- tion. It is, however, believed that the Contractors had made arrange- ments for the disposal of the Debentures ; such as is done in all ordinary cases, and such as, in this case, they had a perfect right to do. And the Contractors state, that " they are entirely satisfied with the opera- tion ;" and that as " they were the only parties having the least interest in them, they disposed of them at what they regnrded as a fair price ;" and that " no subsequent event has, as yet, satisfied them that the arrangement was an injudicious one." That the second allegation of the petitioners is in these terms ; — " That a profit of £10,000 has been realized l»y tlic transaction." Were tliis statement true, it would be a matter entirely between the Contrac- tors, who were the owners of the property, and the parties to whom the property was sold ; but the Committee have the })est evidence for Btating, that the fact is not as alleged by the petitioners. That if the contractors, as stated, sold the debentures at a discount of one per cent, per annum, which would amount to twenty per cent, in twen vy years (the period the debentures had to run,) instead of parting with t^ ober, iuj- as consolids^ the ssent, a letter da, to the city gland, to take I by the biU, one half of the s issued to the d to the com- opted by that il, and there n the follow- ssued for the for ^40,000, ictors." This 'ontractors re- 'ity Chamber- 0,000. After the sole pro- ul over them ; rectly or indi- ined them in t a preminm, i\'n considera- iiade arrange- 1 all ordinary to do. And th tlie opera- least interest . foir price ;" lem that the PC terras : — •tion." Were tlie Contrac- to whom the jvidence for "pount of one t, in twenty )arting\Tith 11 them ftt a depreciated rate, the Committee have ascerttuned that they brought the full market value, usual in the sale and transfer of such stocks. While every witness of respectability, acquainted with the moretary transactions of the city, bore willing testimony to the usual rate of discount being about one per cent, per annum, (the rate at which the contractors disposed of the Northern Railroad debentures,) no one was found to say, he would give more favourable terms for i!iom. The nearest approach to a better disposition, than the sale made oi i hem by the con- tractors, may be found in the evidence of William Cawthra, Esq. who states that he thinks he would have been willing to havo given from £44 to jG45,000, which is the highest he would be willing lo have given for them, had they been offered to him." Taking this as the most favour- able view, the parties who purchased, instead of realizing £10,000, as stated by the petitioners, could not have realised one half of that sum on the purchase, taking the article at its highest and best market value. In addition to this, the Committee had the evidence ofT. G. Ridout,Esq. that the bank deducted commission and other ordinary charges ; so that the profit — if any — could in no sense justify the extravagant statement madu by the petitioners. Nor can the council refrain from observing, that one of the petitioners (J. II. Hagarty, Esq.) admitted before the committee that in December last, (two months after the negocia- tion and sale complained of,) he had, in concert with his partner, acted as the agent of a third party, in the ncgociation and purchase of the city debentures, to the extent of £3000, having from eight to eighteen years to run, at the same average rate of discount, at which the Northern Rail- road contractors disposed of tlieirs. That the third statement of the petitioners is ; — " That the matter appears to have been effected through the Bank of Upper Canada." This averment is found to be correct. But in making this avowal, the coimcil feel it but just to add, that throughout, the conduct of Mr. Ilidout, and of tlie institution witli which he has been so long connected, was fair, honourable and business-like. That the /o(^r/7i allegation of the petitioners is couched in these words: — '* That shortly afterwards £50,000 of city debentures, actually worth par, were substituted therefor." To state that the city debentures were, at that time *• at par," is contrary to all evidence on that head. This council cannot account for tiie fact of many persons, who were them- selves in the constant habit of purchasing and selling city debentures, and of l)eing cognizant of others having purchased and sold them, in no case at par, and even in some cases at a higher rate of discount than the rate now complained of, attaching their signatures to a statement so entirely at variance with their every day knowledge. The evidence of the city chamberlain, Mr. llidout's tender on behalf of the parties who p urohascd at par, and many other circumsttmces, go to satisfy this council 19. I that the same parties who purchased the debentures from the contractors were those who treated with the city for the £100,000 loan, and that had the whole £100,000 of debentures to be paid for in money instead of one half only, par value 'could not have been procured for the debentures sold. That as regards the substitution of the debentures, that substitu- tion was made under the authority of an act of the Provincial Legislature, that it was unanimously concurred in by the committee on finance and assessment, and by the council ; that it entailed no additional expense or responsibility of any kind upon the city ; and that moral honesty de- manded such an exchange, if the original issue had been illegal. That the fiflh statement of the petitioners is, — " That great difficulty seems to exist in ascertaining the parties who reaped the benefit of the £10,000 discount." This evidently goes to show that no parties " reaped a benefit" to the extent stated. In reference to the difficulty which existed in ascertaining the names of the parties, great reluctance was felt to indulge in a course so unusual, and probably so impertinent, as to demand the mames of the parties who negociated the sale, and who par- ticipated in the profit, if any ; the committee yet so far yielded to the pressure of public curiosity, as to enquire if his worship the Mayor, or any offices of this corporation was the party. The committee received the distinct assurance, that neither his Worship nor any inhabitant of this city was concerned in the sale or participated in the purchase — a fact which, when given in the evidence of a gentleman so unimpeachable in character, and so well known as Thomas G. Bidout, Esq., ought to silence all further observation on that head. That the sixth and last averment of the petitioners is contained in the following words: — "That charges of the gravest nature, materially affect- ing the character, credit and respectability of the municipality of this city, have been publicly made respecting the transaction in question." This statement the council regret to know is but too true. Not only have those "grave charges" so " materially affecting the character, credit and respectability of the municipality," found parties wicked enough to give them circulation and currency abroad, but even many resident in the oity, whose property and position should have given them a direct inte- rest in maintaining "the character, credit and respectability of the muni- cipality," have lent themselves, if not to the invention and propagation, certainly to the circulation of those " grave charges." While the council cannot but express their deep regret that " the character, credit and respectability of the municipality" should be injured by the invention and propagation of such reports, they offer their hearty congratulation to the thoughtful and reflcting portion of their fellow-citizens in general, upon the fact that, the committee have been unable to discover fraud or guilt in ftiy part of the transaction , and that every officer of the corpo- ration, from the chief magistrate downwards, stand acquitted in their n the contraotoro an, and that had >y instead of one the debentures es, that substito- icial Legislature, on finance and ional expense or oral honesty de- illegal. t great difficulty he benefit of the parties '* reaped difficulty which ; reluctance ■woe ipertinent, as to e, and who par- r yielded to the ) the Mayor, or imittee received ahabitantofthis )urcha8e — a fact limpeachable in ought to silence lontained in the laterially affisct- icipality of this •n in question." Not only have cter, credit and enough to give resident in the n a direct inte- ty ofthemuni- id propagation, nle the council er, credit and the invention congratulation ms in general, icover fraud or r of the corpo- itted in their 18 ' opinion from the slightest taint of malversation or other improper eon* duct in the discharge of the onerous and responsible municipal duties assigned to them by their fellow-citizenst That this Council, having thus disposed of the allegations of the petitioners, it now remains to notice their prayer ; which is, " that the Council will cause the matter in question to be fully investigated ; and that, if necessary, an application be made by the Corporation, to the Court of Chancery, to enforce discovery ; or that such of the Bate* payers as may desire so to do, may, at their private cost, be allowed to use the name of the Municipality, in taking such proceedings as counsel may advise." To the first part of the prayer, that of inves- tigating the matter, this Council has already acceded. That investiga- tion has " fully satisfied" this Council, not only that it is not " necessary that an application should be made, by the Corporation, to the Court of Chancery," but that a heavy expense would be incurred thereby, and a deep injury inflicted upon the City, Which was carried. \; PROCEEDINGS or SELECT COMMITTEE, AND EVIDENCE. Wednesdat, 9th February, 1853. The Select Committee, to whom was referred to Petition of David Paterson, Esquire, and others, praying for an inyestigation into the issuing of City Debentures, met. Present : Aldermen Belt,, Couneilmen Ashfiild, DENisoy, Greex, GOODERHAM, MaCDONAU). GOH'AX. Alderman Dcnison, seconded by Councillor Macdonald, moves — That Alderman Gooderham be the Chairman of this Committee. Which was carried. Yeas — Aldermen Bell and Denison ; Councillors Ashfield and Macdonald. — 3. Nays — Aldermen Gooderham and Gowan, and Councillor Green. — 3. Alderman Gooderham took the Chair. Alderman Gowan, seconded by Councillor Macdonald, moves — That it be resolved that all the proceedings of this committee be taken dowu in writing, including the questions to and answers of witnesses, which was carried. Alderman Gowan, seconded by Councillor Macdonald, moves — Tliat the undermentioned witnesses be reiiuestcd to attend, for the purpose of giving evidence, to-morrow (Thursday), at 3 o'clock p.m. namely : — Samuel Thompson, Esquire, Chairman Finance Committee. Joshua George Beard, Esquire, late Chairman Board of Works. David Paterson, Esquire, first petitioner. The Clerk of the Common Council. The Chamberlan of the City. Which was cariied. 16 ', i ll'jji in i I ! Alden&an Dcnison, seconded by Councillor Green, moves — That the questions intended to be asked of witnesses be furnished them in writing. Yeas-^Alvlermen Denison and Gowan, and Councillor Green ' — 3. Nays — Alderman Bell, and Councillors Ashfield and Macdonald — 3. The votes being equally divided, the Chairman voted with the yeas. Carried. JoAn B^ll, Esquire, examined. Question. — llave you, at any time, purchased, or offered to purchase, either for yourself or any other person, the Debentures of this City ? Answer. — I have. Q. At what rate did you offer to purchase ? A. At various rates, from 15 per cent, downwards. Will answer more fully to-morrow. Q. Are you the law agent of Williiun Cawthra, Esquire, formerly an Alderman of this City ; and did you, as such agent, advise him to pur- chase City Debentures 7 A. Mr. Cawthra is a client of mine. I am not avrare of having advised Mr. Cawthra to purchase City Debentures, beyond mere inci> dental conversations in the office. Q. Are you aware at what rate the Debentu)Pes were purchased by Mr. Cawthra ? A. I am not aware of the rate at which Mr. Cawthra purchased all the Debentures. I know that he has purchased some at a discount of 15 per cent., downwards. I heard it remarked that Mr. Cawthra had purchased some at a much larger discount — as high> even, as 25 per cent. Q. Did you, as Mr. Cawthra's agent, advise him to demand 2 percent, from the City, for receiving the money due him upon the securities which he held against the City ? A. I decline answering ; as I am not legally at libterty to disclose the advice given to clients. Q. Do you know any matter connected with the issue of £50,000 City Debentures, in aid of the Ontario, Simcoe, and Huron Union Kailroad ; and if you do, please state to this Committee what ? A. I do. I know that on the 2l8t of July £10,000 debentures were on the 3l8t, £5,000 ; on the 3rd of August, £10,000 ; on the 31st of August, £13,000 ; on the 30th of September, £5,000 ; and a further sum of £7,000 were issued on the 19th or 20th of October. These Debentures, as they were issued, wore placed in the Bank of issued I '-■ ih% B aves— That the ished them in )Uncillor Green d Macdonald — Avith the yeae. ed to purchase, f this City ? Will answer •e, formerly an ise him to pur^ rare of having ond mere inci> purchased by I purchased all t a discount of . Cawthra had ren, as 25 per [ind2peroent. L the securities to disclose the • £50,000 City lion Railroad; hentures were 3,000 ; on the ;5,000 ; and a th of October, the Bank of 17 Upper Canada, for the Contractors. I find that the last sum, of £7,000, were iesued contrary to law ; as the Act of Parliament authorising the loan of £100,000 was passed on the 7th October ; which Act required that those previously issued should be redeemed ; and, in effect, that no further issue should be made. On the 11th October, I find that the Standing Committee on Finance and Assessment accepted the offer of the Cashier of the Bank of Upper Canada to provide the £100,000 loan. I got a Debenture on the 18th of January, delivered to me by Dr, Beatty, which I tliought should have been a Railroad Debenture, but it was not. Mr. Orton, a Railroad Director, in August last, inquired of me if I would take 80 per cent, for the Debenture I Was entitled to. lie had previously complained of ill treatment, in not getting his Debentures. At the time he offered me 80 per cent, he stated that the Mayor had negotiated for them, apd that that was all they could obtain for Debentures. Mr. Cooper importuned me for thia Debenture. I frequently applied for it. Upon inquiring again of Dr. Beatty, he told me that tiie Mayoi: had arranged to furnish this Debenture, and had neglected to do so. This transaction was a matter between Mr. George Cooper and the Con- tractors, for right of way over his land, or for fencing, and with which the City was not concerned, or responsible to Mr. Cooper. I THURSDAY, February 10, 1853. The Committee met. Aldermen B£ll, Denison. GOWAX. present: Councillors Asbfield, Green, Macdonald. The Chsurman, Alderman Gooderham, being compelled to be absent at a meeting of the Directors of the Toronto and Guelph Railway Com- pany, Alderman Denison was appointed Chairman pro. tern, A communication from Samuel Thompson, Esquire, stating that he was unable to attend the committee this day in consequence of being obliged to attend a meeting of the Directors of the Toronto and Guelph Railway, was read. David Paterson, Esquire, the first petitioner, examined. Q. Are you the first signer upon the petition of David Paterson and others, complaining of some misappropriation of certain debentures of this city ? A. I am. 18 il I ! t I :) I . I , ' f ij Q. Can jou give the committee any information upon the lubjeot of the said petition, and if so, be pleased to state it ? A. I have no knowledge of my own upon the subject, other than that contained in the petition. Q. Are you a member of the Board of School Trustees of this city, and have you in that capacity sold the debentures of the city for the erection of school houses ? A. I am a School Trustee, and the board of which I am a member sold them. Q. To whom were the debentures sold ; what was their amount ; and at what rate of discount were they sold ? A. About £700 were sold to the Rev. Anson Green, and first paid for by notes and otherwise, the arrangements were for cash, and the notes wore redeemed within a month ; the debentures were not surrendered until the notes were paid ; the rate of discount was as 17 J per cent, for twenty years, or tths per cent, per annum. Mr. Green got those at four, five, six, and seven years date: the longer dates were taken by Mr. vShort, of the Bank of Upper Canada, at, I believe, a little less per cent, discount. Q. If you purchased a city debenture would you be unwilling to state such fact, and at what rate of discount. A. I should not. Q. If you purchased any debentures with the money of another party, would you conceal the fact ? A. I should not with the person whose money I had invested, but 1 should not inform the public. Q. To whom would you consider the profit on such a purchase to belong ? A. The person whose money I invested. Q. Are you a member of the direction of the British North America Insurance Company ? A. I am. Q. Has that company declined receiving the funds loaned to the city uulc«s it is able to re-invest the same ? A. They have. Q. What rate of interest is that company now receiving for the balance duo to it by the corporation ? A. Sis per cent. 19 the Bobjeoi of other than that oes of this city, the city for the I am a member ilr amount ; and nd first paid for h, and the notes not surrendered .7J per cent, for 2en got those at !re taken by Mr. ble less per cent. nwilling to state f another party, id invested, but 1 a purchase to 1 North America )aned to the city g for the balance Cbarlks Daly, Clerk Cumrnon Council, examined. Q. Are you the City Clerk, and how long have you held that office? A. I am, and have held the office since February, 1835. Q. Were loans or grants at auy time made to or taken in the Ontario, Simcoe Huron Railroad Union Company, for or on behalf of the city ? A. There were. Q. State the particulars of such grants, loans or stocks, when made, the amount granted or taken, and upon what condition ? A. On the 2l8t of November, 1850, a deputation from the board of directors of tho Ontario, Siraeoo and Huron Union llailroad Company waited on the Standini» Committee on Finance and Assessment of the Cor- poration to know, *' If the Corporation of the City of Toronto would grant the sum of £25,000, to assist in completing the Toronto and Lake Huron llailroad, parties now being found willing to contract for the completion of the same in two years aud a half from tlie present time, provided the Corporation granted tho above sum." On the 23rd of November the President of the Board of Trade of Toronto communicated the following: resolution, unanimously adopted by the Council of the Board of Trade : — " Resolved, — That the construction of the Ontario, Simcoe and Huron Railroad would be of vast importance to this part of the province, and of immense advantage to the City of Toronto ; and in order to maintain our present position in the commercial community, and to promote and extend our agricultural interests, it is the opinion of this Council that the Corporation of the City of Toronto should, with the least possible delay, co-operate with tlie Directors of the said company in carrying out and completing their present arrangements for the construction of the Road, by a gratuitous contribution of £25,000 in debentures, payable at twenty years date, with interest half-yearly, said debentures to bo issued when so much of tlie Railroad sliall have been completed as will justify such advance, and satisftictory security obtained for the compl*?- tion of tho Road." Upon the recommendation of tiie Standing Committee on Finance and Assessment of the council, as contained in their Report No. 21 for 1850. The Common Council of the City of Toronto, on the 25th of November, 1850, adopted the following resolution : — " Resolved, — TJiat tho sum of £25,000 in debentures, payable twenty years after date, with interest at six per cent, per annum, payable half-yearly, be granted in aid of the Ontario, Simcoe and Huron Railroad Union Com- pany, on the conditions set forth in the second clause of the Report No. 21 of the Standing Committee on Finance and Assessment : and in order to extend the benetits of the said Railroad to all parts of the city, k be another condition of the above grant that the terminus for pa»- avuger trains ehall be erocte.1 on a portion of the Market block property, !l. (i ''M ■ ,i V lu': if- 20 now vacant, such portion to be leased to the company at ^ nominal rent for 99 yeiu-s, and that the line of Railroad shall be carried along Palace and Front streets, to the full extent of the Cii sator lots." The con- dition in the 2n(l clause of the report, referred to in the forgoing rcsolu* tion was : — '• In the proportion as */ne work progresses as one is to ten, viz. — jEIOO.OOO to be expend .. I on thlution, m tiio work on the said Road progresses. 2nd. Tliai of the said sum of C60,00O, the mm of £25,000 shall be as a gift, to aid in tl:»' construction of th^ said Road ; and the remain- ing £35.000 shall beaaaloan Io fhe Ontario Simcoo, and Huron Railroad Union Company; and for the securing tlie repayment of th ■ ^nid loan, in ten years, with interest at the rate of G per cent, per +um, pay- able half-yearly, the said Compan;- shall give to th»- Cit\ f Toronto their bonds, secured upon the sai.i Road, to the amount of sul '" DeK'n- tures from time to time issued t*i the said Company, uu accoum of tht said loan. On the 29th of July, 1852, the Mayor communfcatod to ;ie Co*»inoil the expediency of confirming an kirectors, by way of loan: n which offer the Maj'or stated to have been, in substance, as follows :- " That the Contractors should a^ree to relinquish the grant of i. '" .000 made by the Council, in aid of tht said Railroad ; which said gn has been transferred by the Directors to the Contractors ; and th Directors should relieve the Coum il from the agreement to loa< Company the sum of £35,000, upon cortain security, u onconditic the Council should take stock in the -aid Road to the extent of £; paying therefor in Debentures, at tl ■ same times and in the s am portions, as the work progresses, as .t was agreed the said grant ..ad loan should ])e advanced, to which the said Contractors had assented. tho t! ii;it HO TO Upon this Resolution ;— Communication, the Council adopted the following Whereas His "Worship the Mayor has informed this Council that the Contractors of the Ontario Simcoe, an I Huron, Railroad Union Com- pany have accepted a proposition made by him, subject to the appro- bation of this Council, in view of the dif5culties which have existed in the execution of a Mortgage Bond, by way of security for the loan of £35,000, formerly voted by this Council, to the effect that the Contrac- tors shall surrender the grant of £25,000 made by the Council, and transferred to such Contractors, in part payment of their contract ; and also that the Directors shall waive the aforesaid loan of £35,000 alto- gether, on condition, that in lieu thereof, the Council will take Stock 22 .ii' 'ill 1\W m ^ . tt ' m to the amount of jCSO.OOO, to be paid by the iesne of City Debentrefl, in the same proportions as the debentures for the above loan and grant, were authorized to be issued. Bo it therefore Resolved, — That the Standing Committee on Finano« and Assessment bo authorized to complete such arrangement : provided tliat no legal diflSculty shall occur in carrying out this Resolution : and provided, also, that no alteration shall take place in the conditions upon which a portion of the Market Block was granted to the said Company, particularly with regard to carrying the Railroad to the eastern limits of the City Water Lots. This Resolution was communicated to the Board of Directors of the Ontario, Sl^icoe, and Huron Railroad Union Company ; and to which tlie following reply was received : Office of the Ontario, Simcoe, and Huron Union Railroad Company, Toronto, 30th July, 1852. To the Worshipful the Mayor of Toronto. Sir, — The Board of Directors have had under consideration a Resolu- tion of the Council, passed on the 2yth instant, relating to a proposed new arrangement for the issue of Debentures to the Contractors,— a minute of the Finance Committee thereon, — and a letter from M. C. Storey & Co., stating their willingness to accept the propositions embo- died in the Resolution of the City Council first mentioned. I now beg to fend you a copy of a minute made by the Directors of this Company, in relation to the documents referred to : Resolved, — " That the board of directors agree to the proposed ar- rangement between the city council and M. C. Storey & Co. sub- mitted in the resolution of the city council of the 29th instant, without prejudice to the existing agreements between the council and the board and the contractors, in the event of the one proposed not being accomplished* And further, without prejudice to the other parts of the said existing agrecraouts, wliich are not to bo affected in any way by the substitution proposed for ccrttiin parts of those agreements. " I have, &c. &c. (Signed) "WILLIAM SLADDEN, Secretary." On the 1 Uh of October, 1852, the following certificate was laid before the council ; — " Engineer's Office, Ontario, Simcoe & Huron Railroad Co. " Toronto, October 5th, 1852. " I hereby certify, that I have this day granted to M. C. Storey & Co. a certificate for £4023 currency, for work done, materials furnished, and 23 City Debentrcfl, loan and grant, tee on Finance nent : provided esolution : and the conditions ted to the said lailroad to the Directors of the ' ; and to which Railroad 1 July, 1852. ration a Reeolu- g to a proposed Contractors,— a ter from M. C. opositions embo- led. I now beg ■ this Company, !io proposed ar- •ey & Co. sub- nstant, without id the board and ^" uccompliphed* lie said existing the substitution , Secretary." was laid before I Railroad Co. i.52. 1 Storey & Co. furnifihed, and M other expenditure under their contract for building the Ontario, Simcoe and Huron Railway, and that the total amount of similar certilicatea grouted under said contract to this date, is £253,170 currency. (Signed) " F. W. CUMBERLAND, October 14, 1852." " CivU Engineer." Bonds releasing the city from all claim to the grant of £25,000 and the loan of £35,000, were executed by the Ontario, Simcoe and Huron Union Railway Company and the contractors, with a view of carrying out the resolution of the council of the 20th of July. On the 18th October, 1852, a bill passed the council to authorise tlio mayor to subscribe for 10,000 shares in the Ontario, Simcoe and Huron Union Railway Company in lieu of the said grant and loan. This bill provides : — " That it shall and may bo lawful for the mayor of the said city of Toronto to subscribe for, take, receive and hold stock in the said Ontario, Simcoe and Huron Union Railroad Company to the amount of £50,000, for and on behalf of said city of Toronto, and for the payment of the same it shall and may be lawful, and it shall be the duty of the said mayor for th« time being, of the said city, to appropriate so much and so many of the said debentures authorised to be issued under the provisions of the bye- law hereinbefore recited, as may be requisite and necessary for that pur- pose, and that the said Debenture shall be issued by him for that purpose, at the times and in the same proportions as is provided by the Bye-law hereinbefore recited, subject however to the same condition relative to the passenger terminus of the said railroad, and the continuance of the said Railroad along Front and Palace Streets, as are contained in the recital of the said Bye-law and the resolution of the Common Council of tho 29th of July last." '' November 1, 1852." The Council passed the Bill, entitled " An Act to provide for the issue of £100,000 Debentures to consolidate a part of the City debt." Q. Can the Mayor or any Officer of the City use the credit of the City, or contract any debt on its behalf without the authority of a Bye-law of the Council and the Corporatic seal being attached thereto ? A. The credit of the city could not bo used witliout the authority of tho Council. Q. Are you aware of any fraud or malversation, or other illegal or im- proper act in connection with tho issue or negoeiation of any Debentures belonging to this City, or within or under tlie control of any one or mwro of its officers or members, as such officers or members ? A. I am not. 24 Q. Can you inform the Committee whether the credit of the city has been at any time used by any person or party, except in the fulfilment of the honest and honorable obligations contracted by the city? A. I cannot. Q. Have you any order or minute of council directing the issue of the ^£7000 on the 20th of October? A. I am not aware of any except the authority of the Bye-law, passed on tlie 18th of October. Q. Is it necessary that the Mayor should have authority, either from tlie Council or Committee of Finance, to issue Debentures ? A. The authority of the Council is necessary. Q. Did you conceive that the Bye-law, passed on the 18th of October, conferred tliat authority ? A. I did. Q. Were you aware of the passage of the Act to authorise the con- solidation of the loan for the city on the 18th of October. A. I was not that I can recollect. Q. lias the City subscribed for stock under the terms of the City Consolidated Loan Fund Act ? A. I believe the City has not subscribed stock, but that the Chamber- lain has received scrip on paid up stock, in exchange for the Debentures from the contractors, in pursuance of the letter of consent of the Direc- tors of the 30th of July, and the bonds to the City by the Directors and Contractors of the 14th of October. The Clerk was directed to request the attendance of the Chamberlain ; Ji^shua G. Beard, Esq. late Chairman Board of Works ; Samuel Thomp- son, Esq. Chairman Standing Committee on Finance and Assessment ; and Dr. Beatty of the Ontario, Siracoe and Huron Railway Contractors. Adjourned until to-morrow, Friday, at seven pan. linin. !t.l. FRIDAY, February 11, 1853. PRESENT : Alderman Bell, Councillor Greek, GOWAN, The Committee a(\journed for want of a quorum until to-morrow., Saturday, at three o'clock, p.m. rf'. I i of the city has the fulfilment of city? ng the issue of Bye-law, passed 25 SATURDAY, Februarv 12, 1853. The Committee met. PRESENT : AtDERHAM GooDERHAH, Chairman, Aldermen Bell, Councillors Ashfied, Denison, Green. GoWAN. ity, either from bs? I8th of October, thorise the con- ms of the City it the Chamber- ' the Debentures nt of the Direc- le Directors and B Chamberlain ; Samuel Thomp- id Assessment; ay Contractors. 3jn. 11, 1853. !N, til to-morrow. Andrew Taylor McCord, Chamberlain, examined. Q. Arc you the Chamberlain of the city, and how long have you held that office ? A. Yes. I have liold the office since the year 1834. Q. What amount of City Debentures have been sold, or otherwise j^ disposed of, during the last two years ? Il A. £218,767 12s. 4d. The Corporation do not ordinarily sell their ■'t: Debentures, in the common acceptation of that word. The Debentures are paid to Contractors and others at par, or fo" what is upon the face of the De1)enture. In some cases, during the past year, this mode has been departed from ; and the late Chairman of the Board of Works, J. „ G. Beard, Esq., has disposed of Debentures for the Contractors of Public '# Works, the proceeds of Avhich wore deposited with mo, and paid to the said Contractors, upon tlie order of the Board. The only other instance in which I can recollect of any departure from the usual mode of pay- ing the Debentures at par was on account of the opening of Colborne Street, in 1851, when several of the Debentures for that purpose were sold, at a discount of one per cent, per annum. Q. To whom wore they sold, and for what work particularly. A. The principal pai't of the smn issued was to the following parties ; — Ontario, Simcoo, and Huron Railroad Company. £50,000 Toronto and Guelph Railroad Company 40,000 Loan to consolidate the City debt, £82,000 sterling, making, in currency 99,7GC 13 4 £189,766 13 4 Leaving a balance of £29,000 19tf., which was issued for sundry Public Works, namely,— r: i: i! Opening of Colborne Street, from Church Street to Yonge Street £4,000 Paid to the Trustees of the Western Market, when the Building Ti^as made over to the corporation 1,725 To discharge sundry claims for extra work at St. Law- rence Hall and Buildings, COO For sundry Street improvements 4,000 Onaccount of Bill for issue of £13,000 on account of improvement of Streets 8,000 J. G. Beard Esq. Chairman of the Board of School Trus- tees, towards building New School Houses 3,500 To sundry parties, being the balance of Debentures ordered to be issued for the constuction of St. Law^- rence Uall Market, &c. &c 7,175 19 Total Balance £29,000 19 Q. A. Q. Contril afler ^ A. issue them; llailrd n Q. What was the rate of discount in each case ? A. Whole amount issued in 1851 and 1852, £218707 12 4. Ontario, Simcoe and Huron Railroad Company £50,000 Toronto & Guelph Railroad Company 40,000 Loan to Consolidate City Debt 99,700 13 4 Opening Colborne Street 4,000 Trustees Western Market 1,725 Extra Work at St. Lawrence Hall and Market GOO Sundry Street Improvements £4000 On account of 13150J. Bill for ditto 8000 12,000 issued at par. issued at par, issued at par. part issued at par, & part 1 per cent, per annum allowed, issued at par. about 8000/. of this sum 1 per cent, per aun. allowed. J, G. Beard, on account of Building School Ileuses 3,500 issued at piu*. Sundry parties, balance of Deben- tures, for building St. Lawrence Hall Market, &c 7,175 19 issued at par. Total amount issued 1851-2 £218,707 12 4 2T £4,000 1,725 COO 4,000 8,000 3,500 7,175 19 £29,000 19 4. I at par. I fit par, I at par. sued at par, & per cent, per 1 allowed, at par. OOO/. of this 't^r t'ent. per owed. t piir. par. Q. By whom are the Debentures signed ? A. By the Mayor and Chamberlain. Q. Had the Mayor any control over the Debentures issued to the Contractors of the Northern Railroad, or over any other City Debentures after signing them ? A. If the Mayor, as the head of the Corporation, chose to suspend the issue of Debentures temporarily after signing them, I would not issue them ; but in the issue of Debentures to the oontractors of the Northern Ilailroad, or any other Debentures, the Mayor exercised no such control. Q. In the negoclation, sale or purchase of Debentures, does the Mayor of the city, in his capacity as Mayor, enjoy any advantage over any other citizen who may have the means, and who may feel disposed to purchase Debentures ? A. No advantage. Q. At the time of the delivery of the Debentures in aid of the Northern Ilailroad, were the finances of the city iu such a position as to enable the City to purchase the Debentures ? A. They were not. Q. Could the credit of the City be used by any person or persons for any purpose without your knowledge? A. The credit of the City could not be used without the Seal of the City, which is in my keeping, and therefore could not be used without my knowledge. y. "Was it used, or wore the moneys of the City used to purchase the Debentures issued to the Northern Ilailroad ? A. It was not so used ; nor wore the moneys of the City so used; nor had the City any money to use for such a purpose. Q. Is the Upper Canada Bank the depository for the City funds ? A. Yes. Q. Who is responsible for the moneys therein deposited, and upon whoso chock or order can they be drawn out. A. I am alone responsible, and upon my check alone can the money be drawn out. Q. Does the Mayor of the City sign the checks, or is it in his power to use or draw out the money ? A. The Mayor does not sign the checks, nor is it in his power to draw out tlio money. Q. lias the management of the City finances during the incumbency 28 11* ;■' i of tho present Mayor, tended to enhance the City credit or to depreciate and injure it? A. The City finances during the incumbency of tlio present Mayor have been so managed as to improve the credit of tho city, and the addi- tional security afforded by tlie now Municipal Act has likewise had an advantageous influence. Previously to that time, I believe the City Debentures were often sold at a discount of 25 to 30 per cent, discount. Q. Did ]Mr. Cawthra ask two per cent, for receiving the money which ho had advanced upon the security of tho City property ? A. Mr. Cawthra holds £20,000 City Debentures, which will not fall due till January, 1854. "With the approval of the Mayor, I offered Mr. Cawthra first one and then ono and one and a half per cent, premium, to allow tho City to retire tho Debentures at once. ]Mr. C. asked two per cont., the Bank of Upper Canada offered to allow 4J per cent, upon the said £20,000, and the Finance Committee directed the money to remain there at that rate of interest, thereby saving the City one-half per cent, on that sum. Q. What has been the average rate of discount upon the City Deben- tures for the last two years ? A. The average rate of discount upon Debentures disposed of by the Board of Works was 1 per cent, for each year the Debentures Had to run — that is 20 per cent, for 20 years ; the Debentures, as issued, were paid over to the Contractors for the Public Works by tho City at par : I have not any knowledge of how they were sr a certified copy of the bill, which left Quebec by post on the 20th of October, and was received here on the 22nd October, so that the provisions of the bill were not authentically known here until the latter date. Q. Have you any directions from the Committee of Finance to issue the £7000 alluded to? A. On reference to the minute book of that committee I do not find any directions to that effect, but am clearly of opinion that several of ti.e Committee were aware of their issue. The City Council passed Bye-laws severally on the 28th June and on the 18th of October, 1852, which authorised the Maj-or to issue those Debentures. • Q. Have you any direction from that Committee to issue any of the said Debentures ? A. I think that the Finance Commi:tce have made minutes approving of the issue of all those Debentures except the £7000 previously alluded to, and do not know any reason why it Avas not done in this case further tlian that the Eye-law of the Council, passed on the day previously to their issue, viz. the 18th Octo))er, authorized the Mayor to issue the balance of the £50,000 Debentures. Q. If you had been made aware of the law of 7th October and its pro- visions, would you have continued to iysue the Debentures which were considered illegal under the City law ? A. I would not issue any City Debentures if I knew it to be illegal to do so. Q. IIow much money belonging to the City is now in the Bank : wlfat interest is ^ho City receiving therefor, and from what date did the Bunk agree to pay interest on the £20,000 ? A. About £30,000 ; the City receives interest only on £20,000 of this sum from the first of January, 1853, at 4 J per cent, per annum. Q. What sum is the City now losing daily in conse(|uence of extra interest necessary to be paid on the money in the Bank idle ? A. The City has in the Bank about £36,000, £20,000 of this sum i» Q. sum will to tli( >ob«Qtures issued cnceofthatlaw? law had passed, eneral way ; in a Esq. at Quebec, e (certainly with e bill, which left vcd here on the lot authentically lanco to issue the r do not find any lit several of tLe passed Bye-laws er, 1852, which ssue any of the nutes approving Jviously alludc{l his case further y previously to >r to issue the 'oer and its pro- res which were to be illegal to icBank: wlfai B did the Bank S:20,000ofthia luunL iience of extra Ic? of thie eum is 31 to remain there until January, 1854, in consequence of the holder of that amount of Debentures not being willing to give up his debentures except at a premium of 2 per cent. The T' • as already stated, receives from the Bank for this sum 4\ per cent. , Jie remaining £10,000 is lying in the Bank for the purpose of paying Debentures and City Notes which are called in, and which are daily being presented at the counter. The greatest part, if not the whole of this balance will be drawn out five months from this date. I do not know that any banking institution would be willing to give interest on this fluctuating balance for so short a period. I am therefore of opinion, that all that the city can be said to lose at present is one and a half per cent, on the £20,000, which could not be avoided ; it will be about IGs. 4d. ^ per day. Q. What rate will have to be levied upon the citizens to make up a sum sufficient to pay the interest upon the whole £100,000, and what will be required to make up the interest upon that sum that will be lost to the city ? A. To pay the interest on £100,000 will require an assessed rate of Id. in the pound ; to pay the loss of interest on the £20,000, will require about f of a penny in the pound. Q. Have you read the section of the act of the 7th October, which gives the Mayor power to issue Debentures in sucli sums as the Council shall direct ; have you read the 5th section ? after reading this section will you state what you consider was your duty thereunder ? A. I have road those clauses, in the 5th section I was directed, with the consent of the holders thereof, "to call in such Dobenturesof the said City of Toronto as may have heretofore been issued imder any Bye-law of the Common Council of the said city, and taken in payment of such stock, and to sulistitute therefor so mucli of the funds on account of the Debentures to be issued under the act as maj- be necessary for tluit purpose." Q. Do you consider the £7000 as legally Issued or exchanged ? A. I am ratlior doubtful as to thoir strict legality, but there is no doubt as to the liability of the Corporation for their payment, having received value thcrclbr ; I am not sufficiently learned in the law to give a legal opinion thereon ; the issue of £7000 has since been paid. Q. Do you know who it was that received the discount of £10,000, said to have been realised by some persons in the charge of the D«- bentures ? A. I do not. Q. After the City Debentures left your hands, could not the Mayor or m I V ■ !' 32 &ny other person, with the conBentof the Contractors) have used them to raise money thereon ? A. See my answer to question No. 20v Q. If an arrangement had previously been made between the Mayor and the Contractors, that the illegal Debentures should be deposited in the Bank in order to raise the money the Contractors agreed to take, has anything inconsistent with such agreement taken place ? A. I do not know of any such arrangement. Q. Do you know what sum the Contractors did receive ? A. No. Q. Has the City ever yet taken stock or purchased stock from the Northern Railroad Company ? Q. The City has purchased 10,000 in the stock of the Northern Rail- road Company. Q. Do you know who it was that first started the question of the ille- gality of such Debentuaas ? A. I do not. Q. If legal Debentures could have been sold in New York at par at the time the illegal issue was made, has that issue had the eflfect of depre- ciating the City credit if they were sold, as stated, at 20 per cent, discount ? A. I a> I not aware that any of the City l)ebentures were offered in the New York mai'ket. I know that the Contractors were so anxious to receive those Debentures, that they were willing to assume all the re- sponsibility as to any irregularity or informality attending their issue ; if they were sold at par in New York instead of 20 per cent, discount in Toronto, the effect would rather have been to have raised the City credit, as up to that period the ordinary discount was 20 per cent. hers. Q. If it be true that some person obtained the £50,000 illegal Deben- tures for £40,000, when by issuing legal debentures you could have dis- posed of them at par, how do you make it appear that the credit of the City has been enhanced bv such transaction ? A. I am of opinion that the same party who purchased the Debentures from the Contractors was the same who treated with the City for the £100,000 loan, the Corporation was bound to use £50,000 of said loan to take up the £50,000 bonds issued to the Contractors, and if the Corporation, after issuing £50,000 of now Debentures, to replace those paid to the Contractors, had to treat with other capitalists for the re- maining £50,000, 1 feel satisfied it would not have been done at par. Q. tion £100,(| take A. Q. Bultec A. . t ve used them to reen the Mayor be deposited in eed to take, has Istock from the JVorthern Eail- ion of the ille- k at par at the ffect of depre- 20 per cent. > offered in the 80 anxious to me all the re- ? their issue ; t. discount in le City credit, hers. [legal Deben- ulU have dis- credit of the 5 Debentures City for the )00 of said > and if the place those for the re- at par. Q. Is it or not, true that the C'uy ia now ] ing 12 i tion of its debt, and if so, has it not been canned )> £100,000 Debenture, coupled with the refusal of tht take their debts before duo ? A. See my answer to question No. 32. c«nt,'on p -^r- iiy Crcil iS to Q. Before said £100,000 were issued, were said creditors ever con- Bulted whether they would receive their pay or not ? A. See my answer to question No. 24. Q. Did you know that the Mayor on that occasion became obligated or agreed to furni.sh the Contractors for the Northern Railroad, seven or any other number of Debentures if they should thereafter be required ? A. I do not ; all I know is, that M. C. Storey and Co. wrote a note to me on the 27th September, to lodge all the Debentures in the Bank of Upper Canada, excepting ten of £250 each, amounting to X2,o00. Q. Can you inform the Committee what interest the Mayor had, that caused him to make this arrangement, and wliy it was necessary that these Debentures s^hould be left in the Bank instead of being delivered to the Contractors, if it were doubtfid whether they would bo required or not? A. I do not know what interest the Mayor had, nor do I know of any 8uch arrangement. Q. What amount of Debentures have been issued to the Guelph Kail- road, under what authority, and what has been done with them ; to whom wore they delivered, and how has that road become entitled thereto ? A. £40,000 ; an act of the Council, pa,ssed 1st December, 1851 ; — paid and delivered to the Secretary of the Company. The Corporation are in the same position as any other municipality, entitled to pay for their stock when called for. Q. Were you ever made aware thnt. the Contractors of the Northern Road had agreed to dispose of the dc' hires of the City of Toronto tu a capitalist in the City of New Yoi'k at par ? A. No. Q. Had you any conversation, or did you have any conversation with a professional gentleman who came from New York to examine the De* bentures and the legality thereof? A. No. Q. Did you offer the British America Insurance Company any of the Debentures for tlie claim of that Company on the City ? 84 A. No. Q. lias the company refused to receive the cash these Debentures produced ? A. ripon the first application the company refused: they have since n' ' tario, Simcoc and Huron Union llailroad receivedonly £40,000 for the liai^ ■ road Shai*ea they handed over to the City ; smd can you tell who re- ceived the £10,000 difference? A. I have it from the best authority that the Contractebeuturos overdue, interest unprovided for, credit obtained at 25 or 30 percent, sacrifice, were mav^ers of weekly occurrence : the Banks would scarcely aflbrd the Council the ordinary accommodation granted to merchants. All this is changed. Doubtless the improved state of our provincial credit, and the prudent restraints imposed upon municipalities, have done much towards this change ; but in my opinion, the city of Toronto owes much of its financial superiority over other municipalities in Canada to his worship the pre- sent Mayor. For obtaining a recognition of the principle of a reduction of the sinking fund on municipal loans from 5 to 2 per cent. — an inestimable advantage — the whole province is his debtor. The city of Toronto is solely indebtc'l to him for persevering drawing the attention of London capitalists to the instrinsic value of our municipal securities. To his personal interference, as I believe, the city was also indebted for large money accomn^odation from the Bank of Upper Canada on many impor- tant occasions. I might mention numerous instances where, to my own knowledge, the Mayor has laboured for the establishment of our civic credit ; and if three years efficient, and zealous exertions for the fiuancial prosperity of the city can be appreciated, then, in my opinion at least, no man is better entitled to claim honor in that behalf than the present Mayor of the city. M'C The «ale of I % liking iybo- )ented a less )0,000, icU for in every er made red and gements umbency credit ? improved w far his matter of has been )m the dis- le, interest ere mav^ers 'ouncil the 8 changed, he prudent )ward8 this its financial lip the pro- 47 Q. Did you submit Mr. Cuwthra's offer to renew his loan to the council ? A. It waa not submitted to the council. I did to the Finance Com- mittee ; it was not a formal offor but a mere conversation, unaccompanied by any conditions; I add, that it was not considered as favourable as the offer for another loan, which the committee had had under con- sideration for some months. Q. After the legal opinions received did you, as chairman of the Standing Committee of Finance and Assesamcnt, continue to recommend tlie issue of the Debentures said to be illegal ? A. The Bill authorising the issue was passed after the opinions were given. In my individual capacity I made no recommendation on tlie subject, as the organ of the committee I did. Q. Were the Debentures issued after the opinions had been received? A. Yes. Q. Do you know who got the amount of £10,000, or any part thereof, realized by the sale of the X50,000 Debentures issued illegally ? A. I have stated already that I did not know anything publicly or privately of any discount having been received by any one. The Clerk was directed to ask the attendance of J. II. Ilagarty, C. E. Roraain, James Beatty, James Crowther, Win. Sladden, M. Courtright, Ja?. Cotton, and George Beatty, Esquires, and of John Brown, Tompsou M'Cleary, and Eobert Dodds, Builders. Adjourned till Thursday, at three o'clock. •tion of the inestimable ,f Toronto is ,n of London ties. To bis Itcd for large Imany impor- |e, to my own . of our civic the financial Inion at least, In the present The Committee met. TIIUllSDAY, present: Fedkuart 17, 18.1S. Ai.DERiiAM GooDEunAM, Chairman, Aldermen Bell, Councillors Ashfield, UovvAN. Macdonald, Gkeen. J. II. IIagarty, Esquire, examined. Q. Are you one of the petitioners complaining of the negociation and sale of the' £50,000 City Debentures to the Contractors of the Ontario, 48 Simcoo and Huron Railroad, and praying the Corporation to enquire into the same ? A. I am. Q. Do you know any matter or thing connected with the said negocia* tion and sale which in your judgment is wrong ; and if ho, state it ? A. I signed the potition for information, not that I could give any. I observed a discussion on the point in the papers, which I thought called for explanation. Q. Have you at any time, for yourself or others, purchased DcbcnturcB of this City, or tendered for their purchase ? A. Mr. Crawford and I pui-chased some about December last. These were not Railway Debentures and no part of the X50,0U0. Q. What amount did you purchase, and what was the rate of discount in each case ? ^ A. About £3,000 at one per cent, per annum for the years they had to run, which was from eight to eighteen years ; so far as I myself am concerned, and I believe the same of Mr. Crawford, we never have pur- chased Debentures for ourselves or in whom ^\o any personal interest. Q. If you purchased a Debenture would you hesitate to state such fact, if it were all correct ? A. Certainly not. James Cottox, Esqcire, examined. Q. Do you know that the £50,000 issued to the Ontario, Simcoe, and Uuron Railroad Contractors were discounted at 20 por cent. A. I have heard so. My position is such, that I do not wish to say anytliitg on the subject. Q. lias the >Tayor over stated to you, or to others in your hearing, whether he was interested in the £10,000 discount, from the Debentures issued to the Ontario, Simcoe, and Huron Railroad. A. Any conversation I had with him was in confidence, and I do not wish to answer. Q. Have you had any conversation with the Mayor relating to this sum of £10,000, the discount on the X50,000 issued to the Ontario, Simcoe, and Huron Railroad ? A, I refer you to my answer to the last question. A. nquitc legocia' it? any. I it called bcnturcs . These f discount they had nysclf am have pur- nterest. state such limcoe, and rish to say 49 Q. Can you give this Committee any information touching the inr^uiry tlMj were appointed to make ; and if bo, please to state it ? A. I decline to answer this question. Alderman Denison joined the Committee. James Bkatty, Esquire, examined. Q. Have you at any time, cither for yourself or for others, purchased Debentures of this City ? A. I have for others, but not for myself. Q. What amount did you purchase, and what was the rate of discount in each case ? A. I do not know the amount. Persons, about December last, called v.pon me, and ofiFered them at one per coiit. per annum discount, for the time they had to run. Q. Can you inform the Committee what has been the usual rate of discount upon City Debentures for some years past ? A. One per cent, per annum I believe the average lately ; but I have known them to be sold at 25 per cent, discount. Q. Can you communicate to this Committee any information tending to elucidate the subject of their present inquiry ? A. I cannot. I know nothing of it, directly or indirectly. Iiu hearing, )ebeuture!» id I do not [ing to this lie Ontario, Charles Edward Romaix, Esquire, examined. Q. Have you at any tim* cither for yourself or for others, purchased jDebentures of this City ? A. Yes. Q. What amount did you purchase ; and what was the rate of discount in each case ? A. I do not remember the amount ; but the discount was one per cent, per annum. n I?, I 50 ^1 -1 Q. Can you state what has been the usual rate of discount on tho Debentures of the City in the month of October last, and since ? A. One per cent, per annum. Q. Do you know who it was that realised the £10,000, as discount of the jS50,000 to the Ontario, Simcoe, and Huron Union Railroad ? A. No. The Debentures I bought were no portion of the Debentures issued to Contractors of Ontario, Simcoe, and Huron Union Railroad. Hugh Miller, Esquire, examined. Q. Are you one of the petitioners complaining of the negotiation and sale of £50,000 City Debentures issued to Contractors of the Ontario, Sim- coe, and Huron Railroad, and praying the Corporation to inquire into the same ? A. Yes. Q. Can you communicate to this Committee any information which may tend to elucidate the subject of the inquiry which ^this Committee waa appointed to institute ? A. I was told by a Director of the Ontario, Simcoe, and Huron Rail- road that of the sum of £10,000, the Mayor got £2,500; Mr, Cotton £2,500, Mr. Hincks £2500. He could not account for tho other £2,500. Q. Who waa that Director who so informed you ? A. Mr. Duncan Macdonald. And Mr, Hancock told Mr. David Paterson and myself that the Mayor had not got the whole amount, but only a part of it. Q. Do you know any matter or thing connected with the said negotia- tion and sale which in your judgment waa wrong; and if so, plcaso state it ? ^ A. I know nothing directly, but merely from public talk. Q. Are you aware at what rate of discount the Debentures of thi« City have been sold ? A. They have been sold at par, and at a premium. •hi ma mi thd mc ■'ijiMJiMMar »i on ths coant of ? benturea Iroad. Ltttion and tario, Sim- (juire into itlon -whick Committee Juron Bail- yir. Cotton tho otlier Mr. David amount, but said negotla- if 80, please itures of thi« Q. To whom were they sold at par ? A. I bought at par myself. Q. To whom were they eold at a premium 7 A. They were cold at a premium in London. Q. To whom were they sold in London, and when ? A. I am unable to tell ; but refer the Committee to the Globe new«- paper, which ia as true a paper, I believe, as any in town. Q. When you stated that the City Debentures were sold, some at par and some at a premium, did you know that such was the fact ; or does your information rest solely on newspaper report ? A. I had it from the newspapers — the Globe in particular, and public talk. Q. Did you purchase any Debentures of the City yourself ; and if 00, at what rate ? A. I purchased some at par. Q. When did you so purchase them ; what was the amount ; how long had they to run ; and from whom ? A. In 1850, £100 or ^125 : four years : from John Brown, the builder : in cash. Q. Are you aware that the Debentures of the City, in the case referred to — the Ontario, Simcoe, and Huron Hnion Railroad — were sold below the usual rates of discount in other cases ? A. I am not aware of it. Q. Have you stated that this Committee reftised to examine Ilie Wor- ship the Mayor of the City ; and if so, what authority had you for making such statement ? A. I understood, from Mr. Cawthra, that a motion was made in Com- mittee that the Mayor should be examined ; and that it was decided, by the casting-vote of the Chairman, that he should not be examined. Q. Are you now satisfied that your information from Mr. Cawkhia wm incorrect ? A. I have been so informed, by the Committee. W 1 5S His Worship the Mayor having, by direction of the Committee, been asked to attend the Committee> for the purpose of furnishing the Com- mittee with any information he could give on the subject under investi'' gation, — The following Reply was read :-^ The Mayor presents his compliments to the Chairman of the Select Committee appointed to inquire into the issue to, and sale of Debentures by, the Contractors of the Oshawa, Simcoe, and Huron Railroad, bega to state that he has no information to give the Committee on the sub- ject, but what will be found in the books of the Ohamberlain, or got from the Chairman of the Standing Committee on Finance and Assess- ment, or the Contractors of the Ontario, Simcoe, and Huron Railroad, or the Cashier of the Bank of Upper Canada. Mayor's Office, 17th February, 1853. M. Courtright, Esquire, acting member of the firm of M. C. Storey & Co., having been requested to attend and give information to this Com- mittee, the following letter was received in reply : — Toronto, February 17, * '3. Toilie Select Committee of (he Council of Toronto appointed tc c- 'iv.$ into certain matters connected with the sale of City Debentures. Gentlemen, — Your note of yesterday's date, requesting me to furnish such informotion as I may possess on the subject under investigiitioD, ia received. In connection with this subject, and in order to proper understanding of it by parties not conversant with the whole matter, allow me state briefly the transaction throughout, so far as the City has been concerned. The Committee are doubtless aware that the City of Toronvo, by a resolution of the Council, agreed upon certain conditions to issue to us j£60,000 of their Debentures on account of tho Ontario, Simcoe, and Huron Railroad Union Company, jC35,000 of which were to be in ex- change for an equal amount of Company's bonds, and tho balance of jE25,000 as a bonus, being an inducement offered to take tho work, sub- sequently by a ntutual arrangement between tho City, tho Railroad Company, and ourselves, the City was released from tho above obligation, together with the l)onus, the City throuf>;li their Council, then purchased from us X50,000 of stock, for which wo took £50,000 of their Debentures. Those Debenture^, after being passed to us and paid for, were con- sidered entirely at our disposal, wo being the only parties having tho Unl ma} I ha h' >, been inveati* ,e Select bentures ad, bega the sub- 1, or got i Assess- Bailroad, . Storey & this Com- 53 least interest in them ; we therefore dispose of them at what we regarded as a fair price, and no subsequent event has yet satisfied us that the arrangement was injudicious. It is taken for granted that the Committee do not desire io enquire into our private business trans ictions, and trust therefore that the above statement will prove satisfactory in showing that no undue official inter- ference had any influence with us in the disposition of the Debentures alluded to, and to relieve the City from any anxiety on our account. I beg leave to state that we are eniiirely satisfied with the operation. Respectfully yours, (Signed) M. COURTRIGHT, Acting Member of the firm of M. C. Storey & Co. The Clerk was directed to request the attendance of Duncan Macdonald, and £. Chads Hancock, Esquires. to furnish itigiitioD, is derstanding ow me state 1 concerned. oronvo, by a issue to us Simcoe, and to be in ex- 10 balance of work, sub- tho Railroad iTO obligation, on purchased Debentures. ;or, were con- 3 having tho The Committee met. FRIDAY, PRESENT I February 12, 18jo. Alderman Gooderuam, Chairman. Aldermen Bell, Councillors Asufied, Denisov, Green, GowAN. Macdonald. Duncan Macdonald, Esquire, examined. Q. Are you a Director of the Ontario, Simcoe, and Huron Railroad Union Company ? A. I am. Q. Did you toll Mr. Hugh Miller, of this City, that in the negotiation, Bale, or disposal of the City Debentures issued to the Contractors of the Baid Railroad, the Mayor of this City luid participated in a profit to the extent of £2,500, or lo any other amount ? A. I did not mention it to Mr. Miller as of my own knowledge. I may have repeated it to Mr. Miller as a matter of common rumour; and I have no knowledge cf such a matter as a Director. 54 Q. In point of fact, do you know that the Mayor did participate in any profit on such sale or negotiation ? A. I do not. Q. Do you know that a legal gentleman came on from New York to purchase or inquire about the City Debentures issued tc the Contractori of the Ontario, Simcoe, and Huron Union Railroad. A. I heard so. Q. Do you know that those Debentures were sold, or a^,Tef;d to be sold in New York at par ? A. I do not know of my own knowledge, I heard so. ">, Can you give any information to the Committee teu'»ing to eluci- date the subject which the Committee was appointed to inquire into. A, I cannot. Alderman DaNisoN", seconded by Alderman Gowan. moved that tho following three questions bo submitted to His ^Vorship the Mayor, through the Clerk, respectfully requesting that ho will answer the same, either verbally or in writing, to the Committee : — Q. 1. Have you in any manner tal-en part, for yourself, or as agent for any other person, in tho negotiation or sale of the £50,000 City Debentures, by the Contractors of the Ontario, Simcoe, and Huion Rtijlroad, which it is said were sold at a discount of 20 per cent., or thereabouts ? If ao, state how, and in what manner. Q. 2. Have you, directly or indirectly, received, or are you in expec- tation of receiving, directly or indirecvly, any portion of the profits on the said transaction mentioned in thd last question, or any sum of money for aiding and assisting in tho promotion of the said negotiation or sale of the said Debentures ? If so, state the amount. # This third question not to be put, if the two preceding are answered in tho negative. Q. 3- Did you assist in tho promotion of the said negotiation, in your position or capacity as Mayor of Toronto ? or did you exercise tho intluo/ice of your civic position to aid you in promoting such negotio- aj t(J 55 tateln tion 7 or did you act entirely in your private capacity, as Mr. Bowefl, a merchant, of Toronto ? rork to xactow be Bold to eluci- into. i that the le Mayor, the eame, >r as agent )0,000 City md Huion 5r cent., or u in expec- le profits on vny sum of negotiation ,re answered tion, in your exercise the iuch negotia- W. Sladdekt, Esquire, examined. Q. ^re you the Secretary to the Directors of the Ontario, Simcoe, and Huron Bailroad Union Gomyany. A. I am. Q. Can you inform the Committee whether the Directors approved of the exchange of the stock to the extent of £50,000 being taken from the Contractors, in lieu of the original loan of £35,000, and the grant of £35,000. A. I refer you to the written communication given by me, as Secre- tary to the Board of Directors, dated July 30th, 1853 ; and any other communication in writing I may have made on the same subject. Q. Did you, as the Secretary of the Board, transfer the stock given tv the City by the Contractors. A. I did. Q. lias the city ever taken or purchased any stock in your company in accordance with the provisions of the law or otherwise ? A. Not directly of the company. Q. How does the city stand on the books of your company as repre- senting stock ? A. As the holders of 10,000 shares by transfer Ti^om certsvin parties ' and also as holders of orij^inal certificates, which certificates were issued to them at the instance of the Cou^ractors, and charged to the account of the Contractors Q. Do you recognize the city in your company as having complied with the law in respect to taking stock in the company ? A. I only consider the City in the light of transferees. Q. Do you know, either from tho Contractors or any other person, who it was that retained tho £10,000 from tho •"Contractors of the Ontario, Simcoe and Huron Union llailr >ad on the sa^v of the £50,000. A. I '^0 not know anything at all about it. 5« Q. Are you aware from the Contractors or any other party, that th« £50,000 Debentures issued by the City to the CoAtractora, had been sold or agreed for in New York at par ? A. I am not. Q. Does it make any difference whether the City subscribed for stock as the original holders, or as the assignees of others, and if so be pleased to state the difference? A. I am not prepared to give my opinion as to whether it makes any difference in any shapo or way ; this I did not expect to be examined on. Mr. Thompson M'Cleary, examined. Q. Have you been a contractor for Public Works ordered to be made by the City ? A. I have been. Q. Did you in that capacity receive the Debentures of the city in payment ? A. I did. Q. Have you any objection to state at what rate of discount you dis- posed of the said Debentures ? A. With the exception of the two first, which were at a higher rate, the whole were disposed of at one per cent, per annum for the time they had to run ? i Ilucn Miller, Esquire, re-examined. Q. You stated on your examinaation yesterday that the Debentures of this city had been sold some at par, and some at a premium, and that you had yourself purchased at par ; did you intend to convey by such answer the meaning that tlie Debentures of the City were at the time actually worth par ; or if not, what meaning did you intend to convey ? A. I traded in the article at this period to a limited extent. I took it at par, because I could not got it at less, you may understand what you like ; I paid par, I do not think they were worth par at the time. Q. Was it not in consideration of the new Market being built in the vicinity of your residence that you gave par for the Debentures ; and was It in the laud was w it not in fact in pursuance of such consideration you had previoiislj bound yourself to take such Debentures ? A. Certainly. Mr. Robert Dodds, esamiued. Q. Have you been a Contractor for certain Public Works, and were you paid for tlieir performance in the Debentures of the City. A. I liave, and was so paid, about a year ago. Q. Have you any objection to inform the Committee the usual rate of discount on the Debentures of the city ? A. Something over one per cent, per annum for the time they had to run, this was in the year 1851 in the fall. The ClerV was dii-ected to address the following letter to M. Court- right, Est^ ..oting Manager of the firm of M. C. Storey and Co. Committee ^ m, February 19, 1853. Sir, — It having been asserted by Mr. Alderman Bell in his place in the councU, that he had been informed the Contractors of the Ontario, Simcoe and Huron Union Railroad had agreed to sell the Debentures of the city in New York at par, that a legal gentleman had come on here to enquire after them, and that in consequence of the manner in which they had been issued they had been pronounced illegal ; no doubt he would say "you hsve issued your Debentures in a clumsy manner, and that in con- sequence the Contractors sold them at a discount of 20 per cent." 1st. Had you or any of your firm made arrangements for the saleof those Debentures or any portion of them at par in New York ; or if not, at what rate could you have disposed of them there. 2nd. Did ever Major Lawman toll you he had sold or arrange*', to sell those Debentures at par in New York ? 3rd. Are you aware that lie told any other person that your Company had agreed to sell them at par in New York ? ^i .; i 58 The fayoar of your answer to the foregoing questiona is requested fbr the information of the Committee at your earliest convenience. I am, &Q. (Signed) CHARLES DALY, C.C.C. The Committee met. MONDAY, FSBRUART 21, 1853. PRESENT : Alderman Gooderhau, Chairman. Aldermen Bell, Denison, GOWAN, Councillors AsHriELD, Green, Macdonald. H E. Chads Hancock, Esquire, examined. Q. Are you a Director of the Ontario, Simcoe and Huron Railway Union Company? A. I am. Q. Did you inform Mr. Hugh Miller that to the negociation sale or dis- posal of the Debentures issued to the Contractors of the Ontario, Simcoe and Huron Union Railroad the Mayor of this City was a party, or that ho participated in any profit or advantage thereby ? A. I never said a word about it. Q. In point of fact do you know who did negociate the said Deben- tures, or who participated in the profit thereof ? A. No. The Clerk informed the Committee that he had not received any reply to the letters addressed to Joshua G. Beard, Esq., the Mayor, or M. Courtright, Esq. Alderman Gowan submitted certain memoranda to form the ground work of the Report of the Committee, which was declined. c. 1^ dfor ;.c. 3. 1 Rail-vray le or dis- L Simcoo I or that Deben- Alderman Denison submitted the draft of a Report to bo adopted by the Committee, which was adopted. Adjourned. The Committee having been notified that a letter in reply to the ques* tions put by the Committee had been received from his worship tho Mayor, — TLo Committee reassembled at half-past sis o'clock, p.m. PRESENT ; Alderman Gooderqau, Chairman. Alderman Gowan, Councillors Greiit, Macdonald. The following lettter was read from his "Worship tne Mayor : — To William Gooderham, Esquire. Sir, — I had the honor, in reply to your communication of the 17th instant, to refer you to the City Chamberlain, the Chairman of the Stand- ing Committee on Finance and Assessment, the Contractors of the Ontario, Simcoo and Huron Union Railroad, and the Cashier of the Bank of Upper Canada for information on the subject of the Debentures issued to the Contractors of tho Ontario, Simcoe and Huron Union Railroad, as capable of giving much more satisfactory information than any I might give. But as the Committee seem anxious that I should answer their ques- tions, I cheerfully do Svj> I introduced tho Contractors to the £tcnk of Upper Canada and ren- dered them any assistance in my power in the negociation of the £50,000 Debentures, but received no remuneration present or prospective therefor. Yours obediently, (Signed) J. G BOAVES, Mayor. |ny reply p, or M. ground Councillor Macdonald, seconded by Councillor Green, moves, — That in consequence of the communication just read having been received from His Worship the Mayor, the following report be substituted for the one previously adopted, — which was carried. {See Report, page 6.) The proceedings of the Committed closed here. The follcnring letter was received bv the Chairman of the Com- mittee, on Tuesday, the 22nd instant : — [Copy,] Buffalo, 2l8t February, iai>3. To /he Select Committee, appointed hy the Council of Toronto la inquire info the sale of certain City Debentures. GEyXLEMEN, — Your note of the 19th instant, requesting my answer to certain interrogations therein contained, is received. In reply to tlie first question, I can only say, that neither myself, or any of our firm, ever made arrangements, to my knowledge, for the sale of the Debentures alluded to, or any portion of them, at par, in the City of New York ; and that the disposition that was made of them answered our purpose better, so far as my knowledge goes, than any we could then, or any time previously, have made. In answer to the second and third enquiry, I say, No! Very respectfully yours, (Signed) M. COURTKIGIIT, Of the firm of M. C. Storey & Co. VA TORONTO: PRINTED BY ORDER OF THE COUNCIL, BT CIO, 1. THOMAS k CO., PRINTERS TO THl CORPORATION, ioo. N.'' L, > t CERTIFY that this is a correct Copy of tho Proceedings in Council, and Minutes of Evidence taken by the Committee, rela- tive to tlie Issue and Sale of City Debentures, in 1852. CHARLES DALY, C.C.C. Clerk's Office Toronto ncE, ] , 8th March, 1853. J i I CKUUTT that ^18 is a correct Copy of the Proceodinga ii» Counoil, tind Minutes of Evidence t^kcn by the Committev, rela- tive to the Issue arid Sale of City Debentures, in 1852. CHARLES DALY, cc.a CtxitK's Ortitjji, ) Toronto, 8tli March, 1853. ) h * r