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1 2 3

-4 .

'-<ni!«baM''

7 0.^

CORRESPONDENCE

EELATIVE TO THE '

CANADIAN PACIFIC RAILWAY.

i}v(0(me& to botl) ^ov^tn of l^arliamrnt Iii* (frontinanH of Jtftv mair^t^*

March, 1874.

LONDON:

PRINTED BY WILLIAM CLOWES & SONS, STAMFORD STREET AND CHARING CROSS,

FOB HER MAJESTY'S STATIONEBV 0:'FTCE.

[C— 911.] Price 3s.

1874.

/v->

976

SCHEDULE.

9
10

12
13

Tlio Eurl of Dufforin.
3 Miiy, 1873.

To tlio Eiirl of Dufforin.
27tli Juno, 1873.

To the Eiirl of Dufforin.
30 Juno, 1873.

The Earl of Dufforin.
15 Aug. 1873.

The Earl of Dufforin.
18 Au.'. 1873.

To tho Earl ofDuffcrin,
9 Oct. 1873.

Tho Earl of Dufforin.
■1 Oct. 1873.

Tho Earl of Dufforin.
23 Oct. 1873.

To tho Earl of Dufforin.
7 Nov. 1873.

The Earl of Dufforin.

3 Nov. 1873.

(Rocoivoil 19 Nov.)

To tho Earl of Dufforin.
13 Nov. 1873.

To tho Earl of Dufforin.
22 Nov. 1873.

The Earl of Dufforin.

7 Nov. 1873.

(Roccivod 26 Nov.)

To tho Earl of Dufforin.
29 Nov. 1873.

Enclosing Bill fi>r tlui Exainiuation of WitiiosH(!H on Oath, and
explaining tho circuuistancus which gave riHo to it -

Tolcfiram — Oaths Act ia disallowoil ------

Tninsmitting Order in Council disallowing tho above Bill

Reporting that ho had prorogued Parliament on tho 13th ; giving
an account of tho circumstances cunnoctiid with tlio Prorogation,
and enclosing documouts relating to tlio grant of tho Pacific
Railway Charter, and a Report of a meeting on tho Prorogation -

Reporting that ho had issued a Royal Conmiission to throe Judges
to inijuiro into tho matters connoctod with the issue of the Pacific
Railway Cliarter, and onclo.sing u copy of tho conmiission, with
other papers ---- ......

Acknowhdgiug tho Govcrnor-Genoral's Diispatch reporting tho
cirenmstancos connected with tho rocont prorogation of the
Dominion Parliament, and fully approving of liis having acted in
these matters in aecordauco witli cuastitutiuual usage

Requesting instructions for guidance in the event of an Act being
passed by tho Dominion Parliament purporting to authorize tho
issue of a Commission of lutpiiry ato tho Pacific Ituilway
Question, and to take Evidence upon Oath - . - -

Acknowledging the above

Enclosing copies of tho Report of the Royal Commissioners, with
tlie evidi;nco talcon by thoni ; with observatidiis as to tho proceed-
ings before tlio CommiBsioners, and their results - . .

Stating that iu tlie opinion of tlio Law Officers of tlio Crown it
would bo beyond the powers of the Parliament of the Dominion
to pass such au Act for the issue of a C(mimission of Inquiry to
take Evidence on Oath as contemplated in No. 9 of series -

in reply to the above

Reporting tho proceedings on the opening of tho Dominion
Parliament — tho resignation of Sir .Tolin Macdonald, and that ho
bad called upon Mr. Mackenzie to form a Ministry . . -

Acknowledging the above Despatch, and convoying Tier Majesty's
entire approval of the manner in which Lord Dufferiu had acted
in circumstances of uo ordinary difficulty - - - -

Speech of the Governor-General on tho opening this day of tho
Dominion Parliament --------85

2G2
2G3

263

265

CORllESPONDENCE

Page.

nnd

;iviug
ation,
'iicifio
tion -

'uciflo
, with

7G
84

2G2
2G3

2G3
2G5

^-M

nELATIVE TO THE

CANADI^VN PACIFIC RAILWAY.

No. 1.

The EauIv of Dufferix to The Eakl of KiMitEitLRr.

My Lorp, Canada, INIay 'S, 1873.

1 HAVE the honour to Ibrwartl to your Lordship a certified cojjy of a Bill, entitled
" A Bill to provide ior tlie Examination of Witnesses on Oath by Committees of the
" Senate and House of Commons in certain cases," which has passed both Houses of the
Canadian Parliament, and to which 1 have th's day given my assent.

The introduction of this Bill into the House of Commons arose out of the following
circumstances : —

On the 2nd April, the Hon, Lucius Seth Huntington, Memljcr for Sheflbrd, in the
Province of Quebec, made the following motion : —

" Hon. Mr. Huntington moved that Mr. Huntington, a member of this House, having
stated in his place, that he is crediljly informed and believes that he can establish by
satisfactory evidence,^ —

" That in anticii)atiou of the legislation of last Session, as to the Pacifio Railway, an
agreement was made Ijctween Sir Hugh Allan, acting for himself and certain other
Canadian promoters, and G. W, McMullen, acting for certain United States capitalists,
whereby the latter agreed to furnish all the funds necessary for the construction of the
contemplated railway, and to give the former a certain percentage of interest in con-
sideration of their int(;rest and position, the scheme agreed on being ostensibly tliat of
a Canadian Company with Sir Hugh Allan at its head, —

" That the Government were aware that negotiations were pending between these
parties, —

" That subsequently an understanding was come to between the Government and Sir
Hugh Allan and Mr. Abbott, M.P., that Sir Hugh Allan and his friends should
advance a large sum of money for the jjurpose of aiding tlie elections of Ministers and
their supporters at the ensuing general election, and that he and his friends should
receive the contract for the construction of the railway, —

" That accordingly Sir Hugh Allan did advance a large sum of money for tlie purpose
mentioned, and at the solicitation and under the pressing instances of Minist^n's, —

" That part of the moneys expended by Sir Hugh Allan in connection with the
obtaining of the Act of Incorporation and Charter, were paid to him by the said United
States capitalists under the agreement with him, — it is

" Ordered, That a Committee of seven members be appointed to inquire into all the
circumstances connected with the negotiations for the construction of the Pacific
Railway, with the legislation of last Session on the subject, and with the granting of
the Charter to Sir Hugh Allan and others; with power to send for persons, pajiers,
and records; and with instructions to report in full the evidence taken bel'ore, and
all proceedings of said Committee;" which was negatived on the following division: —
Yeas, 7(i ; Nays, 107.

As your Lordsliij) will perceive, this motion charges my present Advisers with a very
infamous proceeding — with no less a crime than that of having sold Canada's most
precious interests to certain American speculators, with a view to debauching the
Canadian constituencies with the gold obtained as the price of their treachery.

In making his motion, Mr. Huntington did not accompany it by any stater

Canada.

.nient as to

CORRESrONDEXCK RELATIVE TO THE

Canada. t|,j. jrroimds on whicli lie IbiiiKlcd his charge, or by the prodiutioii of any evidence in
sujiport of it; and neither Sir Jolni iMacdonald nor any of Iiis coHeagues having risen
to address tiie House, " vote was J'orthwith taken witliout (U;hate, wliieh resulted in a
majority ol'.'H in favour ol' the Cjovernnient in a House of iH;j.

The next day Sir John Maodonald himsell' gave notice that he would move the
ap))oii!tnienl; of a Committee for tl'.e purpose of investigating Mr. Huntington's charges,
and it being further suggested, as I am informed, l)y some of the Opposition members,
that the evidence; should be taki'n on oath, a IJill lor that purpose was introduced by
The Hon. John Hillyard Cameron, an eminent lawyer of Ontario, and the Chaii-mau of
the ])roiiosed Committee.

This Bill was accepted by the Government, and passed with scarcely any disjussion in
the House of Commons.

It was introduced into the Senate by Mr. Camj)bell, the Postmaster-General, and gave
ris(! to some dilTerence of opinion as to whether its enactments were within the compe-
tence of the Canadian Legislature.

[n the I8th clause of the Union Act of Canada, it is provided that " The privileges,
" immunitii's, and powers to be held, enjoyed, and exercised by the Senate, and by the
" House of Commons, and by the Members thereof respectivtdy, shall be such as are from
" time to time defined by Act of the Parliament of Canada, but so that the same shall
" never exceed those at the passing of this Act held, enjoyed, and exercised by the
" Commons House of I'arliament of the United Kingdom of (Jreat Britain and Ireland,
" and by the Members thereof," and the critics of the measure observed that inasmuch
as the I3ritish House of ('ommous did not acquire the general right of examining
witnesses on oath until a date subsequent to the passing of the Union Act, the Dominion
Parliament was precluded by the terms of the foregoing clause from investing the
Canadian House of Commons with the powers in question.

It strikes me, however, that the 18th clause of tlie Union Act was not framed for the
purpose of restricting the legislative action of the Dominion Parliament, but that the
terms '' immunities, i)rivil('gos, &c.," refer to those immunities and privileges which are
inherent in the British House of Commons as a separate branch of the Legislature, and
this view seems to be confirmed by the use of the word "defined."

The manifest purpose of the Act was to endow the Canadian House of Commons with
a status analogous to that enjoyed by the House of Commons at home; and for obvious
reasons it was necessary that the attributes of this status sliould be distinctly specified in
the manner provided for by the ISth clause, but it could scarcely have been intended to
preclude either branch of the Canadian Legislature I'rom acquiring, by Act of Pari..".-
ment, such other ])owers as experience might prove to be necessary, providing these
powers were constitutional in themselves, and did not infringe the prerogatives of the
Crown.

That this view was held by my predecessors as well as by the Imperial Government
may be deduced from the following circumstances : —

The Canadian Senate is also endowed by the IBth clause of the Act of Union with the
same privileges and attributes as the Imperial House of Commons, but these "privi-
" leges," &c., are confined by an identic formula within the same limits as those which
restrict the powers of the Canadian House of Commons, and which are supposed to
render the present " Oaths Bill" ultra vires, viz. to such as were possessed by the British
House of Commons at the passing of the Act. Yet one of the first acts of the Canadian
Legislature was to invest tlie Canadian Senate with a general power of examining
witnesses at its Bar — a power which was not possessed by the British House of
Commons until long after the passing of the Union Act.

It is possible that this Act may have been assented to by the Governor-General, and
acquiesced in by the Imperial Government through inadvertence, in which case it could
not be appealed to as a precedent for sanctioning an obvious illegality, but there are no
corroborating circumstances to justify me in acting on so unlikely an assumi)tion.

Under these circumstances, I trust your Lordship will consider that I have done right
in giving the assent of the Crown to the Canadian " Oaths Bill."

Had I deferred doing so, very prejudicial results would have arisen. The investigation
of a charge of the gravest nature, affecting the honour of my Constitutional Advisers
would have appeared to be indefinitely postponed, while it Avas being loudly asserted
and widely credited throughout the country that the delay had been contrived at the
instigation of Sir John Macdonald and his confederates, who were seeking by these
devices to defer the exposure of their guilt.

But for this circumstance 1 might have been tempted, as the point raised is a
purely legal one, to have reserved the Bill for your Lordshiji's consideration, and the

CANADIAN PACIFIC RArLWAY.

evideiKH! in
hiiviiif; risen
jsulti'd ill a

il move the
)n's cliarf^cs,
III m( mbi.'i's,
trod I iced by
Jhaii'maii ol'

iisjussioii ill

ul, and gave
the compo-

10 privileges,
, and by the
1 as are Iroin
I' same shall
jised by the
and Ireland,
lat inasmuch
examining
le Doininiou
iivesting the

imed for the
but that the
3S which are
;islature, and

mmoiis with
I Jbr obvious
' specified in

intended to
t of ParL.\'

iding these
atives of the

Government

ion with the
lese "privi-
those which
sujjposed to
\l the British
le Canadian
examining
1 House of

leneral, and

case it could

there are uo

tion.

e done right

investigation
nal Advisers
dly asserted
rived at the
iig by these

raised is a
ion, and the

Pavaba.

noimrtrnont
(if Jimtido,
;iOth Aiiril,
1873.

more so because, ns you will iicrccivc by the oiulosed Minute, Sir John Macdonnld is
inclined to share the inisgivinf;s of those who question the competence of the Caiiatlian
I'arlinmeiit in this matter; but as the issue is one not ol ('olonial Itut of Imperial
concern, anil as .Sir .loliii tendered his opinion merely for my information, and not as my
Adviser — indeed he intimated that he would lie glad if I saw my way to asseiilingto the
Bill — I felt at liberty to consult my own judgment, more especially as it may be pre-
sumed that my (lovernment would not have ])romoted the " Oaths Bill " in the House of
Commons and lathered it in the Senate, had the Minister of Justice entertained a decided
conviction of its illegality.

My conclusions have been further fortified, not only by the opinion of many legal
authorities whom I have consulted, but more especially by that of Mr. Alpheus Todd,
the author of 'Parliamentary novernment in England,' who, as your Lordship is aware,
is exceptionally ciualilied to j)ronounce upon (|uestioiis of this description, and who has i»tMiiy, i'-;3,
been good enough to discuss the case in a short Memorandum, of which I (inclose a copy.

I have, iVc,
The Earl of Kimberley, (Signed) DUFFERIN.

&c. &c. &c.

Enclosure 1 in No. 1.

Ottawa, September 8, 1873.
I, Robert Le Moine, Esq., Clerk of the Parliaments and Custodian of the Statutes of
the Parliament of Canada, certily the subjoined to be a true copy of the original enact-
ment passed by the Senate and House of Commons of Canada, in the first S(!ssioii of the
Second Parliament, held m the thirty-sixth year ol Her Majesty's reign, and assented to
in the Queen's name, by the Governor-General, on Saturday, the third day of ^lay, one
thousand eight hundred and seventy-three, and afterwards, on the twenty-second day of
May of the said year, was disallowed by her Majesty in Council, and proclamation
thereof made by his Excellency the Governor-General on the first day of July following.

ROBERT LE MOINE,

Clerk of the Parliaments.

An Act to i^rovide for the Examination of Witnesses on Oath 1)y Committees of the Senate

and House of Commons in certain cases.

Her Majesty, by and with the advice and consent of the Senate and House of Commons
of Canada, enacts as ibllows : —

1. Whenever any witness or witnesses is or are to be examined by any Committee of the
Senate or House of Commons, and the Senate or House of Commons shall have resolved
that it is desirable that such witness or witnesses shall be examined upon oath, such
witness or witnesses shall be examined upon oath or affirmation, where affirmation is
allowed by law.

2. Such oath or aflirmation shall be administered by the Chairman or any member of
any such Committee as aforesaid.

3. Any witnqss giving false evidence upon any such examination, shall be subject and
liable to all the pains and penalties of perjury, as fixed by the criminal law.

4. The oath or affirmation aforesaid shall be in the following form : " The evidence
" you shall give on this examination shall be the truth, the whole truth, and nothing but
" the truth. So help you God."

Enclosure 2 in No. 1.

" Department of Justice,

" Ottawa, April 30, 1873.
"The undersigned, to whom has been referred, by your Excellency, the Bill passed
during the present Session by the Senate and House of Commons, intituled ' An Act to
• provide for the Examination of Witnesses on Oath by Committees of the Senate and
' House of Commons, in certain cases,' begs leave to report : —

A 2

4 CORRR^rONDENCK RKLATFVR TO THE

Canada. " « 1 . 'I'lint by the 1 8th Chiuso of " The British Nortli America Act, 1 8(17," it is provided
■ as IbUows ;— -

"'Th(! privih'^cs, iminiiiiitics, mid junvers to he hehl, ciKoyed, and exercised hy the
Senate and hy tli(^ House of Coninions, and l)y th(! niemhers thereof respectively, shall
ho such as are I'roni lime to time definecl hy Act of the I'arliament of Canada, hut so
that the same shall never <'xceed those at the [mssini; of this Act held, enjoyed, and
exercised i)y the Commons House of I'arliament of the United Kingdom of (Jreat Britain
and Ireland, aiul hy the memhers thereof.'

" 2. That snhsequently.on the 'J'Jnd May, ISdS, the C^anadian Parliament, hy the Act
IJlst Victoria, chap. '2.">, in pursuance of the authority so ;j;iven l)y the Union Act, defnicd
the privileges of the Senate and House of Commons respectively. The clause doing so
is as follows: —

"The Senate and the House of Commons res])ectively, and the memhers thereof
reHj)ectively, shall hold, enjoy, and exercise such and the like privileges, immunities, and
])o\vers, as at tlu; jjassjng of ' The British North America Act, 18(>7,' were held, enjoyed,
and exercised hy the (^onunons House of Parliament of the United Kingdom of Great
Britain aiul Iridand, and by the memhers thereof, so far as the same an; consistent with
and not repugnant to the said Act.

" At this time neither the JJiitish House of Commons, nor any (^ommittee thereof, had
])ower of examining witnesses on oath, except in certain specihed cases, such as in Private
Bills. That ])ower was only conferred on the British House of Commons and the Com-
mittees in 1871, by the Act o i and ?,') Vict., chap. 83.

" The Bill now referred to thi! undersigned seeks to confer this power upon any
Committee of the Senate or House of Commons, when either House shall liavc resolved
that it is desirable that Avituesses should be examined upon oath. The empowering
section of the Bill is as follows : —

" ' Whenever any witness or witnesses is or are to he examined hy any Committee of
the Senate or House of Commons, and the Senate or House of Commons shall have
resolved that it is desirable that such witness or witnesses should be examined ujion
oath, such witness or witnesses shall be examined upon oath or affirmation, where
affirmation is allowed by law '

" The questloii has been raisied whether it is competent for the Parliament of Canada
to confer thih power on a Coi.nmittee of the Senate or House of Commons h ••'!, as it is
a power which was not possessed or exercised by the British House of Commons at the
time of the passing of * The British North America Act, 18G7.'

"The undersigned has come ;o the conclusion, although not without doubt, that this
Bill is not within the competency or jurisdiction of the Canadian Parliament, and that
the attention of Her Majesty's Government should be called to its provisions, and to the
doubt that exists with respect to its validity.

" All which is respectfully submitted.

(Signed) " JOHN A. MACDONALD."

Enclosure 3 in No. 1.

" Opinion in reference to the Meaning op tue ISth Clause of the British

North America Act of 18G7.

" This clause is as follows : —

" • The privileges, immunities, and powers, to he held, enjoyed, and exercised by the
Senate and by the House of Commons, and by the members thereof respectively, shall
be such as are from time to time defined by Act of the Parliament of Canada, but so
that the same shall never exceed those at the passing of this Act held, enjoyed, and
exercised by the Commons House of Parliament of the United Kingdom of Great Britain
and Ireland, and by the members thereof.'

" A Bill having been introduced into the Dominion House of Commons, in the present
Session, intituled ' An Act to provide for the Examination of Witnesses on Oath by
' Committees of the Senate and House of Commons in certain cases,' a question has been
raised as to whether the Dominion Parliament were competent to pass this Bill in view
of the restrictions imposed by the 18th clause of the B. N. A. Act aforesaid.

" In my opinion that clause was intended to restrain the claims of either House to

CANADIAN PACIFir RAILWAY

it is i)rovidfd

•rcised l)y tlic
irtivi'ly, sliall
aiiiida, Imt iso
(Mijoycd, and
(ircatBrituiu

it, l)y tlic Act
1 Act, dcliiied
ausc doiiijj so

ibors tlierool'
nniiiitics, and
lu'ld, enjoyed,
lorn ol" Groat
)nsisti'nt with

' thereof, had
as in Private
nd llie Com-

;r upon any

lave resolved

empowering

committee of
s shall have
amiiied ui)on
ition, where

lit of Canada
h ""';, as it is
imons at the

ibt, that this
nt, and that
;, and to the

Indefinite privileges and immunities, l)y providinj; that such privileges shall never exceed
those enjoyed hy the imperial Mouse of Commons at a i^'iv • .lute. The privilefjes
and immunities herein referred to are those that mi;;lil reasonably or unr'.'asonal)Iy he
claimed as iniierent in, or necessarily attacliiuf.'' to, tlie Houses of tlie Canadian Par-
liament, ])ursuant to the maxim that 'all things necessary ]mss as incident.' By limiting
such ])rivileges and i)owers to tiioFi; ]M)ssessed by the Imperial House of Commons in
l^i(i7, it j)revents, on the one hand, an inidue encroachment or extension of privilege, and
on the other hand secures to the two Houses and the members thereof respectively, the
])rivileges, immunities, and powers ai)propriate to them as component })arts of the
Canadian Parliament.

"It has been urged that the Act to authorize the examination of witnenscs on oath by
Committees of the Senate and House of Commons of Canada, is an extension of their
])rivileges, beyond those sanctioned by the IJ. N. A. Act, inasmuch as Select Committees
of the Imperial House of Commons (not l)eing Private 15111 Committees) did not jwssess
such ])ower in 18(t/, or until, by tlie Imperial 'Parliamentary Witnesses Oaths Act
'of 1871,' such jiower was for the first time conferred upon them.

"It is to be observed, however, that the power so conferred upon Committees by the
i'iiiglish House of Commons was not claimed as a 'privilege' inherent in that body.
It was merely a power conferred by statute, to facilitate legislative inquiries, similar to
that which has been repeatedly conferred upo i Statutory Commissions; and in being
so conferred it did not trench upon any iirerogative of the Crown, or enlarge the constitu-
tional rights of the House of Commons.

"The Dominion Parliament were therefore clearly com])etent, in my judgment, to
confer a similar power upon Committees of the Senate and House of Commons, pursuant
to the authority conveyed to thai y.rliament by the .">lst clause of the British North
America Act, 'to make laws for the [i. ice, order, and good government of Canada.'

"In a word, the restrictions contiiiiied in the I8th clause of the aforesaid Act are
restrictions upon claims that might Le urged on behalf of the two Houses of the Canadian
Parliament, or the members t'l rcof r: pectively, io inln'rent or e.ro'ssirc priviki/cs, and
are not intended to prevent tnu exercise of leijislativc poicerK by the whoh; Parliament,
provided that the same are exercised within approj)riate constitutional limits.

(Signed) "ALPIIEUS TODD.

"Library of Parliament,
1st May, 1873."

Canada.

)NALD."

No. 2.
Telegram receivkd i\ Quebec, June 27Tir, 1873.
The Eari, of Kimberley to Earl of Dukferin.
" Oaths Act is disallowed."

British

ised by the
iively, shall
ada, but so
joyed, and
[•eat Britain

the present
)n Oath by
3n has been
Jill in view

r House to

No. 3.

The Secretary of State for the Coloxies to the Goverxor-Gexeral.

" My I^rd, " Downing Street, June .SO, 1873.

" I HAVE the honour to transmit to you an Order in Council disallowing the
Act passed by the Parliament of Canada, 'to provide for the Examination of Witnesses
•on Oath by Committees of the Senate and House of Commons in certain cases,' and
also the Certificate, as required by the 56th Section of the British North America Act,
1867, stating when the Act was rL.;eived in this Department. Belbre tendering any advice
to Her Majesty upon this Act, I referred to the Law Officers of the Crown, and I was
advised that the Act was ultra vires of the Colonial Legislature, as being contrary to
the express terms of Section 18 of the British North America Act, 1867, and that the

CORRESPONDENCE RELATIVE TO THE

Oahada. Canadian Parliament could not vest in themselves the power to administer oaths, that
being a power whicli the House of Commons did not possess in 1867, when the Imperial
Act Avas passed. The Law Officers .also reported that the Queen should be advised to
disallow the Act.
t " My attention has been called to the fact that by an Act of the Canadian Parliament,

cap. XXIV. of 18()8, provision is made by the first section for examining witnesses upon
oath at the bar of the Senate, and that the Act has been allowed to remain in operation.
It appears to have escaped observation both here and in the Colony that though such
examination of witnesses is in accord.mce with the practice of the House of Lords, the
powers of the Senate of Canada are limited by the British North America Act, 1867,
to such powers as were then enjoyed by the House of Commons, and that the first section
of the Canadian Act of 1868 was therefore in contravention of that Act.

"But though the Act of 1868 was not disallowed, I have to point out to you,
that under the second section of 28 and 29 Victoria, cap. 63, this first section is void and
inoperative, as being repugnant to the provisions of the British North America Act, and
cannot be legally acted upon.

"So far as regards the powers given by the Act of 1868 to Select Committees upon
Private Bills, they would appear to be unobjectionable, as like powers had, before the
passing of the British North America Act, been given to the House of Commons by 21
and 22 Vict., cap. 78."

'* I llclVC &c.

(Signed) '" KIMBERLEY."
Governor-General The Right Hon.

The Earl of Dufierin, K.P., K.C.B.,
&c. &c. &c.

Cal

*cl

Del

At the Court at Windsor, the 26th day of June, 1873.

PRESEXT :

THE QUEEN'S MOST EXCELLENT MAJESTY,

Lord President, Earl of Kimberley,

Earl Granville, Lord Chamberlain,

Mr. Gladstone.

" WHEREAS by an Act passed in the thirtieth year of Her ^Majesty's reign, entitled
' An Act for tlie ITnion of Canada, Nova Scotia, and New Brunswick, and the Govern-
' ment thereof, and for i)urposes connected therewitli,' it is, amongst other things,
enacted, that where the Governor-General assents to a Bill in the Queen's name, he shall,
by tlie first convenient opj)ortunity, send an authenticated copy of the Act to one of
ller Majesty's Principal Secretaries of State, and if the Queen in Council, within two
years after receipt thereof by the Secretary of State, thinks fit to disallow the Act, sucli
disallowance (with a Certificate of the Secretary of State of the day on which the Act
was received liy him) being signified by the Governor-General, by Speech or Message to
each of the Houses of tlie Parliament, or by Proclamation, shall annul the Act from
and after the day of sucli signification."

"And AVhereas on the 3rd day of May, 1873, a certain Bill, jiassedby the Parliament
of the Dominion of Canada, entitled ' An Act to provide for the Examination of Witnesses
' on Oatli by Committees of the Senate and House of Commons in certain cases,' was
assented to by ihe Ciovernor-General of the said Dominion of Canada : and whereas the
said Act of the Parliament of Canada has been laid before Her Majesty in Council, and
it is expedient that the said Act should be disallowed by Her Majesty :

" Now, therefore, Her Majesty, in pursuance of the said Act of the Imperial Parlia-
ment, and in exercise of the powers thereby reserved to Her Majesty, as aforesaid, doth
by this present Order, by and with the advice of Her Majesty's Privy Council, declare
her disallowance of the said Act of the Parliament of Canada. And the Right
Honourable the Earl of Kimberley, one of Her Majesty's Principal Secretaries of State,
is to give the necessary directions herein accordingly.

"ARTHUR HELPS."

" Colonial Office, Downing Street.
" I, John, Earl of Kimberley, being one of Iler Majesty's Principal Secretaries of
State, do hereby certify that the Act passed by the Senate and House of Commons of

Hi-

ir oaths, that
the Imperial
3e advised to

I Parliament,
itnesses upon

in operation.

though such
af Lords, the
a Act, 1867,
e first seotion

out to you,
n is void and
rica Act, and

mittees upon
d, before the
amons by 21

EHLEY."

gn, entitled
tlie Govern-
;hcr things,
ae, he shall,

: to one oi'

Avithin two
ic Act, sucli
ich the Act

Message to
3 Act from

Parliament
f Witnesses
cases,' was
vhereas the
iniucil, and

ial Parlia-
esaid, doth
cil, declare
the Right
!s of State,

ELPS."

Str.-et.
retaries of
mraons of

CANADIAN PACIFIC RAILWAY. 7

Canada, intituled, ' An Act to provide for the Examination of Witnesses on Oath by
* Comm'ittees of the Senate and House of Commons, in certain cases,' was received at tliis
Department on the 22nd day of May, 1873.

" Given under my hand and seal, this 1st day of July, 1873. ^T,,„T^„r i-v "

Canada.

No. 4.

The Earl of DuFFKiim to The Eahl of KiMin-RLKY.

My Lord, Canada, August 15, 1873.

I HAVE the honour to state, for your Lordsliip's information, that at half-past
three of the afternoon of Wednesday the 13th instant I prorogued Parliament.

As this event is likely to be regarded with dissatisfaction by one of the great political
parties in this country, and has been already animadverted upon in no measured terms
by a portion of the Canadian press, I i)ropose to give your Lordship a full account of the
circumstances under which it has taken place.

Although I have already acquainted your Lordship from time to time with everything
which has occurred in connection with the grant of the Pacific Railway Charter, as well
as with the proceedings in and out of Parliament to which it lias given rise, it may be
well to preface my intended statement by a brief recapitulation of its previous history.

The scheme of a Canadian line of railway I'rom the Atlantic to tlie Pacific first
acquired a practical character in 1871, when its construction within ten years from that
date became one of the conditions on which British Columbia covenanted to enter into
confederation.

The first move towards the realization of the project seems to have been initiated, not
by a Canadian, but by an Englishman of tlic name of Waddington, who, after broacliing
his proposals in Toronto and elsewhere, a])parently without success, eventually succeeded
in obtaining the co-operation of a numljor of capitalists in Chicago and New York, most
of whom, tliough not all, were interested in the "Northern Pacific Railway," a United
States line, connecting at Lyndon with the continental --ystem, which it is intended to
carry across the iiortheriiiiiost States of the Union to a port on the Pacific, and which
will consequently run parallel^ — though at a lower latitude and over a wider arc — with
the proposed Canadian line.

A deputation from these gentlemen seems to have visited Ottawa in the autumn of
1871, and to have had an interview with some members of the Canadian Government, by
whom they were informed that the time for entering into negotiations for the construction
of the railway had not arrived. For several months no other proposition was received
by the Government; but it is stated by Sir Francis Ilincks, in a letter of which I append
a copy, that, being in Montreal in tlie month of July of the same year, he met Sir Hugh
Allan, and, giving him the names of some of the Americans who had made these
advances, expressed his regret that a work of such importance should fall into the hands
of foreigners. Acting upon this suggestion, Sir Hugh Allan turned his attention to the
matter, and eventually, in conjunction with these American gentlemen and some Quebec
friends of his own, formed a Company for the prosecution of the work. Rut as the
Session of 1872 apjiroached, it became evident that the admission of parties connected
with the American Pacific to a share in the contract for the Canada Pacific was become
unpopular, and, Parliament appearing to share this feeling, it was announced by the
Government to Sir Hugh Allan that no proposals emanating from an American Company
would be entertained.

On this intimation, Sir 11. Allan appears to have addressed himself to the organization
of a purely Canadian Company, and gave to the Government the most positive assuranres
that he had entirely dissociated himself from his American friends.

In the meantime another Company had been formed in Toronto, called the " Inter-
" oceanic Company," of which Mr. Alacpherson, a gentleman of very high standing and
character, and a Dominion Senator, was Chairman.

During the ensuing Session— that is, in the Spring of 1872 — both the Companies, the
" Interoceanic " and "Canada Pacific," as Sir Hugh's was now called, obtained Acts of
Incorporation, and, at the same time, an Act of Parliament was passed enabling the
Grvernment to enter into a contract with one or other of the above-mentioned Companies,

CORRESPONDENCE RELATIVE TO THE

Canada.

or with an amalgamation of the two, or, if they should see fit, to grant a royal charter to
anew and altogether distinct Company, in case an agreement should be found impossible
with those already in existence.

The terms which Government was authorized to grant to whatever Company undertook
the contract were settled in the last Parliament, and will already have been communi-
cated to your Lordship by my predecessor, Lord Lisgar, who, up to this time, was still in
office ; but it may be convenient to mention that the principal concessions consisted of a
grant, under certain conditions, of 50,000,000 acres of land, in alternate blocks along the
line, and of a subsidy of $30,000,000 (say 0,000,000?. sterling). Of this sum the interest
of 2,250,000?., which, by the transference of the fortification loan to the same account,
became eventually .3,800,000/., was guaranteed by the Imperial Government.

The Session closed on the 14th June. Parliament was dissolved on the 8th July. On
the 25th June I arrived in this country, and became personally cognizant of many of the
events I now jiroceed to record.

From the L5th of July to the 1 2th of October the elections were being held. As soon
as they were concluded, Sir John Macdonald returned to Ottawa, and the Canadian
Pacific Railway became a frequent tojjic of conversation between us. My Government
never seem to have favoured the idea of giving the contract to either of the rival Com-
panies, who wore then competing for the i)reference. In Senator Macplierson's Company
an Ontario interest was very strongly represented. In Sir Hugh Allan's a Quebec interest
predominated. The contemplated undertaking would evidently tax the resources of the
country to the utmost. It would be undesirable, therefore. Sir John argued, that any
Canadians desirous ol' putting their shoulders to the wheel should be excluded, and a
fusion of the two Companies — as provided lor in tbcir Incorporation Acts, and contem-
plated by the Act of Parliament — was the object to be attained. Into the intricate and
somewhat obscure negotiations which then ensued between Mr. Macpherson and Sir
Hugh Allan, at the instance of my Government, I need not enter. They are sufficiently
displayed in the Blue Book which I subjoin, and Avhich I have marked for reference. It
suffices to say tliat, notwitlistanding Sir John Macdonald's efforts to bring the parties to
an understanding, the negotiation altogether failed, principally, as it was alleged on the
one side, because Sir Ilugli Allan had not really broken off his connection with the
American interest ; and on tlie other, because Mr. Macpherson was not willing to
recognize the claims to the chairmansliip of iSir H. Allan, whose pretentions my Govern-
ment were disposed to i'avour, in consideration, as they stated, not only of his influential
position in tlie Province of Quebec, but as having been the first Canadian in the field to
associate himself with the onteriu'ise.

In reference to this i)oint, I may observe that, although I have no means of knowing
eitherwhen or to what extent my Ministers riiay have pledged themselves to favour Sir
Ilugli AUan's election to the chairmanship, the selection of sucii a jjereon, the originator
of the Oceanic line of communication iietween Great Britain and Canada, a gentleman
who might fairly Ijc regarded as the representative capitalist of the Dominion, and who
would be more likely tlian any other to make an impression ujjon the English money
market, was a choice which, at that time, few seemed disposed to question.

Baflled in their ellbrts to efiect the amalgamation tljy desired. Sir John Macdonald
and his colleagues announced their intention of promoting tiie formation of a new and
independent Company, out of wiiatcver elements of strength were to l)e found througliout
the Dominion, and shortly before the meeting of the new Parliament in March, a Board
of Directors was constituted, which included not only some of the leading promoters of
the two defunct Comjjanies, l)ut representative men from each of the Provinces of the
Dominion. Of tliis Board Sir Hugh Allan seems to have been elected chairman as a
matter of course, and to the Company it represented the Charter was eventually it-sued.

In previous Despatches I have already described to your Lordship the iirecautions
which were taken to jji'cvcnt any American interest or foreign capital ever obtaining
control over the concern. 1 am not sufficiently conversant with railway financing to assert,
on my own authority, that the restrictions introduced into the Charter with this view are
sufficient for tlieir purpose. Money, like water, has a very narrow shoulder, and will
find its way wherever it is likely to fructily,— but as far as I can judge, every reasonable
precaution seems to have been taken. All the Directors must be British subjects. The
I'resident and the majority of the Directors must reside in Canada, and though the
shares are transferable, no transfer can be made lor the first six years without the consent
of the Government, nor alter six years without the consent of the Directors — the
transfers in both cases being registered in the books of the Company.

Another subject which seemed constantly to i)re-occupy the mind of my Prime

I individual, or any one interest

sity ol preventing any (

I'i

CANADIAN PACIFIC RAILWAY.

il charter to
d impossible

ly undertook
11 communi-
, was still in
)nsisted of a
ks along the
. the interest
me account,

h July. On
many of the

d. As soon
lie Canadian
Government
; rival Com-
n's Company
ebcc interest
urces of the
ed, that any
iided, and a
and contem-
ntricate and
son and Sir
e sufficiently
elerence. It
le parties to
leged on the
on with the
t willing to

my Govern-
influential

the field to

of knowing
o favour Sir
e originator
gentleman
pu, and who
;Iish money

Macdonald
a new and
throughout
ch, a Board
romoters of
nces of the
lirman as a
Uy issued,
precautions
r obtaining
ng to assert,
lis view are
r, and will
reasonable
jects. The
hough tlie
the consent
xtors — the

my Prime
one interest

or com1)iiiation of interests, wliether represented by Sir lliigli Allan or anotlior, from
acquiring a predominant influence on the Directory. Here again 1 am not sufficiently
familiar with the arcana of Board-rooms to know wlietlier the adjustments on whicli
Sir John relied were as effectual for the ])urpose as tliey appeared to me to be, but I may
observe, that although the scrutiny of Parliament was directed under the light of
subsequent events to tliese especial points, neither House has expressed dissatisfaction
Avitli the provisions of the liailway Charter, or the personnel of tlie governing body. On
the contrary, up to the last moment of the Session, on repeated occasions Parliament
continucu to manifest its confidence in those wlio framed the one and constituted the
otlicr. If therefore, as is alleged, a corrupt modification of the Pacific Railway
Charter to the advantage of Sir Hugh Allan and his American friends was the con-
sideration for whidi these personages squandered the enormous sums asserted to have
been spent, it would seem tliat they have scarcely obtained their money's worth, a result,
I should imagine, foreign to tiie experience of such shrewd men of business.

But though the Parliament of Canada thus unmistakably ratified the railway policy
of my Ministers, its verdict on the subject was not destined to pass unchallenged. On the
2nd of April, Mr. Lucius Seth Huntington, a distinguished member of the House of
Commons, startled his immediate auditory, as well as the whole political world of Canada,
by the unexpected introduction of the following motion : —

"Hon. Mr. Huntington, moved, that Mr. Huntington a member of tlie House, having
stated in his place that he is credibly informed and believes that he can establish by
satisfactory evidence, —

" That in anticipation of the legislation of last Session as to the Pacific Jiailway, an
agreement was made between Sir Hugh Allan, acting for himself and certain other
Canadian promoters, and G. W. McMullen, acting for certain United States capitalists,
whereby the latter agreed to furnish all the funds necessary for the construction of the
contemplated railway, and to give the former a certain percenta<Te of interest, in con-
sideration of tlicir interest and position, the scheme agreed on being ostensibly that of
a Canadian Company wiih Sir Hugh Allan at its head, —

"That the Government were aware that negotiations were pending between these
parties, —

" That subsequently an understanding was come to betw(;en the Government and Sir
Hugh Allan and Mr. Abbott, M.P., that Sir Hugh Allan and his friends should advance
a large sum of money for the purpose of aiding the elections of Ministers and their
supporters at the ensuing general election — and that he and his friends should receive
the contract for the construction of the railway, —

"That accordingly Sir Hugh Allan did advance a large sum of money for the purjiose
mentioned, and at the solicitation and under the pressing instances of Ministers, —

"That ])art of the moneys, expended by Sir Hugh Allan in connection with the
obtaining of the Act of Incorporatian and Charter were paid to him by the said United
States capitalists under the agreements with him, — it is

"Ordered that a Committee of seven members be appointed to inquire into all the
circumstances connected with the negotiations for the construction of the Pacific Railway
— with the legislation of last Session on the subject, and with the granting of the Charter
to Sir Hugh Allan and others ; with power to send for persons, pa])ers and records ; and
with instructions to report in full the evidence taken before, and all proceedings of, said
Committee" — which was negatived.

As I have already remarked in a previous Despatch, May .'Ird, the charge thus
brought against my Government was very grave, viz. — that they had trafficked with
foreigners in Canada's most precious interests in order to debauch the constituencies of
the Dominion with the gold obtained as the price of their treachery. In making these
allegations, however, Mr. Huntington did not enforce them by any confirmatory statement
or by the production of any prima facie proofs of their validity. He merely read his
motion and sat down. Neither Sir John Macdonald nor any of his colleagues having
risen to address the House, a division was taken without debate, which resulted in a
majority of 31 for Government in a House of 1S8.

Notwithstanding this display of their Parliamentary strength, which I imagine was
put forward by way of protest against Mr. Huntington's appeal to his own mere ij)se
dixit my 'viO.ernment felt that the matter could not thus be disposed of, and accordingly
the next day Sir John Macdonald gave notice of the following motion, which was carried
on the ensuing Tuesday, Ai)ril 8th : —

"On motion of the Right Hon. Sir John A. Macdonald, that a'select Committee of
five members (of which Committee the mover shall not be one) be appointed by this
House to inquire into and report uixin the several matters contained and stated

Canada.

CORRESPONDENCE RELATIVE TO THE

K Canada. [^ a Resolution moved on Wednesday, the 2nd of April instant, by the Hon. Mr.
Huntington, member I'or the County ol'Shcflbrd, relating to the Canadian Pacific Railway,
with power to send lor persons, pai)ers, and records : to re})ort from time to time, and
to report the evidence from time to time, and if need be to sit after the prorogation of
Parliament.

" The members 'to compose the Committee were then named by the House as follows :
Hon. Mr. Blanchct, Mr. Blake, and Hon. Messi-s. Doriou (Napierville) Macdonald
(Pictou), and Cameron (Cardwell)."

Of the five above-mentioned gentlemen three — viz. Mr. Cameron, Iklr. JSIacdonald,
and Mr. Blanchet — may be regarded as regular supporters of the Administration, and two,
Mr. Blake and Mr. Dorion — as leading members of the Opposition.

On the debate which took jilace on this motion, I am informed by my Prime Minister,
and here I must remind your Lordship that I have no other means of acquainting myself
with what takes place in the House, as I am precluded from being present at its pro-
ceedings, and the newspaper reports are quite untrustworthy — that INIr. Mackenzie the
leader of the Opposition, as well as Mr. Blake, Mr. Dorion, and Mr. Joly, eminent
members of the same party, expressed tliemselves of opinion that the evidence tendered
should be on oath, and tlic former gentleman further suggested, it being douljtful whether
the Committee could sit after the House was once prorogued, that a Bill should be
introduced expressly enabling it to do so. I shall have occasion subsequently to refer to
this latter circumstance. As the necessity for sworn testimony in resjjcct of such grave
charges was generally obvious, an Oaths Bill was introduced into the House of Commons
on the 18tii of April, was passed through the Senate on the 2nth, and received the Royal
assent on the 3rd May. The time occupied in getting this measure through Parliament
was pronounced unnecessarily long by many members of the Opposition.

Into the motives whicli induced me to sanction the Oaths Bill, and into its subsequent
history, I need not enter, as the former are stated in my Despatch of the 3rd
of May and the latter is recorded in your Lordship's communication of June 30th
— but I may observe in passing, that amonst other resjiects in which my conduct
has been criticised, the fact of my having communicated to you by the first oppor-
tunity a certified co])y of the Oaths Bill has been a very general point of attack.
I apprehend it will not be necessary to justify myself to your Lordship in this particular.
My law-adviser had called my attention to the possiljility of the Bill being illegal. Had
perjured testimony been tendered under it, no ])roccedings could liiive bi'cn taken against
the deliiiqi.v nt, and if, mider these circumstances, I had wilfully withheld from the Home
Govcinment all cognizance of the Act, it would have been a gross dereliction of duty.
To those in this country who have questioned my procedure it Mould be sufficient to
reply, that t recognize no authority on this side of the Atlantic compet .t to instruct the
Governor-General as to the nature of his correspondence with He- lajesty's Secretary
of State.

In the meantime the Committee had met, and on the 5th of lay had resolved,
amongst other things, " That in view of the absence of Sir George Carticr and the Hon.
" J. J. C. Abbot, and the impossibility of the investigation with which the Committee is
" charged being carried on in a proper manner without an opportunity being afforded
" these gentlemen of being present and hearing the testimony adduced, it was advisable
" the Committee should adjourn until Wednesday, the 2nd day of July, if Parliament
" should be then in Session," — a conclusion which ap])ears to have been arrived at in the
Committee by a majority of three to two. On the following day these recommendations
were ado])ted by the House of Commons, on a vote of 107 to 7G.

The ordinary business of the Session being now nearly concluded, and it i.v. ,ing been
admitted, I understand, by all parties, that the Committee could not sit after prorogation,
it was arranged that the House should adjourn to such a day beyond the 2nd July as
would enable the Committee to complete the investigation and to frame their Report.
The date eventually determined on was the 13th of August, which was also settled as
the day on which Parliament was to be prorogued.

As the nature of the understanding at the time in respect of this latter event has been
warmly controverted, it is necessary that I should here acquaint your Lordship with the
facts of the case so iar as I am cognizant of them. Early in May — I Ibrget the exact
date — Sir John Macdonald waited upon me in my office, and having communicated to
me the arrangements contemplated for the convenience of the Committee, informed mo
that he wished to take my pleasure as to the date of prorogation, mentioning the 13th of
August as the one i.c: ''esired to suggest. Having received my assent to this proposal, he
repaired to the House of Commons, and announced from liis place as leader of the
House and the ^)ersou res^wnsible for the conduct of public business, that Parliament

CANADIAN PACIFIC RAILWAY.

he Hon. Mr.
cific Railway,
,» to time, and
prorogation oi"

ise as follows :
s) Macdonald

r. Macdonald,
tion, and two,

rime^Iinister,
ainting myseli'
nt at its i)ro-
ilackenzic tlic
Joly, eminent
lencc tendered
il)tful whether
Jill should be
itly to refer to
of such grave
;e of Commons
ived the Royal
gh Parliament

its subsequent

li of tlie 3rd

of June 30th

1 my conduct

lie first oppor-

nnt of attack.

|;his particular.

illegal. Had

taken against

cm the Home

iction of duty.

sufiicient to

instruct the

ty's Secretary

lad resolved,
and the Hon.
Committee is
jcing afforded
was advisable
Parliament
ived at in the
jmmendations

i.>. , ing been

r prorogation,

e 2nd July as

their Report.

ilso settled as

vent has been
ship with the
get the exact
miunicated to
informed me
ig the 13th of
s proposal, he
eader of the
t Parliament

Avould be prorogued on the 13th August, stating, as he affirms, in the most distinct
terms, tliut tlie " re-assembly of Parliament on that day would be pro forma, that no
" business would lie done beyond the reception of the Report of tlie Committee, which
" could then be printed with the evidence, and go l)eforc the country ; that the members
" would not be required to return, and that only the Speakers of the two Houses need
" be in their places." The only observation elicited by this announcement proceeded
from Mr. Ilolton, an Opposition member, who remarked " that to do any business there
" must be a quorum, and that he and a quorum would be there;" to which Sir John
informs me he replied, that " if a quorum was necessary, a sufficient number of members
" would be found in the neighbourhood of Ottawa," — a quorum consisting of the Speaker
and nineteen others. It was upon this understanding. Sir John assures me, tliat the
House consented to adjourn, and in confirmation of his assertion he has communicated
to me the subjoined letter from Mr. Palmer, the member for St. John : —

" Sir, " St. John, August 1 1, 1873.

" In consequence of statements that I understand have com i from some niembers
of the Commons to the effect that there miglit be an actual Sessioi. of Parliament at the
adjouT-nment on the 1.1th, to ycu, as tlie leader of the Government, I beg to make the
following statement by way of protest,

" I have to remind you tliat the House of Commons only consented to adjourn to that
time on your pledge openly given in the House that no business should be transacted,
nor would the attendance of members be required, as there would be enough around
Ottawa to make a_quorum ; that Mr. Speaker would receive the Report of the Committee
on the Huntington charges, so that it might be published, and that then Parliament
would be at once prorogued. >•' ' ^

" If this promise had not been made, I do not believe the House would have consented
to any such adjournment. I certainly would not have given my consent to any adjourn-
ment that would have put the country to an expense of a quarter of a million dollai-s by-
bringing the Legislature together again.

" At all events, be that as it may, I feel that it would be dishonourable for rtystUf ^6
attempt to do business at an adjournment of the House, at which my colleagues had been
told that no business would be done, and that they need not attend, and therefore I itiujit
decline to do so ; and I protest at any attempt to do business, and I require the Oov(?l'n-
ment to fulfil the pledge made to me and to every member of the House, th.it ParliaiA^nt;
would be at once prorogued. '■'"■

" While I do this, I do not wish to interfere in any way with the right of the Govern-
ment to call Parliament together whenever they think the exigencies of the tximntry
require it; they must be the judges of that, and be responsil^le for it; but let that be
done in the usual way, that all may understand that it is their duty' to ?ittend ; ttlid
when I, together with all my colleagues, am so called upon, I trust thoit I shall be fdund'
in my place, and I shall then feel that whether or not all my collea^iiftS attend, they will
not have been kept away by a ])ledge that they Mould not be required, and I could there-
fore honourably join in doing anything that the House might ■Consider iot the inttirests
of the country. * v v iww -ii . ■■-,,,'

" I have the honour to be,'&c., I'-iri^oH hnrw x-'t 'U,

" Sir John Macdonald, "A. L. PAf.MiJR, ' ' '<<

" Minister of Justice, Ottawa." " Member for the City and tJoUlitT of St. Johii?' J'

As far as my opinion is concerned, I am quite clear thVit it IvftS' the af^feire'arid'exjiec^ta-'
tion of Parliament that prorogation should take place ftt the timte' tn«1ti<M<^-. Every
member must have known that Sir John's announcemeTit on the !!iffl)jectti^aa'toi intimation
of the pleasure of the Crown through its official org-tirt in' the Houy*', and that the Prime'
Minister could only have made it after receiving my'hrtthority to do- sol 'Fbittierly, the
intentions of the Sovereign on this subject were convey<^ to eithei- Chamber by a written
message, but though a verbal comnuinication thtoilgh the I'Mrst Minister has been now
substituted, it does not render this latter mode of communication less foimal or official.
Had therefore tbe House of Commons desired to pVo)oiigthe SessiOrvbeyoiid the 13th df
August, its proper course would have been tbhate'tommunicntod its wishes tome by dn
Address. Though the Itict that no motion tolhis eflfefct Was cvM suggested is SUfficitfiitiy
conclusive, there are other circumstances WhK'Qi^Kjdiitrate rtlOre or less'distini'tiy the feeling
of the House. The motion originally ai^itttittlng tlw GbiWrnittee, ftfnd eatried On the '8th
of April, ordered it to sit, "if need werlV^^f^t' ^Vroij-f^tldn,'' ami m<M'ft' than orie membrii'
of the Opposition urged the propriety of ft Bill behig introduced to eriabld it to dO'flOi
Clearly therefore, when this motion wa^ catTitid And these suggestions made, the tnajbrity

B 2

Canada.

CORRESPONDENCE RELATIVE TO THE

Oamada. who passed the one and the individuals who pvojOTsed the other must have contemjilated
the probability of tlie Rcjiort of the Committee l)eing considered, not i\\ the present but
in a subsequent Session of Parliament. Indeed, the mere fact of prorofjation belnp; Hxcd
for the J.'lth of August implies this much, for it is not to be ])resume(l that the House
would have proceeded to consider the Report, until botli it and the evidence upon wliicli
it was founded liad been ])rinted and distributed to members ; but to enable this to be
done an interval of a few days, after Parliament had reassembled and had received the
Report, would manifestly have been required before action could have been taken upon it.
If, therefore, Parliament had contemplated considering the Report during tbc current
Session, it would have desired a Later day to be fixed for prorogation than that on which
the mere manuscript copy of the Report was to be laid on its table.

Again, when Mr. Dorion moved in amendment of the motion for the Committee's
adjournment to the 2nd July, that " inasmuch as the Committee will have no power
" either to enforce the attendance of witnesses or to compel them to give testimony with-
" out the action of this 1 louse, it is essential to the proper conduct of the investigation
" that it should be prosecuted under circumstances that will admit of the prompt
" exercise of the authority of the House, it is therefore necessary that the Hou? ' should
" sit on the day to which the Committee has leave to adjourn," the House decided against
him by a majority of 101 to GG, — one of the Representatives from British Columbia, as I
am informed, protesting against members from the more distant Provinces in the Dominion
being required to return to Ottawa so late in the summer as the 2nd of July.

But the intention of the House is still further exhibited by the following circumstance.
During the Session a Bill was passed increasing the indemnity paid in this country to
Members of Parliament for their attendance. Into that Bill a clause was introduced to
the following effect: "The said amendments shall apply to the present Session of Parlia-
" ment, and if either House shall adjourn for more than thirty days such adjournment
" shall, for the purposes of such Act, be equivalent to a prorogation." This provision
was intended by its authors to enable members to receive their salaries and travelling
expenses on the 23rd May, the day on which P.arliament adjourned, without having to
wait for the 13th August, the day named for prorogation. 1 may also mention that the
same day, i. e. on the 2.'ird of May, I came in state to the Senate Chamber to give
mj' assent to the Bills of the Session ; and in view of a progress I intended to make
through the maritime Provinces during the summer, I provided, before leaving Ottawa,
for the prorogation of Parliament by commission, in order to spare myself the labour
and fatigue of a journey of 2,400 miles for what I understood would be a mere
formality.

From the foregoing narriitive your Lordship will probably agree with me in the con-
clusion that up to the time when the Houses adjourned, it was clearly the wish and the
expectation of Parliament that i)rorogation should take place on the 13th August. And
it is most natural that this should have been the case. The commercial business and thr
agricultural operations of the year have to be crowded into the five short months of
summer. Almost every member of both Houses in this country is actively engaged in
business pursuits requiring his personal attendance. To be detained from home at this
season implies not only extreme inconvenience but pecuniary loss. Already the lateness
of the current Session had bred considerable discontent, and it had been expressly
determined by the House that in future the Session should never begin later than the
first week of February. The distance from Halifax to Ottawa is something like 1,200
miles, from Victoria in British Columbia it is 4,000 miles. The reassembly of Parlia-
ment in August, for the transaction of business, would have cut up the entire summer, as far
as many members were concerned, and would have hren more or less inconvenient to all
but those who reside within a day or two's journey of Ottawa. The majority in the
House of Commons appear to have attached but little significance to Mr. Huntington's
accusations, for they negatived his motion without even requiring my Ministers to reply
to it, and I do not imagine that any one of them contemplated a renewal of the Session
on the 1 3th of August. But though the conduct of the majority who confided in the
Government is easily understood, the procedure of the members of the Opposition is
more difficult to explain. They had inl their possession, it is to be presumed, what they
considered convincing proof's of the corruption of Ministers. The matter had been
referred to the adjudication of a Committee, and according to the theory of the prosecu-
tion, could have but one result. Strong in these convictions, they should never have
allowed the announcement of prorogation to have passed unchallenged, but should have
resorted to every means known to the Constitution by which such a consummation could
have been jjrecluded. Indeed, so obvious was their duty in this respect, that their
opponents have attributed to them a deliberate intention of allowing the dispersion of

CANADIAN PACIFIC RAILWAY

contemplated
le present hut
)n being fixed
lat the House
^c upon wliidi
ihle tliis to he
I received the
talven upon it.
; the current
that on wliich

i Committee's
ave no jjower
stimony with-
investigation
i" the prompt
Hour^ should
ucided against
Columbia, as I
the Dominion

circumstance,
lis country to
introduced to
lion ol' Parlia-
I adjournment
'his provision
ind travelling
)ut having to
ition that the
mber to give
ded to make
wing Ottawa,
If the labour
d be a mere

le in the con-
wish and the
ust. And
iiness and thr
irt months of
y engaged in
lome at this
the lateness
en expressly
liter than the
like 1,200
ly of Parlia-
immer, as far
'enient to all
jority in the
Huntington's
ters to rci)ly
the Session
fided in the
Opposition is
i, what they
er had been
the prosecu-
never have
should have
nation could
;, that their
lispersion of

the majority to take place sub silentio, with a view to the jmcking of a House with their
own adherents on the day to which it had adjourned, an operation to them exceptionally
easy, as the Parliamentary strength of the Ministers lies i)rincipally in the maritime and
out-lying Provinces, while their own is close at home in the central region of Ontario and
Quebec. The subsequent publication in the newspapers of tlie documents now known as
the Allan and McMuUen correspondence is ])ointed to as having been a move in aid of
the same unworthy policy, by supjdying a sudden and unexpected pretext fen- insisting on
the immediate intervention of Parliament at a time when the Ministerial supporters were

dispersed.

I do not, however, myself attach the slightest credit to this injurious insinuation.
Although, undoubtedly, party strii'e is conducted in this country with less reticence and
generosity than at home, and although the combatants "strike below the waistcoat" more
frequently than could be wished, my personal knowledge of the leaders of the Opposition
convinces me that such a design would be quite foreign to their natures. My own opinion is,
that, from first to last, they found themselves impeded by the initial mistake in tactics —
as I ventured at the time to consider it — committed by Mr. Huntington in not re-enforc-
ing his motion by the jiroduction of some of the documents on which it was founded.
Had he done so, Parliament would undoubtedly have listened to him with greater
respect, and Mr. Dorion's motion might perhaps have been carried : for though Mr.
Huntington's case is far from being proved, no one can now deny that if he was in
possession of the Allan correspondence at the time he demanded his Committee, he had
a right to require an investigation of the suspicious circumstances thus brought to his
knowledge. The premature disclosure of his hand could not have been the objection, for
a sufficiency of ." pieces justificatives " for his puqjose have] since been produced. As it
was, he could not convince the House of the urgency of tlie affair, and discouraged by
their repeated defeats, the Opposition, I imagine, gave up all hopes of being a])le to per-
suade Parliament to dispute the arrangements of the triumphant Minister. Be that as
it may, it is certain iiiUt the day after the adjournment, most of the members of both
Houses dispersed themselves in different directions, some to their homes, some to the
States, and some t'^ Europe, without any more intention of returning to Ottawa, on tlie
13th of August, than myself.

On the 2nd July, Mr. Cameron's Committee met in Montreal, but in the meantime
I had received an intimation from your Lordship that the Oaths Bill had been dis-
allowed by the Queen in Council, and I had made the fact public by Proclamation.

Immediately on receipt of this intelligence, communications had passed between Sir
John Macdonald and myself as to the course to be pursued. Sir John was inclined to
issue a Commission to the m.embers of tlie Committee, but as he hesitated to do so from
an unwillingness to expose the Crown to the rejection of its mandate, I addressed him in
the following terms : —

" The Citadel, Quebec, June 28, 1873.

" I ber to acknowledge the receipt of yon , letter of the 19th. I am sure you are
quite right not to allow the Committee to be postponed beyond the time originally fixed
for the opening of its proceedings.

" On the i^art of the Crown, I should have no objection to the offer of the Commission
as you propose, and I think you may with perfect propriety act upon the presumption that
the members of the Committee will accept the charge confided to them.

" The Government has stretched its legal conscience and encouraged Parliament, though
not without warning, to (exceed its legitimate powers in order to facilitate this inquiry.
The obstacle now interposed is one with whic'. you have no concern, and beyond your
control. You propose to obviate tlio difficulty by the only means in your power — but a
means both 'legitimate and effectual. No one can doubt that for the purpose for whi ^^
the Committee was originally constituted, its conversion into a Commission can make no
practical difference. As a Commission it will take evidence, and as a Committee it will
report upon that evidence to the House. It would be unreasonable to allege that in
discharging this double funccion, and in acquiring in addition to the powers delegated to
it by Parliament, a technical authority at the hands of the Crown to take evidence en
oath, it abates one tittle of its constitutional independence."

Thus authorized, Sir John communicated with Mr. Cameron in the following letter : —

" Sir, " Montreal, July 2, 1873,

" As the Act which would have enabled the Committee now sitting in Montreal,
of which you are Chairman, to examine witnesses on oath has been disallowed, as being
beyond the competence of the Canadian Parliament, I desire to renew to you, as Chair-

Oanada.

CORRESPONDENCE RELATIVE TO THE

Canada.

mail of tlic Committee, the offer made by mo on tlie i)art of the Government on the floor
of the House of Commons, to issue a Royal Commission addressed to the gentlemen
forming the Committee, which would confer upon tliem all the powem given to the
Committee by the House of Commons, including the examination of witnesses imdcr
oath, and the ])()\ver to send lor jjcrsons, papers, and records, and containing the same
jnovisions as to the votes of the members of the Committee and yourself os Chairman, as
was ordered by the House. The accejjtance of this Commission will enabhs this Committee
to proceed with the inquiry, and the examination of witn(;sses on oath without any
important delay. I shall cause a copy of this letter to i)e sent to each member of your
Committee.

" I have the honour to be, your obedient servant,

" J. A. MACDONALD.
" To Hon. J. H. Cameron, &c., &c.

" P.S.— Tlie Commission will contain a clause-enjoining the Commissioners to report
to the Speaker of the House of Commons,

(Signed) "J. A. MACDONALD."

The majority of the Committee are imdcrstood to have been willing to return a
favourable reply to this ])roposal had their colleagues assented ; but neither Mr. Dorion
nor Mr. Hlake considered themselves at liberty to accept the arrangement, and stated
their reasons in the l\)llowing terms : —

"Siu,

" I have the honour to acknowledge the receipt of your letter of the 2nd inst.,
received this morning, enclosing a copy of a letter addressed by you to the Hon. J. H.
Cameron, Chairman of the Special Committee ol" the House; of Commons, now sitting in
Montreal, in which you state that, as the Act which would have enabled the Committee
to examine witnesses under oath had been disallowed, as being beyond the competence
of the Canailian Parliament, you desire to renew to him, as Chairman of the Committee,
the offer made by you on the part of the (rovernment to issue a lioyal Commission,
addressed to the gentlemen Ibrniing the Committee, which would confer upon them all
the power given to the Committee by the House of Commons, including the examination
of the witnesses by the Committee ; but, as I understand your i)roposal, it is that the
Government should give to the several members of the (Committee named by the House
of Commons to inquire into the charge made against it, a Commisi^ion to inquire into the
same charges, Avith jiowcr to examine witnesses under oath, and this with a view to carry
out the intention of the House, to have this inquiry made under oath. Now, I would
beg to call to your attention that the Committee was originally named on your own
motion, as an ordinary Parliamentary Committee, without reference to any authority to
examine witnesses under oath, and that it was only on the suggestion of the Committee,
subsequently made, that the House and Senate unanimously passed the Oatlis Bill,
although on more than one occasion you yourself made the suggestion, unheeded by the
House, that a Commission might be issued instead of passing an Act to authorize tiie
administering of oaths to the witnesses. This alone seems to me to be conclusive that
the House of Commons, whose nominee I am on the Committee, did not intend that the
inquiry should be carried on by a Commission ajjpointed l^y the Executive, and responsible
as such only to that Executive. It seems to me, moreover, that the authority Avhich is
sought to l)e conferred on the Committee to examine witnesses under oath cannot be
attained by the issue of a Royal Commission, for, although the Commissioners appointed
might examine witnesses under oath, it would not be as members of the Committee
appointed l)y the House that they Avould do so, but as Commissioners, whose decisions
and proceedings would be subject to the supervision and control of the Executive, under
whom they hold their appointment, and not of the House. I have always been willing,
as a Member of the House of Commons, to obey its commands in reference to any Parlia-
mentary duties it might impose upon me. In that view I did not shirk the arduous
and unenviable position of a member of this Committee of Inquiry, as being part of the
labour and duty to which a ^Ieml)er of Parliament is bound to submit ; but if, instead of
moving for tlie appointnent of a Committee by the House, the Ciovernment had proposed
to name me on a Commission for the purpose of this iiKjuiry, I would then certainly have
declined the proposed Commission. I cannot see why I should now accept it, when it
seems to me that the effect of issuing such a Commission would be to supersede the Com-
mittee, and more especially in view of the declaration you made immediately before the
adjournment of the Session in reference to Mr. Blake and myself, that wo should not have
consented to serve on the Committee, that men in our positions in England would not

sh(

dc(

ace

UIK

.iji

r a q. 7g gM ■jf-i'i^.-u

CANADIAN PACIFIC RAILWAY.

lent on the floor
' the gentlemen
i-s given to the
witnesses under
lining the same
as chairman, as
' this Committee
th without any
member of your

MCDONALD.

oners to report

3D0NALD."

ng to return a
her Mr. Dorion
cnt, and stated

f the 2nd inst.,

the Hon. J. H.

I, now sitting in

the Committee

ihe competence

the Committee,

al Commission,

upon them all

lie examination

1, it is that the

1 by the House

nquire into the

a view to carry

Now, I would

I on your own

ny authority to

hu Committee,

lie Oatlis Bill,

heeded by the

) authorize tlie

conclusive that

ntend that the

md responsible

ority which is

ath cannot be

ners appointed

le Committee

hose decisions

ecutive, under

been willing,

to any Parlia-

i the arduous

g part of the

t if, instead of

had proposed

certainly have

pt it, when it

>ede the Com-

ly before the

ould not have

nd would not

have done so, and that you could not ex]H;ct any fair play at our hands. This alone
should be a sufQcient reason why I hunil)ly believe I sliould not be called upon to accept
a Commission from the (iovernnicnt of which you are the head, alter your public
declaration, made in my aijsence, of my unlltness to perform what the Connnission would
impose on me.

" I have the honour, &.C.,
(Signed) "A. A. DORION.
"To the Right Honourable Sir J. A. Macdonald."

Canada.

" Sir, " ^lontrcal, July ."}.

" I have the honour to acknowledge the receii)t of your letter of the 2nd inst.,
enclosing a cojjy of a letter addressed by you to the Hon. Mr. Cameron, as Chairman of
the Pacific Railway Inquiry Committee. I cannot agree in your statement that the
acceptance of a Royal Commission would enable the Committee to proceed with the
inquiry and the examination of witnesses on oath. The Committee is, I believe,
unanimously of opinion that the acceptance of the Commission would not enable the
committee to make ])rogress, and that the action of the Commissioners (whether or not
they be the same jicrsoiis as those who constitute the Committee) would lie entirely
disconnected from tlie action of the Committee. Sharing tlieir opinion, I am called on
to consider whether I should accejit the offer made by the Government, of a Royal
Commission addressed to the gentlemen who happen to be members of the Committee,
calling on them to inquire into the matters of charge preferred in the statement of Mr.
Huntington. I believe that it would 1)e of evil consequence to create the jirecedent of a
Government issuing a Commi-ssion of Inquiiy into matters of a charg against itself, the
Commissioners being, as they are, suliject to the direction and control of the accused. I
believe that the acceptance of such a Commission would b(! ojiposed to the sense of tlv!
House of Commons, as manii'ested by its action last Session, and ^vould, under present
circumstances, be calculated to jirejudice the incpiiry ordered by the House, and to
impair the full and eflicient exercibc of its most ancient antl important powers. The
House of Comrnons does not, I think, expect tliat the Crown or anyone else, least of all
the members of its own Conniiittee, will interpose between itself and the great inquiry
which it has undertaken. Apart from these and other difliculties, you have yourself
interposed a barrier to my acceptance of your offer. During my absence from the House
of Commons last Session, you stated in your i)lace that I had done wrong in not declining
to fulfil the duty of Committeeman, which bad been imposed on me by the House; that
English statesmen in my jiositioii — which, however, you misstated — would have scorned
to do as I had done, and that my speeches during the Session showed that your Govern-
ment could not expect fair i)lay from me on the inquiry. I shall not condescend to reply
to these statements, but I have to say that, although I reluctantly came to the conclusion
that I was not free to decline to serve the House of mIhcIi I am a member, I do iiot
think it consistent with my self-respect to accept the Commission here offered oy a
Minister who has chosen to so characterize my conduct. I have sent a copy of this letter
to Mr. Cameron, for his information as Chairman of the Committee.

^' 1 lltlVC iSuC

(Signed) " EDWARD BLAKE.
"The Right Hon. Sir Jno. A. Macdonald."

I do not presume to question for a moment the propriety of the course adojited

•by these gentlemen. As Members of the House of Commons, they may have had a more

acute appreciation of their Parliamentary obligations than had occurred to my ai)pre-

hension,— but I trust that your Lordship will not consider that I acted wrongly in thus

endeavouring to forward the inquiry by what I considered an opportune expedient.

1 he Committee being thus precluded from swearing in their witnesses, a motion was
made by Mr. Dorion, supported by Mr. Blake, that they shou' 1 content themselves with
unsworn testimony, but the majority considering themselves debarred from this course by
the express mstructions of the House upon the point, they determined to adjourn until
the 13th of August. i i ^ j j

< ivJ^"^ resolution was taken on the 3rd of July. The day after there appeared in the
At M Hr ^^*''^^^'^'' ^ series of letters and telegrams written by Sir Hugh Allan to a Mr.
McMullen, and to a Mr. Smith of Chicago, and to some unknown person in the United
States m reference to the Canadian Pacific Railway. The day following a long statement

CORRESPONDENCE RELATIVE TO THE

C.vNADA. on tho same Hulyi'ct in the form ol" an ullidiivit was issueil by Sir IIuf;h Alliin in another
newspaper. 1 liave already had the Iionoiir ol' I'orwardinji; to your Lordsliip hoth these
H0.3&N0.4. doeunients, hut I tliinii it well to append tliem to tliis Despatch for convenience of refer-
ence. It is not necessary for my i)resent pur[iose that I should either analyze or contrast
the conllicting assertions ohserval)lc in tiiese iiroductions. It will he suHicient to note that
not only does Sir llu{j;li Allan admit upon oath that tiie language of his letters is "inae-
" curate" hut he also denies in the most jiositive maimer tlie correctness of the inferences
sought to be deduced from them. On the whole, as far as I could gather from the tone
of the press, and from conversation, these revelations rather improved than otherwise the
position of the Ministry. On tlie one hand, Sir Ilugli Allan's letters accounted for and
justified Mr. Huntington's pertinacity; on the other, his allidavit — or rather, Sir .lohn
Macdonald's telegram quoted in tlie allidavit — satisJ'actorily proved that so far from
yielding himself or allowing his colleague. Sir George Cartier, to yield to the pressure
put upon him l)y Sir Hugh Allan in the height of the election contest, my Prime
Minister had required the immediate and comi)lete cancelling of an arrangement favour-
able to Sir Hugh to which Sir (ieorge had evinced a willingness to subscribe. In illus-
tration of this point, I subjoin Sir George Cartier's letter as well as Sir Hugh Allan's
reference to Sir John Macdonald's telegram concerning it.

" Dear Sir Hugh, "Montreal, July 30, 1872.

" I enclose you copies of telegrams received from Sir John A. Macdonald ; and
with reference to their contents I would say that in my opinion the Governor in Council
will approve of the amalgamation of your Company with the Interoceanic Company, under
the name of the Canadian Pacific Railway Company, the Provincial Board of the amal-
gaihated Company to be composed of seventeen members, of whom four shall be named
from the Province of Quebec by the Canada Pacific Railway Company, four from the
Province of Ontario by the Interoceanic Railway Company, and the remainder by the
Government ; tlie amalgamated Company to have the powers specified in the tenth sec-
tion of he Act, incorporating the Canada Pacific Railway Company, &c., the agreement
of amalniagation to be executed between tlie companies within two months from this
date.

" The Canada Pacific Company might take the initiative in procuring the amalgamation ;
and if the Interoceanic Company should not execute an agreement of amalgamation
upon such terms and within such limited time, I think the contemplated arrangements
should be made with the Canada Pacific Company under its Charter.

"Upon tlie subscription and payment on account of stock being made, as required by
the Act of last Session, respecting the Canadian Pacific Railway Company, I have no
doubt but that the Governor in Council will agree with the Company for the construction
and working of the Canadian Pacific Railway with such branches as shall be agreed upon,
and will grant to tlie Company all such subsidies and assistance as they are empowered
to do by the Government Act. I believe all the advantages which the Government Act
empowers the Government to confer upon any Company will be required to enable the
Avorks contemplated to be successfully carried through, and I am convinced that they will
be accorded to tlie Company to be formed by amalgamation, or to the Canada Pacific
Company, as the case may be.

" 1 would add, that as I api)rove of the measures to which I have referred in this letter,
I shall use my best endeavours to have them carried into effect.

" Very truly yours,
(Signed) " GEO. E. CARTIER."

Extract from Sir H. Allan's Affidavit of July 5th.

" On the same day that I received the above letter from Sir George Cartier, I informed
Sir John A. Macdonald of the contents of it, and asked for his sanction of the views
Avhich it contained. But he declined to concur in the terms of Sir George's letter,
telegraphing to him that he would not agree to them, and that he would come down to
Montreal and confer with him respecting them. Thereupon, I immediately informed Sir
George Cartier that I should consider the letter addressed to me as being withdrawn ;
and to my knowledge Sir George telegraphed Sir John that he had seen me, and that as
he (Sir John) objected to Sir George's letter it had been withdrawn. I also telegraphed
to Sir John on the same day (July ;!lst) to the effect that I had seen Sir George Cartier,

CANADIAN PACIFIC RAILWAY

Ian in another
liip both those
lionce of relor-
y/.i' or contrast
LMit to noto tluit
utters is " inac-
r the inferences
• from the tone
u otherwise the
ounted for and
ither, Sir .lohn
it so far from
to tlie pressnrc
test, my Prime
igement favour-
cribe. In illus-
[• Hugh Allan's

uly 30, 1872.
lacdonald ; and
.•rnor in Coinicil
Company, under
u-d of the amal-
shall be named
y, four Irom the
[•mainder by the
in the tenth sec-
•., the agreement
lonths from this

amalgamation ;
f amalgamation
d arrangements

', as required by
pany, I have no
the construction
be agreed upon,
are emi)owered
Government Act
jd to enable the
id that they will
Canada Pacific

red in this letter.

CAETIER.

irtier, I informed
ion of the views
George's letter,
d come down to
tely informed Sir
leing Avithdrawn ;
I me, and that as
also telegraphed
r George Cartier,

and that lie (Sir John) niijiht return my letter or regard it as waste paper, and that I Canada.
was satisfied witli the telegram of the 2Gth as expressive of the views of the
Government,"

Ihit any reaction in favour of the Government which might have thus set in was more
than counterbalanced l)y the ni)i)earance of another scries of Iett(TS, which 1 also re-n])pend,
and which are now generally known as tlie RIcMullen correspondence. Amid these
productions tiiere have been introduced documents of a very compromising character, the
one a letter from Sir (icorge Cartier asking for twenty thousand more dollars (!?'J0,0{)(» =
4,()(H»/. sterling), and the other a telegram ihmi Sir John Macdonald demanding an addi-
tional ten thousand dollars (!? 10,000 = 2,000/. sterling). These latter I subjoin :—

" Montreal, Aug, 21, Ifi72.
" Dkai: Ml!. Aiiiio'i r,--In the absence of Sir Hugh Allan, I shall be obliged by your
8up])lying the Central Committee witb a further sum of twenty tliousand dollars upon
the sanK! conditions as tin; amount written by me at the i'oot of my letter to Sir Hugh
Allan of the 30th ultimo.

" (JllOKGE K. CARTIER.

" P.S. — Please also send Sir John A. Macdonald ten thousand dollars more ou the
same terms."

" (InaDcilint,; Prirnt,:) " Toronto. Aug. 20, IST-i.

" I must have another ten thousand : Avill be the last time of calling ; do not fail me ;
answer to-day.

" JOHN A. M.VCDONALI).
" To the Hon. J. J. C. Abbott, St. Amies."'

Rut for the apiiearance of the foregcing documents, I doubt whetlier so great an
imi)ression would have been jjroduced on the public mind by the statement of Mr.
McMullen. 1 myself have no knowledge of the gentleman, and have no rij;ht to impeach
his veracity, but it is manifest that many of his assertions are at variance with Sir Hugh
Allan's sworn testimony, while otliers have been contradicted by gentlemen whose
credibility it would be difTicult to impugn. lOven with regard to the documents them-
selves, it is to be observed tliat they were neither addressed to Mr. McMullen nor to any
one with wlioni he was associated, and that they could scarcely have ctmie into his
possession by other than surrei)titi()us means. They do not therelbre necessarily coiuiect
themselves with those nelarious transactions to which Mr. McMullen asserts he was
privy. It is further contended by the fiiends of the Govennnent that the sums nten-
tioned or even rel'erred to were not very largi — about 12,000/. sterling in all -an amount
which would go but a little way to defray the legitimate expenses of the 150 Ontario and
Quebec Elections, and that there was nothing to show whetlier they had been lirod'ered
as a subscription or as a temporary loan from a wealthy political ])artisan. Their
sinister significance resulted in a great measun; from their factitious juxtaposition with
Mr. McMuUen's narrative. Under these circumstances, though without attaching too
much importance to mere conjectural pleas of this kind, I was unwilling to jum[) to a
hasty conclusion on a matter involving both the private and the public honour of my
Ministers, and above all things I felt bound not to allow my judgment to be swayed by
the current of popular suspicion which this concatenation of documents would naturally
pi'oduce.

I happened to be at Prince Edward Island when the McMullen corrcsi)oiidencc
reached my hands, whither two of my Ministers— Mr. Tilley, the Minister of Finance,
and Dr. Tujjper, the Minister of Customs — had also come for the purpose oi' settling certain
details consequent on the recent confederation of the Island. 1 immediately sent for
these gentlemen, and the strcMuious assurances I received from each of them confh-med
Bfly hope that matters might l)e satisfactorily (;xi)lained. But, however that might Ijc, I
teiew that our original programme I'or the indefinite jirorogation of Parliament could no
longer be adhered to, and that my presence at Ottawa on the l.'Jth of August was
italierative. Understanding, however, that preparations were in progress i'or our public
reception at Halifax, I thought it better to proceed thither, and to make no announcement
Of my subsequent intentions until the last moment. At the same time I wrote to Sir
John, and intimated to him that tlie position of affairs had changed since we parted—
that a recess for the usual period was no longer jjossible, and that it was necessary Parlia-
ment should be provided with as early an ojjportunity as circumstances permitted ol"
f ronouucing upon the points at issue between himself and his assailants.

COT^T^ESrONDKNCE RELATIVE TO TFII-)

Canapa. On rcnrhiiiR Halilax, on t\\v 'J'.ltli July, I found the popular cMitomcnt all over tho
Dominion was intonsi', and that my supposed views, sympatliies, and inti'iitions were
l)ecomiii}j; not nicrcly the suhjcct olcoiijt'cturc, hut of assertion and conuncnt in the rival
newspapers, — tiie (iovcrnnient prcNS stating;-, as il'npon authority, that my course would
he so and so, — announcenirnts which were met hy tlie Oppositicm prints with stronj;
admonitory or rather minatory artichs. As, at this time, 1 had hy no means made up
my mind as to tiie i)ropcr course to he pursued, and I'elt that no decision was possihh:
until 1 had seen my Alinislcrs, I determined to take an early opportunity of deprecating
the introduction ol' tin; (<overnor-(iciier;irs name into such a controvc'rsy. An occasion
soon presented itsell", and I have the honour to sniijoin an extract I'rom a newspaper
report ol'a speech I made at a dinner ^iven to me hy the Halilax C'luh :-

***** * " And here. i;i'ntiemen, 1 should l)e disposed to conclude
this iniperfi'ct ex]M'ession ol'my thanivs, were 1 not desirous oi'conveyiuf; to my friend the
(Jhief .Fustice tlie <j;reat gratillcation I have (U-rived from the remarks which have
dropi)ed from him in regard to my oirieial position as Governor-deneral of this great
Dominion, (icntlemcn, t am well aware that tliis is, as it were, a domestic festival, and
that nothing could he more inopportune than tiie slightest alhision to any political tojae,
l)ut 1 may he permitted to say tliis much in reference to what has fallen from tin.' C^hief
.Tustice, that if there is one ohligation whose importance I ap])reciafe more than other
as attaching to the functions of my office, it is the ahsolute ainl paramount duty of main-
taining not merely an outward attitu<le of perlect impartiality towards the various parties
into wliich the i)olitical world of C;\nada as well as of the INIotlicr-Country is divided,
])ut still more of jireserving tiiat mcu'e sul)tleand inward halance of sympathy, judgment,
and ojjinion whicli should elevate the Kepresentativiiof your Sovereign ahove the faintest
suspicion of having any other desire, aim, or anihition than to follow the e\am])le of his
Koyal Mistress in tlie relation slie has constantly maintained towards Iier Ministers, her
Parliament, and lier people (tremendous ajiplause) ; to rememi)er every hour of the day
that he has Imt one duty and hut one oLject — to ailminisfer his (Jovernment in the
interests of the whole Canadian people, and of the Dominion at large. (Great cheering.)
Of course, gentlemen, having heen hut one i)rief vcar in the country, my character and
my sentiments in these respects can scarcely' known; and there is always a danger
during the fervour of tlicsc ]iolitical controN ics, which seem to he conducted i)y the
press of Canada with i)eeuliar liveliness and anii tion — (great laughter), of unauthorized
rej'erences hcing made to the (iovernor-Generars supposed sentiments, o])inions, and
intentions, which would convey to the uninstructed reader a very erroneous imj cssion
of the conduct and the attitude of the chief of tiie State. Gentlemen, I do not make this
remark hy way of complaint. If there is any ])erson in Canada who has heen kindly
and considerately dealt with hy tht; j)ress, to whom the press of every political con -
plcxion has shown indulgence and good will, it is myself, and it is mos\, ,.atural and hy
no means an uncomplimentary circumstance that the orpans of different shades of opinion
should persuade themselves that the Ciovernor-Gencral must necessarily he of their way
of thinking, and see through their spectacles. (Laughter.) But what I wish to say once
for all, and I do not care how widely this remark is disseminated, is this — that there is
no human heiiig Avho is authorized to make any statement or suggestion as to what my
opinion or scMitiments may he in respect ol' any jiolitical topic, or who has ever heen in a
position, or is likely to he in a position, to make anything ap[)roachiiig to a conjecture
upon paints of this description. It is true, my object and my desire is to inform my
mind upon every subject allecting the interests of the country, hy conversation and liy
discussion with anyone who can allbrd me instruction or inibrmation ; and it would he
very unfortunate Ibr me il' this freedom of intercour,se with all classes and parties in
Canada, from which I derive so much benefit and ])leasure, should be trammelled by the
dread lest this casual intercourse should become the foundation for inference, comment,
or conjecture in the; press. No, gentlemen, I understand my duty too well ever to allow
my judgment or my sympathies to be surjirised into political ])artisaiiship. My one
tliought imd desire is the welfare of Canada as a whole. To maintain her honour, to
promote her prosperity, to do uiy duty hy her and her entire people, is the sole object
of my ambition. When I converse with your public men, it scarcely ever occurs to me
to remember to what political party they belong, I only see in them persons devoting
themselves, each according to his lights, to the service of his country. My only guiding
star in the conduct and maintenance of my official relations with your public men is the
Parliament of Canada. (Cheers.) In fact, I su])])ose I am the only person in the
Dominion whose faith in the wisdom and the infallibility of Parliament is never shaken.
(Great laughter.) lOach of you, gentlemen, only believe in Parliament so long as Par-
liament acts according to your wishes — (cheers and laughter) — and convictions. I,

(<5

CANADIAN PArmr T?AILWAY.

I .ill ovor \hv
U'lilioiiH wore
it, in llic rival
course would
s with stroiit;
■iUis luiuli; up
I was i)()Hsil)li:
)!' (loprecutiiis
All occasion
I a uewspaptT

(1 to conclude

niy IViend the

which have

ol' this great

• I'estival, and

jolitical topic,

•oni tht! Chief

ire than other

duty of niain-

(arious parties

;ry is divided,

hy, .judf^ment,

ve the I'aintcst

\amiilo of his

llinisters, her

ur of the day

•nnient in the

•oat cliecrinji;.)

character and

ivays a danger

ducted hy the

unautiiorized

opinions, and

us imi ission

not make tliis

heen kindly

)litical con -

itural and hy

OS of opinion

of their way

all to say once

that tliere Is

to what my

vor been in u

a conjecture

to inform my

ition and by

it would he

lid parties in

nelled by the

ce, comment,

ver to allow

\\). INIy one

or honour, to

le sole object

xcurs to me

ons devoting

onlj' guiding

c men is the

terson in the

icver shaken.

long as Par-

ivictions, I,

gentleman, lielieve in Parliament, no matter which way if votes— (laughter)
those men alone whom the deliberate will of the confecU'rated Parliamen

and to
•nl of the
Domini'Mi may assign to me as my {{esponsible Advisers can I give my confidence.
(Cheers.) Whether they ar<' (lie heads of this party or of that party must be a matter
of iiidiHerence to the (idvernor-CJeneral. (Cheers.) So long as they an- maintained by
Parlianu'Pt in their position, so long is hi; bound to give them his iinreserve(| coniidence,
to defer to their advice, and loyally to assist them with his counsels. (.Applause.)
Whenever, in the vicissitudes of jiarty warfare, they are replaced by others— (laughter)

— he welcomes their successors with an e(|iially open and loyal regard. (Cheers.) Such
private friendships as he may have formed he may have a right tn retain. (Hear, hear.)
As a reasonable being he "cannot help having convictions upon the merits of din'orent
policies— (hear) -but these considerations are abstract, speculative, and devoid of iiraitical
ellect on his olTleial relations. (Cheers.) As the head of a constitutional .Stiite, a3
engaged in the administration of Parliamentary CJovernment, he has no jiolilieal friends;
still less need behave jiolitical enemies, ((ireat che(.riiig.) 'riie,])ossessioii, or even to bo
8us])ected of jiossessing either, destroys his usefulness. (I-ond ( beers.) Somerinus, of
course, no matter how disconnected he personally may be with what is taking jdace, his
name will get dragged into some controversy, and he may suildciily find himself the
Bubjoct of hostile criticism by the press of whatever party may for the moment be out of
humour. (Laughter.) Put, under these circumsfances, he must console hiinsoll' with the
reilection that these spasmodic castigations— (laughter)- are as transitory and innocuous

— (great laughter) as the discipliue apjilied occasionally to tln'ir idols by the unsophis-
ticated worsbiiipcrs of ^Iiimbo .himlu) (immense laughter) when their harvests arc
abort or a murrain visits their flocks. (Cheers.) For, gentlemen, of this 1 am certain:
although he may sometimes err in his judgment, or fail in serving you as ellectually as
he might desire, a Viceroy who honestly se(>ks to do his duty — (cliei-rs)— to whom the
interests of Canada are as precious and her honour as dear as his own— (imnienso
cheering) — who steers unmoved an even course, indin'erent to praise or blame, between
the political contentions of the day — (cheersi — can never appeal iii vain to tlu; confidence
end generosity of the Canadian i)eo])le. (Iirmense ajijilause.)''

But though keeping my final deeisio:-, in suspense, my mind was nnich occupied, as
your Lordship may imagine, with the consideration of the various courses open to me.
On one point 1 was (piite dear— namely, that it would not be right forme to eonntouancu
the settlement of the serious issues raised between my Ministers and their ojiponents —
involving, as they did, the jiersonal honour of the most eminent men in Canada, the fate
of my Ministry, and the imlilic credit of the country — exeejit at the hands of a full
Parliament, in which the distant Provinces of the Dominion wen- as Avell represented as
those of Ontario and Quebec.

As I have already described to your Lordship in the earlier ])art of this Despatch,
before Parliament adjourned on the 2.'h'd of May I had caused it to be announced to
both Mouses that Prorogation would take place on the lIUli of August. This arrange-
ment, I have no hesitation in saying, was agreeable to what were then the views of the
majority both in the .Senate and in the Houses of Commons. On the faith of this pledge
many gentlemen were gone to so great a distance that it was jiliysically impossible for
them to be recalli'd, and it so happened, from causes to which 1 have already referred,
that by far the larger proportion of these absentees wer(> supporters of the Government.
All the members from British Columbia, except Sir P. llineks, were on the wrong side
of the Rocky Mountains. Some ]\Iinisterialists were in Europe, as 1 was informed,
others in the States, and even to those in the Maritime Provinces, a return to Ottawa,
though not physically impossible, as it Avas to their colleagues, would prove a great
iri^onvenience at such a season. On the other hand, I learnt that the Opposition were
mustering their lull I'orce, an operation for which they possessed certain geographical
facilities. Were therefore the 1 louse of C^ommons to meet fiir the transaction of i)ublic
business, it was evident that important votes might be passed, and diH'isions taken,
contrary to the real sense of the country, and that my ^linistcis might justly complain
that they were being unfairly treated, and their late determined by a packed Parliament.

But apart from these practical considerations, a grave question, of ju-inciple si-omed to
me involved. The Imperial Officer representing the Crown in the Dominion is the
natural protector of the federal rights of its various Provinces as secured under an
Imperial Act. The sanctity of the rights of any one of these Provinces is not aflected by
the number of its representatives or the amount of its population. In this view it is
especially necessary that, in a country of such enormous distances, ample notice should
be given of the times and seasons when Parliament is to sit; but if it be once admitted
that the official "fixtures"' which regulate the opening or closing of a Session and ths

C •-'

Oanadi.

("ORR]<:SPONJ)KNf'E RELATfVK TO THE

Canada.

conduct of public l)usiness are to be capriciously tampered with, and changed at so shoi*
a notice as to ])rccludo the distant representatives from being present, it is evident mucli
wrong and inconvenience would result,and the door be opened to a great deal of trickery
at the hands of an unscrupulous Minister.

The foregoing considerations pointed ])retty distinctly to prorogation as an inevitalde
necessity of the situation. Only one other alternative indeed either suggested itseli"
then, or has occurred to me since, and that was anotlier adjournment of tlie House to
such a date as would suit the convenience of the absentees. At iirst, I confess this course
appeared to me fairly practicable, but further reflection disclosed difficulties I had not
at once seen. In the first place, this was an arrangement which I had not the j)o\ver of
enforcing, and I was confronted by the obvious reflection, that if the Gov rnment made
a motion to that effect, it might be defeated or met with an am-judment .autamount to
a vote of want of confidence at the hands of the majority in presence, and I should then
find myself landed in the very ])osition which I was quite satisfied ought to be avoidisd.
P^ven if the opponents of the Government were to reirain J'rom taking so unfair an
advantage of their numerical sujieriority, it was evident that in view of the adjournment
preliminary issues would croi) up of vital importance relative to the fresh instructions to
be given to the Committee ; for instance, whether the evidence was to be sworn or
unsworn, and if the I'ormer, how the oath was to be administered — all of which would
necessarily be decided in amamicr unduly adverse to the Government, and in the absence
of those who had an undoubted right to make their voices heard on the occasion. I was
so anxious, nevertheless, to find some way of avoiding a course which I foresaAV would
be denounced, however unjustly, as an undue exercise of the Queen's ju'erogative,
that I thouglit it desirable to make a suggestion in tiiis sense to Sir John Macdonald,
ofl'ering at the same time to become the channel of communication by which an
understanding between liim and his opponents might be arrived at. Sir John's reply was
very much in the sense I had anticipated. He insisted upon the injustice of his Govern-
ment being given over, bound hand and foot, to the tender mercies of their opponents in
th(! absence of his sujjporters, whom he had dismissed to their homes with my sanction
and with the acquiescence of Parliament. He called my attention to the fact that the

Opposition organs, far from hinting at any compromise.

were insistuig on

the fact that a

quorum of Parliament could do anything that Parliament itself could do, and were
evincing by unmistakable signs that they would show no quarter; that both Messrs.
Blake and Dorien had endeavoured to persuade the Committee to content themselves
with unsworn evidence, and that if Parliament met for lousiness they would be in a
position to pass an instruction to the Committee to that effect, that no man would be
willing to risk his life, still less his honour, m the hands of witnesses released from tlie
consequences of perjury and finally ; that he would not feel himself safe in entering into
any arrangements dependent upon the bona fides of those with whom I had suggested he
sliould treat.

Unfortunately in this country party animosity is intense, and the organs of each side
denounce the jjublic men ojiposed to tiiem in terms of far greater vigour than those to
which M'e are accustomed in England, The quarrel at this moment is exceptionally
bitter. The one party openly accuse the other of jjcrsonal dishonour, while these regard
their opponents as unscrupulous conspirators. As a consequence, a mistrust of each
other's fair dealings — which I cannot believe to be justified on either hand — has been
engendered, which would render the role of mediator under any circumstances extremely
difficult. As it was, the former part of Sir John's representations, though not the latter,
coincided too closely wiih what had occurred to my own mind to enable me to deny its
cogency. There being, however, no further time for correspondence, I left Halifax on
Saturday night, the 9th August, and arrived in Ottawa on the morning of Wednesday
13th. Had I ))cen at liberty to have done so, I should have preferred starting sooner,
but the town of Halil'ax had organi;!ed a series of popular demonstrations in our honour
for Saturday afternoon, and it would have occasioned great dissatisfaction had I absented
myself.

Before contiiming my narrative, there is one incident connected with my stay at
Halifax which perhaps ought to find mention here. Mr. Huntington sent me a sealed
packet covered by an official communication to my secretary, which, as I undei-stood from
the gentleman who brought it, as well as from Mr. Huntington's letter, contained copies
of the incriminatory documents in his possession. As the matters to which the papers
referred had become the suljject o'" a public investigation before a House of Commons'
Committee, and as I was still uncertain what turn affairs might take, I did not consider
it would be proper for me to take personal cognizance of these papers. I therefore
returned the packet unopened to Mr. Iluntington.

CANADIAN PACIFIC RAILWAY.

nged at so shor^
is evident mucli
deal of trickery

as an inevitable
suggested itself
)f tiie House to
iifess this course
iltios I liad not
ot the power of
v rument made
-antamount to
d I should then
t to l)c avoided,
so unfair an
he adjournment
I instructions to
:o be sworn or
)f wliich would
i in the absence
)ccasion. I was

foresaw would
n's jn-erogative,
Im iMacdonald,
I by whicli an
John's reply was
1 of his Govern-

ir opponents iu
itli my sanction
lie fact that the

the fact that a
I do, and were
it both Messrs.
tent themselves
wouhl be in a
man would be
leased from tlie
in entering into
ad suggested lie

ms of each side
ir than tliose to
is exceptionally
ile these regard
listrust of each
hand — has been
inces extrcinely
^ not the latter,
me to deny its
lell Halifax, on
: of Wednesday
starting sooner,
s in our honour
had I absented

ith my stay at
;nt me a sealed
nderstood from
lontained copies
hich the papers
e of Commons'
lid not consider
rs. I therefore

The 13th August was not only the day appointed for prorogation, but it was also the
day to which the Committee of Inquiry had adjourned, but as far as I can gather from
the subjoined Keport of what occurred it came together to very little purpose. Indeed
its whole procedure on this occasion is difficult of comprehension, in consequence, I
supjiose, of the moagreness of the only Keport of what passed which I have been able to
obtain, ^n the first place only four out the five members were present, and eventually
another, Mr. Dorion, withdrew in the middle of a discussion, leaving what arc considered
the Government members in a majority. One of these, Mr. Blanchet, then proposed tluit
they should report their jn-oceedings to tlio House. Mr. Blake, in amendment of this sug-
gestion, moved the adjournment of the Committee, which was carried— the result being
that whttn the House met at three o'clock, as had been arranged six weeks hi fore,
for tiie very purpose of receiving the Committee's Keport, no Keport of any sort or descrip-
tion was Ibrthcoming. The Ibllowing is the account of the proceedings referred to : —

" Ottawa, Aug. 1 ;j.

"The Pacific Committee met at 11.30. Present : Messrs. Cameron, Blanc'^et, Blake,
Dorion.

"At the request of Mr. Blake, the Resolution passed by the Committee at last meet-
ing — that the Committee cannot jn'ocecd without further instructions i'rom the House,
was read.

" Mr. Blake moved that the said Resolution be rescinded.

" Yeas — Blake, Dorion.

" Nays — Cameron, Blanchet,

' ' Resolution lost.

" After some conversation as to the Committee making a Report to the House,

" Tiie Chairman said if Mr. Dorion and Mr. Blake were not in I'avour of making a
Report, and witlidrew because they thought no Report should be made, the majority of the
Committee would not make any Report.

"Mr. Dorion said he wanted a Report to be made, but did not concur with tlu;
majority.

" The Chairman — All we propose to do is simply to Report our proceedings to the
House. If you don't like that Report, we need not make any at all.

" Mr. Dorion — If I move any amendment, I would stop the report from being
made.

" The Chairman — It is imjjossible for me to tell the result of merely reporting our
proceedings to the House; but if you don't think any Keport of our proceedings should
be made, I have no objection that it be so resolved. My own impression is that as we
reported all our former })roceedings to the House, there is no objection to our also report-
ing those which have taken i)lace since the last meeting of the House.

" Mr. Dorion said he would not interfere with such a step.

" The Chairman — Then I suppose it is so resolved, and we have completed our
business.

" Mr. Blake — No, there is a quorum present, and any amendment is in order. I move
that the House be asked to give such instructions to the Committee as will enable them
to proceed with the inquiry.

"Mr. Dorion here withdrew from the room, and the motion was carried unanimously
by Messrs. Cameron, Blanchet, and Blake.

" Mr, Blake inquired of the Chairman — Do you propose to give the House communi-
cation of this Resolution ?

" The Chairman — Not unless you move it to be done.

" Mr. Blake — Do you propose to communicate any of the previous proceedings?

" The Cliairman — I do not.

'' Mr. Blanchet — I think W(! should report our proceedings. I move that the proceed-
ings of the Committee since ITtJi May last be reported to the House.

"Mr. Blake— I move; an amendment that the Committee adjourn, till eleven o'clock
to-morrow.

" Carried.

" Yeas— lilake, Cameron.

" Nay -Blanchet.

" The Committee then adjourned."

A few hours after my arrival in Ottawa, Sir John Macdonald called upon me by
appointment, and ft-.mally submitted the unanimous advice of my Ministers, that
Parliament sliould le prorogued according to the announcement made by my authority

Canada.

CORRESPONDENCE RELATIVE TO THE

Canada. ,n both Houses previous to its adjournment. Alter some conversation, in which we went
over the wliolt; ground, and again examined the suggestion contained in my letter
relative to an adjournment, I finally announced to him, that on a due consideration ol' all
the circumstances ol' the case, the prorogation ol' Parliament seemed to me inevitable, —
that I did not feel niysclf justified in withdrawing my confidence from Ministers, or in
concluding that Parliament had done so, and that therefore I was prepared to be guided
by tlie counsels of himself and liis colleagues, —but that I must formally insist on one
condition as the price of my assent to prorogation, viz. : — that Parliament should be
again convoked within as short a period as was consistent with the reasonable convenience
of members, and that I considered six or eight weeks was as long an interval as should
intervene before the House re-assembled. Sir .lohn Macdonald did not offer any
objection to this jiroposition — indeed he had already volunteered a suggestion to a similar
efi'ect, — and it was agreed that I sliould meet my Council at two o'clock, in order that it
might be ratiiicd in the presence ol' all my INIinistors.

At one o'clock, however, I was une.;pectedly informed that a deputation of members
of I'arliament was desirous of Avaiting ujion me Avith a Memorial against prorogation.
I had not received the slightest intimaaon of the intention of these gentlemen, yet,
although I felt the propriety of sucli a step upon their i)art Avas very questionable, I
concluded to receive them.

In the meantime 1 had repaired to the Council Chamber, as agreed upon, where my
Ministers jointly re-submitted the advice they had commissioned Sir John Macdonald to
convey on their behalf in the morniug. I ma(l(! the same rejjly to them as to my Prime
Minister, and the re-assembly of Parliament within the time specified was agreed upon.
It was, however, suggested tliat if ten wcks were named as the limit instead of eight, it
Avould be possible to get the preparation of the Estimates fjufficiently advanced to roll
tA\o Sessions into one, and disjiense with the usual Spring Session. Although I was
scarcely in a position to know how far this proposal was practicable or would be acceptable
to Parliament, it would evidently prove such a saving of expense to the country and
of fatigue and inconvenience to members, many of whom would otherwise scarcely have
time to return to their homes at all, between an autumn and the usual Session, that I
consented to the additional fortnight upon the specific understanding, however, that if in
the interval anything should occur which, in my opinion, rerpiired Parliament to meet
sooner, an ex])ression of my wishes to that effect would he at once acted upon without
comment or discussion.

These matters being settled, I returned to where the deputation of remonstrant
members was waiting for me. They were introduced by their Chairman, Mr. Cartwright,
a gentleman for whom I have a great esteem. In presenting the Memorial, iVIr.
Cartwright stated that it liad been signed by ninety-two members of Parliament, and that
another gentleman had intimated his willingness to have his signature attached to it. I
found, liowever, on examining the document, that three of the ninety-two signatures had
been affixed by deputy, though, of course, with the full authority of their owners. I
note the circumstance, however, as 1 shall have occasion to r(;i'er to it hereaiter.

As my interview witn my Council had occupied some little time, it had not been
]iossible for me either to study or to write my rej)ly to the Memorial. I was therefore
I'orced to make Mv. Cartwright and his friends an extempore answer, which was
afterwards reduced to writing as nearly as possible in the terms actually used. This
document, together with the Members' Kemonstrance, I subjoin for your Lordship's
information.

Mkmouul.

" The undersigned members of the House of Commons of Canada desire resp(!ctfully
to approach your Excellency and humbly to represent that more than lour months have
already elapsed since the Honourable Mr. Huntington made, from his place in the House,
grave charges of corruption against your E.\cellency's Constitutional Advisers in reference
to tile Pacific Railway contract ; that although the House has apiwinted a Committee to
inquire hito the said charges, the proceedings of this Committee have, on various grounds,
been postponed, and the inquiry has not yet taken place; that the honour of the
country imi)eratively requires that no further delay should take place in the investigation
of charges of so grave a character, and which it is the duty and undoubted right and
Mrivilegc ol' the Commons to prosecute.

" Tiie undersigned are deeply impressed with the conviction that any attemj)! to
postpone this in(|uiry, or to remove it from the jurisdiction of the Commons, would
create this most intense dissatisfaction ; and they therefore i)ray your Excellency not to
prorogue Parliament until the House of Commons shall have an opportunity of taking

CANADIAN PACIFIC RAILWAY.

in which wu went
lied in my letter
lonsideration oi' all
a me inevitable, —
n Ministers, or in
tared to be guided
ally insist on one
iament should be
)nable convenience
interval as should
id not ofler any
jestion to a similar
k, in order that it

;ation of members
;ainst prorogation.
e gentlemen, yet,
ry questionable, I

upon, where my
ihn Macdonald to
11 as to my Prinii'
was agreed upon.
iistead ol' eight, it
advanced to roll
Although I was
ould be acceptable
I the country and
ivise scarcely have
lid Session, that I
lowever, that it' in
rliament to meet
ted upon without

1 of remonstrant

, Mr. Cartwriglit,

Memorial, Mr.

iament, and that
ittached to it. I
vo signatures had
tlieir owners. 1
r(;alter.

it had not been

I was tlierefore
wer, which was
lally used. This

your Lordship's

'sire respectfully

bur months have

»ce in the House,

isers in reference

a Committee to

various grounds,

honour of the

the investigation

ul)ted rigiit and

any attempt to
Duimons, would
Iscellency not to
tunity of taking

such steps as" it may deem necessary and e.Lpedient with reference to this important Canada.

niatter. . i i ,. ^i

'• The number of names signed to this document is ninety, withni ten oi one-liall the

House. They are as follows : —

" Opposition.— Anglin, Archibald, Bain, Bechard, Bcrgin, Blain, I'llake, Bodwell,
Bourassa, Bowman, Boyer, Brouse, liuell, Burpee (Sanbury), Cameron (Huron), Cart-
wriglit, Casey, Casgrain," Cauchon, Charlton,* Cluirch, Cockburn (Muskoka), Cook, Cutler,
Delorme, St.' George, Dorioii, Dorion, Edgar, Ferris, Findlny, Fiset, Fleming, Fourniur,
Galbraith, Geoffrion, Gibson, Gillies, Goudge, Ilagar, Harvey, Iliggiubolhani, Holton,

Wood, Young, Young.

" MixiSTEiUALisrs.— Burpee (St. John), Coffin, Cunningham, Forbes, Glass, Macdonell,
(Inverness), Kay, Schultz, Scriver, Shibley, D. A. Smith (Selkirk), A. J. Smith
(Westmoreland)."t

Rkply.

"Gentlemen-, — It is quite unnecessary for me to assure you thai any rcpresontations
emanating from persons possessing the right to spoak on i)ul)lic affairs with sucli
authority as yourselves, will always be considered l)y me witli the greatest resjtect, even
had not circumstances already compelled me to give my most anxious thought to the
matters to whicli you are now desirous of calling my attention.

"You say, in your Memorandum, that lour months have elapsed since the Hon. Mr.
Huntington ])referred grave charges of corruption against my i)resciit Advisers, in rei'erence
to the Pacific Railway contract, and that although the House has appointed a Committee
to inquire into these cliargc^s, the proceedings ol" this Committee liave on various grounds
been postponed, and tlie inquiry lias not yet taken place.

" Gentlemen, no person can regret more deeply tlian 1 do tliese unfortunate delays,
the more so as tiiey seem to have given rise to the impression tliat they have been
unnecessarily interposed by the action of tlie Executive.

" It may be p/remature at this moment to enter into a history of tlie disallowance of
the Oaths Bill, l)ut this much, at all <'vents, it is but fair to everyone that I should state,
viz. that imiTKHliately alter I Jiad assented to tha' AcL T transmitted a certified copy of
it to the Secretary of State, in accordance witi, the instructions by which I am bouml
on such occasions. That, leaning myself to the opinion (an o])inion founded on the
precedent afforded l)y the Act of the Canadian Parliament, which empowers tlie Senate
to^ examine Avitnesses on oatli), that the Act was not ultra vires, T accompanied it by a
full exposition of the arguments whicli could lie urged in its support ; but en the i)oiiit
being referred by tlie Secretary of State ibr the professional o])inJoii of tlie Law Ollicers
of tlie (]rown, it was ])ronounced inconsistent with the Act of Conlederation, and that
therefore the iiost])onement of the inquiry, so I'ar as it has arisen out of this circumstance,
has resulted wholly by the operation of law, and li.is been beyond the control oi' anyone
concerned.

"You then proceed to urge me, on grounds which arc very fairly and forcibly staled,
to decline tlie advice which has been unanimously tendered to me by my Kesiionsible
Ministers and to refuse to prorogue; Parliament ; in other words you require me to dismiss
them from my counsels; for, gentlemen, you must be aware' that this would be the
necessary result of my assenting to your recommendation.

" Upon what grour.ds would I be jus1ili(>d in taking so grave a step?

"What guarantee can you adbrd mo that the Parliament ol' the Dominion Mould
endorse such an act of personal interference on my part?

" You yourselves, gentlemen, do not form an actual moiety of th(! House ol' Commons,
and I have no means therefore of ascertaining that the majuiity of that liody subscribe
to the opinion you have enounced.

"Again, to what should I have to appeal in justification of my co"duct?

" It is true grave charges have been preferred against these gent'emen ; charg(>s which

* The luuiK'H thus noted wrro Ripiiod by proxy.

t Tho iibijvo I'luHsilieiilidii is foimdod <iii the votes taken oil Mr. ITniitiiiRtoirrt motion. Ouo or two goiltlomcil
liowcvcr, tliisbod with iLo Uiniowitioa iiiigLt bo mure iwoiiorly Bot down as " Jiidciirudcnt."

COERESPONDENCE RELATIVE TO THE

Canada. I admit require the most searching investigation ; but as you yourselvcj remark in your
'— Memorandum, the truth of tliose accusations still remains untested.

" One of the authors of this correspondence which has made so painful an impression
u])on the public, has admitted that many of his statements were hasty and inaccurate,
and has denied on oath the correctness of the deductions drawn from them.

" Various assertions contained in the narrative of the other have been positively
contradicted.

" Is the Governor-General, upon the strength of such evidence as this, to drive from
his presence gentlemen who for years have filled the highest ofTices of State, and in whom,
during the recent Session, Parliament lias repeatedly declared its continued confidence ?
It is true certain documents have lately appeared in connection with these matters of
grave significance, in regard to which the fullest explanation must be given, but no proof
has yet been adduced which necessarily connects them with the culpable transactions
of wliicli it is asserted they formed a part, however questionable they may appear, as
jdaced in juxtaposition with the correspondence to which they have been appended by
the jHM'son who has possessed himsell' of them.

" Under these circumstances, what right has the Governor-General, on his personal
responsibility, to proclaim to Canada — nay, not only to Canada, but to America and
Europe, as such a proceeding on his j)art must necessarily do — that he believes his
Ministers guilty of the crimes alleged against them? Were it jiossible at the present
time to make a call of the House, and place myself in a direct communication with the
Parliament of the Dominion, my present embarrassment would disappear, but this is a
physical impossibility. I am assured by my Prime Minister, and the Report of the
l)roceedings at the time bears out his statements, that when Parliament adjourned it was
announced by him, as the leader of the House, that the meeting on the 13th of August
would be immediately followed by prorogation ; that no substantive objection was taken
to this announcement ; and that, as a consequence, a considerable portion of your fellow-
members are dispersed in various directions. I should therefore only deceive myself
were I to regard the present Assembly as a full Parliament.

" Since the adjournment, indeed, circumstances have occurred which render your
proximate re-assembly highly desirable, but in this country there are physical cir-
cumstances which necessarily interpose a coiisideral)le lapse of time Ijelbre the repre-
sentatives of the various Provinces comprising the confederated Parliament of Canada
can assemble, separated as some of tliem are by thousands of miles from the capital of
the Dominion.

" In regulatir.g the times and seasons when Parliament is to be called together, the
Executive is bound not only to consider the reasonable convenience of these gfiiitlemen,
but also to protect the federal rights of the Provinces which they represent, and under
these circumstances I have concluded, on the advice of my Ministers (and even if I
differed from them as to the policy of such a course, which I do not, it is a point ujwn
which I should not hesitate to accci)t their recommendation), to issue a Royal Commis-
sion of Inquir- to three gentlemen of such legal standing, character, and authority, as
will command the confidence of the public, l^y virtue of the powers conferred upon me
l)y the Act 31 Vict., cap. 38. On the otiier hand, I have determined in proroguing
Parliament to announce to the members of both Houses my intention of assembling them
immediately after the Commission in ([uestion shall have concluded its laliours. By
these means an ojjportunity will be affordeu for the preliminary expurgation of these
unhappy matters before a tribunal competent to take evidence on oath ; ample oppor-
tunities will be given to the members of the more distant Provinces to make their
preparations, in view of an autumnal Session ; and within two months or ten weeks from
this date a lull Parliament of Canada will take supreme and final cognizance of the case
now pending between my Ministers and their accusers.

" Gentlemen, the situation we have been discussing is one of great anxiety and embar-
rassment, but I cannot but hope that on a calm retrospect of the various considerations
t() be kept in view, you will come to the conclusion that in determining to be guided by
the advice of my Ministers on the present occasion — in other words, in declining to act
as though the charges which have been advanced against them were already proven, and
in adhering to arrangements upon the i'aith of which many ol' your colleagues are absent
I'rom tlieir places — I have adopted the course most in accordance with the maxims of
constitutional government, and with what is due to those whom the Parliament of
Canada has recommended to my confidence."

After the members had retired, it had become time for me to proceed to the Seua,te
Chamber, and about half-past three o'clock the Speaker appeared at the Rar, and Parlia-
ment was prorogued. Considerable excitement, 1 am informed, prevailed in the House

CANADIAN PAflFIC RAILWAY.

•emark in your

I an impression

md inaccurate,

ti.

aeen positively

, to drive from
;, and in whom,
ed confidence ?
iiese matters of
n, but no i)roof
)le transactions
nay appear, as
n appended by

n his personal
I America and
le believes his

at the i)resent
L-ation with the
ir, but this is a

Report of the
Ijourned it was
1 3th of August
;tion was taken
of your fellow-
deceive myself

h render your
c physical cir-
(bre the repre-
ent of Canada
the capital of

d together, the

ese gentlemen,

nt, and under

[and even if I

is a point upon

loyal Commis-

1 authority, as

3rred upon me

in proroguing

mbling tliem

lal)ours. By

ation of these

ample o})por-

;o make their

n weeks from

ICC of the case

ty and cmbai"-
considerations
be guided by
.'ciining to act
y proven, and
ues are absent
he maxims of
Parliament of

lo the Sena,te

,r, and Parlia-

iu the Iloiuie

of Commons, and cries of "Privilege" were uttered, when P)lack Rod made his ajjpcar-
ance ; but, as far as I can learn, nothing was done or said incom])atible with the dignity
and self-respect of that Assembly. Only the jMinisterialists present, about thirty-five in
number, accompanied tlie Speaker to the Senate Chamber. The Opposition, amongst
whom, on this occasion, I suppose must be included thirteen of the ordinary supporters
of my Government who liad signed tlie jMcniorial, remained l)eliind in their places.
Upwards of seventy meml)ers in a House of two liuiidred must have been al)sent — all of
whom, with tlie exceiitioii of three, were claimed by GoveriuiKMit as tlieir adherents.

In the evening, what is i)opularly known as an "indignation" meeting was lield,
under the presidency of Mr. Mackenzie. I have appended to this Despatch a Report ol
its proceedings.

I have thus recounted, in as faithful language as I can command, the various circum-
stances connected with the recent prorogation. In doing so, your Lordship will perceive
that I have not attempted to discuss, still less to defend, tlie action of my Ministers on
any of the occasions rei'erred to, except so I'ar as tlie justification of tlieir conduct ibllows
as a corollary to the vindication of the attitude I myself have assumed. The propriety
of their ])rocedure is a matter which they will have to settle with the Canadian Parlia-
ment. My contestation would be, that the fact of their being hereafter jiroved innocent
or guilty of the accusations alleged against them, or of having acted judiciously or the
reverse, is a result wliich can have no relation to my share in these transactions, and
that, given the circumstances in which I found myself, I liave acted in the liighest
interests of the Parliament and of tlie people of Canada. In tlie same way, if i'rom
time to time I have argued against any of tlie views maintained liy the Opjiosition, it
has only been as contending against their implied condemnation of what I myself have
done or said.

Were I to be put upon my defence, my best justification would be found in a review
of whatever otiier courses may be considered to have been possible, but tliis inquiry
has been pretty well exhausted in the course of the preceding statement. The alternatives
I have seen suggested by those who ,re disposed to criticise my conduct are indeed very
few. The morning after the news of the prorogation had reached Toronto, but before
my pledge in regard to an autumn Session was known, the ' Globe' — a recognized organ of
the Opposition, and one of the ablest conducted jiapers in Canada — in lamenting the
prospect of a recess which was to last till February of next year, observed that "a proro-
" gation for two or three weeks would have been a i)roper course." As I liad actually
anticipated the 'lith of these suggestions (for the question of a lew extra weeks, I a])pre-
hend, cou]'^ .lot have become any grave cause of complaint), 1 naturally might have
expected to nave been complimented on my action ; but altliough tliis paper and all
the other Opposition journals in Canada have, with a iew exceptions, sliown great
forbearance to me personally— considering tlie excitement which prevailed and the
forcible language in which leading articles are written — I am afraid I must admit to
your Lordship that its subsequent allusions to my procedure have not been eulogistic.

But if a short prorogation was wrong, what were the alternatives? An adjournment.
But an adjournment is an act of the House, and cannot be compelled liy the Executive.
The leader of tlie House liad already rejected the suggestion, and not the slightest
intimation had ever reached me tliat sucii an expedient would be agreeable to the
Opposition. On the contrary, their last word within an hour of the time the House was
to meet, as conveyed to me iiy the ninety-two members, amongst whom were Mr.
Mackenzie and Mr. Rlake, was — " Let us meet and proceed to business as tiiough we were
a fully constituted Assembly representing the collective will of the people."
• But it has been suggested that I should, on the one hand, have compelled the
acquiescence of Sir John Macdonald in an adjournment by refusing to prorogue, while on
the otlier Mr. Mackenzie ought to have been driven into the arrangement under a threat
of prorogation.

' Now I am quite ready to admit, that one of the functions of a Governor-G cneral is to
moderate the animosities of party wari'are, to hold the balance i!ven between tlie con-
tending parties, to see that the machinery of the Constitution is not unfairly strained
for party purposes, to intervene with his counsels at opportune moments, and when
desired by his Ministers to become the channel of communication with their opponents,
Dr even, though uninvited, to oiler himself as negotiator in a dilTicuity. But the role
marked out for me above is very dilleuent I'rom this. I certainly should not have
considered it consistent witli my personal lionour to have ajiproached my Prime Minister
with a threat I had no intention of executing, even had I seen less clearly than I did tin;
objections to the course proposed, while, except at his instance, I should have been still
less justified in opening communicationa with the Opposition. But as I have already

Canada,

CORRESPONDENCE RELATIVE TO TITE

Canada.

('xi)lniiioil. llio moro iiojjiotiation of nil adjournment would not liavo advanced matters in
;uiy decree, unless tlie issues relative; to the I'uture proceed in sj;s of the C!omniittoe could
have heen settled at the same time; but tlie divergencies of opinion upon these points
M-ere irreconcilal)le, and could never hav(! been satisfactorily dealt with except by the
House in full Session.

If then my choice lay — which seems to he admitted — -between a short prorop;ation and
n barren adjournment for a similar period, I do not think it can be disputed that the
I'ormer was th(> i)rel'erai)le of the two.

Of course it M-as ilways opcni to me to have disniisstnl my Ministers, and to have taken
my chance of I'ar'iament approvini;' my conduct, but I did not feel myself warranted in
hazarding such a stej) on tli(> data l)efore me. Indeed, the rashness aiul injustice of the
])roceedinji; would probably have aroused such a feeling- of dissatisl'action in the minds of
what I have no reason to know may not ])rove the majority of the constituencies that
there would have been a great chance — if Sir ilohn and his friends came at all decently
out of the allair — ^of their being borne back into office on the shoulders of the people.
If wholly exculi)ated, your Lordship can imagine what my position would liecome in
presence of the reaction that would have ensued. At all events, as I told tlu; remonstrant
members in my reply, I was not ])repared by jniblicly withdrawing my confidence from
my Ministers, to proclaim to Canada, to America, and to Europe that t believed untried
men guilty of such atrocious crimes as those imputed to them. It is, however, not
necessary to debate this line of conduct, as no responsible person in this country has
ventured to recommend it.

But though not directly suggesting the dismissal of my Ministers, it has been very
generally contended that I should have considered them under a ban, and should have
ceased to act on their advice, though still retaining them in olfice. The establishment
of a relationship of this kind between the Crown and its Ministers would be a novel fact
in constitutional history, and might have proved difficult of execution. I was to go to
my Council and say to them, " Gtuitlemen, you state that in your opinion the Crown has
" i)ledged itself to Parliament to prorogut; on a certain day ; you assert as a matter of fact
" that relying on this pledge sixty or s jnty members are not in their places, and that to
"allow the House to proceed to business in their absence would be a gross impropriety,
" to which you would not consent, and that in view of this circumstance as my Consti-
" tutional Advisers, placed al)out me by the will of Parliament, you unanimously advise
" me to prorogue. Well, gentlemen, when Parliament last voted, you possessed a
" commanding majority : whether you have lost tlu; confidence of Parliament or not 1
"cannot tell. You say j'ou have not. Others say you have. Your political opponents
" have brought grave accusations against you. You are therefore under a ban. You have
" forfeited my confidence. I do not intend to take your advice, cxcej)t on mere questions
" of administration, but — jiray retain your ploces." To which, of course, these gentlemen
would have replied : — " We are highly sensible of your Excellency's forbearance, perhaps
"you will favour us with a list of subjects on which you will accept our recommendation,
" as Avell as an index expurgatorius of those which are tabooed. The arrangement will
" lighten our responsibilities, our salaries will remain the same, and our honour" — I cannot
exactly conjecture how the sentence M'ould have concluded. But the suggestion that my
refusal to take their advice on j)rorogation would not have been tantamount to a dismissal
of them, is too untenable to need refutation.

Bel'ore, however, closing this head of the discussion it may be Avell to examine the
grounds on which it is alleged I ought to have withdrawn my confidence from Sir John
^lacdonald and his colleagues.

In order to answer this question, we must inquire what I had to go upon ? There
were Mr. Huntington's statements as displayed in his motion — but these statements were
not statements of facts, but of conclusions drawn from facts within Mr. Huntington's
knowledge i)er]ia])s, but not within mine;, and ollered no safe foothold. Next there were
Sir Hugh Allan's statements, but upon which was I to found myseli",— upon those in Sir
Hugh's letters, in which he admits there was a good deal of "inaccurate" language, or
upon those in his affidavit ? If upon the latter, could 1 have pronounced the Government
guilty ? Then there were Mr. McMulIen's statements, — but these have been much
questioned, and many of them have been contradicted. I do not think the people ot
Canada would be willing to allow the reputation of any of their representative men to
he staked ujion evidence of this nature. , Lastly, there were Sir George Cartier's
letter, and Sir John Macdoiuild's telegram. In respect to these documents, I would
merely observe that, suspicious as they might appear, no man would have been justified
in acting upon any conclusion in regard to them, until it had been shown with what
transactions they were connected. There is ns yet no evidence to prove that the sums

CANADIAN PACIFIC RAILWAY.

red mcittci-s in
nniitti'i" could
III tli(!S(! i>oint8
except by the

ivorop;ation and
mtod that the

I toliave taken
ir warranted in
njustiee oi' the
ill the niindj^ oi'
stitueiu'ies tliat
at all decently
i oi' tlic people,
imld hecome in
the remonstrant
[•onfidence from
lelievcd untried
1, however, not
Ins country has

; has been very
uid should have
c establishment
i be a novel fact
I was to go to
1 the Crown has
s a matter of fact
ices, and that to
•OSS impropriety,
e as my Consti-
uiimously advise
ou possessed a
iament or not 1
itical opponents
mn. You have
1 mere questions
these gentlemen
earance, jjcrhaps
ccomii^endation,
rrangemont will
3nour" — I cannot
•gcstion that my
uit to a dismissal

to examine the
:e from Sir John

a upon? There

statements were

Mr. Huntington's

Next there were

pon those in Sir
ate" language, or

the Government
lave been much

k the people ol
sentative men to

George Cartier's
iments, I would
ive been justifii'd
shown with what
)ve that the sums

referred to were consideration moneys I'or the Pacific Railway Charter; and Sir Ihyh
Allan states upon his oath that tliey were not, as will be seen from tiie sul joined extract
from his affidavit : —

" In tlicse and similar ways T expended sums of money approacliing in amount tliose
mentioned in tliose letters, as I conceive I had a perfect riglit to do ; but I did not state
ill tliose letters, nor is it the fact, that any portion of those sums of money were jiaid to
the members of the Government, or were received by them or on their behalf directly
as a consideration in any form for any advantage to me in coniuclion Avith the Pacific
Railway rontract."

On the other hand, what were the countervailing facts within my knowledge ? The
theory of the prosecution " is that the terms ol' the Charter were c()rruj)tly niodiiied to
"the advantage of Sir Hugh Allan and liis American confederates." Has th(! bargain
been carried out'/ Certiiinly not, as far as the Americans are concerned. Tluir complaint
is that they have taken nothing by their motion. I was myself a witness of the pains
taken to exclude them when the C'harter was being framed. Have Sir Hugh Allan and
his friends been gratified with that control over the concern to attain which Mr. IMcMullen
asserts he briljed my Ministers'? Tiiis is a fact less easy to elucidate, but I myself
believe that lie has not. At moments when Sir John Macdonald could not have been
playing a part he gave me rejieated indications of his desire to prevent Sir Hugh from
obtaining any commanding influence on the direction. That direction was framed with a
view to a proper representation upon it of every Province in Canada, regard being had to
the wealth and pojiulation of each. It numbers amongst its members gentlemen who
had been on the direction of the late Interoceanic Company, and it includes the names of
men wliom everyone would acknowledge would never willingly associate tliemselves
with any dishonourable enterprise. It is difficult to believe that these personages are
either the willing or unconscious tools of Sir II. Allan. Hence, wo must arrivi' at the
inference that, at all events, if the crime was imagined, it can scarcely have been con-
summated. This would not in the least excuse its authors, but if a thing has not been
done, the fact afTords prima facie grounds for lielieving that it Avas not iiiteiuUd to be
done. Lastly, I have received tlie most solemn assurances from my Ministers, l)oth
individually and collectively, on their word as men of honour, and on their fealty to the
Crown as my sworn Councillors, that tliey are al)solutely innocent of the things laid to
their charge.

On a balance of the foregoing considerations, can anyone say that I should have been
justified in deliberately violating my first duty as a constitutional ruler on a premature
assumption of the guilt of these gentlemen '!

But a still more important question remains Itehind. Had I any means of knowing
that my Ministers had forfeited the confidence of tiie House of C'ommons,— f'tn-, of
course, if this were the case, any inward impressions of my own would cease to be
elements of the problem ?

^Vhat were the facts upon which I could rely'? During the whole of the preceding
Session tlie Government had marched from victory to victory, as will be seen Iiy the
subjoined record of votes taken on test divisions :—

C.VNADA.

7th March, majority for Government

18th do.

do.

2nd April,

do.

17th do.

do.

7tli May,

do.

8th do.

do.

12th do.

do.

16th do.

do.

2.')

2(j

They had left oil" with a majority of ;].') at tlieir command. The ordinary presumption

•would be that their supjiortcrs still adhered to them. Had anything occurrcid to invali-

I'date this conclusion'/ The publication of tlie documents I have referred to'/ Judging

Jfrom the process of thought in my own mind, which compelled me to suspend my

"Verdict, I could not bring myself to believe that Parliament had jumped to any jn'e-

- mature conclusion. Hut 1 had one other indication to assist me. Ninety-two Members

.of Parliament declared themselves opjiosed to the views of Ministers on ])rorogation.

Where were the other one hundred and seven, and what were tlieir opinions'? Of tiie

thirty.five or forty who were in their places, not one took steps to make me aware tlial

• Mr, Hunlingtoii's motiyii.
D 2

C0RRESP0N1»ENCK RELATIVE TO THE

Canada, tlioy liad coased to sii]i])ort the (JoviTiimpn*. Tlicir names wore coiispicuniisly absent
from the Memorial. Tlie sixty or sixty-five members wlio were away eamiot eomj)hiiii
ir 1 liave interpreted tlieir .'>seiice as an indication that they endorsed the policy ol'
Government, so I'ar at least as prorogation was concerned. That the memorialists were
so many and no more was in itself significant, for it gave tlie measure of the (ilVort made
and the maximum result. They were not even a moiety of the House. They were a
minority, and therefore not in a position to acquaint m<! with the wishes of the majority,
or to speak in behalf of Parliament at all. So acutely was the force of this fact felt that
within a very few days after prorogation, it was industriously circulated by all the
Oi)position newspapers, that in rei'using to accpiiesce in the suggestions of the signatories
of this Memorial, 1 had flown in the face of a "■inajorifi/" of the House of Commons. It
is said that ]iy])ocrisy is the homage ])aid by vicC to virtue. The pertinacity with which
this mis-statement has been proi)agated, I cannot hut regard as a homage to the strength
of my position. IJut not content with this, some pajjcrs have even gone farther and
stated positively that other gentlemen, friends of the Governmtnit, waited upon me the
same day and held language similar to the remonstrants — an assertion for which there is
not the slightest foundation, for on that day, up to three o'clock, with the exception of
the Speaker, the remonstrant members themselves and my Ministers, I had neither
s^wken to or heard from a single Member of Parliament.

But it has bren subsequently argued, that inasnuich as no division ever took place in
a perfectly full House, ninety-tno signatures imjjlied a practical majority, — as though my
a})preciation oi' what should constitute a majority is to be regulated by my estimate of
the cogency of the rcs])ective whips. If, however, we are to count noses with such
])articularity, let us see how the case stands. I admit that tin; numerical strength of a
House is always in excess of its voting ]iower. There will always he accidental vacancies,
liut the ranks of each side are equally lial)le to be thinned by casualties. What was the
voting power represented by this Memorial '! It is true, on tlie word ol' the Chairman, I
took Ol) as the munber of persons on whose behalf he spoke, but the actual signatures at
the time I had to decide on my course were only i)2. Of these, three were alTixed by
jiroxy, reducing the momentary voting strength of tlu; body represented to 80 ; for it is
to be presumed that, unless detained from Ottawa, the remaining gentlemen would have
signed with their own hands. Now, if we douljle SO wc; get a House of 178, and no later
than last Session IS.'J names appeared on a division list, — so that the 80 remonstrants
represented only a minority of the House even on this principle of reckoning. But during
the whole of last Session Government had a large majority, a condition of afl'airs which
superinduces a laxity of attendance. Had the two parties been more evenly balanced, had
victory depended on only a few votes, the muster of members would have been inevi-
ta])ly stronger, and the maximum division list of 18,'! undoubtedly exceeded.

But I am not prepared to admit that a Governor-Cieneral would be justified in taking
so serious a step as was then urged upon me, on the strength of a Memorial signed even
by a majority of Members of Parliament. Excejit so far as bringing a certain amount
of pressure to bear upon him for a momentary iiurpose, a document of this nature is
quite inconsequent. It would prove so much waste paper in the presence of a different
mandate from the constituencies of many of inese gentlemen, and when the time for
voting arrived the Governor who relied upon it might very well find a considerable pro-
portion of its signatories on the wrong side of the division list, with a dozen plausible
excuses for their having jilayed him false. Indeed, within a couple of hours after the
deputation had left my presence, I was assured on trustworthy authority that some of
these very persons had openly stated that in signing the Memorial they by no means
intended to signify that they withdrew their sujiport from Government.

It is further to be remembered that, although I was in Ottawa at six in the morning,
T heard nothing of this Memorial until one o'clock, that three was the hour at which
Parliament met, that the gentlemen bringing it must have known that its presentation
and j)erusal must have occupied some time, and that I w'as l)ound to communicate it to
my Ministers; yet, it was upon the strength of a document of this nature, presented in
this i'ashion, when my speech from the Throne was in the hands of the printers, and the
guard of honour under arms, that I was expected to take; a step which, under such
circumstances, must have inevitably led to a change of Government, and possibly a
general election.

I have one further point to mention, and 1 have done. It is a favourite theory at this
moment with many persons that when once grave charges of this nature have been
preferred against the Ministry, they become ipso iivcto unfit to counsel the Crown. The
practical application of this principle would prove very inconvenient, and would leave
not only the Governor-Grcneral, but every Li«;utenant-(jovenior in the Dominion very

CANADIAN PACIFIC RAILWAY.

piciiously absent
i-aiiiiot complain
u(l the jjolicy ol'
omorialists were
■ the ellort made
J. Tlicy were a
ol' the majority,
Iiis fact felt that
ated hy all the
1' tlie sif^natories
)!' Commons. It
city with which
1 to the strength
)ne farther and
id upon me the
)r which there is
the exception of
I had neither

er took place iu
— as though my
my estimate of
noses with such
al strength of a
iental vacancies.
AVhat was the
the Chairman, I
lal signatures at
were afiixed by
to 80 ; i'or it is
hen Mould have
78, and no later
H') remonstrants
ing. But during
of affairs which
ly balanced, had
ave been inevi-
dcd.

stilicd in taking
rial signed even
certain amount
f this nature is
:;c of a different
3n the time for
jnsiderablc pro-
lo/.cn plausible
hours alter the
;y that some of
y by no means

ill the morning,
hour at which
its presentation
imunicate it to
re, presented in
rinters, and the
ch, under such
and i)ossibly a

3 theory at this
;ure have been
e Crown. The
tid would leave
Dominion very

thinly provided with Responsilde Advisers; for as far as I have been able to seize the
spirit of political controversy in Canada, there is scarcely an eminent man in Ihe country
on cither side whose character or integrity has not been, at one time or another, the
subject of reckless attack by his oi)poMents in the press. Even your Lordslii[) and Mr.
Gladstone have not escaped, for it has been more than insinuated that the Imperial
Government have been " got <at " Ity Sir John Macdonald, and that the law offu'crs ol' Her
Majesty were instructed to condemn the Oaths Bill contrary to their legal convictions.

In conclusion, I desire to call your Lordship's attention to the fact that in this Despatch
I have made no allusion to the Royal Commission, which I have just issued under the
advice of my Ministers.

My desir(! is to keep the transactions relating to tin; i)rorogation of Parliament and to
■the issut! of the Commission entir(;ly distinct. These two events are quite disconiu-cted
and independent. The reasons which induced me to agree to the ))rorogation of Parlia-
ment had to be considered without reference to the effect of prorogation on the
Conn;.itteo, or at least tlii-y appeared sufficiently cogent to overpower any countervailing
argumenls i'ounded on the necessity of keeping the Committee alive. However much I
might have dosinnl to do so, I could not have treated Parliament as a pregnant woman,
and ])rolonged its existence for the sake of the lesser life attached to it. If I have
satisfied your Lordship that ])rorogation under the circumstances was the projier course,
the extinction of the Committee was an ill eU'ect with which I liad no concern. It is
necessary to keep this consideration very clearly before our eyes, otherwise a confusion of
ideas will ensui; prejudicial to a correct judgment of the case. The extinction of the
Connnittee is being denounced as the worst feature in the transaction by ])ersons who are
ready to admit that ])rorogation was jjcrhaps a necessity, and they insensibly transfer
their dissatisl'action with the result to the circumstance which occasioned it. The same
class of minds ])robably conjecture that the destruction of the Committee was the main
inducement with my (lovernment for insisting on prorogation ; l)ut with speculations of
this kind I have nothing to do. I prorogued Parliament for w hat I considered not only
full and suffuient, but imperative reasons. The subordinate consequences incident to
the transaction do not therelbrc; come under review.

There is one further point it may be well to remember. I see it is asserted that the
Government purposely kept its sixty members away. Of course I have no means of
knowing how far this may have been the case. It is probable that having concluded
that the Session could not be ])rolonged, my Ministers may have notilied their followers
to that effect ; but it is an indisputable fact that the absence of a considerable proportion
was unavoidable.

In another Despatch I propose to address your Lordship on the subject of the
Commission.

Canada.

The Earl of Kimberley,
&c. &c. &,c.\

I have, &c.,
(Signed) DUFFERIN.

Enclosure 1 in No. 1.

Montreal, July IS.
Ihe following letter has been addressed by Sir Francis Ilincks to the 'Gazette,' and
wul appear in that paper to-morrow morning: —

" To the Editor of the ' Gazette.'
" Siij,

"Although reluctant to anticipate the formal inquiry into Mr. Huntington's
chaises I cannot allow the statement made in the ' Herald' of yesterday by .Mr. Geo. VV.
JlcMullen to remain unnoticed. In all my proceedings regarding the construction of the
I acitic Railway, I have been governed by an opinion, early exi)ressed and never modified,
winch was that, if the construction of that work was undertaken by proper parties, the
lioyernment and the country, instead of thinking that they \ad conlerred a favour on
"" aV'''![1"'v, ,,°"^,^ ^'''''^ '^^*'^'^y i»debted to them. I shall at i)rcsent confine my remarks
on Mr. McMullen s letter to what affects myself here personally. I have a distinct recol-
lection of Mr. McMullen's visit to Otawa in July, 1871. He was accompanied by
Mr. bmith, of Chicago ; Mr. James Beaty, jun., barrister, of Toronto ; Mr. VVaddington,

IS^

|iW'

CORRESPONDENCE RELATIVE TO TITK

Cakada. aii<l Mr. Korstcmun. Thoy wore l)carcrs of an informal proposal for undcn-takinR the
work, and it is true that they Iiad tlic names of several parties of the hij^lu'st resjjeetahility
Mr. Me.Mullen admits tliat it sju'edily beeaine ai»i)areiit to myself and associates tliat
Mr AVaddiiinton had lieen over saiifJiuine in tin; idea tiiat tiie formation of any Company
M'oalil l»e entrusted to his hand. I d(» not pretiMul to recollect all that jjasst'd in tli{
l)ru'f conversalion that took place, Init tlio sulwtance was that the (Jovernment was not iii
a position to negotiate on the snhject. After tjic return of the party to Toronto, I had
some further eorres])on(lence on the siil)jeot, wliich [ only refer to that I may show liow
T came into communication with Sir IFuj^h Allan. I received a letter on tin; 24th p1
July, ae<(uaintinf; me that the writer intended froinf); diirin;;; the following week td
Montreal, along with a gentleman who has heen active in promoting railway enterprises
with a view to bringing this scheme under the notice of Sir Hugh Allan and other capi-
talists ill Montreal. 1 at once sent the J'ollowing reply ; —

" ' Conjidential.

"'Mv ni;Ai! Sn;, -"Ottawa, July 20, 18~1.

" ' I have received your letter of the 2ltli instant , 1 note that you had yoursell
arrived at the conclusion that " the whole matter was disorganized and required

" complete reconstruction." You mention your intention of jjrocceding with Mr.

to Montrt'al to see certain ])arties. Mr. is reported to be aslirewd businessman,

and yet, from your account, he is aliout to see persons regarding a scheme, of th(! advan-
tages of which neither he nor you can have the slightest idea; at least, I certainly am
very ignorant at tiiis moment what aid in land and money the (lovernmeiit will
recommend Parliament to grant. How anyone under such circumstances can talk tn
men of business almut bein;; c meerned in the scheme, 1 am at a loss to comprehend, and
I am persuaded that, owing to Mr. Kersteman's most injudicious proceedings, tin
greatest injury has been done to a great undertaking.

" 'James Beaty, jun., Esip'

1 am,
"'F. HINCKS.

" I readily admit that from the time when the proposals made through Mr. McMullcn
were lirst submitted, 1 was most anxious, but sulely on public grounds, tiiat the negoUa-
lions should fall into other hands. After having [)revenli'd, as l believed I liad done, tin
communication to Sir Hugh Allan, I determined to let him know what was going on. 1
accordingly gave him the names of the American gentlemen who had made the informal
communication, but 1 certainly could not have requested Sir Hugh to communicate witli
them. I did not then even know that Sir Hugh Allan was ])repared to emijark in tlu'
scheme, l)iit 1 readily admit that I was of opinion that several of the American names
were wholly unol)jectionable, and tliat Sir Hugh Allan was as likely as any other
Canadian capitalist to secure eo-operatioa Ijotli in England and Canada. Mr. McMuUcii
refers to an interview, or interviews, with U\o prominent railway bankers at New York,
and prior, I think, to my first communication to Sir Hugh Allan, in the month of August,
1871. During my brief visit to New York in August, 1871, which, I may observe, was
wholly uncunnected with Pacific Railway matters, I had interviews with the gentleman
rel'erricl to, and I believe that I did suggest that the American capitalists, who wen
inclined to promote the undertaking, would iind Sir Hugh Allan a better medium of
communication with the Canadian (rovernment than INIr. McMullen and his Chicago
friends. I acted entirely in the interest of the Canadian people in suggesting to tlic
gentlemen referred to that the parties who had brought the scheme hefore the Government
had not the standing that it was desirable they should have. I was on my way to New
Brunswick and Nova Scotia when the conversations in New York took place, and 1
certainly never gave any address to Sir Hugh Allan. On my return I gave him a list of
names, and he remarked that he knew all or most of them by reputation. The next
reference to me in Mr. MeMuUen's letter is to the meeting of Council on the otli ol
October, 1871, when Mr. McMullen says: — ' It was at once ajjpareiit that they were no!
' I'uUy in accord among themselves.' How this was apparent it would be difficult for
jNIr. McMullen to show, inasmuch as to the best of my recollection no member of tlu
Government said a word except Sir John. Sir .lohii asked Sir Hugh Allan whether \v
had any proposition to submit, to which Sir llugii replied 1)y inquiring whether, if lii'
made a proposition, the Goveruiucnt would he prepared to consider it, or enter into
negotiations ; to which Sir John replied that they were not prepared to do ^o, ami
Sir Hugh rejoined that in that case lie did not think it advisable to make any suggestion.
I have no recollection whatever of holding any private conversation with Mr. McMullen,

;".

TANADIAN PAriFir RAILWAY.

)!• iiiiil<;rl(ikin|T the
;li('st r(;sj)cc'tal)ility
uid associates tlmt
II oi' any ()()in)iaiiv
that jiiiHsi'd in tin
L'fMmi-nt was not in
y to Toronto, I liad
t I may sliow liow
tcr on th(j 2'lth of
I'ollowinj^ wiu'k fn
railway enterprises,
an and other eai)i-

I, .Inly 20, 1871.
t you liad yourscll
ized and required

It;- witli IMr.

rewd business man,
enie, of the advaii-
ast, I certainly am
^iovernnient will
stances can talk (o
,0 eoniiM'ehend, and
3 Ijroceedings, tin

am,

"*F. IIINCKS.

uo'h Mr. jMcMuIIcii
Is, that the negolia-
I'cd I had done;, the
lat was going on. 1
made the inl'ormal
I communicate with
d to embark in the
le American names
ikely as any other
a. M:. MciMuUeii
ikers at New York,
le montli of August,
I may observe, was
with the gentleman
pitalists, who were

better medium of
n and his Chica;;o
I suggestnig to the
no the Government
on my way to Neiv

took place, and I
I gave him a listol
utation. Tlu! next
uncil on the ilth ol
tliat tliey were iini
uld be difficult lor
no member of the
1 Allan whetlur he

ing whether, if lie
r it, or enter into
ired to do f»o, ami
ike any suggestion.
ith Mr. McMuUcn.

and I cannot believe it ))ossiblc that I could have discussed with him the views of Sir
George t!artier. It must be borne in ininil.that all this lime, and for many months aftor-
wards, indeed till after the Scission of I'arliami'ut of 1S72, the objects of the pronuiters
of the I'acinc scheme and of the; (Jovernment were wholly at variaiu-e. IMr. Mc.MuUen and
his followers, both, before; ami aite:- their association with Sir Ilii.rh Allan, were trying
in every possible way, and for this they cannot Ix! blamed, to get the (Government com-
rnittod to entrust the building of the railroad to their ('omi)any, while the {government
Tfere anxious simply to get all possible information so as to «Mial)le them to submit a
Bchenie to Parliament that would be acceptable to c:»pitalists, witlu)ut being too burden-
80me to the country. It is alleged that after Sir Hugh Allan returned from I'lngland, I

aid something al)out advertising for teiulers, so as to avoid blanu'. I must, in the first
ace, declare that I never made any authoriz(;d communication to Sir Ilngh Allan, nor
I recollect that the subject of advertising for tenders was ever under the consideration
of the (lOVcM'ument. If Sir Hugh Allan was pressing for immediate; action, nothing would
be more natural than that I should jjoint out to him that the (iovernment could not enter
into a contract without having jjreviously submitted a scheme to Parliament. 1 may
have talked of advertising for tenders as a mode of ascertaining not only the terms of
capitalists, but also whether there were any other parties ])repared to make oilers. I
cannot now recollect what passed at these conversations, but I am clear that I merely
gave expression to my i)rivate opinion, and] that I was pointing out the imi)ossibility of
any immediate action being taken. This was not owing, as Mr. McMullen alleges, to the
exigencies of the jjolitical situation, but simply to the necessity of obtaining the concur-
rence of Parliament to whatever scheme thi' (nivemment might finally decide on. The
only furth(>r reference to me in IMr. McMullen's letter is to certain alleged money trans-
actions. / siihmnlij di'fliiri' (lint I never asheil and nevev dhtiiiiied, i if/irr hi/ /omi or
g\ft, (tin/ KUia of money fruiii Sir Ifiii/k Alhni, or from any pcrnon mi. /il.s heltalf, or f rum
any person in connection icith the Pacific Jiaihray ; that I never was sounded by
Sir Hugh Allan as to my personal expectations, anel never, directly or indirectly, asked
or obtained any money in connection with tlie sch(;me. Mr. McMullen asserts tliat I
required not only a sum of money for myself, but a situation for my son at a salary of
not less than i?2,()()0 per annum. I never made any sucli demand, but 1 did, on oj>e
occasion, casually say to Sir Hugh Allan, as I had done to other I'riends, that if l>o
hap])ened to know of any employnu'ut for my youngest son I would )je glad if he would
bear him in mind. I had not the least idea at the time of employment under a ('()mi)any
not likely to be in existence for an indefinite and certainly a long time. Sir Hugh
replied, that no doubt when the Pacific Company was formed, he would have no difficulty
in finding him (>mployment, and there the matter terminated. This was long before the
disputes which arose between the rival Ccnnpanies, from which time I determined that no
one connected with me should have any employment in any such Company, and this
determination I communicated to Mr. Abbott. Meantime my son got employment of a
different kind, and without any reference to Sir Hugh Allan. I may add, that at the
time the conversation took place, my youngest son, who held an appointment in British
Guiana, was on leave; of absence, and paying a visit to his liimily. I was anxious that
he should resign his a])pointment, and remain in Canada, anel undertook to find him
suitable employment. I mentioneel him to several friends in Montreal, where I wished
him to settle, and I also mentioned him to Sir llngh Allan. I never imagined that 1
would incur the risk of being charged with bargaining for my sujiimrt to the Pacific
Railway scheme. I desire to state, in conclusion, that t/ie Canadian Government wa.t
never _ in any urty a party to any arranyement between Sir Jfiiyh Allan and his American
associates. From the very first there was the strongest opposition to the introduction e)f
the American element on the part of se^veral members of the Cabinet, and for myself,
though not unfavourable to Americans being introduced, I always felt that Mr. McMullen
Was a source of ^veakness. / further sta:e most jwsitively, that the Government never
entired into any agreement to give the Pacific Railway Charter for monetary considerations
hf any kind. The various eonditiems and the Charter were discussed on their merits, and Sir
Jiugh Allan and his immediate friends were repeatedly obliged to yield points which they
desired to press. The Government honestly tried to obtain an amalgamation between
.;^ho two Canadian Comjianies to the exclusion of Americans, and, Vailing that, they
Incorporated a Canadian Company, in which Sir Hugh Allan's infiuence most certainly
does not preponderate.

"I am, &c.,

"F. HINCKS."

Canada.

■I

rOPRESPONDENrE TIELATTVE TO TTTE

Canaiia.

'' Enclosure 2 in No. 4.

ClIAllTER FOR TIIK C\ PTUUCTIO.V Or TIIK PaCIKIC HaII.WAY,* WITH PaITUS AM)

Coiun;nro\nKNCi;.
"Silt, "Montreal, June Slsf, iHTl!.

" I have (lie honour to inlbrni you that th(! Provisional Directors ol' the Canadian
Pacific ('oin])any held a meeting;, attcr due notice, on Wednesday, tlie IKtIi ol' June
Instant, at which Sir IFuf;h Allan was appointeil President, Mr. Donald Mclnncs Vicc-
presichnt, nnd niysell' Secretary ol' the J'rovisional Hoard.

"I have also the honour to state, by direction ol' the IJoard, that the Canada Pacific
Railway Company is desirous of enteriiii; into an af^reenient with the (iovernment under
the statute res])ecting the Canadian Pacific Railway Company recently passed, and will
I'cel honoured by any commnnication from the Govorninent on the subject.

" 1 have, ttc,
"The Hon. .1. C. Aikins, " I]. LK1\ Dl'] BELLEFEUILLE. Secretary.

" Secretary ol" .State, &c., Ottawa."'

" Canada Pacific Railway Co.,
"Sin, " .Montreal, ;?rd July, 1872.

"I am directed by the President and Provisional Directors of the Canada Pacific
Railway Company to inform you that at a meetin;;' of the Provisional Hoard held
yesterday, the second instant, in Moi\treal, under the presidency of .Sir Hugh Allan, 1
was instructed to write to the (iovernment of the Dominion of Canada, to inform them
that the C!anada Pacific Railway Company is disposed and ready to undertake the
building of the Canadian Pacific Railway, on the terms and conditions contained in t\w
Act respecting the Canadian Pacific Railway, i)asscd at the last Session of the Parliament
of Canada.

*' I have <fec

'• E.' LEF. DE BELLEFEUILLE, Secretary.
" The Honourable J. C. Aikins,

" Secretary ol' State, kc, Ottawa."

*' Department of Secretary of State,
" SiH, ♦' Ottawa, '1th July, 1872.

"His Excellency the Governor-General in Council has had under consideration
your letter of the 21st ult., reporting the provisional organization of ' The Canada
' Pacific Railway Comi)any,' and expressing the desire of the Board of the Company to
be informed when the Government will be prepared to negotiate with the Company in
respect to the construction of the Canada Pacific Railway, and I am directed to inform
you that it is the wish of the Government of Canada that your Comi)any and ' The
* Interoceanic Railway Comjjany ' should unite and form one Company, in accordance
with the tenth section of the Act respecting the Canadian Pacific Railway.

" A similar communication has been made to the President of the latter Company, the
Honble. D. L. Macpherson, Toronto.

" I have, (Src,
«' E. Lcf. de Bellefeuille, L^., " E. PARENT, U.S.S.

" Secretary, Cauiida Pacific Railway Co., Montreal."

" Sir,

" Department of Secretary of State,

" Ottawa, 5th July, 1872.
'I am directed to acknowledge the receipt of your letter of the 3rd instant,
stating that the Canada Pacific Railway Company is disposed and ready to undertake
the building of the Canadian Pacific Railway, on the terms and conditions contained
in the Act respecting the Canadian Pacific Railway passed at the last Session of the
Parliament of Canada.

" I have, &c.,

« E. PARENT, U.S.S.
" Lef. de BcRefeuillo,

" Secretary, Canada Pacific Railway Co., Montreal."

• The Charter will bo found printed at p. 1 of Command Paper, C. No. 750 of Ist May, 1873.

OAVADIAN PACIFIC RAILWAY.

I Papfus AM)

line 2 1st, 1872.
i of tho C;iiiui(liaii
lie lilth ol' .Func
il McIiiiH's Vicc-

Canada Pacific
ovcriiiru'iit iiiulcr
passL'd, and will

LE, Secretary.

I'd July, 1872.

L' Canada Pacific

iial IJoard held

Hui^Ii Allan, I

to inform them

) undertaii(! the

contained in tlic

the Parliament

lE, Secretary.

State,

July, 1872.
consideration

' The Canada
le Company to
le Company in
cted to inform
any and ' The

in accordance

Company, the

5NT, U.S.S.

tate,

July, 1872.
e 3rd instant,
to undertake
ons contained
Session of the

NT, U.S.S.

" Office of the Canada Pacific Pailioad,
"Sir, "INIonfrcal, !)tli .luly, 1S72.

"Wifli reference t(t the last communication addressed to you by the Secretary
of this Company, advisinj^ that the Company was now jn-ejiared to accept ol the contract
for the hnildinj; of the Pacific Uailroad on the terms and conditions authorized in the
Act of Parliament, I have now the honour to state, that if the huildinj; of the I'acilic
Railroail is given to this Company, il will agree, with such assistance as may he olitained
from the (lOVernmvMits of Ottawa and (Quebec, or such other assistance as may he given
us, to build a l)iait« h railroad from some point on the main line of the I'acific Kailroad,
near and north of l,ake TVipissing, to Hull, opposite Ottawa, there to comiect with the
Northern (Joloni/ation Kailroad. This route will cross the Ottawa it Deep Kiver, or
some other point as far up on the north shore of the Ottawa, in the Province ol Quebec,
as the nature of the country will admit.

" This t!omi)any will also agree, with >>uch assistance as we may obtain from the
Government of Ontario, or other assistance that may be given to us, to build another
branch railroad from the Nipissing terminus of the Pacific Railway to such a point
in the I'rovince of Ontario as will coimect the Pacific Kailroad with the railway system
leading to Toronto and other parts of Ontario.

" 1 have, Ike,
"Honourable J. C. Aikins, (Signed) " HCtJlI .ALLAN,

" Secretary of State, Ottawa." " President, Canada Pacific Kailroad.

Canada.

" Department of Secretary of State,
"Siu, "Ottawa, I7th .Inly, 18;2.

" I am directed to acknowledge the receij)t of your letter of the '.'lb instant,
referring to the communications of the Secretary of the Canada Pacific Kailway Company
of the ."h'd same month, advising that the Comj)any was then jjrcpared to aicepl the
t,>;itract lor building the Pacific Kailway, and entering into iurther details on the terms
and conditions on which tlie Company was ready to take the contract for the construction
of said railway.

"I have, &c.,
" Sir Hugh Allan, (Signed) " E, 1»AKENT, U.S.S.

"President, Canada Pacific Kailway, Montreal."

"SlU, Ottawa, 2iul October, IR-o.

" I have the honour to state, in answer to your letter, suggesting that the Canada
Pacific Kailway Company and the Literoceanic Kailway Company should amalgamate',
that the former Comi)any is willing to make such an amalgamation; and that 1
comnmnicated such willingness to the Interoceanic Kailway Company through its
Provisional President, the Hon. Mr. ]McPherson, shortly afti'r reciiving your last' letter.
I have I'urther to state, that 1 have not been informed of any action by the Interoceanic
Company on the subject, having only received an acknowledgment of the reception of
my letter.

" I have, kc,
'■ The Hon. the Secretary of State, &c., (Signed) " HUGH ALLAN, President,

" Ottawa." " Provisional Board, Canada Pacific K.K.

" Department of Secretary of State,
"Sir, _ "Ottawa, :!rd October, 1872.

" I am directed to acknowledge the receipt of your letter of the 2nd inst., in
answer to mine of the tth July last, suggestin^nhat the Canada Pacific Kailway Company
and the Interoceanic Kailway Company should amalgamate.

"I have, &c.,
" fcir Hugh Allan, Montreal." (Signed) " E. PAKENT, U.S.S.

'•Sir,

"Montreal, 14th October, 1872.

y, 1873.

•Hon. J. C. Aikins,

"Secretary of Sfate, Ottawa."

" I have, kc,
(Signed) " HUGH ALLAN,

' President, Provisional Directors.

CORRESPONDENCE RELATIVE TO THE

Canada.

" Memorandum of the Canada Pacific Railway Company upon the Statement submitted by
the Interoceanic Raihvay Company to the Government of Canada.

" The undersigned, the Executive Committee of the Canada Pacific Railway Company,
have to express tlieir obligations to the Honourable the Privy Council lor the courtesy of
a communication of the statement of the Interoceanic Raihvay Company, purporting to
set I'orth the reasons which have induced the latter Company to decline tlie 2)roi)osal of
amalgamation made by tlie Canada Pacific Company. And they avail tliemselves of the
opportunity tlms afforded them, to make some remarks upon the contents of that
statement, tliougli they do not feel that any good result would be attained by answering
it fully and in detail.

"They regard with regret the decision of the Interoceanic Company, but as they
conceive tliat it has been brouglit about chiefly by errors upon matters of fact, they are
not witliout liope that it may be reconsidered.

" In making the proposal of amalgamation, the Canada Company felt iiiat so vast a?i
enterprise riicpiired all tlie strength that could be enlisted in it. They believed that the
Government aid, with all the advantages wliich the Government are empowered to grant,
would not be in excess of the requirements of the undertaking, and :hat there was no
room lor attempting to diminish sucli aid or advantages by competiticn. They consider
that the Govi-rnment had adojjted a wise policy in endeavouring to create by consolida-
tion the strongest Company possiljle, ratner than to attempt to effect some insignificant
saving l)y placing the two Companies in competition with each other and tliey IVlt that
the only pul)lic-spiriled and patriotic course was to meet th« desire of tlie Government
frankly ; and to consent to amalgamation without undue solicitude as lo the terms of it.
Tliey believed that the gentlemen who represented the Interoceanic Com);;vny would be
prepared, as they themselves were, to lay aside any feeling of rivalry that may have
existed, aiul to act vigorously in concert with them for the benefit of l^ie i iidcrtaking.
But at the same time tliey were, and are, i'uUy prepared to undertake and c;.rry out the
enterprise alone ; as tliey have already ascertained, by negotiation with English cipitalists,
that the ])laiis they have lormed fov tlie requisite financial arrangemcpts can, in all
[irobability. be carried out.

" ■\Vitli resjiect to the propositions which the Interoceanic Con pany seek to estal)lish by
the first ])')rtion of their statement, namely, that the organization siiould be pre-eminently
national in its cliaracter; and that its means must be drawn first from Canadian, and
second and chielly from Britisli sources ; the undersigned have simply to say that any
argument for tlie purpose of sustaining such proposition was quite superfiuous, although
possiljly lMiro]iean capital may require to be sought for outside of Great Britain — -no one
will dispute the advantages of committing the construction and running of tlie Pacili;^
Railroacl to a (."i)inj)any of Canadian origin and composed of British subjects; nor
the disastrous results that might lie expected from placing the enterprise under tlic
control of the American Northern Pacific Railway Company. The Canada Company
have always entertained the opinions enunciated in their statement on this subject: and
as proof of that fact, it will appear, on reference to the draft Charter submitted by that
Company to tlie House of Commons, that they proposed to make their Board of Directors
exclusively British ; M'liile, on the other hand, the Interoceanic Company jiroposed by
their draft Charter to create a Board wliich of necessity needed oidy to be British as to
the majority of it. And it was only in consequence of the desire of the Cjlovernmcnt
and I'arlianieiit that the two Charters should lie identical, and of the objection of the
Interoceanic Company to make their Board of necessity exclusively British, that the
Canada Coni[)any took from the Interoceanic Company's Charter the clause requiring
only a majority to be British instead of the whole. And, moreover, the Canada Company
have been actively engaged since their incorporatioi- in negotiations with British
capitalists, excliij^ively tending to the acquisition of m<. lis lor tiie toustruction of
the railway with every prospect of favourable result, should they be authorized to under-
take it.

" In th3 face of these facts, it would seem that the somewhat elaborate argument of
the Interoceanic Com])aiiy, to prove the expediency of making the Company entirely
Canadian and British was not only unnecessary and inapplicable, but possibly might be
said to be out of place as coming from that Company.

" The Interoceanic Company having however submitted various arguments in suj)port of
these jirojiositions, proceed to apply them to the disadvantage of the Canada Company.

" They i-.ssert that it is a matter of notoriety that one of the leading nieuibers of the
Canada Company, and its Provisional President, has been engaged in negotiation witli
gentlemen connected with the Northern Pacific Railway, for the organization of a

CANADIAN PACIFIC RAILWAY.

cut submitted hy
ada.

Iway Company,
r the courtesy ol'
puri)ortiiig to
the projjosal of
lemselves ol' the
)iitents ol' tliat
lI by aiisueriiig

ly, but as they
)i' fact, tliey are

iiiat so va&t an
elieved that the
iwered to grant,
t there was no

Tliey consider
e by consolida-
ne hisignificant
d tliey felt that
he Government
the terms of it.
ii;:vny uould be
that may have
ic tndertrtking.
d c'.rry out the
!;lis'ii cipitalists,
I'ts can, in all

to establish by
) pre-eminently
Canadian, and
) say tliat any
uous, although
Jrituin — no one

of the Pacilio
subjects ; nor
rise under the
lada Company
s subject: and
mitted by that
I'd of Directors
>' j)roj)osed by
•e British as to
e (Government
)jection of the
itish, that the
luise re(j^uiring
lada Company

with British
f)nstruetion of

i/id to undcr-

argument of
pany entirely
ibly might be

sinsiijiport of
I Company,
embers of the
jcitiation with
lization uf a

Company for the construction of the road ; and they say that the impression still exists
everywhere that his original scheme is unchanged, and that his Company, as they term
the Canada Company, is intended to co-operate with })arties in the United States
interested in the Northern Pacific Railway. And they declare that the Interoceanic
Company share this belief.

" That, in reality, is the chief ground stated by the Interoceanic Com})any for declining
amalgamation ; and as it is easy to show that this groimd is entirely unsupported by
facts, the Canada Company hope that, this erroneous impression being removed, the
course of the Oceanic Company may be materially changed.

" With regard to the assertion mat a belief ' exists everywhere ' that the Canadian
Company still intend to carry out the design of combination with American capitalists,
it is only necessary to say that the gentlemen who say so no doul)t s])eaiv truly as to some
limited circle with which they are in immediate communication. But the Canada Com-
pany emphatically deny that beyond such a limited circle any such belief or even any
• idea of such a state of things is entertained.

" The Canada Company are aware that a negotiation was commenced during the
summer of eighteen hundred and seventy-one, between Sir Hugh Allan and certain
Americ n capitalists lor the formation of a Company to construct and run the Canada
Pacific Railway ; but they are informed by Sir Hugh Allan, and have satisfied themselves
by a full inquiry into the circumstances and details of tiiat negotiation, that it was not
initiated by Sir Hugh, and that it was commenced and supported by influential persons
in Canada, as being the only combination that offered itself at that time for the construc-
tion and running of the road; but they are satisfied that that negotiation never possessed
the character attributed to it by the Interoceanic Company, and they know that Sir
Hugh Allan would never have consented to embark with foreign capitalists in a
Canadian enterprise in which he takes so great an interest without the most perfect
securities and guarantees for its control and conduct in the interest of Canada. But the
discussion of the negotiation is entirely foreign to the i)ropositioii now l)eing considered.
That negotiation terminated when Sir Hugh Allan engaged with others in the lormation
of the Canada Com])any, and it has never been renewed.

" The Canada Company never participated in that negotiation, and nintr considered
or entertained any proposition, suggestion, or intention of asking aid i'roin American
capitalists, or of combining with them for the prosecution of tl railway, or for any
other i)urpose. The only negotiations tliey have carried on are .lose already alluded
to with British cajtitalists, and they have never even communicated on the sulyect of
the railway Mith anyone outside of Canada or Great Britain.

" The Canada CJomjiany would further remark on tliis branch of the sui)jcct, that
they are unwilling to attempt to gather from the terms of the statement of the Inter-
oceanic Company any meaning which does not plainly appear upon its face. But they
cannot omit noticing that the weight of this objection rests ujion the suggestion, rather
implied than expressed, that the Canada Conlpany is prepared to lend itself to the
obstruction of the Canada Pacific liaihvay, by placing the control of it in flie hands of
capitalists interes^-d in a rival road. Unless tlie objection is taken as having this bearing,
it would have no weight, and the Canada C;omi)any are thereiore forced to make u single
reman- upon this view of it. They desire expresslv to state that their Company is
compos(-d of gentlemen as fully alive to tb..- interests oi' Canada, and as di'cply interested
in its welfare, as the members of the Interoceanic Company, or anyone else can be.
And they protest formally ..nd energetically against any imputation, whether expressed
or impiied, contemplating the possibility of their taking the course which they cannot
hut interpret as being imjiuted to them by th(> statement of the Interoci'auic Comiiany.
Although probably the Interoceanic Company will accept the ]»ositi\e and uiuiualilied
disclaimer whicn the Canada Company now place on record, it may xwi be amiss to
remark upon the impossibility of any such course being taken as that whicli is implied
111 the Interoceanic Company's objection.

" It will be ol)scrved that the aid in money and lands is onlv to be granti'd hy the
Government as the work actually progresses. It is also necessary that tlu' periods for
the completion of the various sections of the road should be fixed bv the agri«ement
with the Company entrusted with the enterprise. It is also necessary that the Govern-
ment should fix a porio(, within which the work should be comnunccd and proceeded
witli. And it is reasonably to b;- supposed that there would be a i)iovisioii in any agree-
ment made with »he (iovermaent that upon I'ailure in any of these coiuUtioiis the
Company should forfeit its rights to the Government aid. Au'ain, in the proposition of
amalgamation which the Canada Company made to the Interoceanic Coin]iany it was
suggested that the former Comiiany should name a small proportion of the Provisional

£ 2

Canaoa.

Canada.

i^jM--'

CORRESPONDENCE RELATIVE TO THE

Directors, the Interoceanic Company naming a similar number, the intention being that
the remainder of the Hoard, constituting a majority of it, should be agreed upon between
the two Companies and the Government.

" Under these circumstances, the undersigned would observe that the carrying but of
any such plan as that implied l)y or imputed to the Canada Company is simply impos-
sible. Supposing, for argument's sake, that they entertained the intention of placing the
control of the enterprise in the hands of the Northern Pacific Railway Company, the
persons named by them on the Board would constitute but a small minority of it. And
without the concurrence of the Interoceanic Company's no;ninees and those approved of
by the Government, it would be utterly impossible not only to alienate the aid given
by the Government, but even to obstruct in any material degree tiie operations of the
majority of the Board. And if, which is impossible, the small minority could control
the majority so I'ar as either to purj)ort to alienate the aid or obstruct the work, the
remedy would be in the hands of the Government, as no portion of the ])roj)osed assist-
ance could .actually be alienated from the purposes for which it was intended, and the
attempt would only result in the forfeiture of the agreement.

" With regard to the assertion of the Interoceanic Company that they ' very generally
'and equally' represent all the Provinces of the Dominion, and „he comparison of
importance they draw lietwcen the Interoceanic Company's organization and that of the
Canada Company, the undersigned would prefer not to discuss it at any length. At the
s\me time, in justice to themselves, they would remark that they have not a word to say
af'ainst the respectability of the three gentlemen from the Province of Quebec, whose
names ap))ear upon the minuteof the meeting of the twenty-sixth day of September; but
they would ask in what sense or from what point of view can these three gentlemen be
said to represent that great and flourishing Province? \v.l] ."- lO the other gentlemen
from the Province of Quebec, whose names appear in ih' '<l' , . ' Interoceanic Com-
pany, l)ut wlio did not take part in that meeting, the woil ' •■otv'i Jiicumstances of their
reception into that Company prevent tlie expectation that they will exercise; any influence
in its favour. A list of the Provisional Directors of the Canada Company is submitted
herewith to the Government, and the company challenge a comparison of them with the
Provisional Directors of the Interoceanic Company. And they do not hesitate to assert
that th(! public of Canada will feel at least as much confidence in the Board constituted
of those gentlemen as in the board of the Interoceanic Company. They regret the neces-
sity for saying even so much as this on the subject, as they earnestly deprecate any
apjiroach to recrimination or anything that could by any possibility arouse any leeling on
tlie part of the members of the Interoceanic Company ; for it is their di'sire, in answering
their statement, rather to endeavoui' to remove any wrong impression which that Company
may have entertained, than to enter into controversy with them, and tiiey have studiously
avoided remarking upon many matters contained in the statement of tlie Interoceanic
Company, though they have been in many instances strongly temi)ted to do sn in order
that by avoiding all recrimination and controversial comment upon the lin;; ..'.argument
contained in the statement they might manifest their earnest desire to car:" c ih.i wish
of the (Jovenmient fo- amalgamation ; not only because such is the desire > i tj" 'lovern-
ment, but also because they feel that it is in the interest of the » it. v i^. chat all
possible strength should be concentrated upon it.

"'The undersigned are desirous of making one remark more as to the oL.sc >• atirms of
the Interoceanic Company's statement with regard to ])olitics. The Canada Jor^iany
have not in any manner or way interfered in ])olitics, and thcj are at a loss to kuow to
what circumstances the Interoceanic Comjjany can refer in their remark on this subject.

"The t'anada Company is comjiosed of persons holding diU'erent views in political
matters, and those persons have acted in accordance with those views when called .upon
in any way to act politically since they joined the Company as they did boiore. and as
they probal)ly will contiiuu! to do; and the Canada Company have not in any way
resorted to sectional or any other pressure to induce the Government to negotiate with
tliem I'or the constnu-tion of the railway. On this point also it will le jierceived that
the Canada Company confined themselves to vindicating their owi* , tsition, without
assailing or attempting to assail the position or acts of the Interoceaf c "« mnany.

"In conclusion, the undersigned respectfully state that the membets ; llie Canada
Com])any claim for themselves in every respect a strong sentiment of jiiiii otisni, and as
nuu'h pulilic spirit as any of their lellow-subjects, and they consider that their nam«!s
and antecedents are a sullicient guarantee tliat their ^laini is well founded. They are as
sensil)le of the disadvantages of any ''stn'otl'iu to tiie gigantic undertaking in which the
Government of Canada is about to eniliik, as nr i 'icr person or Company can be.
They believe themselves to be as compcieut as tlie Interoceanic Company or any other

■3

CANADIAN PACIFIC RAILWAY.

he intention being that
30 agreed upon betweeu

that tlie carrying but of
ijiany is sini])ly impos-
intention of placing tlie
Railway Company, the
11 minority of it. And
and those approved of
» alienate the aid given
e tlie operations of the
minority could control
obstruct the work, the
of the j)roposed assist-
was intended, and the

lat they ' very generally
,nd .he comparison of
lization and that of the
at any length. At the

have not a word to say
'hue of Quebec, whose
day of September ; but
'se three gentlemen be
lO tiie other gentlemen

. ■ ■" Interoceanic Com-

Jiicumstanccs of their
1 exercise any influence

Company is submitted
irison of them with the

10 not hesitate to assert

I the Board constituted
Tliey regret the neces-
arnestly deprecate any
:y arouse any feeling on
eir desire, in answering

11 which that Company
id they have studiously
ut of tlie Interoceanic
pted to do sn_ in order

II the lin;; .-'.'argument
e to car:" o" ib.; wisii
L> desire ) ti" ^Joverii-
tlie i-.«i,> v> ■;, diat all

to the o:. . • ations of
^hc Caiiauii Jev.^iany
e at a los« to know to
mark on this suiiject.
eiit views in political
Avs when called -upon
ley ilid beibre. and as
luve not ill any way
eiit to negotiate with
vill |.e perceived that
)v '* , r.iition, without
ai! c "i ninany.
mb';!>> '. vhe Canada

:<f jiati otisni, and as
der that their iiam«!s
oiinded. They are as
irtaking in which the

or Company can be.
ompany or any other

Company or body of men to carry out the undertaking, and they are prepared to assume C.iSAD*.
the responsibility with a complete recognition of the weight of that responsibility, but
with assured conviction that they are justified in assuming it. They desire an amalga-
mation with the Interoceanic Company. They are willing to make it upon terms that
jnay be agreed upon as being perfectly just to both Companies, and satisfactory to the
people of Canada. And in the event of such amalgamation, they are prepared to act
•cordially with the gentlemen who may be associated in the Board of Direction with such
members of the Canada Company as may be chosen to form part of it; but if the Inter-
KJceanic Company are not prepared to meet them in a similar spirit, they respectfully ask

iJthat their proposition to undertake the building and running of the Pacific Railway

ifnay meet with the favourable consideration of Government. The whole respectfully

iJjBubmitted.

; (Signed)

'f" Montreal, 12th October, 1872."

" HUGH ALLAN.
"J. J. C. ABBOTT.
" LOUIS BEAUBIEN.

" Department of the Secretary of State,
-*' Sir, " Ottawa, 5th October, 1872.

" I am directed to enclose to yo''. a copy of a communication received from the
President of tlie Interoceanic Railway Company of Canada, on the subject of the amal-
^mation of that Company with the Canada Pacific Railway Company, which had been
suggested by the Canadian Government.

*' I have &c.
(Signed; « E. PARENT, Under-Secretary.
■<<' Sir Hugh Allan, Montreal."

'• Sir, " Montreal, l.'ith October, 1872.

" I have the honour to enclose a list of the Provisional Directors of the Canada
Pacific Railway Comna'-.y referred to in my letter of yesterday's date.

" I have, &c.,
(Signed) "HUGH ALLAN.
■"The Honourable the Secretary of State, Ottawa."

"CANADA PACIFIC RAILWAY COMPANY.

"Provisional Board of Directors, Montreal, 15th October, 1872.

' Sir Hugh Allan, Montreal.
' Hon. .1. J. C. Abbott, M.P., Montreal.
•Hon. A. B. Fost«'r, Senator, Waterloo.
' Hon. John Haiiiilton,Senator, Hawkes-

bury Mills, Ontario.
'Hon. CIi. J. Coursol, Montreal.
' Hon. Jean L. Beaudry, Leg. Councillor,

]Montreal.
'Hon. Cxcdc'on Ouimet, Att. General,

Q., Montreal.
•Hon. David Christie, Senator, Paris,

Ontario.
' Hon. James Skcad, Senator, Ottawa,
'Hon. John J. Ross, M.P. and Leg.

Councillor, Q., Ste Anne de la

P('rade.
'Hon. Donald A. Smith, M.P., Fort

Garry, Manitoba.
'Hon. Thomas McGreevy, M.P., Leg.

Councillor, Quebec.
' Sir Edward Kenny, Halifax, N.S.

"Hon. Louis Archambault, M.P. and

Minister of Agriculture, Q., L'As-

somption.
" Andrew Allan, Esq., Montreal.
" Louis Beaubien, Esq., M.P., 1 lochelaga.
"Victor Hudoii, Esq., Montreal,
" Charles S. Rodier, jun., Esq., Montreal.
"Donald Mclmies, Esq., Hamilton,

Ontario.
" Chai'les F. Gildersleeve, Esq., Kingston.
" VV'illiam Kersteman, Esc^., Toronto.
"Jos. M. Currier, Esq., M.P., Ottawa.
"Jean Bte. Rcnaud, Esq., Quebec.
" Eugi;ne Cliinic, Esq., Quebec.
"Hon. Billa Flint, Senator, Belleville,

Ontario.
" William M'Dougall, Esq., M.P., Three

i{ivers, Q.
" Ilenrv Nathan, Esq., M.P., Victoria,

B.C.
" E, P.. Burpee, Esq., St. John's, N.B."

CORRESPONDENCE RELATIVE TO THE

Canada. " Copy of a Report of a Committee of the Honourable the Privy Council, approved by
His Excellency the G-overnor-General in Council on the 16th October, 1872.

" The Committee of the Privy Council have had under their consideration a letter
addressed to the Secretary of State by the Honourable D. L. Macpherson, enclosing copy
of a lle])ort from the Executive Committee of the Provisional Dircctoi-s of tlie contem-
plated Interoceanic Railway Company, which has been unanimously adopted by th
Directors, The Committee of the J'rivy Council have learned with regret that the
suggestion of the Government, that there should be an amalgamation between the two
Companies, which obtained duriup, the last Session of Parliament Acts of Incorporation
for tlie construction of a railroad between a terminus on the Pacific Ocean and one on
the vicinity of Ltike Nipissing with which all the Canadian railroads could connect on
equal terms, has not been acted on by the contemplated Interoceanic Company for
reasons which are given in the Report of their Executive Committee." The Committee of
the Privy Council admit the importance of securing as much unanimity as possible
among the Canadian capitalists who are disposed to assume the res])onsibility of con-
structing the great work which by the terms of the union of British Columbia with the
Dominion became the duty of Parliament to undertake.

" In the opinion of the Committee of the Privy Council there is no ground for rivalry
between the Province of Ontario and Quebec, especially as the eastern terminus has been
fixeil by Parliament at a point convenient for both Provinces.

"The Committee of the Privy Council has not I'ailed to give their attentive considera-
tion to the reasons adduced by the Committee of the Interoceanic Company for opposing
ialgamation with the Pacific Company, while the latter Company, in deference to
n. sbes of the Government, has expressed its readiness to agree to.

*' .he Committee of the Privy Council concur iii^the ojjinion expressed in the Report,
that the success of the Pacific Railway ])rojcct must mainly depend upon its complete
identification with the public sentiniont of tl»e country, and that the lan<ls ai)propriated
for the construction of the work should be so dealt with as to enlist the whole energies
of the country in their early settlement ; and they therefore admit that the orgiVii.i/ation
should 1)0 essentially and pre-eminently national in its character, and that success in the
British money market is more likely to be attained if the Canadian people Lliemselves
become interested in the undertakinsi;.

"It is unnecessary lor the Committee of the Privy Council to discuss the question
raised in the licport as to the iiiexijcdiency of looking to aid from the UnitLtl States for
the construction of the Pacific Railway, as they do not contemplate seeking such aid,
but on the contrary, most earnestly desire to accomplish the very olij(;ct recommended
in the Report under their consideration, viz. : the united action of the Canadian people
in the work. It is assumed in the Report that the Canadian Pacific Conij)any would be
under the control of citizens of the United States connected with the Northern Pacific
Company. It is said to be a matter of public notoriety that the original proposal of Sir
Hugh Allan, relative to the Canada Pacific Railway, was made in association with the
American gentlemen most prominently connected with the Northern Pacific Railway.

" The I'oregoing statement is the avowed ground of the refusal ol the Interoceanic
Company to amalgamate with the Canada Pacific Company. The Committee of the
Privy Council avail themselves of this opportunity to place on record all that is come to
fhz'ii kiiut ledge regarding tiie negotiations on the subject of the Pacific Railway; when
it became known that the Canadian Governnu^nt was about to invite the consideration
of Parliament to the suijject of the admission of British Columbia into the Dominion on
conditions, one oi' which was that Canada would undertake to procure the construction of
a Pacific Railway, an enterprising gentleman, an inhabitant of British Columbia, the late
Mr. Alfred AV'addington, who had already made extensive surveys at his own expense,
petitioned Parliament for a Charter to construct that line, intending, it is believed, to
obtain aid in England and United States.

" Mr. Waddington had a Bill introduced aild printed, but did not proceed with it
during the Session of 1871 ; aft<!r the close of the Session Mr. \Vadilington, in conjunc-
tion with one or more gtMitlemen in Toronto, visited the United ^tates, having, as he
always stated, failed in securing any co-operation in Canada, with the view of interesting
loreign capitalists in the undi.Ttaking. lie took with him his own printed Bill, and
the Resolutions which had been adojitcd liy Parliament for the admission of British
Columbia into the Dominion, on condition that the Pacific Railway should be con-
structed, and he succeedt.'d

m Ml

teresting in his project a miinber of influential
capitalists, some connected with the Northern Pacific Railway, others entirely uncon-
nected with it.

CANADIAN PACIFIC llAILWAY.

ouiidl, approved by
r, 1872.

insidcration a letter
rson, enclosing copy
itoi-s of the contcm-
ily adopted by the
ith regret tliat the
m between the two
;ts of Incorporation
• Ocean and one on
Is could connect on
:ai«'c Comi)any for
I The Committee of
Jiimity as possible
ijionsibility of con-
Uoliimbia with the

ground for rivalry
terminus has been

ittentive considera-
npany for opjjosing
ny, in deference to

5sed in the Report,
upon its complete
amis appropriated
:he whole energies
at the orjani '-nation
that success in the
people Lliumselves

icusb the question

UnitL.l States for

seeking such aid,

(!cr recommended

i Canadian people

ompany would be

Northern Pacific

Lil pro2)osal of Sir

sociation with the

'acific liailway.

the Interoceanic

Committee of the

11 that is come to

c Railway ; when

the consideration

the Dominion on

lie construction of

yolumbia, the late

his own expense,

it is believed, to

proceed with it
gton, in conjunc-
tes, having, as he
iew of interesting
printed Bill, and
ission of British

should be con-

of inlluential

3 entirely uncon-

" On his return to Canada, Mr. Waddington employed a respectable legal firm in
Toronto.'as solicitors to the promoters of the railway, and visited Ottawa, armed with
.a document, signed by a number of gentlemen of known wealth, in which they stilted
the terms on wliich they would undertake to construct the railway. The deputation had
interviews with some members of the Cxovernment, who received them courteously, and
listened to their proposals, but informed them that the Government was not then in a
position to enter into negotiations. Meantime, the members of the Government, aware
■of the necessity that existed of proposing a definite scheme during the next Session of
Parliament, availed themselves of every opportunity of endeavouring to ascertain the
terms on which Canadian capitalists would be willing to undertake the work.

" The scheme, however, was, so far as they could learn, coldly received, and for
■several months no proposition was received by the Government for the construction of
l|he road, excej)t that already referred to, which was obtained through Mr. Waddington
ind some friends of his in Toronto. At this stage, a member of the Grovernment,
•during a casual visit to Montreal, happened to meet Sir Hugh Allan, when he informed
him of the proposition which had been made, and mentioned to him the names of the
Americans who had made the proposition to the Government. He expressed to Sir Hugh
Allan his regret that such a work should be allowed to fall into the hands of foreigners,
dwing to the apathy of Canadian capitalists. It was after, and in consequence of this
<»nversation, that Sir Hugh Allan put himself in communication with the American
gentlemen already referred to, and it is not a little remarkable that the suggestion made
to Sir Huj,h Allan arose from a desire to carry out the object which the Committee of
the Interoceanic Company appear to have in view. That ol)ject was to secure the
•construction of the work under Canadian management, no doubt being entertained that
there would be no difficulty in finding safeguards against the dangers anticipated l)y the
Interoceanic Company; such were the circumstances under which Sir Hugh Allan's
■connectioii with the American capitalists took place. Sir Hugh Allan was the first
•Canadian capitalist who made a proposition for the construction of the line, and to him
the Government is indebted for the information which enabled them to decide with
confidence as to the scheme to be sul)mitted to Parliament. The Committoe of the
Privy Council think it unadvisable to enter into any discussion of the respective merits
or influence of the rival Companies, especially because they remain of opinion that it
would be highly inexpedient to select either Company to the exclusion of the other.

" Siiould they fail in ol)taining the concurrence of both Comj)anies to their proposition
-for an amalgamation on just and equitable principles, they will be compelled, from a
sense of duty, to adopt other means to secure their ol)ject, which is a cordial co-operation
of the Canadian people of all classes and from all sections of the Dominion, in the
construction of the Pacific Railroad,

" The Committee of the Privy Council have, in conclusion, to state that they have
received the most positive assurances that it is not contemplated by the j)romoters of
the Canada Pacific Company to associate themselves with foreigners, and also that tlie
Company is prepared to accejit any proposition made by the Government for the
iHiri)ose of j)reventiiig the enterprise falling into the hands of an alien projjrietary.
They cannot, under tlie circumstances, recommend that the individual who was the first
Canadian capitalist who entered into negotiations with the Government for the i\m-
«tructio]i of the Pacific Railroad should, with all its associates, be excluded from tlie
management of a work which, as is admitted in the Report under consideration, requires,
in order to ensure success, the cordial co-operation of the Canadian peojile. The
•Committee of the Privy Council are not without hope that on a reconsideration of
the subject, the Interoceanic Company may come to the conclusion that the course which
Would be most for the advantage of the country that they should follow, would be to
act on the suggestion of the Government, and to consent to an amalgamation with the
Pacific Company ; and they therefore recommend that a cojiy of this Minute l)e sent to
^--^'i Companies, and that they be urged to make an early and earnest attempt to
iiicile their differences, and to form an united Company for the construction of the

Cana&a.

botl

recoiu'

Pacific Railroad.

" CertifuHl,

"W. II. HIIMSWORTII.

Clerk, Privy Council."

Canada.

CORRESPONDENCE RELATIVE TO THE

" Department of the Secretary of State,
" Sir, " Ottawa, 0<>tober 2 2n(l, 1872.

" I am directed to forward you the oncloscd copy of an (3r<ler in Council on the
subject of the correspondence between the Government of Canada and tlie Executive
Committee of the Provisional Directors of the contemplated Interoccanic Railway
Company, relative to the Canadian Pacific Railroad.

" I have, &c.,
(Signed) " E. PARENT, Under-Secretary.
"Hon. D. L. Macphcrson,

" President, Interoccanic Railway Co.,' Toronto.
" Sir Hugh Allan,

" President, Canada Pacific Railroad Co., IMontrcal."

" Sir, « Montreal, October 2r), 1872.

" I have the honour, on behalf of the Canada Pacific Railway Company, to
acknowledge receij)! of a co])y of a Report of the Committee of the Honourable the
Privy Council, approved by his Excellency on the Kith instant, and 1 here request that
you nill be good enough to lay before the Honourable the Privy Council the following
remarks upon that Minute : —

" In deference to the desire of the Government, which they consider is in accordance
with the best policy under the circumstances, the Canada Pacific Company are prejjared
to amalgamate with the Intcroceanic Company upon reasonable terms, to be api)roved
by the Government.

" With regard to the statement in the Minute that there would be no difficulty in
finding safeguards against the danger anticipated T)y the Intcroceanic, I would further
say, that the Canada Company is prepared to consent to any safeguard that can be
devised against the possibility of the money or land subsidy being diverted from its
purj)ose.

" I would desire, further, respectfully to remark that the Canada Company is prepared
to make such addition to its members from the Province of Ontario as may bu considered
necessary to constitute a complete representation of that Province in llic proprietary and
on the Roartl of the Company. And, in the event of the Interoceanie Company declining
to accede to the suggestion of the Government, that the Canada Company will be
prepared to submit additional names i'rom Ontario, in order that that Province may be
represented in the Company to the satisl'action of the Goveriuuent.

" I have, &e.,
(Signed) " HUGH ALLAN,
• " President, Provisional Board, Can. Pac. R.R.

" Tlie Hon. J. C. Aikins,

*• Secretary of State, Ottawa."

" Department of tlie Secretary of State,
" Sir, " Ottawa, December 4, 1872.

" I am directed to transmit to you, for the information of the Canada Pacific
Railroad Company, the enclosed Memorandum of the Executive Council of the Inter-
oceanic Railway Company of Canada, upon the INIemorandum sui)mitted to the Govern-
ment by the I'^xecutive Committee of the Canada Pacific Railway Company.

" I have, &c.,
(Signed) " E. PARENT, Under-Secretary.
" E. L. De Bollefeuille, Esq.,

" Secretary, Canada Pacific Railway Co., Montreal."

" CANADIAN PACIFIC RAILWAY.

" Copy of a Report of a Committee of the Honourable the Privy Council, approved by
" His Excellency tlie Governor-General in Council on the .31st January, 1S73.

" The Committee of the Privy Council have had under consideration the correspond-
ence and Reports of Committees ol' the Provisional Directors of the (Janada Interoccanic
Railway Company, and of the Canada Pacific Railway Compai.y, and whilst much

CANADIAN PACIFIC RAILWAY.

ate,

ber 22n(l, 1872.
in Council on the
,nil tlie Executive
rocouuic Railwav

'nder-Sccretary.

:tober 25, 1872.
my Company, to
J Honourable the
liere request that
ncil tlie following

r is in accordance
lany are prei)arecl
s, to be approved

)e no difficulty in

I would further

lard tliat can be

diverted from its

ni)any is prepared
nay be considered
! proprietary and
)nipany declininfi
/ompany will be
Province may be

Can. Pac. R.R.

f State,
ember 4, 1872.

Caiuida Pacific
icil of the Inter-
1 to the Govern-
lany.

ider-Secretary.

regretting that these Companies have not been willing to unite and form one Company for O amada .
the purpose of constructing the Pacific Raihvay, the Committee of the Privy Council are """
unable to advise your Excellency to agree with either of the said Companies separately
for the construction and working of the whole line of railway described in the Canadian
Pacific Railway Act of last Session, .3.5 Vict., cap. 71 ; and they are of ojjinion, and
submit it to your Excellency, that it will be more advantageous for the Dominion, and
will better ensure the attainment of the purposes of the Act above referred to, tliat a
Company should be incorporated under the powers conferred by the fifteenth section of
the above Act, by charter for that purpose.

"And whereas Sir Hugh Allan, of the City of Montreal, Knight; the Honourable
yAdams George Archibald, of the City of Halifax, C.M.G., a member of the Queen's
Iprivy Council for Canada; the Honourable Joseph Octave Beaubien, of Montmagny,
Commissioner of Crown Lands in the Province of Quebec; Jean Baptiste Beaudry, of
the City of Montreal, Esq. ; Egerton Ryerson Burpee, of the City of St. John, Esq. ;
Frederick William Cumberland, of the City of Toronto, Esq. ; Sandford Fleming, of the
City of Ottawa, Esq. ; Robert Newton Hall, of the Town of Sherbrooke, Esq. ; the
Honourable John Sebastian Helmcken, of the City of Victoria ; Andrew McDermot, of
the Town of Winnipeg, Esq.; Donald Mclnncs, of the City of Hamilton, Esq. ; Walter
Shanly, at present of the Town of North Adams, in the United States of America, Esq. ;
and John Walker, of tlie City of London, in the Province of Ontario, Esq., have stated
their ability and willingness to form such Company, and that they have a subscribed capital
of ten million dollars, and that they are ready to enter into an agreeir ent for the
construction and working of the said line of railway; the Committee recommend that
negotiations be entered into with the said persons for the purpose of settling the terms
of an agreement under the Act between the Grovernment and such persons, and that the
Minister of Justice be instructed to conduct the same.

" Certified,

"W. A. IIIMS WORTH,

"Clerk, Privy Council."

" Department of Justice,

"Ottawa, 31st January, 1873.
" The undersigned, to whom was instructed the conduct of the negotiations witli Sir
Hugh Allan and his associates for the construction of the Canadian Pacific Railway, by
the Order in Council of this dale, begs leave to rejjort : —

"Tliat he has settled an agreement, and a draft Charter under such agreement, with
Sir Hugh Allan and his associates, which he begs leave to submit for the consideration
of your Excellency in Council.

"JOHN A. MACDONALD." '

oil, approved by
uary, 1873.

the correspond-
ida Iiiteroceanic
d wiiilst much

"Copy of a Report of a Committee of the Honourable the Privy Council, approved by
His Excellency the Governor-General in Council, on the 31st January, 1873.

"The Committee of the Privy Council have had under consideration the Report of the
Hon. the Minister of Justice, and the accompanying draft agreement i)repared pursuant
to the Order m Council of this date, and they recommend that the said draft be accepted,
and an agreement according to its terms be entered into with Sir Hugh Allan; the
/Honourable Adams George Archibald ; the Honourable Joseph Octave Beaubien ; .lean
gaptiste Beaudry, Esq.; Egerton Ryerson Burpee, Esq.; Frederic AVilliam Cumberland,
^sq.; Sandford Fleming, Esq.; Robert Newton Hall, Esq.; the Honourable John
|eba4ian Hel....ken; Andrew McDermot, Esq.; Donald Mclnnes, Esq.; ^Valter Slianly,
*iSO, ; and John Walker Esq. ; for the construction and working of the whole line of the
Cai.adian Pacific Railway, under the Statute 3.') Victoria, cap. 71.

1^ " The Committee have also had before them a stock list, showing that the said persons
,*ave a subscribed capital of ten million dollars, and they are of opinion that under and
^unZ ^^^^^ °^ ™''^ agreement, such capital is satisfactorily secured.
'I ^,^'^^y therefore advise that on the execution of such agreement by il.e said parties,
-a Cfiarter may properly be granted to them under the Great Seal, pursuant to the 15th
clause of the said Act.

" Certified,

" W. A. HIMSWORTir,

" Clerk, Privy Council."

■ifflTT

I. :

Pahada.

^^w

CORRESPONDENCE RELATIVE TO THE

" Depart mont of Justice,

"Ottawa, .Mst January, 187,'].
" The undersigned lias the honour to report, that the agreement between the Govern-
ment and Sir Hugh Alhin and liis associates, lb" tlie eonstruction oi' the Canadian Pacific
Hailway, wliieh was accepted by tlie Order in Council ol" this day's date, has been duly
executed by them. He thevcibre recomnu'uds that a Charter under the Great Seal be
granted to such jjcrsous, pursuant to the 15th clause of the Statute 3'> Victoria, cap. 71.

" JOHN A. MACDONALD."

"CorY of a Report of a Committee of the Honourable the Privy Council, dated 31st
January, 1S73, and ai)])roved by His Excellency the (jovernor-Gencral in Council
on the "jth February following.

" The Committee of the Privy Council have had l)efore them the Report of the
H(inoural)le Minister of Justice of this date, stating that the agreement mentioned in the
Order in Council of this day's date, for the construction of the Canadian Pacific Railway,
by Sir Hugh Allan; the Honourable Adams George Archibald; the Honourable Joseph
Octave Reaubien; Jean Baptiste Beaudry, Esq.; Egerton Kyerson Burpee, Esq.;
Frederic William Cumberland, Esq. ; Sandford Fleming, Esq. ; Robert Newton Hall,
Esq.; the Honoural)le John Sebastian Helmcken ; Andrew McDermot, I']sq. ; Donald
Mclrnics, Esq. ; Walter Shanly, Esq. ; and John Walker, Esq ; has been duly executed
by them. The Committee therefore recommend that your Excellency do ord(!r that a
Charter be granted to such persons under the Great Seal of the Dominion, pursuant to
the 15th clause of the Act 35 Vict., cap. 71.

"Certified,

" W. A. HIMSWORTH,

'* Clerk, I'rivy Council."

" Department of Secretary of State,
"SiH, "Ottawa, lltii February, 1873.

" I am directed to transmit to yon tlie enclosed Charter of ' The Canadian and
' Pacific i^ailway Company," tlie receipt of which you will be good enough to cause to be
acknowledged.

'' f have, &c.,
" Sir Hugh Allan, cl'c, c<cc., &c., Montreal." (Signed) " E. PARENT, U.S.S.

"Sir, 'Olontreal, 17th February, 1873.

" I have the honour to acknowledge receipt of your letter, dated 14th instant,
accompanied with the Charier of the Canadian Pacific Railroad.

" I have, (Src,
(Signed) " HUGH ALLAN.
" E. Parent, Esq., Under-Secretary of State, Ottawa."

" Ofiice of the Interoccanic Railw/.y (^ompany of Canada,
" Sir, " Toronto, 20th of June, 1872.

" I have the honour to inform you, that the Intcroceanic Railway Company of
Canada was this day organized provisionally by election of myself as President, Mr.
Charles H. Fairweathcr as Vice-president, and Mr. John Hague as Secretary.

"I shall feel obliged by your informing me when the (fovernment will be prepared to
negotiate with this Company, in respect to the construction of the Canadian Pacific
Railway, authorized Ijy Parliament last Session.

" I have, &c.,
(Signed) " D. L. MACPHERSON,

" President of Board of Provisional Directors.
" To the Honourable

" The Secretary of State for Canada, Ottawa."

CANADIAN PACIFIC lUILWAY.

January, 1873.
wccii the Govcrn-
Caimdian Pacific
te, has been duly
he Great Seal be
'^ictoria, cap. 71.

MCDONALD."

uncil, dated 31st
,'neral iu Council

\c Report of the
mentioned in the
1 Pacific Railway,
'onourable Joseph
n Burpee, Esq. ;
■rt Newton Hall,
ot, Esq.; Donald
en duly executed
f do order that a
nion, pursuant to

[T,

'rivy Council."

)f State,
•'(•bruary, 1873.
riie Canadian and
ikIi to cause to be

VRENT, U.S.S.

•Y^bruary, 1873.
ited 14th instant,

UGII ALLAN.

Janada,

oi" June, 1872.
Iway Company of
as President, Mr.
efary.

ill be prepared to
Canadian Pacific

|)N,

onal Directors.

" Department of Pcrrctary of State,
««Sni, "Ottawa, -Ith July, 1>!72.

" His Excellency the Governor-General in Council has had under consiileration
your letter uf the 2()th ultimo, ri'i)()rtinf; the jjrovisional organization of ' The Intcr-
' oceanic Railway Company of Canada,' and ex])ressing the desire; to be inlurmeil when
the Government will Ih' ])rei)arod to negotiate with the C()mi)any in respect of the con-
struction of the Canadian Pacific Railway, and I am directed to inform you that it is the
wish of the (Government of Canada that your CJompany and 'The Canada Pacific Rail-
• way Company ' should unite and form one Company, in accordance with the tenth
section of the Act rcsjut'ting the Canadian Pacific Railway.

', "A similar communication has been made to the Secretary of the latter Company,
'.E. Lef de Belleleuille, INloiitreal.

" I liave, &c.,
t (Signed) " E. PARENT,

" Under-Secretary ol State.
*'IIon. D. L. Rlacpherson,

" President, luteroceanic Railway Company, Toronto."

Canada.

« Sir,

" Office of the luteroceanic Railway Company of Canada,

"Toronto, 28th September, 1872.

" I have the honour to state, for the information of the Government, that 1 convened
a meeting of tlu; Provisional Directors of the luteroceanic Railway Comjjany ol' Canada,
for the i)urpose of considering the suggestion of the Government, that this Company should
Mnalgamate with the ('aiiada Pacific Railway Company.

" At the request of the Board, I send herewith a copy of a Rejjort from the; Executive
Committee upon the subject, adopted unanimously by the Board, declining amalgamation
for the reasons set forth.

"I am also requested by the Board to intimate to the Government that this Company
is prepared to enter into arrangements for building and working the Canadian Pacific
Railway.

" I have, Sec,
(Signed) " D. L. MACPIIERSON,

" Provisional President.
^ To the Honourable the Secretary of State, Ottawa."

^ " luteroceanic Railway Company of Canada,

"Toronto, 2fith Sept., 1^72.
"At a meeting of tlie Provisional Directors of the luteroceanic Railway Company of
Canada held this day, jjresent in person or by proxy : —
" Tiie Hon. D. L. IMacpherson, President ;
"Charles H. Eairweather, l^sq., Vice-i)resident ;

" The Hon. Messrs. VVm. McMaster, Prank Smith, John Simpson, G. W. Allan, Is.

Tlnbaudeau, John Carling ; J. W. Cumberland, l^sq., C. S. Gzowski, Esq., J. G. AVorts,

Esq., John \Valker, Esq., \V. II. llowland, Esq., David Torrance, Esq., John Boyd, Esq.,

T. Kemiy, Esq., Edwin Russell, Esq., J. F. Raudolph, Esq., John Starr, Esq., the Hon.

|D. E. Price ;

•i " A communication was read from the Government, suggesting that the luteroceanic
iKailway Com])any should amalgamate with the Canada Pacific Railway Company. The
j^foUowing Report thereon from the Executive Committee was also read:—

l" To the Provisional President, Yicc-presideut, and Directors of the luteroceanic Railway
* Company :

■'"i'our Executive Committee have had under consideration a communication from the
overnment, expressing a wish that the luteroceanic Railway Company should amal-
Igamate with the Canada Pacific Railway Company, and they now beg leave to report :
^ Ihat they have given their best attention to the proposal, solely with reference to
the successful and early completion of the Canadian Pacific liailway.

Ihe construction and management of an undertaking involving sucli vast and varied
interests must, in their opinion, mainly depend for success upon its complete identification
with the public sentiment of the country.

F 2

.HI-

mT?T?ESPONDENCE RELATIVE TO THE

Oakada. "The subsidy in money, though in itself large, is still insignificant relatively to the

■~~~ enormous outlay that must attend the construction of the work. The Company having

to rely upon the disposal of their lands for the greater j)art of tlieir expenditure, renders

it desirable, nay necessary, that the land should be dealt with so as to enlist the whole

energies of the country in their early settlement.

" It is tlrerefore of supreme importance that the organization through which the railway
is to be Ijuilt should be essentially and pre-eminently national in its character.

" The sources irom whence the Comi)any's means must be drawn arc twofold :

1st, Canadian; 2nd (and chielly) British.

Success in tlie British money market will, in tlic opinion of your Committee, depend
in a great measure upon tlie extent to which the Canadian people themselves became
interested in tlie undertaking.

"It is perfectly futile to look to the United States for aid in this work, as it is
necessarily a rival to the several existing Pacific Railways. While this remark applies
generally to its I'uture as a commercial enterprise, it is in the meantime still more
apjilicable and weighty in reference to the measures required for the early settlement
of the vast regions traversed by the rival lines through the United States. The Canadian
Pacific Railway Company must compete in Great Britain and Europe generally for the
emigration tlience, and tliiscan never be done advantageously or successfully in association
with any of the American interests concerned in tlie trans-continental traffic. The
suggestion for amalgamation with the Canada Pacific Company, more generally known
as tiiat organized by Sir Hugh Allan, forces upon your Committee the consideration of
the matters above referred to.

" It is a matter of public notoriety that the original proposal of Sir Hugh Allan,
relative to the Canada Pacific Railway, was made in association with the American
gentlemen most prominently connected with the Northern Pacific Railway. It is gene-
rally believed that the Government are themselves aware of this; and it was mainly
owing to tlie ai)preliension that the control of a work, ui)oii whicli the I'uture of the
Dominion so mucji depeuds, might pass into American hands, that the Interoceanic
Comjiauy was called into existence.

" The public of Canada instinctively felt that if the parties interested in the Northern
Pacific Railway were permitted to control the Canadian line, that such a combination
would obstruct the material as well as political alliance with tlie British possessions on
the Pacific Coast, and retard and endanger the successful settlement of the fertile Western
Territory of Canada.

" From one end of the Dominion to the other, but more especially in the great Province
of Ontario (ui)on whose peojde the greater part of the Inirdeii of the cost of the railway
must fall), there have come unmistakable indications of public opinion on the subject,
and the names connected with the Interoceanic Company conclusively show the general
determination to make the work distinctively national and Canadian. It may appear
inviflious to institute comparisons between the relative importance of the Interoceanic
Company's organization and that of Sir Hugh Allan's Company, but this cannot be avoided
when the proi)osal is one for amalgamation.

"Your (.'ommittee must therefore remark that the Interoceanic Company is probably
the largest and most influential combination of men of cai)ital and position which could
be found in the Dominion, not confined to one Province, but very generally and er[ually
representing all.

" AVitli respect to the other Company, your Committee submit that it is not in any
broad or national sense representative of the Dominion.

" Its active infiuence is almost exclusively confined to the Province of Quebec, and in
that Province to the city of Montreal; but excejjting Sir Hugh Allan himself, and two
or three other gentlemen, it cannot witli fairness be designated as representing the capital
and enterprise of even that community.

" It is no injustice to say that the claims of Sir Hugh'^Allan's Company rest, not upon
general public support, but mainly upon the position of Sir Hugh Allan himself Early
though it be in the history of the Canadian Pacific Railway, the dangerous character of
such ail organization as the Company you arc invited to amalgamate with has already
been made apparent by its promoters resorting to the arena of politics for that strength
and support not due to its intrinsic merits.

" The Interoceanic Company, on the other hand, has relied solely upon general
public support, and has in no instance appeared as desirous'of unduly influencing the
Government.

" If the Canadian Pacific Railway is to be made the subject of undue and improper
pressure by one section of the Dominion to the prejudice of others, it will soon acquire

CANADIAN rACIFIO RAILWAY.

relatively to tlie
Uomiiany having
i'lulituro, renders
enlist the whole

hich the railway
ractcr.
twofold :

mmittce, depend
mselves become

s work, as it is
remark applies
time still more
early settlement
The Canadian
generally for the
llv in association
tal traffic. The
generally known
consideration of

ir Hugh Allan,
1 the American
ivay. It is gene-
1 it was mainly
le I'uture of the
the Interoceanic

in the Northern
h a combination

1 possessions on
i fertile Western

ic great Province
of the railway
on the subject,

low the general
It may appear
le Interoceanic

nnot be avoided

lany is probably
which could
ly and equally

; is not in any

Quebec, and in
imself, and two
ting the capital

rest, not upon

limself Early

)us character of

ith has already

that strength

upon general
influencing the

and improper
ill soon acciuire

a reputation which will destroy public confidence in the enterprise, and occasion either
its abandonment or completion at sacrifices far beyond any that the country now
contemplates.

'' Your Committee readily admit that it would be desirable to secure the united strength
of the Dominion in support of this work, and if the Company organized by Sir Hugh
Allan really represented Canadiau interests, though local, it would be well to have their
co-operation.

"Dut, unfortunately, the impression still exists everywhere, that Sir Hugh Allan's
original scheme is unchanged, and that his Comjiany is intended to co-ojjerate with the
parties in the United States interested in the Northern Pacific Railway, and your
Committee sharing this beliel', cannot regard the proposal of amalgamation as otherwise
than ill-advised and dangerous to the public interests.

, "Your Committee are convinced that such an amalgamation would at once destroy
jj^ublic faith in the Company as a Canadian undertaking.

; " They believe that if amalgamation were accomjjlished, the best friends of the
enterprise in Canada would reluse their aid, and that in consequence an e.\cuse would
be found for ])lacing it under the control of the rival American Company, or of its chief
promoters, in the illusory hojie that they Mould carry it through to completion.

"Your Committei! iail to luul an adequate reason for asking the Interoceanic Company
to part with its individuality.

"The i)ublic everywhere evince confidence in it as it is.

" Assurances have been received I'rom every Province in the Dominion (except
Manitoba), that the quota of stock allotted to each by the Act of Incorporation would
be subscribed, and in some of the Provinces much more than such allotted quota would
be taken.

" In this way all classes of the community would be closely identified with the great
national work, and the I'ulfilmcntof such assurances would vastly strengthen the Company
in its negotiations in England and on the continent of Europe.

" By entrusting the execution of the Pacific Railway to the Interoceanic Company,
the Government will, in eflect, be dealing with the representatives of their own people.

" They will be assured of the application of every dollar and every acre to the sole
object which Parliament contemplated in granting the sui)sidies, and that the lands will
not be permitted to pass under foreign control, or be held back from settlement for
years, or until those of the Northern Pacific Railway Company are occupied. Your
Committee cannot avoid drawing attention to the fact, that the promoters ol' the line
•which is our nearest rival route — the gentlemen with whom Sir Hugh Allan has been
acting — depend wholly upon the sale of their lands ibr means to construct that railway.
It is, therefore, of extreme imi)()rtance to the promoters of that line, the Northern
Pacific, to get control of the Canadian lands (which almost equal in area England and
Scotland), and to retard their settlement until their own are disposed of.

" No more suicidal policy could be pursued by the people of Canada than to allow
their rivals to have such an interest in this national undertaking as would virtually
transfer to them the ownership and control of .50,000,000 acres of Canadian territory ;
would invest them with the direction of the immigration pulicv, vhich must be
inaugurated for the settlement of those lands ; confer upon them the iicwer to influence
the construction and progress of the railway, and grant to them, in perpetuity, a
monopoly of the traffic over the Canadian, which is the shortest and best trans-continental
route.

" Your Committee firmly believe that amalgamation means the admission of this rival
United States interest into the organization of th '.'.nadian enterprise, and that once
admitted and wielded for one object, it would speea.ly master the divided and weakened
Canadian representation. They consider that this danger far outweighs any possible
advantage that could result from union with Sir Hugh Allan and his associates. They
are convinced that the jjublic would shrink from committing themselves and their means
to the undertaking, and they therelbre respectfully recommend that the Board of Directors
(Of this Company inform the Government that they cannot be parties to any amalgamation
rWith the Canada Pacific Company, but are prepared forthwith to enter into arrange-
Cinents on behalf of the Interoceanic Company for the construction and working of the
Xanadian Pacific Railway.

" All of which is submitted.

Canada.

(Signed) " D. L. MACPHERSON.
" W. SHANLY.
"W. H. IIOWLAND.

(Signed) " C. II. FAIRWEATHER.
" FRED. CUMBERLAND.

4*;

COKnT'SrOXDKXCK TJKLATTVE TO THE

Oamapa. "Alter discussion of tlit- l'()iTi:;()ing Ki-port, the I'oUowiiig Kesoliitiou .., carrieil
uiianiinoiisly : —

" ' That the llciiorf of tlic I'lxt'ciitivc (Jommittoc, just read, l)o approved and adopted,
and that tlic I'rcsideiit \n- i'e<|iicstc(l to traiisniil a (■()))y of the same to the (ioveriiineiit,
as settiiiu; i'orth the leivsoiis ol' tliis JJoard lor declining anial,!i;amution with tlu- Canada
Paciiic iiailway (.'oni])aiiy.'

" A true extract lioni th(! minutes of the Provisional IJoard of tlie Intcroceanic Rail-
way C'oniiiany ol' Canada.

(Si-ned) "JOHN HAGUE,
" T(n-onto, Sept. 28, 1872." "Provisional Secretary.

" Sir, " Ottawa, October 7, 1872.

'' I am directed to acknowledge the receipt of your letter ol tlie 28tli ultimo, and
inelosures, inlorming this Dei)artment liiat tiie Interoceanic liailway Com])any ol' Canada
declines its amalgamation witii tiie Canada Paciiic J{ailway Company, asproimsed by the
(iovernment, and intimating that the Company is ])rei)ared to enter into arrangement I'or
the building and working ol' the Canadian Pacific Kailway.

" I have, etc.,
(Signed) "E. PARENT,

" Under-Secretary of State.
" Hon. D. L. Maci)lierson,

" President, Interoceanic Railway Company, Toronto."

" Department of Secretary of State,
" SiK, " Ottawa, October 1 C, 1S;2.

" I am directed to transmit to you the enclosed copy of a * Memorandum of the
' Canada Paciiic liailway Company," upon the statement submitted by tlie Interoceanic
Kailwav Company to the Goyernmenl of Canada.

" I have, &c.,
(Signed) " E. PA' r,

'r-Secretary of State.
" Hon. D. L. Macplierson,

" President, Interoceanic Railway Company, Toronto."

" .Memorandum of tlie executive Committee of the Interoceanic Railway Company of
Canada, upon the Memorandum suljmitted to the Government by the IvKccutive
Committee of the Canada Pacific Railway Company,' dated 12th Octo])er, 1872.

" The imdersigned, the Executive Committee of tlie Interoceanic Railway Company,
oiler their ackllo^^ ledgments to the Honourable t'lc Privy Council, for communicating
to them ll'.e Memorandum of the Canada Pacific Company upon the communication
addrcsM'd to the Covernment by the Interoceai ic Company, on the .'Kith September
last; seltiiig fortli their reasons for declining amalgamation with the Canada Pacific
C'onipaiiy.

"Thc! undersigned 1)og to say that when trans nitting that statement to the Govern-
ment, the Interoceanic Company had no intentitn of entering upon a controversy with
the Canada Pacific Company through the medium of the Government. But they "do not
regret tliat tlie (lovernment saw fit to communica.e it to the Canada Paciiic Company.
The olijecl of the Interoceanic Company was merely to communicate, frankly, to the
(tovi'mnient the reasons which prevented their complying with the request of the
Govei iinuut to amalgamate with that Company.

" Tiie Interoceanic Company decided against aiiialsramation after mature deliberation,
and luider tlie firm ])ersuasion that they were acting in the true interests of the country.
The undersigned will now proceed to comment briefly upon the Memorandum of the
Executive Committee of the Canada Pacific Comjiany.

" Tlie undersigned observe that the Committee of the Canada Pacific Company profess
to concur lull) in the opinion which the Interoceanic Company holds, namely, that the
importance to Canada of the Canadian Pacific Railway being owned and worked pre-
eminently as a Canadian enterprise, cannot be exaggerated. It is matter for regret tliat
the Canada Pacific Company, or its chief promoter, did not always entertain this opinion;

fcr
Di

CANADIAN I'AC'IFIO IfAlLWAY

111 ..-. oarried

i and adopted,
e (ioviTiuniiit,
ith tilt; Canada

croceaiiif Rail-

al Secretary.

ober 7, 1«72.
8tli ultimo, and
|)any of Canada
[jroposed by the
irrauL^emeut I'or

tary oi" State.

■ State,

ibcr 1(1, IS 72.
oraudiim of the
the Interoceauic

tary of State.

ivay Comiiany of
lY the HN.ecutive
ctober, 1872.

lilway Company,

[• communicating

communication

50tli September

,e Canada Pacific

t to the Govern-
controversy with
But tliey do not
'acilic Company.
(, frankly, to the
e request of the

turc deliberation,
ts of the country,
norandum of the

Company profess
namely, that the
and worked pre-
:er for regret that
tain this opinion ;

lind they or he done so, it is probable the Interoeeanie Company would never havesouglit
ineoi'poration.

"The Committee of the Canada Pacific Company seem anxious to eslal)li-.li tli.it the

})rom()ters of that Company are more Canadian than the pnimoters of the Interoceauic
>mipany, because tbcdralt Charter, as originally submitted to I'arliamen' by the former
Comiiany, provided that all the l)ire<'tors should be l>iitisb subjects, wliib; that of the
Interiiccauic (.'omjiany oidy required that a niiijority should be so. The undersigned
must express surprise that any importance should seem to be attached to what is mani-
festly unimportant, if not positively trivial. To maki; the ('ompany really Canadian, it
is iu'('ess.uy that the greater part of the stock should be bona (ido held by Canadians and
JBritish subjects.
% " It was the purpose of the Interoceauic Company to secure that object, and, it once
'secured, tliey saw no reason for excluding any class of their fellow-citizens, wliether
.native born or alien, from j)arlicipatiiig in the management of the ('omi)any.

"Shareholders have the ]i()wer to control the i)olicy of (companies; Directors are
.merely their agents or deputies to carry it out. If Canadians hold bona fide acontrolling
amount of the stock of the Canadian Pacific l^ailway, they will see that the Directors,
•whatever t!u;ir luitionality, manage the undertaking for the adv uitage of the sharehnldeis
,and of Canada; but if a controlling ])ortion of the stock is held by citizens and residents
of the United States interested in a rival railway, they will see that tlu'ir Directors carry
out their policy regardless of Canadian interests, even if the law required every member
of the Hoard to be a P.ritish sul)ject ami a resident of Canada; under such circumstances
if any of the Directors ])rove too ]);itriotic to give eHect to tlie designs of the foreign
shareholders, they will be remove(l and more subservient men elected in their stead.

" Th(! Committee of the Canada Pacific Company argue at great lengtli, that under
their proposal for amalgamation it would be inqxjssible to alienate any jiortion cd' the
public subsidies from the purpose for which they were intendeil, and that an attempt to
alienate them, if made, would result in a forfeiture of the agri'ement.

"The undersigned see no force or weight in this argument. But even if it has some
force, as far as it apjjlies, it would !> of little moment; for desirable though it be that the
advantages resulting from the construction of the railway should be insured to Canadians,
yet tliese advantages are insignificant when c()m])ared with those that would follow the
ownership of the road after completion, viz. the possession of a vast territory' in the
heart of the Dominion, and the eontrcd of a large trans-continental traflic.

"The undersigned regret that the Committee of the Canada Pacific Company, Mhile
admitting- tlie respectability of the Directors of the Interoceauic Ccnnpany from the
Province of Quebec, should have made three of those gentlemen the subject of invidious
attack. The gentlemen referred to are too well known, at home ami abroad, as suceessl'ul
merchants of high character and wide infiuence, to require any vindication from this
covert and unwarranted attack. They compare favourably with any gentleman ujion the
Provisional Board of the Canada Pacific Company, or any other Board of Directors iu
the Dominion.

. " The uiulersigned do not know what is referred to in the following extract iVom the
Memorandum of the Committee of the Canada Pacific Company:—' And as to the other

* gentlemen whose names appear in the Bill of the Interoceauic Company, but who did
' not take part in that meeting, tlie well-knoAvn circumstances of their recei)tion into
' that Company prevent the expectation that they will exercise any iullueuce in its

* favour.'

" If the insinuation is intended to charge that the names of any gentlemen were
introduced into the Charter of the Interoceauic Company, either as Provisional Dii'cifors
;0r Corporators, without their knowledge and consent, the undersigned meet that charge
by the most unqualified denial. Of the one liundred and seven names which appear in
|he Charter of this Company, no name was placed tlicre except at the solicitation or
with the permission of the gentleman named; but the undersigned have been given to
understand that of the eighteen names which appear in the Charter of the Canada Pacific
"Company, more than one, and tliat too of the more influential among them, were used
without permission.

. " The Committee of the Canada Pacific Company deny, in most distinct terms, that that
Company have in any way interfered in politics.

"The undersigned can only assume that the Committee desires to state that no inter-
ference m politics took place under authority of a formal resolution of the Provisional
Dn-ectors of that Company.

" Ihe public press has made the whole country aware of pressure having been brought
to bear upon the Government by Sir Hugh Allan during the lAIontrcal election.

Canada.

CORRESPONDENCE RELATIVE TO THE

Oahada.

" On the eighth day of August last, Sir Hugh Allan tlelivered a public speech, of
wliicii a report appeared in the newspapers pu'olished on the following morning. Sir
Hugh, then as now. President of the Canada Pacific Company, in tiiat sjieerh, referrin;^
to the contract for that enterprise, declared that he had received pledges iromSir George
Cartier which were entirely satisfactory to him. His own words were: — 'I have every
• reason to be satisfied with what Sir George has done.' Unless it can be sliown that
the Provisional Directors of the Canada Pacific Company disajiproved of and annulled
the agreement or arrangement which Sir Hugh Allan, their President, declared he had
concluded to Ins own entire satisfaction, the undersigned submit that the Canada Pacific
Company must be held to be parties to that agreement.

" Tile undersigiied consider that it woU'd liave Ijcen ]iroper in the Canada Pacific
Company to have communicated that agreement to the Iiiteroceanic Company when
proposing amalgamation.

"The Interoceanic Company have at all times studiously avoided everything cal-
culated tu arouse sectional feeling, and have always lield that all tralTic intended for
the Maritime Provinces and for shipment to Europe via the St. Lawrence, should go
by Montreal ; but they have likewise held that the interests of the Railway Company
and of the Dominion require that the location of the Pacific Railway shall be as near
the settled and tax-paying districts of Ontario as the reasonable directness of the line to
tide-water may permit. VVhile the Interoceanic Company have avoided all sectionalism,
it wiP be noticed by those who may read Sir Hugh Allan's speech, already referred to,
that he unfortunately excites it, and to justify his doing so, advances the extraordinary
doctrine, that thos'j for the transport of whose ])roducts and merchandise railways are
constructed ' iiave a ]ess direct interest' in their location and economical construction
and running than those wlio have .nerely the liandling of the property at a port of
transshipment.

"Tlie Committee of the Canada Pacific Company admit that negotiations were
carried on between Sir Hugh Allan and certain American cajiitalists for the formation
of a Company to construct and run the Canadian Pacific Railway, but they say ' that
' this negotiation was not initiated by Sir Hugh, but was commenced and supported by
' influential persons in Canada, as being the only combination that ofltjred itself at the
' time lor the construction and running of the road, and tliey are satisfied that that
' negotiation never possessed the character attributed to it by the Interoceanic Company,
' and tliat tliey know Sir Hugh Allan would never have consented to embark with
' foreign capitalists in a Canadian enterprise in which he takes so great an interest
' witlioiit the most perl'ect securities and guarantees for its control and conduct in the
' interest of Canada.'

"If, as may be implied from the above, Sir Hugh Allan ])rovided 'securities and
'guarantees' for the control of tlie railway by Canadians, tlie undersigned submit that
the production of the agreement would be the satislactory mode of enabling the Govern-
ment and country to judge of their sufficiency.

"They must add, however, that in tlie opinion of the Interoceanic Company, nothing
short of the ownership of the undertaking by Canrdians would afford real security or
guarantee for its control and conduct in the interests of Canada.

"'I'iie undersigned are not aware who the influential gentlemen are to whom the Com-
mittee refer. Tliey never heard any influential gentleman named as having negotiated
with American capitalists except Sir Hugh Allan himself. The Committee of the;
Canada Pacific Company declare that their Company ' ncner particii)ated in the negotia-
' tions referred to, and never considered or entertained ..ly i)ro])()sition, suggestion, or
'intention of asking aid from American capitalists, or of combining with them for the
'prosecution of tlie railway or for any other purpose. The only negotiations they have
'carried on are those al>-jady alluded to with Rritish capitalists, and they have never
'even communicated on the subject ol the railway with any outside Canada or Great
' Uritain.'

" The undersigned confess that this statement surjirises them, and they have reason to
believe the American cajiitalists with whom Sir Hugh Allan has been negotiating would
be e(|ually surprised if they had communication of it, but the undersigned assume that
the Executive Committee only mean it to lie understood that the Canadinn Pacific Com-
pany did not authorize, by formal resolution of the Directors, any negotiations with
capitalists in the United States. While accepting the denial made on behalf of the
Canada Pacific Company, the undersigned assume, as they h.avt; already stated, that it is
not intended to apply to the acts of their President, for the undersigned learn from one
ol the promoters of the Interoceanic Company, who has had the opjwrtunity of com-

19*

CANADIAN PACIFIC RAILWAY.

public speech, of

ng morning. Sir
sj)cech, referring

s Irom Sir George
— ' I have ev(,'ry

n be sliown that
of and annulled
declared he had

le Canada Pacific

e Canada Pacific
Company when

I everything cal-
alTic intended for
vrence, should go
lailway Company
r shall be as near
less of the line to
all sectionalism,
ready referred to,
the extraordinary
disc railways are
tiical construction
erty at a port of

legotiations were
lor the formation
ut they say ' that
and supported by
ered itself at the
atisfied that that
Dceanic Company,
to embark with
great an interest
id conduct in the

'd ' securities and
i^ned submit that
iling the Govern-

ompany, nothing
i real security or

3 whom the Corn-
having negotiated
ommittee of the
ed in the negotia-
3n, suggestion, or
I'itli them lor the
tiations they have
they have never
Canada or Great

ey have reason to
legotiating would
gned assume that
Jian Pacific Com-
iiegotiations with
on behalf of the
' stated, that it is
d learn from one
H)rlunity ol' com-

municating with gentlemen in the United States who were parties to and interested in
the arrangement made with Sir Hugh Allan, that they consider the same to be still in
force, but that owing to tlie feeling existing ir. Canada against the Canadian Pacific
Railway being owned by Americans, tliey, the Americans, would not in future be known
in the project.

"Tlie American capitalists had been led to expect that the amalgamation of the two
Canadian Companies would have been efiected in Septcniibcr last.

"Tlie undersigned are given to understand, through the same source, that the sclieme
of the 'American' or ' Allan' comljination for constructing and running the railway, is
to coimect at Sault St. Marie; and at Pembina with the Northern Pacific Railway, and
,se tiiat line when built between the two points named; that it is iiitenneJ to send all

e traffic between the West, including British C(!luml)ia and tlie Atlantic cities, by the

nierican lines of lailway, via St. Paul, and sending throimh Canada only the tralTic
llestiued for Eurojie and the Maritime Provinces.

■ " This information was obtained by the undersigned about llic time the Memorandum
of the Committee of the C!anada Pacific Company, under consideralion, was written.
Tlie undersigned feel bound to communicate it to the Government. It confirms in a
remarkable manner the ojiiiiion (>xpressed to tlie Government by the Interoccanic (,'om-
pany, and justifies the decision of that Comiiany against amalgamation.

" The correspondent to whom the undersigiK-d are indebted for tiiis information uses
the ibllowing language in commenting upon it, in which the undersigned fully concur:
'If this (scheme) is carried out, our great national enterprise, instead of being the
'successful rival of the American Company, competing for the Asiatic trade, which is now
*m its infancy, and building up the Dominion as no other undertaking can do, will sini})ly
*be the Canadian branch of the Northern Pacific Railroad, entirely under its control and
'dictated to by it relentlessly.'

"The undersigned beg to say that they do not yield to any Company or individual in
the earnest desire to promote the earliest ])Ossible construction of the Canadian Pacific
Railway, com])atibIe with its being a strictly Canadian and IJritish enterprise, and the
Canadian Pacific Company cannot more sincerely than the undersigned desire to aid the
Government in carrying out this great national undertaking. It would, however, be
^oing the (iovernment poor service to agree to amalgamation unless the iiitcroceanic
Company believe that tin; Amalganiatetl Company would constitute a distiiRtively
Canadian Company of sufficient strength to carry the undertaking to a siicccssl'iil issue.
Xhe undersigned are of opinion that amalgamation with the Canada I'acific Company
would not lead to this result. They deem it their duty to state to the Government that
in their opinion the admitted negotiations of Sir Hugh Allan with gentlemen in the
United States, resulting in an arrangenient or understanding \\ liich is considered opjiosed
to ("aiiadian interests, and which the undersigned, from information in their iiossessioii
and referred to above, have rea.son to believe is still substantially existing, will continue
to cause the Canadian i)eoj)le to view with suspicion, and prevent their subscribing stock
in any Company in which Sir Hugh Allan and his associatis ajjjjcar coulroUiiig i)arties.
Tlie undersigned are of opinion that this feeling, instead of being confined to a limited
circle, as the Committee of the Canatla Pacific Company allege, will be found to infhience
the peo])le of the whole Dominion.

" The undersigned venture to remind the Government that books for applications for
etock in the Canada Pacific Comjiany liave been open I r months at the capitals of, and
large towns in, all the Provinces of tl:. Dominion.

f "The Pacific Company have thus luul the best means of ascertaining the favour Mith
^Hvliich they arc regariled by the ca, 'lalists and pi'ople of Canada.

U " It is somewhat surprising that their Committee do not, in their Memorandum, inform
•|the Government what amount of stock has been applied for and subscribed up to a giscn
day, say to the first day of Octolnir last. Instead of doing so, the Committee's Memo-
randum is conspicuously silent in respect to the countenance and aid their Company
^xiicct from Canadian sources.

"Prom this silence, were it not for their repeated protestations that their Conijiany
.iWould be pre-eminently Canadian and Hritish, it might fairly be assumed that the
['Directors had little or no ex|)ectation of making it so. For the reasons given above, and
'ithose stated in their communication of the 3Utn September last, the nndersigncd. on
itchalf of the Interoccanic Comiiany, feel themselvt.'s under the necessity of again
declining amalgamation with the Canada Pacific Company ; but they beg to reiterate,
that from the assurances they have received from capitalists in this and the other
Provinces and iu England, the luteroceanic Company, as an in dependent organization,

Caxada.

CORRESPONDENCE RELATIVE TO THE

Canada.

can undertake to construct and run the Pacific Railway in the full confidence of carrying
the work successfully to completion, through the instrumentality of a Canadian any
British j)roprietary.

"All of which is respectfully submitted.

(Signed) "D. L. MACPIIERSON.
" W. SlIANLY.
" C. H. FAIRWEATIIER.
" W. H. HO\VI.AND.
"Office of the Interoccanic Railway Comi)iUiy of Canada,
"Toronto, 25th Nov., 1872.

" I certify that the foregoing is correctly copied from the Minute-book of the later-
oceanic Railway Company.

(Signed^ " JOHN HAGUE, Provi>ional Secretary.
"Toronto, 25th November, 1872."

" Department of the Secretary of State,
" Sm, " Ottawa, 22nd October, 1872.

" I am directed to forward you the enclosed copy of an Order in Council on the
subject of the corr-csijondence between the Government of Canada and the Executive
Committee of the Provisional Directors of the contemplated Interoceanic Railway
Company, relative to the Canadian Pacific Railroad.

*' I have <xc.
(Signed) " E. PARENT, Under-Secretary.
" Hon, D. L. Macpherson,

" President, Interoceanic Railway Co., Toronto."

" Office of the Interoccanic Railway Company of Canada,
« Sir, Toronto, 2uth October, 1872.

" I have th.c honour to acknowledge receipt of a copy of an Order in Council
on the subject of the coi-respondencc between the Government of Canada and the
Executive Committee of this Company, relative to the Canadian Pacific Railroad.

" I shall take the earliest opportunity of laying it before the Directors of this
Company.

" I have, &c.,
(Signed) " D. L. MACPHERSON.

" Provisional President, Interoceanic R. Co,
" To the Hon. the Secretary of State, Ottawa."

" Ofiice of the Interoceanic Railway Company of Canada.
" Sm, " Toronto, 2ath October, 1872.

" I have the honour to atknuwledge receipt of a copy of a ' Memorandura of the
'Canada Pacific Railway Company,' ujion the statement submitted by the Company to
the Government,

" I sliall lay it before tin- Directors of this Company with as little delay as possible.

, " I have, &c.
(Signed) " D. L. MACPHERSON,

" Provisional President, Interoceanic R, Co.
" To Hon. J. C. Aikins, Secretary of State, Ottawa."

"Tc

" Office of the Interoceanic Railway Company of Canada,
•' Sir, ^ " Toronto, 2(5lh November, 1872.

" I have the honour to enclose a ' Memorandum of the Executive Committee
' of the Interoceanic Railway Company of Canada upon the Memorandum submitted to
' the Government by the Executive Committee of the Canada Pacific Railway Company,'
dated 1 2th October, 1872.

" I regret ihe delay thiil, has lake i place in transmitting to the Government the reph
of this Company to the Memoraiuluhi of the Canada Pacific Railway Company. It k'is

CANADIAN PACIFIC RAILWAY.

ence of carrying
I Canadian any

lERSON.

^'^EATIIER.
[.AND.

)k of the Intcr-
lal Secretary.

f State,
ictober, 1872.
Council on the
i the Executive
ceauic Railway

.er-Sccrctary.

been caused by the absence from Toronto of members of the Executive Committee of C amad a.
iliis Company, one of whom is still absent in England.

'* T have (&c.
(Signed) '" D.' L. MACPHERSON,
" Provisional President, Iiiteroceanic E. Co. of Canada.
" To the lion, the Secretary of State^ Ottawa."

« Sir,

" Office of the Interoccanic Railway Company of Canada.

" Toronto, 28th Nov., 18/2.
I have the honour to enclose a Memorandum from the Executive Committee of
file Interoccanic liailway Company, referring to a Report of a Committee of tlie Honour-
able the Privy Council, approved by his Excellency the Governor-General on the IGth
day of October last, a copy of which you transmitted to me for the information of the
Interoccanic Railway Company of Canada.

" i regret the delay that lias taken place in transmitting to the Government the
ac(om]vuiyii)g Memorandum"; it has Ijcen caused by the absence from Toronto of
mcmlK'rs of the Executive Committee of this Company, one of whom is still absent in
England -

" 1 have, iVc,
(Signed) " D. L. MACPHERSON,
" Provisional President cf the Interoccanic Railway Co. of Canada.
*' To tlie Honourable the Secretary of State, OttaM'a."

Canada,
ctober, 1872.
dor in Council
anada and the
railroad,
rectors of this

ON.

eanic R. Co.

'anada,
tober, 1872.
andura of the
e Company to

as possible.

pN,

auic 11. Co.

anada,
iibur, 1872.
e Committee
submitted to
ay Company,'

cut the rcplT
•any. It k'ls

" MF.MORAXDUJr.

" Office of the Interoccanic Railway Company of Canada,

" Toronto, November 28, 1 8/2.

" The undersigned Executive Committee of the Interoccanic Railway Company of
Canada ha\ c the honour to state, that they have liad under consideration the Report of the
Committee of the Honourable the Privy Council upon the snliject of amalgamation of the
Jnterorcanic Company and the Canada Pacific Railway Company, ajiproved by his Excel-
lency the (ifovernor-General in Council on the 16th day of October last, and transmitted
to the Provisional President of this Company. In reply, the undersigned beg respect-
fully to state, for the information of his Excellency the Governor-General, that the
commii!iications addressed to t' Government by this Company, on the 30th day
of September last and on tlie _ ili day of November inst., fully set lorth the reasons
which induced this Company to decline amalgamation with the Canada Pacific Railway
Comjiany.

" The undersigned deem it unnecessary to re-state those grounds. They will merely
■ add tliat the promoters of the Interoccanic Conip ay arc sati- 'd tliat the amalgama-
tion of that Company with the Canada Pacific Company woul<l not fulfil the antici-
pationa of tlie Government, because, in their opinion, it would not sn ure the confidence
of the people of the Dominion for the amalgamated Company, and that consequently
amalgamation, under such circumstances, would be followel l)y certain failure when the
time arrived for organizing the Comjiany upon a Canadian proprietary basis.

" The principal matters referred to in the Report of the Committee of the Honourable

.Ahe Privy Council liaving been, as already stated, discussed at length in the two com-

toiunications above referred to, the undersigned only consider i' necessary to remark

^pon one other p'>int, now, for the first time, brought under tlic notice of the Interoccanic

Coni])any.

' The undersigned, with the utmost respect, Ijeg to state ihey gather from the Report
of the Honourable the Privy Council, that the Goverinnent impliedly charges the pro-
moters of thi' Interoccanic Company with remissness in not communicating with the
Government during the summer of 1871, and making a proposition for constructing and
running the Canadian Pacific Railway.

•' The undersigned submit that they do not see how they could have done so before
tiu; Government had announced its readiness to receive propositions.

The Committee of the Honourable the Privy Council furni.shes, in the opinion of

the undersigned, an answer to this charge, as it apjiears by the Report that when Mr.

. W addington and his ns-,ociatcs approached the Government to tender for the construction

and riiiining of the railway, they were informed that the Government was not in a

position to enter into negotiations.

• G 2

CORRESPONDENCE RELATIVE TO THE

Canai ,

" Should the refusal of the Interoceanic Company to amalgamate result in excluding
it from all connection witli the Canadian Pacific Railway, the undersigned and their
associates will nevertheless have the satisfaction of knowing that if that great national
undertaking remains in Canadian and British hands it will be due, in no small measure,
to their efforts, and that if it sliould unfortunately fall into foreign and rival hands, it
will bo through no fault of theirs, but in the face of their most strenuous exertions to
avert so great a calamity.
" All of which is submitted. (Signed) " D L. MACPIIERSON.

" C. U. FAIRWEATIIER.
« W. SHANLY.
" W. H. IIOWLAND.

" Toronto, Nov. 28, 1872.
" I certify tha,; the foregoing Memorandum is correctly copied from the Minute-book
of the Interoceanic Railway Company of Canada.

" JOHN HAGUE,
(Signed) " Provisional Secretary."

" Department of Secretary of State,
" Sir, " Ottawa, Dec. 2, 1872.

" I have the honour to acknowledge your letter of the 28t]i ultimo, enclosing a
Memorandum from the Executive Committee of the Interoceanic Railway Company,
referring to a Report of a Committee of the Honourable the Privy Council, dated IGth
October last.

" Yours, &c.,
(Signed) " E. PARENT.
" The Honourable D. L. Macphcrson, Senator, Toronto."

Enclosure No. 3.

" CORRESPONDENCE BETWEEN SIR HUGH ALLAN AND HIS AMERICAN

PARTNERS.

(From the ' Moxtukal Herald.')

" The following portion of the documentary evidence, showing the corrupt nature of
the negotiations between Sir Hugh Allan and the Governmen*, in connection with the
granting of the Pacific Railway Charter, has come into our possession.

{Telegraph.) " ' Father Point, October 8, 1871.

" ' Send me by mail, care of Allan Bros. & Co., Liverpool, the names of the parties
engaged with us in the railroad enterprise.

(Signed) '"H. ALLAN.
" ' To C. M. Smith, of Chicago, Metropolitan Hotel, New York.' "

{Letter.)
" ' Dear Mu. Smith " ' Ix)ndon, E.C., Nov. 4, 1871.

" ' 1 find a considerable interest manifested here by moneyed men in our scheme of
a Dominion Pacific road, and if we desire to raise funds here to carry on the work, I
have no doubt they can be obtained. 1 have not heard anything from the Government
on the subject, and I i)resume nothing will be done till I go back. I propose to sail
some time this month.

" ' Yours truly,
(Signed) "'HUGH ALLAN.'"

{Telegraph.) " ' Montreal, Dec. 7, 1871.

" 'I do not think the Governmi nt at Ottawa will be prepared to deal witli us sooner
than the 18th inst. Sir F. Ilincks is here, and hints at necessity of advertising for
tenders to avoid blame.

(Signed) " ' HUGH ALLAN.
" ' To C. M. Smith, Banker.' "

CANADIAN PACIFIC RAILWAY.

result in excluding
ersigned and their
that great national
no small measure,
nd rival hands, it
nuous exertions to

CPIIERSON.
IIWEATIIER.
LY.
WLAND.

, Nov. 28, 1872.
n the Minute-book

onal Secretary."

,ry of State,
'a, Dec. 2, 1872.
ultimo, enclosing a
iailway Company,
ouncil, dated lOth

" e! PARENT.

IIS AMERICAN

corrupt nature of
)nucctiou with the

)ctober 8, 1871.
[Ties of the parties

"II. ALLAN.

;., Nov. 4, 1871.
II in our scheme of
ry on the woriv, I
n the Government
I propose to sail

III ALLAN.'"

,1, Dec. 7, 1871.
:;al with us sooner
of advertising for

JGIi ALLAN.

'(Teleqraph.) " Montreal, Dec. 8, 1871. Canada.

• " ' I have seen Sir Francis lo-day. He says they have determined to advertise, and
that it is no use to visit Ottawa at present. I write you by mail. . „ . ^,

(Signed) " ' HUGH ALLAN.

«• ' C. M. Smith, Banker.' "

(Letter.') ,, , ^ „ _.

•• 'Dear Sin, " ' Montreal, Dec. 8, 1871.

"'Sir Francis Ilincks called at my olTicc this day. and said that, while ho was as
«nxii,v;s as ever to arrange with us about' the railroad, the feeling of the Government is
|hat if they closed an agreement with us without advertising for tenders, they would be
Attacked about it in the House. 1 think this may be true, and in view of it I see no use
^fnour going to Ottawa at present; but I think we should meet and arrange i)reliminaries
Ourselves and decide on a course of action. If, tlierefore, you could come lii're about the
^5t]i instant, I would go on to New York witli you on the 18th, and we could then put
the afl'air in shape. Please advise me if this suits you.
i " ' Yours truly,

«• ' To C. M. Smith, Esq., Chicago.' " (Signed) " ' HUGH ALLAN.

" ' Dear Sir, " ' Montreal, Dec. 29, 1871.

" ' I have your note from Pictou, but I have not heard from New York since I
left there. A good many rumours are afloat regarding railroad matters, and I have good
reason to believe that Mr. Brydges is using all the influence he can with Cartier to
thwart our views, not that he has any proposal to make, but he wants to stop the Pacific
Railway altogether. A party in the interest of the Hudson's Bay Company, consisting
of Donald A. Smith, D. Mclnnes, G. Laidlow, G. Stephen, Daniel Torrance (of New
York), and one or two others, have given notice in the ' Official Gazette' that they will
apply for a Charter to make a railroad irom Pembina to Fort Garry. That is the only
one that alTects us. I go to Ottawa on Wednesday, and will return liere on Saturday. I
will find out there what is going on, but I think we are sure of Cartiers opposition.

" * Yours truly,
(Signed) "'IIUGII ALLAN.
" ' To G. W. McMullen, Esq., Pictou, Ont.' "

♦' ♦ Dear Mr. McMullen, " ' Montreal, January 1, 1872.

" ' I saw Mr. Brydges yesterday, and found out pretty nearly what he will require
to join our railway project. His terms are very high ; but as they possibly include more
than himself, we may have to concede tliem. He thinks, however, that the Government
will not have the courage to go into the scheme at all, and Avill shirk it till after the
elections. I go to Ottawa on Wednesday, and will see what they propose to do. 1 will
write you as soon as I find out. I intend to return back to here on Saturday night.
Wishing you the compliments of the season,

" ' I am, yours truly,
(Signed) "'HUGH ALLAN.

" ' P.S. — I have a telegram from you this moment, advising me that you arc going to
t New York ; I therefore send this letter to the St. Nicholas Hotel there.' "

" 'Gentlemen, " ' Montreal, January 21, 1^72. '

"'My subscription of $1,450,000 to the stock of the pro])oscd Canada Pacific
Railway Company includes the sum of $200,000, furnished jointly by you and myself, to
be transferred, in Tvhole or in part, to Mr. C. J. Brydges, on condition of liis joining
the organi^^tiov:, and giving it the benefit of his assistance and influence. In case he
refuses or neglects to join before the loth day of April next, I will transfer at once
thereafter to you jointly $100,000 of the before-named subscription, and in case Mr. B.'s
influence and co-oi)eration can be secured lor a less interest in tlie Railway Company
than the before-mentioned amount, then I will transfer to you one-half of any residue that
remains of the said §200,000 after Mr. Brydges' accession to the Company lias been
secured. It is, however, understood that any residue, or portion of the $20O,('0(l named,
may be used to secure any other influence deemed by myself and you desirable or
important, on the same terms as is proposed in regard to Mr. Brydges, and may a])ply to
othei-s in addition to liim. " * Yours trulv,

(Signed) "'IHIGH ALLAN.
" ' To Charles M. Smith and George W. McMullen.' "

CORRESPONDENCE RELATIVE TO THE

Cakada. " ' Dkaii Ml!. Mi'MuM.KN', " ' Montrcii], Feb. 5, 1873.

" ' I rcturiird yesterday Irom dtawa. Evcrytliing looks well up till the present time;

i)ut I may tell you in strict confidence that tliere are symptoms of coolness between Sir
Jolni A. and Cartier, arising irom the coquetting of the latter with Blake and Mackenzio
to form an alliance and carry tlie elections next summer, with a view to leave Sir John A.
out in the cold. Tliis would not be quite so well for ns; but I am KO'"S to Toronto on
the 7th instant to look after our interest. We are all right witli tlie ' (ilobe.' You have
not yet sent me the articles of agreement signed I y the ])arties. Send it immediately, as
I need it in my negotiations. 1 will re(iuire you to come down luM'c, by and by, to
arrange the construction of tlie Company, ant. consult about other matters. In the
printed Bill is there not a mistake about the land and taxation ? Lot)k at it.

" ' Yours truly,
" 'To G. W. INIcMuUen, Chicago. (Signed) " ' MUGII ALLAN.

" ' P.S. — I wrote you, but have not received iiny answer.' "

" ' Dk.vu Sir, " ' Toronto, Fel). 23, 1S72.

" ' I find that Mr. Brydges is making a st/ong attempt by exciting national feelinj;;
to get up an opposition to us in our Pacific schemes. lie is endeavouring to get up what
he calls a purely Canadian Company, on the represe.itation that we are going to make
enormous profits out of it, the most of which will go to parties in the United States. He
lias written to influential men here, and in other ))arts of the country, urging them to
subscribe stock merely as security, for they never will he called on to pay anything, and
he says the Government must give a preference to a Canadian Company. I do not know
to what extent he has been successful.

" ' Yours truly,
" ' To C. M. Smith, Cliicngo.' " (Signed) " ' HUGH ALLAN.

" 'Dkah Sir, " ' Toronto, February 24, 1872i

" ' Since writing to you yesterday, I have seen Mr. D. L. Macplierson, of Toronto,
who is a member of the Dominion Senatt", and rather an imi)ortant person to gain over
to our side. He has been ajiplied to by our opponents, and uses that as a lever by which
to obtain better terms from us. lie insists on getting $'i")(),OUU of stock, and threatens
oi)position if he does luit get it. You will remember, he is one of those I proposed as
Directors. I will do the best I can, but I think that MclNIullen, you, and myself will
have to give up some of our stock to conciliate these parties.

" ' Yours truly,
" ' C. M. Smith, Esq., Chicago.' " (Signed) " ' HUGH ALLAN.

" 'Dear Sir, " ' Montreal, February 28, 1872,

'"It seems pretty certain that, in addition to money payments, the following
stock will have to be "distributed :—D. L. Macplierson, 5*100,000; A, B. Foster,
$100,000; Donald A. Smith, slOO,000; C. J. Brydges, $100,000; J. J. C. Abbott,
$50,000; D. Mclnnes. s'jO.OOO ; John Shedden, .^.lO.OOO ; A. Allan, $.")(),000 ; C. S.
Gzowski, $jO,000; George Brown, $')0,000 ; A. S. Ilincks, $•'30,000; H, Natlian,
$50,000 ; T. ?.'cGreevv, $50,000— total, $850,000. To meet this I propose that we give
up of our stock as follows :—C. M. Smith, $250,000; G. W. McMuUen, $250,000;
Hugh Allan, $;!50,000— total, $850,000. Please say if this is agreeable to you. I do
not think we can do with less, and may have to give more. I do not think wc will
require more tluin $100,000 in cash, but I am not sure as yet. Who am I to draw ci
for money when it is wanted, and what proof of payment will be required ? You are
aware I cannot get ixveipts. Our Legislature meets on tlie 11th of April, and I am
already deep in pre|)aration lor the game. T^very day brings up some ne"' '..iiculty to be
encountered, but I hope to meet them all successfully. ^Vrite to me immediately.

" ' Yours truly,
(Signed) "'HUGH ALLAN.
" ' C. M. Smith, Esq., Chicago.

" ' P.S. — I think you will have to 70 it blind in the matter of money — cash jMyments.
I have already paid $8,500, and have not a voucher, and cannot get one,"^

" ' Mv PEAR Mr. McMlt.lex,

" ' Mr. Macpherson, of Toronto, and Mr,

"'Montreal, March 4, 1872.
Brydges here, have both notified me
to-day that thoy decKne ^0 join us in the Canadian Railway scheme. Their reasons are
that the Compuny is too largely American, und that they want to see it in the hands of

Can
^oin
inte
abo

M(1

CANADIAN PACIFIC KAILWAY,

i)b

I, Feb. 5, 1873.
the present time;
iiess between Sir
ce and Mackenzin
leave Sir John A.
ig to Toronto on
I lobe.' You have
t immediately, as
I', by and by, to
matters. In the
at it.

Gil ALLAN.

Feb. 23, IS 72.
;; national leeliii";
ig to get up what
e going to make
iiited States. He
urging them to
ay anything, and
, I do not know

Gil ALLAN.

nary '2i, 18/2;
rson, of Toronto,
son to gain over
V lever by wliich
k, and threatens
se I ])roi)oscd as
nd myself will

GII ALLAN.

ary 28, 1872.

i, the following
A. B. Foster,
J. C. Abbott,

^50,000; C. S.
H. Nathan,

)se tliat we give

len, $250,000;

to you. I do

think we will

11 I to draw ci

ed ? You are

Lpril, and I am
"..iiculty to be

iiediately.

IH ALLAN.

cash payments.

reh 4, 1872.
h notified me
;ir reasons are
n the hands of

Canadians. They tried to detach me from the Company we have formed and get me to
join tlieirs, which of coui-se I declined. I don't know what they can do against us, but I
iotend going to Ottawa on Monday, the Uth inst., and will try and find out something
about it! Twill be in Ottawa most of the week.

" ' Yours truly,
(Signed) "'HUGH ALLAN.'"

Canada.

«" Dkau Mr. McMuLLEy, " ' Montreal, April IG, 1872.

" ' I must remain here to-niglit to write my letters for the English mail, which I
ive been rather neglecting of late. You might make use of your time in seeing such
J the Ministers as you can reach, but I wish esi)ecially that you would arrange that you
Id I together should see Sir John A. at 1 1 o'clock on Thursday. Telegraph me to
fescott Junction to-morrow if you can do this. I enclose a letter which came enclosed

tt me from New York this day. What can be the matter there ? I ought to arrive at

^tawa at 4.30 to-morrow p.m. (Wednesday).

,, " ' Yours truly,

,: (Signed) " ' HUGH ALLAN.' "

•'♦Dear Sir, '"Montreal, June 12, 1872.

" ' I have this day received a telegram from you, dated New York, asking me to
meet you in Ottawa to-morrow on important business. I am unable to go, and if the
important business refers to the Pacific Railway scheme, I do not think it necessary I
should go. I believe I liave got the whole arranged through my French friends, by
means you are aware of, and we have now a pledge of Sir G. that we will have a
majority, and other things satisfactory. I have told you all along that this was the true
basis of operations, and anything dse was powder and shot thrown away, and I think so
stUl. You should come here and see me bcl'ore you carry out any important transaction
or pay any money. I want you to get a correct copy of the Government Bill and our
own Bill, because we have first to consider how far they will suit our friends, and we
may have to go to New York to consult them. I will be in town to-morrow and
B*riday. I will be absent on Saturday, but will return here on Monday and be here till
Friday.

"'Yours truly,
" 'G. W. McMullen, Esq., (Signed) " ' HUGH ALLAN.

' ' Kussell Hotel, Ottawa.' "

«« My PEAR Mr. McMullen, " ' Montreal, July IG, 1872.

" ' I feared you had got entirely lost in ihe depths of matrimony, but I am glad
to notice by your letter dated 11th instant that ;vou have got safely back. Since I saw
you the Pacific Railway " Canada " scheme had gone through many phases, and its

S resent iwsition is difficult to be described. Sir Geo. Cartier has been in town for some
ays, and I have had several interviews with him. He now tells me that he does not
Bow, and never did, intend to deal with either Macpherson's Company or ours, and that
he only allowed them to get incorporated as a matter of amusement, but he says he
always intended that the Government would Ibrm its own Conii)any, would carry on the
Work under the orders of the Government, according to the views of the Government
engineers, and with money furnished by the Government. He says that he and Sir John A.
Jnade up their minds to this long ago, but did not tell any of their col' "agues. A kind
p' negotiation is going on with 5lacphcrson and myself, relative to the composition of
■'|his Government Company, but it has not come to anything as yet; meantime, the period
|f the elections is drawing near, and unless the matter is arranged satisfactorily to Ijower
|)anada, Sir George Cartier's prospect of being returned is very slim indeed. I cannot
i|)resee with any certainty the ultimate result, but the decision cannot be long put oil'. I
|rill advise you as soon as anything is positively known.
I " 'Yours truly,

I (Signed) «' HUGH ALLAN.'"

7? The following is addressed to an American gentleman in a \c\j high position in
% New York, whose name has Ijcen given to us, but which is for ti.e present with-
I held:-

' * 'My iiE.ui Sir, " ' Montreal, July 1, 18/2.

" The negotiations regarding the Canadian Pacific Railway are now approaching
a termination, and I have no reason to doubt they will be i'avourabh; to us. I have been

CORRESPONDENCE RELATIVE TO THE

Canada.

given to understand by Mr. McMulleii that lie has regularly kept you informed of tlio
progress and position of affaii-s, hence I have not eommunicated with you as often as I
otherwise would have done. No doui)t he has informed you that, thinking as I had
taken up the project there must be something very good in it, a very formidal)lc
ojiposition was organized in Toronto, which, for want of a better, look as their cry, ' No
' foreign influence; no Yankee dictation ; no Northern Pacific to choke of!" our Canadian
' Paciiic,' and others equally sensible. So much efl'ect, however, was produced both in
and out of Parliament by these erics, that, after consultation with Mr. MeMuUen, I was
forced unwillingly to drop ost(nisii)ly I'rom our organization every American name, and
to put in reliable ])eoplc on this side in place of them. It will have been a])i)arent tn
you that at this point Mr. McMuUen and 1 dilfered a little as to the means to l)e adopted
to influence the Government itself. Two oiijiosing Ct)mi)anics, desiring to build the
railroad, were formed, the one I'rom Ontario having the greatest number of names,
while that from Quebec had the greatest political jjower. Mr. McMulIen was desirous
of securing the inferior members of the (rovernment, and entered into engagements of
which I did not approve, as I thought It was only u waste of jjowder and shot. On a
calm view of the situation, I satisfied myself that the decision of the question must
ultimately be in the hands of one man, and that man was Sir (Jcorge E. Cartier, tlii'
leader and chief of the French i)aity. This party has lujld the balance of power between
the other i'actions ; it has sustained and kej)! in ofluH! and existence the entire
Government for the last five years; it consists of forfy-fivc! men, who have followed
Cartier and voted in a solid phalanx for all his measures. The Government majority in
Parliament being generally less than forty-five, it lollows that the defection of one-hall
or two-thirds would at any time put the Government out of oflice. It was tlnu'elbre
evident that some means must be adopted to bring the influence of this compact body of
members to bear in our favour, and as soon as I made up my mind what was the best
course to pursue, I did not lose a moment in following it up. A railroad from Montreal
to Ottawa, through the French country, north of the Ottawa river, has long hcen desired
by the French inhabitants; but Cartier, who is the salaried solicitor of the Grand Trunk
road, to whicli this would be an opposition, has interposed dilliculties, and by his
influence prevented its being built. The same reason made? him desirous of giving the
contract for the Canada ]*acific into the hands of parties connected with the Grand Trunk
Railway, and to this end he fanned the flame of opposition to us; but I saw in this
French railroad scheme and in the near a])proach of the general elections, when Cartier
as well as others had to go to their constituents for re-election, a sure means of attaining
my object, especially as I ])ropose to carry it through to the terminus of the Pacifu'.
The plans 1 propose are in themselves the best i'or the interests of the Dominion, and in
urging them on the public I am really doing a most ])atriotie action. But even in tlint
view, means must be used to influence the public, and I em])loyed several young Frencli
lawers to write it up in their own newspa|)ers. I subscribed a controlling influence in tlie
stock, and proceeded to subsidize the newspapers themselves, both ediiorsand i)roprietors.
I went to the country through which the road would pass, and called on many of the
inhabitants. I visited the priests and made friends of them, and Iemi)loyed agents to go
among the principal people and talk it uj). I then begun to hold public meetings, and
attended to them myself, making frequent speeches in French to them, showing them
where their true interest lay. The scheme at once became ])opular, and I formed
a Committee to influence the members of the Legislature. This succeeded so well that.
in a short time, it had twenty-seven out of forty-five on whom I could rely, and the
electors of the ward in this city, which Cartier himself represents, notifled Iiim that
unless the contract for the Pacific Railway was given in the interests of Lower Canada,
he need not present himself for re-election. He did not belicsve this, but when he came
hero and met his constituents, he found, to his surprise, that their determination was
unchanged. He then agreed to give the contract, as required, in a way that there would
be seventeen Provisional Directors, of which Ontario would liave eight and we nine,
thereby giving us the control. We at once proceeded to organize the Company, and
they named me President, D. McInnes,of Hamilton, Vice-president, E. L. De Bellefeuille,
Secretary, and Hon. J. J. C. Abbott, Legal Adviser. We have advertised that the
books lor subscription of stock will be opened on the LOth July, at the difl'erent places
named in the Act, and we have notified the Government we are willing to take tin
contract for building the Canada Pacific Railway on the terms and conditions prescribed
in the Act. The next thing to be done is to subscribe stock, which must be done by
British subjects only, and ten per cent, of the subscription must be paid in cash at the
time of subscribing. We have the right of subscribing nine-seventeenths at ])resent, and
of taking up whatever the other party may not subscribe at the end of the mouth.

CANADIAN PACFFK! RAILWAY.

^^1

w informed of tlio
yoii as often as I
niinkin<]; as I had
very formidaljlc
; as their cry, ' No
(■ oil" our Canadian
produced l)otli in
. McMuUeii, I Mas
nericaii name, and
! been a])i)arent to
cans to l)e adopted
iring to buihl the
number of names,
ullen was desirousi
to engap;ements of
r and sliot. On a
tlie question must
•go E. Carticr, tlit
I- of ])o\ver between
istence tin; entire
lio have followed
•nment majority in
d'ection of one-hall
It was tluu-efoic
is compact body of
wliat was the best
oad IVom Montreal
s long l)een desired
if the Grand Trunk
•ulties, and by his
drous of giving the
h the (Irand Trunk
but 1 saw in this
ions, when Cartier
means of attaining
nus of the Paeifit'.
Dominion, and in
Dut even in tlmt
oral young Freneli
ing influence in tlic
orsand jjroprietors,
d on many of the
loyed agents to go
iblic meetings, and
lem, showing them
ar, and I formed
eeded so well that.
ould rely, and the
notified him that
of Lower Canada,
but when he came
determination wa<
y that there would
ight and we nine,
tile Company, and
L. De Bellefeuille,
dvertised that tlio
the diirerent places
illing to take tlu'
nditions prescribed
h must be done by
)aid in cash at the
ths at jiresent, and
end of the moutli.

I have arranged in the meantime tliat if you will send a ccrtificato of the equivalent of nAVAi)A.
|1 (100 000 .^)1.1, having been placed by Jay (Jooke k Co. to the credit of the Merchants
Bank of Clanada, Montreal, in their own bank, in New York, it will accept the clu-eks
for the sui»scriplion, but no money will pass till the contract is entered mto, and then
ten per cent, on the whob; amouiit of stock awarded us will have to lie ]mid into tin;
Reccivcr-(ieneral. Ue i)leased, therel'ore, to send me as early as possible jjowers of
attorney to'subscribe slock, and JavCooke k Co.'s certificate above mentioned. 1 have had
scverarietters from England, ollering to take the whole thing up if we desire to part
with it. but it looks to me to be too good to part with readily. If you wish any further
Information, I will go to New York next week, if you desire it, and (ommunicate with
^u personally. Please telegraiih if you wish lo see me, and the day. As you may
Aipiiose, the matter has not reached this jioint without great expense,— a large jiortion ol
IT only payable when the contract is obtained, but I think li Nvill reach not mueli short

jjf $:}uu,o6u. . , . „

^V "'Yours faithfully,

rSigned) "'HUGH ALLAN.

«' P.S.— I presume you desire that unless we can obtain and secure a majority of the
rtock, you would not take any. Hut on this point I wish to be instructed.

(Signed) " ' 11. A.

" The following is to the gentleman before alluded to : —

" * Dkar Sill, " ' Montreal, August 7, 1 872.

'" I wrote you on 1st July, giving you a detailed account up till that date of the
events and my movements in connection wiili the Canadian Pacific Railway. I have
not had any acknowledgment of the receipt by you of that letter, but I suppose it
reached you in due course. The question I asked you, however, remains unanswered,
and I now proceed to inform you of the progress of the negotiations since the date of my
letter. The policy adojited has been (juite successful ; the strong French influence
I succeeded in obtaining has jjroved sufTicient to control tlie elections, and as soon as the
Qovernnu-nt realized this fact, which they were unwilling to admit and slow to see,
they opened negotiations with me. It is unnecessary to detail the various phases
through which it passed, but the result is that we yesterday signed an agreement by
which, on certain monetary conditions, they agree to form a Company, of which I am to
he President, to suit my views, to give me and my friends a majority of the stock, and
to give the Company so formed the contract to build the road on the terms of the Act of
Parliament, which are §30,000,000 in cash, and 50,000,000 acres of land, with all other
advantages and privileges which can be given to us under the Act, and they agree to do
everything in their jiower to encourage and assist the Company during the whole courst;
of construction. The final contract is to be executed within six weeks I'rom this date,
probably sooner. Our ojiponents are to get a minority of the stock, and they regard us
with great jealousy and dislike, in consequenee of their defeat, and on that account the
Government is obligcul to stipulate that no foreigner is to ajjjiear as a shareholder, so as
to avoid the former cry ol' selling ourselves to the Northern Pacific, and succumbing to
foreign influence. The shares taken by you and our other American friends, will
therefore have to stand in my name for some time. We shall get six million dollars of
4he stock out of the whole capital of ten million of dollars. I again ask you if the
—"irties are willing to take the reduced amount of stock in the same proportions, signed
r previously. As it is my duty, I offer it to you, but there are plenty tlesirous of
itting it; — ten per cent, on the amount will have to be paid up and de})osited in the
ands of the Government as security, but will be returned, I think, as soon as the work
Is fully begun. The expenses incurred in bringing the matter to this [loint have been
>fery great. I have already paid away about $'250,000, and will have to jmy at least

f 50,000 before the end of this month. I don't know as even that will finish it, but
hope so. Of course this will all have to come from the subscribers to tlie six
,#lillion stock. If you elect to go on with the subscription, I will visit New York about
Hhe end of this month, to settle the details with you. Please apply as early as
.^nvenient.

" ' I am, yours faithfully.

(Signed) '"HUGH ALLAN.'"

r.R

COHI^IlFsrONDKNfU-: TIELATIVK TO TlIK

Canapa. '" I)(.:ai! 1\Ii;. McMlllkv, " ' Montreal, August 6, 1872.

~~' " 'I have lu'cn lioi)inj5 from ilay to day tliat sonio conclusion, which I could com-

inunicato to you, would lio arrived at, respect iiifj; tht; Pacilic Railway negotiation, hut
some obstacle to cause delay always intervened. Tlu' near aiiproach of the (dections,
however, ami the stand taken by my French friends, that they would lend us hel]) till
I |)ronounced myself satisfied, has at length brought the matter to a crisis, and 1 think
the iiixnw I have been playing is now likely to be attended witli success. Veiiterday we
entered into an agreement, i)y which the (Jovernnunt iiound itself to form a (.'ompnny
of (.'anadians, only according to my wishes. That tiiis Company will make me President,
and that 1 and my friends will get a majority of the stock, and that tht; contract for
biiil linn- the raib'oad will be; niven to this Coniiiany, in terms of the Act of Parliament.
Americans are to be carelnlly exchided in thi' fear that they will sell it to tho Union
Pacilic, bnt I fancy we can get over that some way or other. This position has not
been attained without large payments of money. 1 have already jjaid over §2O(),()0(),
and will have at least !:!l(K),()(lO more to pay. I must now soon know what our New
York IViciids are going to do. They tlid not answer my last letter.

" ' Yours truly,
(Signed) "'HUGH ALLAN.'"

" ' Deau Sin, " ' Montreal, September Ifi, 1872.

" ' I wanted at this time to have a meeting in New York, to see what our friends

tliere were disposed to do, but to-day I have a letter from stating that he is leaving

New York for Ohicago, there to join , and the two are going to Pngct Sound, They

say, no meeting can be held till ^bc l.'ith of July, Mhich will not do at all. 1 hope in
ten days or so to have the contract signed, and would like immediately after to go to
England to raise tho money to build the line. I have disbursed !<;M;!,OnO in gold, wliicli
I want to get rei)aid. I have still to pay !?lo.50(), which will close everything oil". I will
go to New York as soon as the contract is signed, say about the 17th of October, and
Mould bo glad to meet you there.

" ' Yours truly,
" ' Geo. W. McMullon.' " (Signed) " ' HUGH ALLAN.

r^nclosure 4 in No. 4.

« EXPLANATORY STATEMENT OF SIR IIITGII ALLAN.
(FnoM TiiK 'MoxTnEAi, GA/ETTr;.')

" In reply to the letters which appeared in Saturday's paper, Sir Hugh Allan has
made the following affidavit : —

" ' I, Sir Hugh Allan, of Itavenscraig, in the Province of Quebec, Knight, being duly
sworn, depose and say;

" ' That 1 have for some years past taken a strong interest in the development of
railway commimication throughout tlie Dominion of Canada, and particularly through
the district of country lying to the westward oi' Montreal, Avith a view to increasing the
facilities of communication between the seaboard and \Vestern America, And that
amongst other projects, my attention was early directed to the scheme for constructing
a railway between Montreal, as the most Westerly Atlantic seaboard, and th(! Pacific
Ocean.

"'That in the autumn of 1871 I learned, in conversation with Sir Francis Hincks,
that certain American capitalists had proposed to the Government, through Mr.
AVaddington, to organize a Company lor the ])urpose of building th(> Canada Pacific
Railway, but that no action had been taken upon their proposition. That, thereupon,
inasmuch as no movement appeared to be contemplated in Canada ibr the ])urpose in
(luestion. and I doul)ted if Canadian ca])italists could be induced to subscribe to it to any
large extent, I obtained I'rom Sir I'rancis Hincks the names of the jjcrsons who had been
(■(niimunicating with Government, and immediately jjlaced myself in corres])ondeiic(!
with them, for tlu; ])iiri)ose of endeavouring to form a Pacific Company, in advance ol
the measures which were exjjected to be taken by the Government at the then ensuing
Session of Parliament.

" ' That, accordingly, after a certain amount of negotiation, I entered into an agree-
ment with Mr. Smith, of Chicago, and Mr. McMuUen, who was understood to represent

-«!;«>

Vusiist f), 187'2.
lich I could com-
{ negotiation, Imt
1 ol' tiio ('lections,
lend us lieij) till
risis, ami 1 think
IS. Yosterdny we

Ibrm a Company
[ike mc! President,

th(! contract lor
ct of Parliament,
1 it to the Union

position lias not
d over !i;;:i))O,00(i,
v what our New

til ALLAN.'"

mher 10, 1872.
what our friends
that he is leaving
et Sound. They
. all. 1 hope in
ely after to go to
no in gold, wliicli
^thing oH'. I will
1 of October, and

JGII ALLAN.

fANADt.A?^ PACIFIO HAILWAY.

LAN.

Hugh Allan has

ght, being duly

; development of
ieularly through
to increasing the
rica. And that
for constructing
and thi! Pacific

Francis Hincks,

t, through Mr.

Canada Pacific

'hat, thereupon,

the ])urpose in

rihe to it to any

s who had been

correspondence

y. in advance ol

he then ensuing

into an agree-
3od to represent

A certain number of American cajjitalists -in which I reserved for Canadians as much C,\nada
Itock as I thouf^ht I could procure to be subscribed in Canada, thi" reniainder to be
takc.i up by the Americans interested and their friends. This agreement contemplated
a vigorous prosecution of tlie work ol construction, in eonlormity with the design of the
Canadian Government so soon as it should be ascertained, provided the means to be
placed at the disposal of tju; Company were such as in the ojiiiiion of the associates
would justify th( in in undertaking the contract. And with regard to this agreement. I
most distinctly and implicitly declare that neither in tlu' agreement itself, nor in any
flbnversat ion or negotiation connected with it, was there any sti|>ulation, statement, or
^pressed plan, wliicli had for its object any retardation of the work, or any other
irpose tlian its conijiletion throughout at as early a day as would be consistent
th reas(nial)le economy in building it. And more particularly, I declare that there
as no intention expressed or iini)lie(l, either in the agreement or in ll;e ni'gotiations
hich accomjianied it, of i)lacing it in tlu; jjower of the Northern Pacific Hallway or
iby other Company or body of men to obstruct tlie eiiteriirise in any manner or way
ii^hatevcr.

" 'That no further steps of iin])ortaiiee were taken by myself or associates up to the
time of the opening of the Session of I'arliament at Ottawa, in resiiect of the projectea
Company, except that I placed iiij:.elf in ((nnmunication with the (lovernment, olleriiig
to organize a Company which would iindi rtake the construction of the road, and dis-
cussing the (piestioii of the facilities and aid which the Government would ])robably
recommend to be furnished by tlie country, and in the coui-se of these discussions and
rtegotiations, I endeavoured, as far as ])ossible, to secure for myself the position of
l*fesident of the projected Company, which was the jiosition my associates wi-re willing
to allow me, and to which 1 thought myself entitled from the active ])art whieb I took
in the great national enterprise to which tin; agreement and negotiations in ([uestiou
h&d reference. And as to this point I had reason to believe, from the first, that tho
(lovernment Avas prepared to admit my claim.

"'That when the time for the 1-^essioii of the Canadian Parliament apjiroachcd,' I
applied to IMr. Abl)ott to prijiare the rei|iiisite legislation ; and shortly after I'arliament
llkd o[)ene(l I proceeded to Ottawa for the puriiosi' of ascertaining how matters were jiro-
gtessiiig, and what jirospcct tliere was of a successful prosecution of the undertaking i)y
Ittyself and the persons who were then associati'd with mc. That, previous to this time,
however, 1 had communicated with a large number of iiersons in Canada on the subject
of the proposed Comjiany, retpiestiiig their co-operation and assistance, and endeavouring
to induce them to subsiribe for stock to such extent as I thought fair, considering their
position and means. And though 1 did not meet with any great measure of success in
procuring subscriptions of stock, yet it was quite as great as I had anticiiiated when
niaking my arrangements with tl-.e American capitalists. In my negotiations with them,
therefore, I provided for the distril)utioii of the stock which those gentlemen were willing
to subscribe, or which I bi-lieved they Avould eventually be willing to subscribe, upon tlu;
fermation of the Company.

"'That, when I visited Ottawa, as staled in the last iiaragiaph, I ascertained, by jier-
80nal o])servatioii and communication with tlu' .Members of the House, that a strong

•I'll*

prejudice bad arisen against any connection with American capitalists in the formation
Of the proposdl Company, the fear e\])ressed with regard to that subject being that such
i^pitalists would tiiid it for their interest rather to Obstruct the Canadian Pacilic. and
rther the construction of the Northern Pacilic, than to act in the interests of Canada by
jressing forward the Canadian Head. And though I did not share this fear, and always
lieved, and still believe, thafthe persons who jn'oposrd to be associated with nie would
S.VC gone on with the enteri)rise in good faith to the best of their ability, yet I found
le feeling for the moment so strong that I judged it expedient and proper to yield to it,
ifcd therefore! coiificnted that the legislation fo be iiresented to the House should exclude
i^reigners from the tlompany. and that tin; Directors should be I'xelusively Canadian.

*v '"That a Hill incorporating the Canadian Pacilic Company was then introduced into
me House liy Dr. Grant, who had been a proiiiinent advocate of the Canadian Pacific
feheme, and had introduetHl in the last previous Session a similar meajure at the instance
•f the late Mr. Waddiugton and others who were then interesting themselves in the
roject.

;„ '"That notwithstanding that the Bill wliich was so introduced contempbt"d by its
ferins the exclusion of foreigners, 1 did not feel by any means convinced that the Govern-
nieiit would insist upon any such condition, believing as I did, and do, that such a ])ropo-
pition was impolitic and unnecrs.«ary. I did not, therefore, feel justilied in entirely
breaking oft" my coiuiection with the' Anu;ricau asaociates, although 1 acquainted them

H 2

(in

COURE^JPOXDHXCK IIF^^ATIVE TO TlfM

(ANAnA. uitli the (liniciilly uhidi mifflit nvUo if tlic Oovcnimciit took tlic same ])ositioii wliiili
llic iiiajority ol' tlic people witli whom I conversed at Ottawa appeared to do. I was
aware (!; i< liy tlie terms of llie Hill iiitrode.a'd hy tlie (ioveriii»U'iit, they would have a
cimtrolliii;; power as to flu; terms of the eoutraet, and I was williiiij; to aiiide l)y their
decision as to llie extent of interest, if <;ny, whieh foreif^ners might he permitti'd to hold.
And until that deeision was eomnninieafed to me I felt in honour hound by the aj^nc-
nient 1 luul made to leave the door ojien lor the entranee of my Ameriean associates into
th(! C-'ompany, unless the eonlin^eney arrived of a distinct i)rohil)ition hy the (lovernmeiit
ai^ainst admittin;; them. And in informing; them of the progress in the all'air in ('anadn,
as 1 did on certain occnsions as an individual, and without implicating the (.Jomjjany ol
which I was a menilier, I considered that [ was only acting fairly by them. And 1 diil
not intend tlu'rel)y to hind, and as I conceive, did not in any way bind or compromise to
my views the other members of the Canada I'acific Railway Comjiany, with whom I did
not think it necessary to communicate at all on the subject of my occasional corrc-
spiindence with my American associates, the nu»re esi)ecially as this correspondence was
ciifirely private and conddential, and nmreover was written with such inattention, as to
accuracy of expression, as might be expected in correspondence intended only to Ih; .seen
by those to whom it was addressed. During my stay at Ottawa, I had some communi-
cation of an informal character with members of the («overnment, and I found that they
were still disposed to recognize the value of my services in endeavouring to organize a
Company. IJut in view of the rivalry which appeared to exist in respect of the Pacific
.scheme, and the strt)ng array of (!anadian names whicli had been obtr i'l.'d by the Inter-
Oceai.ic C-'ompany as associates in its project, nothing delinito leading me to expect any
preference for myst If, or for tl e Company which I was endeavouring to organize, or
indeed anything defmite relating to the project, was said by the members of the Goyerii-
inent with whom 1 communicated. It ajjiieared to me that while their intentions and
ojjinions had been freely exi)ressi'd to me when no Comi)any other than that which F was
l)roposing to organize was likely to bo formed, the presence of competition amongst
Canadians for the contract bad decided them to allow matters to take tht-ir own course
until they should have been enaijled to decide after the formation of the Canadian
Companies what line ol conduct would be most conducive to tlu; interest of the country.
And there was, therefore, very little said or done during tlie Session wbirh gave me any
clue to the views of the (lovernment with respect to the course o'' acliciu which they
would i)robably ultimately adojjt.

'" After the session, the Canada I'acific l^iilway Corajjany, of which 1 was a member,
proceeded to organize; and notified the (jfoverinnent that they were prci)ared to take the
lontract for building and running the Pacific Railway on the terms and conditions
mentioned in the (Government Bill. They caused stock books to \>c opened in various
parts of the Dominion in conformity with the Act, and took such initiatory steps and
such other proceedings as weri' necessary to enable tliem to act as an organized corporate
body. That it soon after became evident to me that the Government would be l)est
pleased to see an amalgamation of the two Companies incorporated by Parliament, in
order that united action might be secured and the greatest strength obtained in the
formation of a Canadian Company. And I therefore opened negotiations with the Inter-
Oceanic Comjiany for the ])uri)ose of endeavouring to elfect such an amalgamation, .and
at the same time tlii^ Canada Pacific Comi)any placed itself in communication with the
Government with ridation to the same subject. It was thereupon intimated that the
Government were also desirous that the; amalgamation should take place. That there-
upon Mr. Abbott, a member of tlu; ('anada Pacific liailway Company, proceeded to
Toronto to meet Senator .Macpherson, and, il' possible, to arrange terms of amalgamation
that would be satisiactory to i)oth ('omjianies. And after a discussion of the matter
during two or three days, in Toronto, between him and Mr. Maepherson, he reported to
the Canada Company that there did Mot a])i)ear to be any material difficulty in the way
of our amalgamation, except that the claim which I made to be President of the amal-
gamated Company, and to have the nomination of an equal number of tlie members oi
the new one to that nominated by Mr. Maepherson could not be acceded to. Mr.
Macpherson's proposal was that he, as reiiresenting the luteroceanic Company, sliould
liave the nomination of a larger number ol' members in the amalgamated Company than
I, and that the (juestion of the Presidency .should be left to the Board of Directors.
With regard to the Presidency, Mr. Abbott informed the Company that Sir John
Macdoiiald i xprcssed himself as being favourable to my election as President, and that
any influence the Government might possess among the members of the amalgamated
Company would be exercised for the purpose of aiding in my election to that office, and
that probably the difficulty as to the nomination of members to the new Company,

in;j

CANADIAN I'AriFIC RAILWAY

r\v ])osifioii wliirli
red to do. I was
licy would have a

to aliidc l)y tliiir
permitted to hold.
uikI by the a^jrcc-
can associates into
)y the Govei'iiineiil
e alliiir in (.'aiiadn,
«; the Coiiij)aiiy ol
liuni. And I (hd

or compromise to
, with whom I diil
' occasional corrc-
irresjmndencc was

inattention, as to
I'd only to h(! scon
1 some comminii-
I found tliat tlicy
•iiig to organize a
)cct of the Pacilic
'ird hy the Inter-
me to exjK'ct any
g to organize, or
•rs of the Govern-
;ir intentions and

that which [ was
ipetition amongst

th(;ir own course
of the Canadian
st of the country.
l.Ii'li gave mc any
L'tioH wiiich they

1 was a mcinhei',
pared to take tiic
s and conditions
)pene(l in various
tiatory steps and
;anized corporate
it would be best
)y Parliament, in

obtained in the
IS with the Inter-
aalgamation, and
lication with the
timated that the
cc. 'i'hat there-
ly, proceeded to
of amalgamation
n of the matter
1, lie reported to
culty in the way
ent of the amal-
tlie members of
L'ceded to. ^Ir.
ompany, .should
I Comjiany than
rd of Directors.

that Sir John
jsident, and that
le amalgamated
) that office, and

new CompaDy,

bftween myself and Mr. Mac|)herson, might be obviated in Home way. In other respects, Oanam.
he reported that he could find no divergence of opinion as to the •imalgamatior of the
two Coinpanies between myself and Mr. Maci)herson.

"'After receiving Mr. Alibott's Heport of the negotiation at Toronto, I felt satisfied
that no (lilliculty would occur in bringing them to a successful termination. And as
the late Sir (ieoVge t'artier happened to be in Montreal shortly al'terwanls, and 1 was
taking considerable interest in his re-election, I met him and had unofficial coiiversations
with him on the subject of the Charter on several occasions, urging that the inlluence of
the (Government should be used to jjrocure the amalgamation upon such terms as I coii-
a^eicd would be just ti myself and the Company over which 1 presided.

"'That .■^ir (j'eorge ('artier, was, as [ was aware, communicating with the Premier
the subject of the Pacific Railway amongst others; and that at one of the interviews
had with him he showed me a communication from the Premier, of which the follow-
ing is a copy :—

"'July 20, 1H72.

i "'Have .en Macpherson. lie has no per.sonal ambition, but cannot, in justice to
Ontario, concede any i)referencc to (Quebec in the matter of the Presidency or in any
other particular, lie says the ((uestion about the Presidency should be left to the
Board. Under these circumstances, I authorize you to assure Allan that the influence
of the Governnu nt will be exercised to secure him the jiosition of President. ' The
otlier terms to be as agreed on between Macpherson and Al)bott. The whole matter to
be kejit quiet until after the elections. Then the two gentlem'"n to meet the Privy
Council at Ottawa, and settle the terms of a Provisional agreement. This is the only
practical solution of the difficulty, and should be accepted at oiuu? by Allan. Answer.

(Signed) " ' JOHN A. MACDONALD.
"•Sir George Cartier, Ottawa.'

" 'And Sir George Cartier on that occasion gave me the assurance whicli he was by
that telegram authorized by the Premier to convey to mc.

" ' That on furthei- discussion with Sir George C'artier as to the course which the
Government would probably take with regard to the amalgamation and the contract to
be granted, I urged uj)on him certain modifications of the terms of the above t-.K.ram
from Sir John Macdonald, and finally Sir George came to entertain the opinion that
I was entitled to have certain of those modifications conceded to me, and expressed his
willingness to recommend it to his colleagues, lieiiig desirous of having as definite an
expression of oi)inioii from Sir George, as he felt himself justified in giving, I re(|uested
that he would put what he stated verbally to me in writing, and accortlingly, on the 3Uth
of July, 1872, he wrote to me the following letter : —

(Cop,;.)
♦" Dk.vi! f^in Iliciii, _ '"Montreal, July 30, 1872.

" ' I enclose you copies of telegrams received from Sir John A. Macdonald ; and
with reference to their contents I would say that in my opinion the Governor in Council
will ajjprove of the amalgamation of your Company with the Intcroceanie Company,
under tlic name of the Canadian Pacific Railway Company, the Provisional Board of the
amalgamated Company to be composed of seventeen memluirs, of whom four ^hall be
named from the Province of Quebec by the t^anada Pacific Railway Company, lour ironi
the Province of Ontario by the Interoceanic Railway Company, and the remainder by
Abe fiovernment; the amalgamated Company to have the powers specified in the tenth
iBection of the Act, incorporating the Canada Pacific Railway Company, d'c, the agrce-
-ineiit of amalgamation to be executed between the Companies within two months from
this date.

" ' The Canada Pacific Company might take the initiative in jn'ocuring the amalgamation;

and if the Interoceanic Company should not execute an agreement of amalgamation

llupon such tcirms and within such limited time, I think the contemplated arrangements

•Sliouhl be made with the Canada Pacific Company under its Charter.

"^ " ' Upon the subscription and payment on account of stock being made, as required

|by the Act of last Session, respecting the Canadian Pacific Railway Company, I liave no

|doubt but that the Governor in Council will agree with the Company for the construction

s;ai- ' Avorkiiig of the Canadian Pacific Railway with such branches as shall be agreed

upon, and will grant to the Comiiany all such subsidies and assistance as tliey are

empowered to do by the Government Act. I believe all the advantages which the

Government Act empowers the Government to confer upon any Company will be

required to enable the works contemplated to be successl'uUy carried through, and I

Canada.

CORRESPONDENCE RELATIVE TO THE

am convinced that they will be accorded to the Conii).iny to be Ibrmod by amalgamation,
or to the Canada Pacific Company, as the case may be. I wonld add, that as I approve
of the nieasnres to which I have rcl'erred in this letter, I shall use my best endeavours
to have them carried into effect,

" ' Wn-y truly yours,
(Signed) '"GEO. E. CARTIEH.'

'• I positively declare that up to the date of this letter I had not any undertaking of
any kind or description with the Goverinneut, either directly or througli any other
person, than that contained in Sir John Macdonald's telegram of the 2()tli of.Tnly, whicli
is given above ; and tliat telegram and the above letter from Sir (xcorge Cartier contains
evcrytliing that was ever stated or agreed to between any member of the Government
and myself on the subject of the I'acilic Railway project U]) to that date.

"On the same day tliat I received the above letter J'roni Sir (Jcorge Cartier. I informed
Sir John A. Macdonald of tiie contents of it, and asiied lor his sanction of the views
wliich it contained. lint he declined to concur in tlu' terms of Sir George's letter, tek-
graphing to him that lie would not agree to them, and that he would come down to
ftlontrtal, and confer with him respecting them.

" Thereupon I immediately informed Sir George Cartier that I should consider tlu'
letter addressed to me as being withdrawn. And to my knowledge Sir George tele-
graphed Sir John that he had seen me and that as lie (Sir John) objected to Sir (Jcorge's
letter, it had been withdraAvn. I also telegrai)hed to Sir Jolni on the same day (July
.'{1st) to the effect that I liad seen Sir George Cartier, and that hi- (Sir John) might
return my letter or regard it as waste j)aper, and that I was satisfied with tlie telegram
of the 2()th as expressive' of the views of the Government.

" 1 jjositively and explicitly declare that, excepting so far as an understandiyg between
the Government and myself is expressed in the foregoing correspondence, 1 had no
agreement of any kind or description either verbally or in writing by myself or througli
any other person in resjieet of the contract for tlie I'aeiiie Railway, or of any advantage
to be conferred upon me in respect of it. Tlie terms of the Charier, the composition of
the Company, the privileges which were to l)e granted to it, the }n'oportions in which the
stock was to be distributed, having been matters for negotiation and settlenu'ut up to the
last moment, and were only closed and decided upon while the Charter was being pre-
pared in tin; early ])art of tiie j)resent year. And the persons who fnnilly <'omj)osed the
•yompany were oidy decided ujjou within a few days of tiie issue of the C^liarter; I
myself bein;),' pi-rmitfed to sulv-ribe only a similar amount of stock to that subscribed by
other prominent members of the Company.

"With reference to certain private anil confidential letters iniblished this day in the
'Montreal Herald,' and to certain statements in (hese letters which may appear to
conflict in some (legree with the foregoing, I niMst, in justice to myself, oiler certain
explanations. I desire to state with ri'gard to those letters that they were written in
the confidence of jirivate intercourse in the midst of many matters engrossing my atten-
tion, and jirobably with less car(> and eireiimspeetion than might have been bestowed
upon them had they lieen intended fur jjiiblication. At the .same time, while in some
respe'cls these letters are not strictly accurate, I conceive that the circumstances, to a
great extent, justified or excused the language used in them.

" \\ ilh regard to tlie reference rejieatedly made in those letters to the American
interest in the stock of the Company, as I have already stated, I had made an agreement
with the parties to whom those letters were addressed, assoeiating my.self with them in
a Company i)rojected for the constriietion of the I'aeific Railway. I had never bien
informed by the Government that it was their intention not to permit the association of
Ibreigners with (.'anadians in the organization of the Pacific Company. And in con-
senting to the legislation introduced into the House, I thought 1 was only deferring to a
preju(licc which I myself considered without foundation. I did not hesitate to intimate
that if a suitable opportunity offered, they should be permitted to a.ssume a position in
the Company, as nearly liki- that which they and I had agreed upon as circumstances
would permit. .\nd as I entirely disbelieved the statenients that were made as to their
disposition to obstruct the Canadian Pacific, and considered that they might be of great
use in furthering its ctmHtruetion, especially in the event of a failure of the negotiations
in England. I had no hesitation in ])laciiig myself individually in the position of favouring
their admission into tlie Company, if circumstances should permit of it. It was in
that spirit that what is said in my private letters now published was written to the
gentlemen to whom they were addressed, and if malteis liad taken such a turn as to
permit with propriety of those intentions being carried out, 1 should have felt myself

hex

wl
th<
no
wh
ter

CANADIAN PACIFIC RAILWAY.

'. by amalgamation,
, that as I approve
ly best endeavours

urs,

E. cartier;

my undertaking of
hroiigh any other
'6th olMuly, which
;e Cartier contains
r tlie Government
c.

Jartier. I informed
•tion of th(! views
orge's letter, tck-
Id eome down to

oiild consider tin
Sir George tele-
eil to Sir (ieorge's
e same day (.Inly
(Sir John)" might
vith the telegrajn

rstandii;g between
lulence, 1 Iiad no
11} self or through
of any advantage
!ie composition of
ions in which the
tlenu'iit up to the
■r was being j)r('-
lly composed tlic
f the Charter; 1
hat subscribed by

I this day in the
may appear to
elf, oiler certain
were written in
•ossing my atten-
lieen bestowed
e, while in some
L'umstances, to a

the American

lie an agreement

if with them in

had never bivn

lie association of

And in con-

y deferring to a

date to intimate

ue a position in

s <ircnmstances

nad(! as to their

ht be of great

he lu'gotiations

on of favouring

it. It was in

written to the

b a tnrn as to

ave lelt myself

*ublic sentiment seems to be decided that the road shall be built by Canadians

teuud to adhere to them. But, in Doint of fact, when the discussions as to the mode in
which the Company should be fen med were entered upon with the Government, late in
the autumn, I came to understand decisively that they could not bo admitted, and I
notiiied them of the fact, and that the negotiations must cease between us, by a letter
which has not been published in the ' Herald ' of to-day, but which was in the following
terms:—

*• ' My nt-Ai! Mit. McMuuji.v, " ' Montreal, October 24, 1872.

" ' No motion has yet (as far as I know) been taken by tlie Government in the
' tter of the ['acific Railroad, liie opposition of the Ontario party will, I think,
ve the ellect of shutting out our American friends from any participation in the road,
,d I apprehend all that negotiation is at end. It is still uncertain how it will be
yen (the ccMitract), l)Ut in any case thi- Government seemed inclined to exact a
;claration that no foreigners will have, directly or indirectly, any interest in it. But
rerything is in a state of uncertainty, and 1 think it is unr-ce.ssary lor you to visit
ew York on this business at present, or at all, till you hear vv'hat the result is likely

ably.

" * Yours truly,

« « G. W. McMulleu, Esq.. (Signed) " ' HUGH ALLAN.

" ' Pictou, Out.'

"Up to this period to which this statement extends, the negotiation between the
Government and myself had chielly reference to effecting an amalgamation between the
two Comimnies which were comiieting lor the railway, upon the principle, as I nnder-
rtand, that tlie enterjirise would require all the strength that could be obtained for it,
abd the united elforts of every oiu; interested in it. And that it would conduce greatly
to its success if the jiersons, in the vwo Companies, who together comprised most of the

}>K)minent men in the Dominion, could lie induced to join their energies in pressing
^rward the project.

'" About this time, however, a memorandum was communicated to me which had
been received by the Government from the Interoceanic Company, which ap])eared to
destroy the jirospect of amalgamation ; and although the Canada Company endeavoured
to remove the objections made by the Interoceanic Company, they tailed in doing so,
and the idea of amalgamation was shortly afterwards finally abandoned. Thereupon
the (iovernment informed me that it was decided that the contract shr aid not be given
to either of the Companies alone, l)ut that the Government would incori)orate a new
Gom])any if the prominent members of the two incorporated Companies, and any leading
Oanadians who might be disposed to join them, and able to give assistance, could be
induced to subscribe the stock in the proportions which] the (Government had decided

Son, which projiortions are those eml)odied in the Charter. And from that time the
brts of all parties interested in tlu; project was directed towards procuring the
lisociat ion together of the most prominent men of both Companies in the newComjiany,
to be incorporated under the terms of the Government Act of the previous ^Jession. And
it was as the result of these efforts that the present Company was formed, composed in
ft majority of instances of gentlemen with whom I had no communication whatever,
md not in any respect as the consequence of any understanding between myself and the
0ov<Tnment.
■|| " ' From that time also communication between myself am! my former associates

1(osed, having finally l)een broken off" by myself as soon as I ascertained the desire of the
overnment. And I state further, positively, that no money derived from any fund or
om any of my former American associates was expended in assisting my friends or the
iSHeuds of the ( iovernment at the recent general elections.

> " 'That witii regard to the construction wbicii ai)l)ear8 to be intended to l)e plar'cd
'||)on the statements in the letter referred to as to the preliminary expenses ei miected
"Itb the Cluufer. I state most juisitively and explicitly, that I never made an agreement
came to any understanding of any kind or description with the (Jovernnient, or any of
meml)ers, as to the payment of any sum of money to any one, or in any way what-
Vc\\ in consideration of receiving the contract ibr the Canadian Pacific. I dicUire that
Jdid e.\))end consideral)le sums oi money in various ways which appeared to me to be
idvantageousto the Company I had organized, and calculated to strengthen my hands m
jtodeavouring to ol)tain tlu' contract for that ('oni|)any, but that i <lid not on any occasiou
'fr in any way ]my, or agree to pay, anything whatever to any meml)er of the (icwernment,
iOr to any ope on Ix'hnlf or at the instance of the Govenunent, for any consideration

Canada.

(X)RRESPO>iDENCE RELATTYE TO THE

Canada, whatever, in oonncction with the Cliarter or coiitrnot. As may be gathered I'rom tlii
letters in question, I considered it to l)e my policy to stren-^then my position as Tarn
I ])ossil)ly could with my own I'r'.ends and I'ellow-citizcns in llu; Province* of Quebec, niii
more especially in so i'nv ivs relnted to the Montreal Northern Colonization Haiiuay, wlii^i
I conceived would at some day be the outlet IVom the Canadian Pacific to the Poit i
Montreal. And a considerable jiortion of the money referred to in those letliM's was i\
pended by me in furtherance of that project in many ways. I considered it for my inton-
alsothiit those members of Parlianu'iit who liad shown an interest in the Canadian Pacili
entc!rprise and in other railway enli'r[)nsi.-. in which I was interested, and wlio wcr.
disposed to assist ainl further them, should be ..ided in their elections, and I subscrilni
some money and 'enl some money to assist the election oi' such persons as were ni
frieiuls and in whom I was interested, but without any understand iuT or condition wit'
them or any of them as to Parliamentary support or assistance in tlie evi;nt of tlui
election. In these and similar ways I expended sums of money approaching in amoiii;
those mentioned in those letters, as I conceive I liad a perfect ri;;ht to do ; but I did lu
state in those letters, nor is it the fact, that any portion of those sums of money wcr
paid to the members of the Goverimient, or were received by them or on their belia!
directly or indirectly as a consideration in any form for any advantage tome in eonnectic
with the Pacific Railway contract.

" ' I desire also to state further with regard to the envedope and the papers which i
contains, which were placed in the hands of the ITon. Mr. Starncs shortly before ni
de])arture for England with the delegation of the Pacific Railway, that upon bci:
informed by me that all negotiations between my former American associati^ a:i
mystdf on the subject of tlie Canadian Pacific Railway must cease, large demands wtr
made upon me by Mr. McMuUen, based jiartly upon alleged e,\pcnditure by him, an
partly upon a claim by him for comi)eiisation for his loss of time and services in tl;
promotion of tlie enterprise so long as he and his friends remained connected with i'
These demands at first were of such an extensive! character that [ declined altogether i
entertain them. I was disjwscd to return to my American associates any money wliii
they might liave expended in the matter, and i was ready to compensate Mr. McMiilli
for the loss of his time and his exj)enses ; l)ut it ap])eared to me that the sum 1
demanded was much greater in amount than all such disi)ursements and exjijuses coiil
possibly have reached. I felt naturally that by trusting to the honour of my corresjioi
dents and writing to them in a manner somewhat inconsiderate, I had placed it in tlu:
power to annoy me by the publication of those letters, and I feared that the outer
which might follow their publication in the columns of certain papers which liav
manifested unceasing hostility to the Canadian Pacific Railway, might injure tl
prospects of the delegation in E)ngland. I therefore authorized an arrangement i
be made with Mr. McMuUen, by which a sum very much less than his original dernaii:
should be paid to him; the greater portion at once, but the remaining and a considcrab
jwrtion on the delivery of the letters to me after the present Session of Parliamci.
should they not be published in the interval. This was accordingly done. M
McMullen received the greater part of the sum agreed to with him, and tlie remaiml!
was placed in one ol those envelopes in the form of a cheque, the other envelope containiii
to the best, of my belief, the same letters which had been published in the ' Aloiitn.
Herald" this morning, together with one or two others, whicli do not appear there. In
which would have estaldished the rujiture of all negotiations iietween the Americans ai.
myself. And thisiu-rangement was made, on my bi'hallj with Mr. McMullen, without t!
concurrence or knowledge of any membi;r of the (ioveriimcut,— none of whom wereav/iir
that the papers had been deposited in the hands of Mr. S.arnes.

" ' And I have signed,

'•' HUGH ALLAN
"'Svvoru before me at Montreal, this fourth day of July, 1873.
'"J. L. Beaudry, J. P.'"

Enclosure 5 No. 4.

STATEMENT BY MR. McMULLEN, WITH DOCUMENTS, &c., &o.

(FuoM TUB 'Montreal IIkuald.')
•"Sin,

" ' So much has been of late said about myself, and my connection with the Pacifi
Railway negotiations, that I think it better to lay a full statement of my ^wsitioii i

gathered from tin
ly position as far ;;^
viiu'(> ot'QiielM'c, an
ition Hail way, whirl
acifir to tl\u l^)^t i
tliosf IftttM's w;is (
I'cd it lor my iiiteiv
tlie(!anadian Pacili.
•stt'd, and wlio wir
)iis, and I subscri! ir
persons as wcro in
ii!r or condition wii'
1 the event of tlui
|)roachinj; in amoiii:
fo do ; but I did iic
nms of money wcr
n or on their bclia!
a tome inconnectio

the papers whicli i
IS shortly before nv
ay, that upon be::..
ican associates an
large demands wcr
nditure by him, an
! and services in tl
d connected with i'
eclined altogetheiM
es any money wliir
nsafe Mr. McMiilh:
no that tha sum I
s and exjjjnses coul
3iu' of my corresjwi
ad placed it in the
ired that the outer

pai)ers which ha'
might injure tl:

an arrangement i
lis original dernaiic
ng and a considenib
ssion of Parliamcii

iingly done. M
1, and thi! remaiml!

I'livelopecontaiiiiii.
led in tlie ' Montn.
lot appear there, In

n tlu; Americans ai.
Mullen, without t!
of whom wereav.ii:

HUGH ALLAN

sn'S, &c., &o.

lion with the I'atit:
)t of my jJOsiticHi r

CANADIAN PACIFIC RAILWAY.

tegard to it before the public than to longer allow myself to be placed in so many
wrong situations by those who are of necessity ignorant of many important facts.
I have chosen, therefore, to place it in the form of an historical narrative, embracing
the incidents that came under ny own knowledge irom the time I first engaged
in the matter until the granting of the charter by the Government to its present
holders.

*'" I visited Ottawa in March, 1871, on a Chicago delegation connected with tlie
enlargement of the canals, and while there met the late lamented Mr. Alfred ^^'addington
and Mr. Wm. Kersteman, who were agitating the sul)ject of a Canadian Pacilic U.K.,
d who introduced the matter to my notice, with a view to organize a coni])any to
ild the pro])osed road. After looking at the surveys and explorations of Mr.
addington, who was well informed on the physical nature of the Pacilic coast, I
included to take the subject before some friends with a view to its serious consideration,
a few weeks, at my request, Mr. Waddington and Mr. Kersteman visited Chicago,
Id the result was, on tlieir re])resentations, that with my friends I projjosed to organize
dS; Company which would undertake to ?'nild the road, on terms api)roxiinating those
^hich current rumour reported th(> (iovernmentas willing to reconnnend to Parliament.
I^c visited New York and Philadcl])hia sliortly afterwards, and in about six weeks later
(heing early in July, 18/1) we visited Ottawa witli an informal i)roposal from parties
of the highest respectability for undertaking the work. The only members of the
Government whom we met were Sir John A. Alacdonald and Sir Francis Ilincks ; and it
speedily became ajijjarent to myself and associates tliat Mr. Waddington had been over
sanguine in his ideas tliat the formation of a Company would be entrusted to his hands.
After sonu! conversation which tended to make tl:is clear, and which intimated that the
Gfoverinnent would wish to incor])orate jiromincnl: Canadian names in any ('omi)any
undertaking the work, Ave left our address witn the two Ministers, with the understanding
that if occasion for it arose wc were to hear from them, Some few weeks afterwards
Mr. ('has. M. Smith, of Chicago, wlio was my colleague in tliis matter, received a
letter from Sir Hugh Allan, stating that Sir Francis Hincks had requested him to
communicate with us in order to cilect a union of t.'anadian and American interests in
the Pacific Itailroad Comjiany that was to be formed.

" ' I afterwards found that Sir Francis Ilincks had visited New York in the early part
of August, 1«7J, and at interviews with two jjromiuent railway bankers, whose names
will readily occur to him, had advised them and their associates to cease negotiations
through Messrs. Smith and myself, and open them directly with Sir Hugh Allan, who
being a lea-iing Canadian was looked upon by the Government as a i)ro])cr ])ersoii to
figure ])rominently in the matter. As the gentlemen applied to were both unwilling and
unable to change I'xisting arrangements, Sir [''rancis, on ids return, seems to have given
the address left with him in July to Sir Hugh Allan, and his letter to us followed. The
Msult was an interview in Montreal, early in Se])teml)er, 1871, at which preliminaries
were settled between Sir Hugh Allan. Charles M. Smith, and myself, by which Sir Hugh
Was to receive a large personal interest in the stock, and an amount for distribution
awiong persons whose accession would be di'sirable, and that the cash instalments on such
rtocA should be advanced and carried by others in interest. An interview was held by
mys^'lf witli .Sir John A. Macdonahl, at the St. Lawrence Hall the day before we met
4ilJaii, at which he expressed th(> approval of the (iovernnunit at the proposed meeting,
Mid nHpiested me to meet him at Ottawa, alicr it was over, to let him know the result.
I^ccordingly went to Ottawa, and explained to him that Sir Hugh had entered into
Wrbal arrangements, which would soon assume a more i'ormal shape, and that we had
iroviiied for the easy accession of such other Canadian gentk-men as would be of advantage.
He seeme(l quite ] (leased with it, and promised, on communication with Allan, to set an
llrly day for entering into i>reliminar> arrangements with the (Jovernment, in order that
the whole matter might be in shape for an early presentation to Parliament. Shortly
Wlerwafds. in accordance with this understanding, Sir Hugh notified Mr. Smith and
l^yself to come, and we three met the Cabiuel at Ottawa, October nth, Is"!, to settle,
1^ we supjiosed, the general h-alures of the scheme. There were present feir John A.
acdonald, Sir J'^rancis Hincks, Sir G. K Cartier, and Messrs. Tilley, Tupi)er, Mitchell,
orris, Aikiiis, and Chapais. It was at once apparent that thev were not fully in accord
ong themselves, in consequence, as Sir F. Hincks informed me, of ti rand Trimk
Jalousy ol Allan, rei)resented by the imp)rtant personage ol' Sir (ieorge Cartier. The
*ttlement of matVero, had, therefore, to be postponed until the return of Sir Hugh Allan
^m Kngland, he sailing on October 7th, and returnin:; the istof December. Mr. Smith
jtod ! ])rocee(l<-d to New York, to inform our friends of the state of atlairs. It was then
|bat we In-st learned of the visit of the Finance Minister, which 1 lu-.^e lieretofore iiarrateti,
'I I -

Canada.

rORRESPONDENCE RELATIVE TO THE

Canada.

yi!

and it was also then that Sir Hugh's ' first telegram of the published correspondence was
received.

"'After the return of Sir Hugh Allan from England, he telegraphed to Mr. Smith, ol
Chicago, that Sir Francis llincks had called and suggested that tlie Government would
he obliged to advertise^ jbr tenders in order to avoid Idanie, so that the conclusion of an
agreement would have to be ])ost])on(Ml for several weeks, but suggesting that we have a
meeting in ^lontreal, and afterwards in New York, to execute the contract which was to
I'oUow our verbal understanding. Mr Smith and myself accordingly lelt Chicago on
December 15, 1871, and after visiting Montreal and closing all])reliminaries with Allan,
we went with him to Ncmv 'i'ork, where tlic contract was signed by all the parties, under
date of DecemlKU' L'.'Jrd. ISTl. A variety of topics were discussed at iutervi(?\vs and by
correspondence, during the winter, and the delays of the Government ex])]ained by the
I'xigencies of the political situation. \Vhile at first Sir Hugh had announced that no
money would be required for such purposes, yet he soon professed to discover that it
would be necessary to ])r<)viile some, toaid in procuring the closing of the arrangements.
He at one time announced to Mr. f^niitb and myself that tiie >::.s,.")()U, of which he speaks
in one letter, had been lent to Sir .lohn A. Macdonald and Sir Francis llincks in sums of
!? 1,000 and ii4,.")00 res])ectively, " with very good knowledge that it was never to h'
rei)aid." 1 le also explained tliat tlie Finance iMinister was taking a great deal of interest
in the matter, and that In- had .sounded him on llie extent of his personal exi)ectatioiis,
when it reached an assured conclusion. He said Sir Fi'ancis liad rejjlied that at his timu
of life an absolute payment would be preferable to a jjercentage of ultimate jn'olits, and
thought he should have s."i(),()0(), and in addition the ])osition of Secretary to the Com-
pany for his son, at a salary of not less than S"2,U00. My reply was, that 1 supposed, as
we were into tlie matter, W(! would have to meet, in some way, such demands, if we
I'Xjiected to proceed, but that large amounts could not be disbursed on uncertainties. As
the Session approached, however. Sir Hugh made application for money, and on March
'JSth. 18/2, a si\i>j)leinentar\ contract was entered into by whicli a committee o! five wen
appointed, Sir Hugh being chaii-man, who were authori/ed to ])ri)vide funds. This con-
tract also covered a change in terms to meet the views, as Sir I high rejiresi'iited, of the
(lovi'rnnieiil, and em|)ovi-ered this (Committee to agree to the acceptance of $.'iO,0(tO,0()0
and .")(),0()0,000 acres ot land, exactly the amount the Government recommended, ami
exactly the amount he tln-n told us they would recommend if we would accept. A levy
of !^.")0,O00 Mas made oe liie American ])artie:;, April ist, 1^72, and the amount ])lacc(l
to the credit of Sir Hiigb.. He drew ^40,(100 as follows : $1. '),()()() by check, dated May
2nd. 1ST2, and i)aid ]\!ay tth, 1872; and s2.'».0(»0 i)y check, dated Alay .'ird, 1S72, and
])aid .Tune (Itii, 1.S72. The only explanations which he made to me of the expenditure of
this sum were the payment of ?? 1,000 to ' La Minerve ' newspa])er. and S'"i,000 each to three
other I'rench ]>apers, whose names I cannot j)ositively remember ; St!,()0() to Attoriun-
General Ouimet for aid ri iidered at Ottawa, and an indefmitt lo.m of ?<iO,0()0 to Sir F.
llincks. I attended (inring the Session of lx7'2, and assisted in the jjassage of the
Canada Pacific Railway Charter; and at its close jiaid the charges under the Private
Bills regulations for the Charters of it and tiie Canada Imjirovement Company — a
Charter wbicji Me suggested to Sir HuL';h and Mr. Abbott, as a necessary attendant on
the railroad legislation. In a<!diti(in to the payments sjjokeii of, Mr. Abbott m;U)
aulhori/ed to promise Mr. Langevin S-.'),nO() to aid in elections about Quebec, on condi-
tion of his friendly assistance, and Mr. Abbott re|i(M'ted that hi had tloiie so.

"'Notwithstanding the re|ieatt!d pledges we had received, and the apparently strong
position M-e occu|)ie(l, both Sir Hugh and niysidf had grave i'ears of the result, in conse-
quence of tin jiosition taken !)y Mr. Macpher.son and his friends, and the animosity of the
Grand Trunk Kaihvay people to Sir Hugh himself 1 met Sir .lohn A. Macdonald in
Montreal, after the close of the Session, wliile on his May to meet Lord Dullerin at
Quebec, and ho suggested tliat, as Allan had made so many enemies, I should go to Mr.

acpherson and try to bring aluiiit an amalgaiuation, ))ron)ising to Mrite;i jjcrsoiial h-tter
to Mr. Macpbersoii. to aid in tiii' desired object. Sir Hugh and Mr. Abbott, however,
both dissuaded me I'rom doing so, as it would alford a pretext for the Interoceanic
Comjiany to raise the American bugbear Mhich they Imd been frying to .lUay, and th(7
promised to fake fh.e responsibility Mith Sir .John of my failure to do as agreed.

•" I then M-eiit to Chicago to await developments, and in .luly, inder date of the Kith.
I got a letter from Allan, m liicli sei'med quite discouraging in tone, an he said Sir (i. E.
Cartiertolil him they never intended dea ling witii either our Company or Mr. Macphersou's,
but would foiin a new one entirely, under the control of the Government. Rut Sir Hugh
added that the elections Mere approaching, and tliennis French friends Mould make their
power felt, and Cartier must either yiidd to Lower Canada Mishe.s, or else he stood a poor

correspondence was

ed to Mr. Smith, of
Government would
le conclusion of an
ing tliat wo have a
itract Avhich was to
ly ielt Chicago on
inaries Avith Allan,
1 the i)arties, nnder
; iuti-rvicws and ijy
t explained by the
mnounced that no
to discover that it

the arrangomcnts.
d" whicli hu speaks

llincks in sums of
t A\as never to \n'
■eat deal ol' interest
ional expectations,
'd that at his time
timate i)rofits,an(l
•etary to the Coni-
hat 1 supposed, a.s
h demands, if wc

uncertainties. As
ley, and on March
nittce o'l five were
funds. This coii-
epresented, t)f thr
L-e of $;W,0OO,O()0
econimended, and
1 accept. A levy
le amount j)lacc(l
check, dated May
ly ;Jrd, 1872, ami
he exjK'nditure of
,000 each to three
.OOO to Attornev-
^^10,000 to Sir i'.
le passage of the
luler the Private
L'ut Company — a
■iary attendant on
Mr. Ahhott was
iuehec, on condi-
so.
ipparently strong

result, in consc-

aniniosity of tlie
A. Macdonald in
jord Dullbrin at
should go to Mr.

a personal letter
\ I •boil, however.

hi- Intcroci'anic
) allay, and they

agreed.

late of the 1 (itii.
le said Sir (i. E.
r. MacphersoiiN,
t. But Sir Hugh
ould make their
: he stood a pour

TANADIAN PACIFIC RAILWAY.

chance to be elected. On August (Jth he wrote again, stating that he had brought about
what he wished, rs the Government had\been forced to come to him, and he had secured

Sii agreement for a majority interest in the Company about to be formetl to build the road,
ut tliat to do this he had to advance a largi; amount of money, some 8200,000 already,
and over $100,000 more still to be i)aid, and \vanting to know what the New York friends
would do. On the lf;th September he wrote again, stating that he had learned of the
absence of several of our friends from New York, and that therefore a meeting could
hot be held until Novend^er l")th. wliich was very unsatisfactory, as he was to have the
contract signed within say ten days, and wanted at once thereafter to go to England to
ibc money. He stated Ins eniiei'iditure to that time as i^l l.'i.OOO gold, witli !r!l.'3,.'J00
on; to jiay, and he urged speedy arrangement lor refunding this. I visited Montreal
ortly after the receipt of his letti'r, to ask him further ])ar1icnlars for the gi'idancc
if our frieii'ls, who were somewhat startled at the magnitude of the figuies, and who
ropo'j'.'d to have some rer.sonable exi)lanation of how the money had been expended
fore they returned it to Sir Hugh. I reached Montreal about Octolier ist, and at the
pterview whicli followed. Sir Hugh reiterated, and e.x])lained the statements in his later
letters. Hi! said Sir George Carticr bad been very loatli to realize the liict that he held
the controlling French influence, subject to a satisfactory disposition ol' the Pacific
Charter, but that after a while Sir Cjleorge did conu' to believe it, and, much against his
will, consenti'd to yield his prejudices, and give Allan the control, with, lu wever, certain
provisions about Americans, which would be more of an appan-nt than real objection
and on the understanding that Sir Hugh should advance money to aid the election of
Government suj)porters. After having Sir George sign an agreement, as stated in letnr
of Aug. fSth, he commenced paying money, but, as he told me, having Cartier's order in
each case, and taking a receipt therefor. AVhen making the agreement he had no idea
that the amount of money would be excessively large, and when it had run up to between
$190,000 and !>;2OO,000, he becamed alarmed, and told Cartier that he must stoj) paying
the drafts which were coming in so rapidly unless the whole Government would sanction
the bargain. He then stated that Sir George sent to Ottawa and received a telegram
from Sir Jo!m A. Macdonald confirming his action. After this Allan said he proceeded
baying until iic bad advanced .■:<'!.")S,00() in addition to ?^ l(),OO0, drawn from New York.
1 promised to submit his statement to my friends, in New York, and leave the matter for
them to decide.

" ' The next word I had was that he thought he must dissoh e all connection with
Americans, in a letter dated October 2'lth. I replieil in a i'cw days after, ])rotesting
strongly against such action, and in return received a brief letter dated November
nth, in which he stated that he was in entire ignorance of the whole intention oi the
Government.
^ " ' In December I got an urgent lettiu- and telegraph, retpiesting me to meet him at
.oronto or Montreal, Init not stating the object. I went to Montreal and had <ni inter-
view on December -Jltli, when he announced a final close of any arrangen.ents with
^Americans, with an utter repudiation of anv »)b]igalions he was under t', them, and
Stated that he. had written to N( >,- York, to the effcict that he could not continue his
arrangements, and must break them entirely off. I j)rotested strongly against such
conduct, referred to tlu; contracts we had »'ntered into, and the long as,ociation existin-'-,
'-s well as the uniform good faith evinced by our party, stating th .t I deenu;d it only
onourable in him to insist on the original agreement, ov else to re* ire himself from the
roposed Company. When this was refused, 1 announced niv iiitention of goiii'- to
ttawa to lay the matti'r before Sir .lohn A. Macdonald. On tlv .'Mst December, 1 had
>lan interview of some two hours' duration with Sir John, and Maced him in posseJsionof
;|ill file facts, and showed him the letters which I had Iron: .Sir Hugh in regard to the
fatter, as well as the original contracts, and the letters to th ; New Yor!: U.K.'' President,
^Jvhich were recently published in connection with other co •res[)oiidenee. T pointed out
■to Sir John the allegations made by Sir Hugh as to his agreements with the Governmeut,
.^,and narrated to him all the leading facts I have given here. He strenuously .lenied that

ftlie Government had iieen bribed, :ind 1 pointed out that if not. then our Canadian
associate must be a swindler in attempting to get refunded nearly 5;I(K),(I(I0, which he
had never laid out. 1 then rapiested him to do one of two things- either to allow our
foriginal arrangements to be carried out, or else to leave Sir Hugh out of thelJovernment
I Company, since we did not ])roi«)se to be a steiiping-stone for bis personal advancement
Bir .lolm said the Government arrangements had gone so far thai be fear( <l they could do
neither, and said that from Allan's memorial in answer to the interoeeanicCoiniianv and
4 irom bis assertions since the Session, they had supposed he had entirely broken olf with
.« Us. i sliowed the most conclusive (jyidcnce -Allan's own letters— that such was not the

I 2

Oanada.

r.s

('()rrespon]^T':n(jk relath'k to tiik

Canada.

case, ami said ii' the Grovcrnmcnt were not in his power, as lie stated, they could belter
afford to take all the risk of his omission from the Conii)any than to lace the])ul)lic when
they knew all the facts, as they certainly would, if Allan was put in and allowed to
broftk his sacred obligations with his associates — associates to whom the (xovernment had
directed him, and who dealt unreservedly with him in the ex[)ress l)elief that he was
the chosen representative oC the Government, and who had the best of reasons for sueji
belief. lit- requested a delay of a few days or more to enable him to communicate with
Sir Hugh and Mr. Abbott. On the 2.'5rd of Jaiuiary last, I again saw Sir John, atwhieli
time two of my iriends accompanied me. We then went over the ground again, and
added the letters which ajjpeared as addressed to Mr. Smith, and after the interview I
gave Sir John, at his rc(iuest, copies of all these documents, Sir Hugh Allan's checks for
the $40,000, and the receipts of ~Slv- Todd for the Private IJill expenses of the Canada
Improvement and C'anada Paciiic Railroad Companies paid by me, which must have bcm
strange reading to him when comjjared with the memorial of the I'iXecutive Committei
of the said C. P. Railroad Company, signc'd by Hugh Allan, J. J. Abbott, and Loui^
Bcaubien, then in his possession, in which the following remarkable ^'issage occurs,
under date October V2ih, 1H72, which memorial was presented to Parliament during tli(
present Session : —

" ' With regard to the assertion that a belief " exists everywhere " that the Canada
Conii)any still intend to carry out the design of the combination with American
capitalists, it is only necessary that the gentlemen who say so, no doubt speak truly as to
some limited circle with wliich they are in immediate communication. But the Canada
Company emi)hatically deny that beyond such a limited circle any such belief, or even
any idea, of such a state of things is entertained.

" ' The Canada Company are aware that a negotiation was commenced during tlic
summer of eighteen hundred and seventy-one, between Sir Hugh Allan and certain
American capitalists for the formation of a Company to construct and run the Canada
Pacific Railway; but they are informed l)y Sir Hugh Allan, and have satislied them-
selves by a full enquiry into the circumstances and details of the negotiation, that it was
not initiated by Sir Hugh, and that it was commenced and supported by influential
jiersons in C'aiia'da, as being the only combination that offered itself at that time for tlu
construction and running of the road ; but they are satisfied that that negotiation never
])ossessed the character attributed to it by the Interoccanic Comjjany ; and they knou
that Sir Hugh Allan would never have consented to embark with foreign capitalists in a
Canadian enterprise in which he takes so great an interest, without the most perfect
securities and guarantees for its control and conduct in the interest of Canada. Rut the
discussion of tlie negotiation is entirely foreign to the proi)osition now being considered.
That negotiation terminated when Sir Hugh Allan engaged with others in the Ibrmation
of the Canada Company, and it has never been renewed.

" ' The Canada Company never participated in that negotiation, and never considered
or entertained any jiorposition, suggestion, or intention of asking aid from American
capitalists or of combining with them for the prosecution of the Railway, or for aiiv
other purpose. The only negotiations they have carried on are those already alluded to
Avith British capitalists, and they have never even communicated on the subject of tlu
railway with anyone outside of Canada or Great Britain.'

" Sir John requested us to meet Abbott and Allan in Montreal, and arrange somethiiij;
satisfactory. Sir Hugh had gone to New York, and while there had called on our
friends and assured them that he would still keep good faith with them. While I had
the strongest reasons for doubting such assurances, and though subsecjuent occurrence^
have confirmed these doubts, yet at their request 1 desisted from jiushing matters against
him, further than to i)rocure a settlement of personal outlay and loss, and that of niv
friends who were with me, a loss directly entailed by his duplicity.

" This narrative embraces all the leading facts relating to my connection with Sir
Hugh Allan, and mainly of my efforts and operations concerning the Pacific Railway:
but as a matter of course, there were numerous negotiations of a nature relating to it,
which seem unnecessary to detail, unless further occasion should arise. Hut these fads
would all tend to confirm the general points herein stated, and they are such as would
occur inevitably in the midst of such prolonged and imjiortant negotiations.

" Yours, &c.,
(Signed) " GEO. W. McMULLEN.

" P. S. — I append authi-nticated copies of documents bearing on this case, which will
explain the manner of doing the business."

CANADIAN PACIFir RAILWAY.

f.n

, they could better
ce the j)ul)lic wlieii
1 and allowed to
e (Tovernmcnt had
hi'lii-r that he was
j1' reasons for siuli
communicate with
Sir John, at which
ground again, and
LT the interview I
Allan's cliecks fur
iscs oi' tlie Canada
til must liave bcLH
ecutivc Committit
Aljl)ott, and Loui<
le pissage occurs,
liament during tin

that the Canada
n with American
t sjieak truly as to
. But the Canada
Lich belief, or even

icnced during tlic
'Vllan and certain
d run the Canada
ive satisfied them-
tiation, that it was
irted I)y influential

tliat time for tlu

negotiation never
y ; and they knou
:ign capitalists in a

the most perleet
Canada. 15ut tlu'

being considered.

s in the formation

never considered

d from American

ilway, or for any

ilready alluded to

the subject of tin

arrange somcsthiiii;
lad called on our
m. While 1 hail
jquent occurrence-
ng matters agaiiisl
!s, and that of my

•nnection with Sir
; Pacific Railway ;
ture relating to it.
But these laets
are such as would
ions.

. Mcmullen.

s case, which will

If Dear Mr. AunoTT, " ' Montreal, August 24, 1872. Canada.

"'In the absence of Sir Hugh Allan, I shall be obliged by your supplying the
Central Committee with a furthiT sum of twenty thousand dollars ujion tlie same con-
ditions as the amount written by me at the foot of my letter to Sir Hugh Allan of the
30th ult. "'GEORGE E. CARTIER.

u « i>.s. — Please also send Sir John A. Macdonald ten thousand dollars more on the
ftfiac terms.' "

" Montreal, August 26, 1«72.
I' Received from Sir Hugh Allan by the hands of Hon. .1. J. C. Abbott twenty
lusand dollars for General Election purposes, to be arranged hereafter according to the
IS of the letter of Sir Cieorge E. Carticr, of tlii' date ;]Oth of July, and in accordance
|th the request contained in his letter of the 2tth instant.

(Signed)

f'For Central Committee.

" L. BETOURNAY."

" J. L. BEAUDRY.
" HENRY STARNES,
" P. S. MURPHY.

" ' {Immedinte, Private) " ' Toronto, August 26th, 1 872.

" ' I must have another ten thousand ; will be the last time of calling ; do not fail me ;

answer to-day.

wrp ,u TT f T n Au ♦* «f A „«n'c ' " "'JOHN A. MACDONALD.

•* To the Hon. J. J. C. Abbott, St. Anne s.

" * Draw on me for ten thousand dollars.
«» « Sir John A. Macdonald, Toronto.' "

" ' Montreal, August 2G, 1872.
"'J. J. C. ABBOTT.

" « Toronto, August 2fi, 1872.
'* * At sight, pay to my order, at the Merchants' Bank, the sum of ten thousand dollars
tot value received.

" ' JOHN :\. MACDONALD.' "

** ' This draft was endorsed thus :

^* * Pay to the order of the Merchants' Bank of Canada.

...I' IT T ir- All . " "'JOHN A. MACDONALD.

" ' lo Hon. J. J. C. Abbot.

••My dear Sir, " Montreal, July 1.'), 1873.

, "I submit for your perusal a statement I propose publishing to the people of Canada
fp to my connection with the Pacific R.R. My reason for doing so is, that I have been
fljlbjected to the vilest slanders at the hands of the Ministerial press, of which you arc
aUrarc. The abundance of such abuse makes it imperative that I should show what
Ithe real I'acts w ere, and as you and I have had a friendly association in the matter,
id you are personally cognizant of many facts, I ask you to give me a letter relating
ireto, and containing whatever may be within your recollection as to the circumstances
the case.

I think I am justified in asking you to do this, when my character has been so
ionsly assailed.
' Your reply will be gratefully received by me, and put me under lasting obligations.

" Very truly yours,
on. A. B. Foster." " G. W. McMULLEN. '

)eau Sir, "Waterloo, July IG, 1873.

" I have had an opportunity to look over the statement you make in regard to your
inncction with the Canada Pacific Railroad, submitted to me for the purpiDse mentioned

your letter of the l.'ith, and I have this much to say in regard to it. With the first
Irt of your history of the matter I am personally unacquainted, as our intercourse did
bt begin until the opening of the Session of 1872, when we were introduced by Mr.
T»bott. My negotiations on the subject of the Pacific Railway previous to that time had

en with Sir H. Allan and Mr. Abbott, though from the commencement I had been
rare of the arrangements made with American parties whom you represented. I was

Delated during tiie Session of 1872 with Allan, Abbott, and yourself, in all the stages

T'OHRKSPONDENrE RELATIVE: TO THE

Canada, ofpi'ocuriiij; tlic Clmrtcr ol" the Ciuiada PacilU' Hnilroud Compniiy, and in all the cnim.
madi! to socuif to that Company tin; contract to hiiihl the road, and as a const'cuuiut
was lamiliav witli many ]ioints naturally arisinj; thtTofrom. I discussed with you in;
ptn-sonal position under tlie projmsed arran-^ements and witli yourself, Allan, and Abboli
all the main i'eatures ol" the lef;islation jjroposed, and such as were deemed necessary In;
the ohject. As yon sfati-, there were diniculties in the way ol" closing matters, and I \v,t
aware of the agreement with ^Nlr. Langevin to which you rel'er, as it was I'requently di-
cussed between us and Mr. Ahhott. I was also aware I'rom the first of Sir (ieoi;,
Cartier's ijjjposition to Sir Hugh Allan, and of the means hy wiiich Sir (Jeorge was forci\
to forego his o])position.

" In regard to the ]myment of money for cdection ])urposes, I was informed of th
arrangement with Sir (»eorge C'artier, and was also shown a confirmatory telegram Iron
Sir .lohii A. IMacdonald. I understand the ailair to he substantially as you have relatoj
and I have reason to believi- that large sums of money were actually expended for cln
tion purposes under the arrangement.

" Yours truly, &e.,
" G. W. McMullen, Esq." (Sigiuul) " A. li. FOSTER.

Enclosure f> in No. 4.
MEETING OF MEMBERS OF PARLIAMENT IN OTTAWA.

FrOJI TllK • MOXTRKAL IIkIUI.D.'

" The gentlemen opposed to iirorogation held a meeting in the Railway Committet
room, immediately after prorogation.

" Hon. L. II. llolton said he thought it would he |)roper for the deputation who liivi
carried (he memorial to the Governor-General to report the result. That memorial ha:
heen signed by ni>uty-threc members, which were a clear majority ol' members who wcr
usually in attendance in the House. It was a memorial only praying him to stay In
hand so as not to prevent the House of (^ommons from iiupiiring into the most stiipcii'
dous political and electoral frauds which had ever hitherto bei-ii heard of. (Loiii
cheers.) The practical result was that in the rejily this memorial had been scorned h\
the representative of the Crown. The worst j)ossible insult had thus been put upur
Parliament by a Governor-General, acting on the advice oi' men who were themselvc
under inijieachmeiit for crimes whicli almost amounted to trea.son.

" -M r. Cartwright said, as Chairman of the Committee, that the memorial had bcor
received by the (rcvernor-General in a very courteous way, and with the remark that i:
was drawn in a very proper manner, and that he also sympalhiied very much with tli.
feelings of the gentlemen of the deputation, hut that he was obliged to act upon th
advice of the members of his Government. He said also that he had named a Royal
Commission, consisting of three legal gentlemen, and would summon Parliament to iimt
again in the course of about two months. With respect to the Oaths liill, his Exeelleiin
stated that his Ministry were not to Idame for its disallowance;. He also said that In
had to di:cline to accede to the jirayer of the ))etition, because, unless he did so, In
must first dismiss his Ministry, which would imply a conviction of their guilt, lit
Excellency, however, had expressly requested that there should be no formal publi-
cation of his reply until he had delivered it in writing. Mr. Cunningham had stated to
his Excellency that the di'putation considered that the prorogation would be an infringi-
meiit of the jirivileges of Parliament, i)ut that point, of course, his Excellency did iw;
discuss.

" Mr. Cunningham (ISIanitoba) said that when his Excellency s])oke of dismissiii;
his Ministers, he (.Mr. C.) stated that the ninety-three members who had signed tin
memorial considered that the accusations against the Minislry were before the Ilouscoi
Commons, not before his Excellency ; and that until they were brought before him, In
had no right to issue a Commission, or to take any other step in connection with them.

" Messrs. Rur[)ee and Church confirmed these statements.

" Mr. Paquet also added that his Excellency had made an exposure of facts exattly
as they had been made in the Ministerial journals, and had said nothing l)Ut what liaJ
been said there, except that the advice he was going to adopt was given by his adviser*
unanimously. He had also remarked that it was impossible for Parliament to jiroccfil
to business, since, in consequence of the understanding arrived at, neither the members
from Manitoba nor those from British Columbia were present ; and he was answered by

CANADIAN PACIFIC RAILWAY.

71.

uid in all the ofTort.
md as a cousoqui'iu,
inissfd with you nii
", Allan, and Abboli
Iconic'd nccL'ssai'y In;
<; matters, and I \v;i
t was IVequcntly di;.
; first of Sir (ieoii
ir (icorf^cwaslbm,:

ras informed ol' fli.
atory tcl(>grani Iron.
as you have relatid
y cxjjendcd for oln

\. a FOSTER.

OTTAWA.

Railway Committet

[Icpiitation who Iiao
That memorial hac
memlx^rs who wcii
ing him to stay hi

the most stu|)('ii'

1 heard ol'. (Loin:
ad been seorned In
;hiis been put ujiui
ho were themselvc

ni'inorial had bm.
1 the remark that i:
very much with tin
ed to act upon tlu
lad named a Koya!
Pari lament to mid
Bill, his Excelleiu)
.' also said that In
nless he did sojn
r their guilt. Hi-
L- no formal publi-
gham had stated to
juld l)e an infringi-
Excellency did iiu!

ijjoke of dismissiiii;
ho had signed tin
)ei'ore the House cl
ght before him, In
ection with them.

ire of facts exactly
thing but what liail
ven by his adviser?
liament to ])roceeil
ither the members
e was answered by

Tginting to Mr. Cunningham, and by the assurance that Manitoba was fully reprosontcd.
There was, however, no difTiculty about seeing on which side his Excellency leaned.

" Hon. Mv. Cauchon said that, although at the end of the meeting of tlu; House Mr.
McKenzic bad invited those ojjposed to prorogation to assemble here, he understood there
were numbers on the other side who would have gladly been here to ])rotest against the
course pursued, i)u1. that they were afraid of their party. He disclaimed the idea that
thk was in any way a party meeting. (Hear, hear.) Every member had been invited
tobe jtresent, and act in unison on the subject. They would all get a fair hearing, and
might express themselves as they I'elt. (Cheers.) In whatever way the mi-eting might
divide, the feelings of all would l)e respected. (Applause.)

^Mr. Jjallannne, rtho was loudly called for, said he did not thiidi i^ his \)\;wc, to
aijjdress them on the subject ; it was more fitting that older politicians shoulil do it. All
||pst feel the outrage whii'h had bi;en ])er|)etrated. (Hear, hear.) It Wiis no cpiestion of
lUrty. The (luestion now was, whether free government and free inquiry really existed,
Moh as they knew wvU was eini)raced within the IJritish C'i)iistitutioii, On this account,
t^ question being so vast and important, he should leave it to older i)oliticiaiis tiiaii
hfeiself to discuss. He (U'nied that the Committee could not proceed with the investiga-
tion, and alUrnu'd that ni'ither the i)eople nor their re})resentatives woubl submit to Ijeing
dejprived of the rights, liberties, and privileges which belonged to them as IJritisli
subjects. (Ajjplause.) As far as he knew, a Uoyal C'onnnission was altogether unne-
cessary, as the question before them was one which involved the ])urity of Parliament.
As he had before said, this was a proper sulyect for tlu; older members to discuss. As
for himself, he had to-day felt like a l''rcnchman, as his blood fairly got up at the outragi'
and insult which had been peri)et rated on the people and their representatives. (Hear,
hear.) He should defer from further speaking, in order to nudve way for the h-ader.
(CHe.s of ' Hlak(! and McKenzle.')

" Mr. Blake urged that it would be well that ]\Ir. McKenzie's speech, which had been
80 rudely interrupted in the House, should liist be eomi)lete(l.

" Mr. McKenzle .said be had so nnu'h dirTiculty in the House in olfering his motion,
ho had almost lost his voice. In addition to what Messrs. Cauchon and Lallamme had
swd, Ih! would remark that ninety-lour members of tiie House had signed the memorial
oi'remonstrance to tlieCiovernor-lieiuM'al. (Applause. A voice : 'It is now ninety-live! ')
Iq addition to those who had thus declared themselves, there were numbers of c;onser-
vatives who lelt just as strongly as they did, that this prorogation was an imi)roper act
uuder existing circumstances, "if tlu'y had not signed this petition of remonstrance, it
was because they had themselves sent a remonstranci'. (Hear, hear.) It was well under-
stood that some of the Conservatives who had sl<;iied the larger i)etlllon Iiad acted more
gr less with us; but those to whom he had previously referred, were outside of that
^Ipnber. No one could confemi)late the recent high-handed proceeding w Ithout feeling
^to be a gross outrage, which must not be permitted. (Hear, hear.) He was ((uite
ire that in times like these, when outrages were consummated by (Government, that
sons sometimes expressed themselves more strongly than prudmice and the circum-
•nces justified ; l)ut in this case an attempt had been'made to sap the very foundations
#the independence of Parliament. (Ap])lause.) Since he hail sat in Parliament, he
miA ever kept in view all legislation which should have a tendency in the direction of
rliamentary independence; but in this instance, to screen Ministers from a charge of
grossest corrui)tl()n, of which a good prima facie ease had In-en made out, it was
empted to violate that indei)eiidence. (Applause.) He had no doubt that, from bis
^nt of view, tlie (iovernor-Cieneral was right when he said that he was bound to take
advice of his advisers; but we had one English writer— an authoritv both on law
history -who had said otherwise. This writer (Cioldwiu Smith) said plainly in a
sr ni the 'Witness,' as well as in an article in the 'Canadian Monthly," that the
ibei-s of the Committei; of Inquiry were right in refusing to allow it, without the
Ihority of the House, to be turned out of doors by a Royal l!ommission ai)polnted by
B parties accused. He takes the ground that tlie Ministry are not in a i)ositlon to
Irise his Excellency us to a in'oi-ogalion or Commission, but must take the prerogative
his own hand. (Hear, hear.) It must be borne in mind that Parliament had
pomted a Conmiittee, whose operations were frustrated by agencies which \\ere eon-
Iled by the Administration. (True, true.) He i>xi)lained that a majority of the
Immittee were appointed by the Ministry themselves— the accused jiarties, who
clnied to take evidence without oath, whilst the majoritv were perfectly willing to
ve all the witnesses, even were they Ministers themselvi!s, to be examined without this,
mb It'aring that they would tidl a lie. (Applause.) Matters were in this jiosition when
ipe Parliament met, as it had done to-day ; constitutionally there was no necessity for

Canada.

mmr

COllT^ESPONDEXCE RELATIVE TO TITE

Canaija.

sM'i'nriii}; witnesses, merely to brins tlit"'" under the ])unislimcnt due to perjury if thi
coniniiftcd it : this was, hj-causc the I louse could <leal with them as it pleased, and \nni\-
theni if necessary, althoUf;li they did not see the necessity for it. Menil)ers were wiijii:
to allow the Oaths Hill to |)ass. lie liad been also willing to aUow evich'uee to Ih; take
M itiiout the sanctity of an oath, as he believed tliat those who would tell u lie woiil
have MO oi)jection at all to swear to it. f Ai)i)laus«'.) While niatlci-s were in this stiit.
his Excellency's advisera had advised the (iovernor to prorogue th(! Houses, tin.
turninjj; the peojjle's representatives out of doors, without ^ivint; them an oi)portuuily i
discussinu: the matter, or the rescdiition which he had offered. In order to prevent tin
the Usher of the Hlack IJod had been directed to wait at the door of the ('hamber, an
knock the very moment the numbers entereil. This was to prevent tliscussion, an
nnike it impossible to deal with his resolution. At length he j;ot it into the hands of tl
Speaker, who was the constituted ])rotector of the members of Parliament. lie w
sorry to say. however, that it appeared to him that his authority was to be used otlic
wise, lor lu; displayed unusual anxiety to ))rcvent it rcacliinu; his own hanils and i
])revent its entrance on the Minutes. He desired to say that in this country, which «,;
f^overned by Parliament, a cry would jj;o out from end to end of the land against tli
indignity which lias been put on it, and if the (Jovernment sought to escape from lli
coMse(iiiences of their crime, they would find that their action only served to intensify ll,
Ji'eling. It now became the members, as rulers of the country, to do nothing unseemly
but to take every stej) to maintain their dignity; and, at tlie same time, to use evn
legitimate and lawful means to obtain the opinion of the country. (A voice: 'That's Ih
advice to-day.')

" Mr. HIake did not think that Mr. Mackenzie liad lell much room for him to sa
anything. I'p to this he had felt it his duty not to interfere at all in the matter, in Ih
j)eculiar position in which he felt himself ])lace<l, and not to express an opinion on th
subject. Now the matter was changed, tin- functi(jns of tlie Committee were at an in
and he was no longer fettered by this consideration, lie would now give them explaiia
tions as to the course which he and his friend Mr. Dorion had pursued when in Montiti;
and the sentiments which had influenced them. They felt the position they occupied n
the second of July as one of no ordinary difficulty ; they were anxious, and they knewtl;
country had the same feeling, that the iiupiiry should be proceeded with in the mostex|ii
ditious and effective manner, but, aftcn- consideration, recognizing all these things, tin
took the responsibility of declining to accept a Royal Commission. They were aware tlii
by accepting the Commission the inquiry might at once go on, but they felt they had a la:
higher <luty to perform, — that from the House of Commons they received their inslnn
tions, and it was lor them to maintain the dignity and indejxndenei.' of that body. .\
delegates of the people their duty was imperative, and their instructions from the Hon-
were not withdrawn; and least of all were they authorized to agree to a change i
tribunal. The proposition for a Hoyal C!onimission had been made in Parliament by tli
l*remier several times, but no member uttered a word in favour of such a coui-se ; aiK
the Chairman of the Committee, the Hon. .1. II. (.'ameron, had himstdf pointed out tli^
inconvenience of it. These were so gri-at that thi- Premier abandoned the project n:
account of the feeling of the House ; and that feeling was sound. IJut the (piestion to-da;
was infinitely greater than Avhether this (pu-stion was true or false. (Loud cheers.) Tli
(pu'stion now was whether the right of Parliament to try Ministers for their crinu*
should be taken away. (Repeated cheers.) Those Ministers had, in the representatioL
of more than one hundred members of Parliament — for it appeared that several li*;
made thi'se representations who liad not signed tlu; memorial, a number more numei'oii;
than had ever taken such a stej) before -advised the Crown to prorogue. The petitin'
was most moderati', as the men who signed it asked merely that Parliament should Iiavi
an opiK)rtuiiity of exjiressing an o])iiiioii and taking order; asked only that it slioulii
have an opportunity of giving advice. One reason given by his Excellency against jiro
ceeding to business was the absence of the members from Manitoba and British Colunibiii;
but every member from Manitoba was present and had signed the iietition, and out
member for British Columbia could easily have been brought up from Montreal, hut
why were these gentlemen not jiresent? It was because instead of advising these rqire
sentatives to be here, the Ministry had advised them not to come. Ministers had ilM
ke])t the House empty, and then advised liis Excellency that, not being full, it was nut
competent to proceed to business. Put that need not have invited a prorogation. 1'
might have been met by an adjournment, though that might have given more cause of
complaint to gentlemen who had come, some of them eleven hundred miles, to atteiult"
business: yet such was the public spirit of those who had thus attended, that he did iw'
doubt their willingness to tell the Ministers they would wait till they got their supporters

CANADIAN PACIFIC RAILWAY.

lie to |)crjiiry if th«
t pleased, uiid puui-
leinliers were willin

eviileiice to Im; fake
ould tell a lie uoul
•s weie in tliis stati
e the lIouscH, tliu
ni an opportunity i
rder to prevent tin

r the (Jhaniher, an
:vent discussion, an
into the hands olt!
'arlianient. lie w
iis to lie used otlu;
) own hands aiul i

eountry, which uj
[he land ai^ainst l[

to esca|)u I'rom ili
!rvc(l to intensity IL

nothing; unscenil;
e time, to use ever
\ voice : ' That's tl;

oom for him to su
in the matter, in lb
ss an opinion on tl.
ttoe were at an di

give them exi)lam
d when in JVIontrd
on they occupied n:
s, and the} ivuew lli
ith in the moste.\|n
II those thinj^s, tlui
'hey were aware f ha'
•y I'elt they had a la:
L'eived tlieir inslnu
l; of that body. .\
ions I'rom the 1 Ioin
;ree to a chanj;c i
11 Parliament by lli:
such a coui-se ; ai:,
self jH)inted out tli:
uned the project m
t the (piestion to-daj
Loud cheers.) Tlh
■rs for their crinit*
n the representatiot
L'd that several liaJ
iber mon; numeroit
ogue. The petitior
lament should lian
Duly that it shoiilil
jUency afi;ainst jiro-
[ British Columbia;
c petition, and out
am Montreal. Ik!
dvisinj,' these rcpn^

Ministers had liM
:ing full, it was not

a prorogation. Il
;iven more cause o'

1 miles, to attend to
led, that he did not
ijot their supportiP

•tlier. What might liapj)en now ? There was a sealed packet of papers impounded Cvnvd*

in the liands of Mr. Starnes, and it was quite possible tliat, by the prorogation of the
Housi' and the consequent dissolution of the Committee, those very important papers
might yet get into other liauds. Perlia])s what he now said might prevent that, but
yesterday tije House had control of those papi-rs, and two hours ago the control liad
ceoseil. The Ministry would not have thus acted unless they had felt that delay was all
that they had to depend upon; delay that would nive occasion, perhaps, for loss of some
important document, j)ossil)ly foi some death that would prevent the disclosure wbich
thev dread, for, assuming the i)nblished docnments to be genuine, the position of the
Mhii-try, and of the country through their acts, was one of the deepest disgrace and
humiliation. It was now admitted tli't the claims of Sir Hugh .\llan to the Pacific
0<ptr act ere looked on unfavourably by a ])ortion of the (!aliiuet, but that he set himself
tliipriirnrc Pailiamentary and popular influences, which be broui'Jit to l)ear upon them,
t;^til lie sacceeded in extracting a promise which he considi icd to be satisfactory. Hefore
qlltuining that promise he liad threatened to prevent some of ibcni I'rom securing their
M«le(tion, and afterwards he assisted them, by his purse and inlhunces, to corrupt the
dttiistituencies thro'.ighout the country. We know that very large sums were received by
Ministers for this nel'arious puri)ose, and that this was contemporaneous with the agree-
ment of the .'!Oth .luly, which Sir Hugh licemed satisfactory. If those papers were
genuine, he n^peated that nothing could alter, nothing diminish the infamy of that trans-
action. 1 was a bargain to give to a i)articular person a benefit, at the same time that
Ministers a -cepted from him by gift or loan an immense sum of money, for the jmrpose
of bribing the electors. These otherwise si'iisible men are not ashamed to say, it is true,
that Sir Hugh got the contract, and that he gave an immense sum for the purposes of
elections; but one thing had nothing to do with the otiu'r. (^Laughter.) He was, say
these persons, an ardent i>olitician, and gave his money to support his i)arty. (Laughter
and cheers.) Do the letters show that he was an ardent politician ? Yes, they do ; but,
Mr. fioldwin Smith has said, it was in the politics of steamboats and railways — (great
cheeriim and bis party was Sir Hugh Allan. (Laughter.) However, we have Sir
Hugh -Mian's testimony on this matter; debased as these letters show him to be, he has
not told us that he lied in writing them. He only committed a few little inaccuracies,
such as he and you and 1 make in private conversations, since we are only exi)ected to
hetrutbfid when we speak in public. (Uoar^ of laughter.) It is, therefore, true that
he s|)eiit his money to get the contract. It has In-en pretended that Mr. ILmtington was
bound III prove every member of the Government to be directly concerned in this
matter,— he (.Mr. Plake) supposed thi'y must ])roduce an Order in Council where every-
thing w IS formally agreed to. (Laughter.) But those who w, le acquainted with Courts
of Justice knew that frauds did not usually thus discover themselves. Such things were
tjgiially cloaked, and men were often found to say, and even to swear, that simulated
kpers were genuine; but Courts will jjiit these two things together, and when they find
lan with documents, assuring him some great benefit in 'one band and a lot of checks
the- other, they take them together. (Cheers and laughter.) The business-like receijjts
kd drafts had something to do with this idea. Sir Ilu-h kiu-w that he was dealing with
|ppery customers, and therefore he made his terms, and put everything down in writing.
V' principal actor in the afl'air, no doubt, to-day regrets this extreme precaution, but
ie cause of truth and justice has been well served by it. A remark, not unfre([uently
tard, is to tin- effect that politicians are alike, and that if one Ministry is ejected the
Bxt will do something. He was glad, however, to see that i)ublie virtue was not jet so
jw as to permit anyone to assert this in public. It nevertheless received much ])rivate
Vrency, and it should, therefore, be frowned down by all who believed that Canadians
Ve entitled to the responsibility and the happiness of self-government. Men may sav
fou will britic too,' but have we not on our side of the House been endeavouring lor
bars to make bribery difficult, if not imjxjssible'/ Have we not been pressing for an
fection law which will give us means of obtaining cheap and searching justice in these
irtu-ulars? and have we not been told that there was a doubt if this system is suited to
Je circumstances of the country ? (Cheers.) What fair-minded man can now doubt
^at this allection was only made for the jnirjiose of continuing the system of bribery and
jDiruption which has hitherto prevailed'/ Who that reads the decisions on electoral
J|efitn)ns could help being ashamed of them'? He did not blame the Si)eakcr of the
Mouse lor these things— for he was inclined, like Mr. Mackenzie, to shut his eyes as
-Ilucli as possible to that officer's failings— but he blamed the law. Because an illiterate
laii wrote Ins name Robertsen instead of Robinson, the petition against J. II. Cameron
^ns thrown out, and there were many more similar decisions bv which election ])etitioiis
/fk'ere prevented from going before even such a wretched tribuiial as the present Parlia-

fOinitSPONDKNCK nELATFVIO TO THE

Cajiada. nionlary Comiiiittcc. Vet that infamous law the Ministry had refused to rectify. What
~ would have lieeii the result if the Allan ^old had not lieen scattered broadcast through
the country? It was well known that there were everywhere venial j)ersous, indid'ereiit
persons, ai\il men with local interest to sell for money; and in counties where opinion
was not very decidtd it was easy to chauf^e the expression of it, hy i)urchase of tlu;
venial, indill'erent, and these local undertakers. Without the (uitlay of Allan's money no
one could douht that the complexion of this Parliament would have been very dillVrent.
Among the luemlu rs, every man may not he as deeply dyed in this iniquity as the Ministry ;
some may not have known that they added to the crime of corrupting constituencies that
of selling their country, i)ut those who did know will resist investigation to the last, as their
crime is only a little less than that of those who perpetrated it; hut when he saw that
Avith a Parliament, even thus «'l((t((l,oue half of thememl)ers shouhl take the decided step
that liad heen taken to assert the rights of the (.lommons, he felt confident yet in the
iudej)endence of representatives of the people. Parliament might hereafter resume the
investigation, and might re-estahlish the Parliamentary tribunal. The motion which liis
friend had made he might then renew, and it would meet with a very dillerent receptioa
from that which it had had that afternoon. He hoped now that those who had thought
it was the wish of a tactions opjjosition to desire Parliament should sit while the Com-
mittee was silting, would consider that, of what had taken place all that had occurred
since would have been aljrogatcd, and that investigation would now be complete. He
hoped ihere would now l>e an investigation, not i^y men chosen by the accused, not by
men named by gentlemen in the dock — (laughter) — hut hy those who should l)e chosen
by Parliament, indillerently to try the question of iunocence or guilt — (cheers) — and try
an exhaustive examination of evidence. To such a tril)unal he was willing to bow, but
not to three persons, whoever they might be, ajjpointed by those on whose innocence or
guilt they were to decide. He was not ready to abandon the right of Parliament to try
this case. He went for maintaining the course of Justice entered on by the House of
Commons, which must not be interrupted and should be resumed at the earliest
moment. (He sat down amid tremendous cheers.)

''Mr. Huntiuiiton said there were occasions that inspired eloquence, great occasions,
which made great men, such as the result of tiie large measure that had to be discussed,
and of the warmth of I'eiling that was elicited. He would pay a poor compliment by
making a lengthy speech ; but however they might feel, this was a great question. He
looked on it as a question, not whether a contract had been sold, but whether this
country should or not l)e governed by Parliament. He desired to speak with reverence
for the Crown, but he did not want to go back to the time rd" Nero, when the depository
of ])ower could fiddle while the city burned. There were times when issues were so
great that the cause of truth was far greater than any man, however highly he was
placed. He had told them in Parliament what he could prove of these terrible charges,
if he had an opportunity afforded him. He felt that he could prove these charges then;
without that he would not have jeopardized his fair fame by making them ; but when
he stood up at that time to do his duty, to state when he asked that means might be
taken to prevent witnesses from being tampered with, and documents from being made
away with, if ho had then fold them that, failing to wriggle out of the net into which
they had betrayed themselves, the Ministry would appeal to the prorogation ; if he had
told them this, antl had suggested that these important papers might, iwrhaps, be floated
away, that Mr. Abbott, wlien asked about the draft upon him, might assert that lie
is the attorney of tlu; Pacific Railway Company, and Sir John A. Macdonald himself
might assert that he cannot be made to divulge the aflairs of State ; he might have been
laughed at. (Cheers and laughter.)

" If he had half an hour of oral tcsttimony he could explain and confirm, in the most
incontestable maimer, all the documentary evidence which had been already published.
It had been said that he had gone into a mean business because he had got hold of secrets,
and therefore could not be tliought fit to sit at the table of a knight. (Cheers.) He
supposed he ought to have got a certificate from the men who were guilty, in order that
they might prove their own guilt. (Laughtci.) What must be thought of men who
argued in this manner in the press. Having, however, done his duty with the aid of men
of all parties who said that he should not be crushed, what more or less could be asked
than that the matter should be thoroughly prosecuted by the House of Commons itself?
(Cheers.) He never believed that so long as the Ministry could prevent it, there would
be any inquiry permitted. (Cheers.) He never thought that Sir Francis Hincks would
testify that being advanced in life, he would prefer cash to prospective profits. (Laughter.)

"When Sir John A. Macdonald called himself a man, and' when, laying his hand on
his heart, he declared th- liere was no truth whatever in the charges which had been

h
ti
ii
n

■c

CANADIAN I'ACIFIC KAHAVAV.

to m-tify. What
mmlfjist flinni;;!!
rsoiis, iiulin'cruiit
•s wlicro opinion
purchase; ol" flic
Whin's nioni-y no
■ti very (liM'tTL-nt.
as tilt" Ministry ;
iistitucncies tliat
the hist, us tlifir
Ik'ii hi! saw that
tlic (Ic'cidfd step
dent yet in the
liter resume tlie
otioii whiih his
lerciit reception
ho Imd thought
while the Com-
it hud occurred
complete. Ho
iccused, not by
Juld 1)0 chosen
leors)— und try
ng to I)o\v, but
e innocence op
rliainent to try
y the House ol'
it tlie earliest

real occasions,
o be discussed,
"inpliment by
question. He
whether this
ith reverence
the depository
ssues were so
,'hly he was
•riljle charges,
charges then ;
ni ; but when
ans might be
n being made
it into which
)n ; il' ho had
ps, be floated
ssert that lie
nald himself
ht have been

in the most
y published,
dd ol'secrefs,
'heers.) He
in order that
of men who
e aid of men
lid be asked
mons itself'
there would
incks would

(Laughter.)
his hand on
;h had been

made, was it likely ho would have appeared before a(!(>ini)iittee and baves.iid that there
were im])ers in the hands of another jiarty which would prove all the ciiarges against
Jiini, ami which lie had sought to destroy. ((Cheers.) Was it likely that he would have
told them of that telegram asking lor another )5! 1 0,(M)() with the assurance that he would,
if be gill that last demand, ask for tio more? (Cheers.) (!iicumstaiu"e had, in this
mutter of delay, been constantly in favour of the Ministry, but I'rovidii'ce bad, on the
contrary, hicn always against them. To-day it wiis a i-ontest of Providence on one side
and prorogation on tlit; other ; and if they would stand by their own rights, they would
find that Providence would gain the victory. (Cheers.) He then returned thanks to
fevcral al)le men who had assisted him in carrying on this jjroscciition men who were
not all of tlie pnrty to which he belonged, but who had firmly lent him their support.
There were, indeed a^ many ('onservutives as there were Liberals who would feel deeply
humiliated at the reilcction that the ])rerogative of the Crown hail been to-day trampled
in the (lust, for the sake of screening mi'ii who had rindereil themselves guilty of the
worst crimes against the liherly of the people. Tbc Hon. Sir.Idhn A. Macdonald always
showed himself in favour of a Royal Commission, but that project did not take with the
House. The honourable mcmliers, however, have the promise of this blessing being
shell ii| on them, and Sir .lobn A. Macdonald would now, no doubt, be most anxious to
jn'ove his own guilt. (Cheers.) They might, however, see that Sir Francis Hiiicks did
not rush to till! front with much alacrity when bis evideni'c was called for; yet under
this blessed Commission, this great alacrity will, of course, be exhibited by him. He
did Tiot liclieve it. Sir Hugh, according to bis judgment, when called into the witness
box, would say that hi- cannot criminate bimsi'If. The ('ummissioners would say
certainly not, and the right bononrable gentleman would then rul) his hands and say he
never thought of that, and tliat he is inex])ressibly sorry. (Cheers.) He had in
Parliament told the House that he could jn-ovc these ciiarges which be bad made, and
told them now that although temjjorary contumely bad been thrown on I'arliament, it
would at least be before Parliament that they wcmld carry ibis prosecution to its rightful
close. (Immense cheering.)

" Mr. Dorion said that instead of a speech he would suggest an adjournment till seven
o'clock, and the apiiointmcnt of a Committee to ])repare resolutions to be ailo])ted. He
liad merely to touch ui)on the Oaths Bill. Whose fault was it that the evidence bad not
already been taken on oath? It M-as the fault of those who had, in an unusual manner,
sent this Oaths Hill to JMigland, even before I'arliament was adjourned, for he was
informed that Bills bad never, for many years, been sent to England until three months
after the rising of Parliament, and when all the Acts of the Session had been printed and
bound and sent at the same time; yet there were two Acts, one of our own Parliament,
and one of that of Ontario, which, though liabh; to the same olyection, had never been
disallowed to this day. The disallowance must, therefore, have been i)rocured by some
influence, he would not say by what, to screen men who bad disgraced the na"mi>s of
Canadians. The ])rcrogative right was su])i)osed to be emi)loyed to jn-otect the lii)erties
of the i)eoi)le ; to-day it has been emjjloyed to destroy them, and this act would create
an excitement throughout the country, little expected, he believed, by the Governor-
General, who, in proroguing the House, had acted upon advice from persons not at all
qualified to give it.

" The mei'ting then adjourned till seven o'clock.

" In the evening a very large and most enthusiastic meeting of members and otiiors
was held in the Railway Committee Room, under the i)residencv of Mr. Mackenzie.
The room was crowded to its utmost capacity, and the feeling manifested was that of the
deepest indignation against the Ministry, who had trampled on the constitutional rights
ofthepeo]de. The Uovernor-Gencral was also spoken of as having over-stretched the
Royal prerogative, which, instead of being exercised to shield the Ministry from inquiry,
should have been used to hasten and second the proiMjr conduct of an inquiry.

"J)j^^^'"s moved by Mr. Cauchon, seconded by Mr. Mills, and resolved :

'" Ihat in the opinion of this meeting, the prorogation of Parliament without giving the
House ol Commons the opportunity of prosecuting the inquiry which it had undertaken,
IS a gross vmlation of the i)rivilegcs and independence of Parliament, and of the rights
ol the people.

1'^ Moved by Dr. Forbes, seconded by Mr. Cartwright, and

'Resolved—' That, in the opinion of this meeting, the I louse of Commons is the proper

•body to mstitute and prosecute an inquiry into the pending ciiarges against Ministers;

and that the action of the accused Ministers, in removing the inquiry from the

Commons, and appointing a Commission under their own control to try themselves, is

a gross violation of the rights, privileges, and independence of Parliament; and it will

K 2

Oa«*pa.

Canada.

'«

CORRESPONDENCE RELATIVE TO THE

' bo the imperative duty of tin; House of Commons at the earliest moment at wjiiili it is
'allowed to meet, to take action lor the vindication of their rights ; and lor the resumption
'of a Parlianuntary inquiry .'

"IvicKiuent and stirrnig addresses were delivered l»y Ahtssrs. Cauehon, Mills, Forbes,
Carlwri;;])!, Hun. A. J. Sniitli, Isaac Burpee, McDonald (Inverness), Cunningham, (JofTin,
fJoudge (Hants), Fisi't, .Senators liCtellier de St. Just, Christie, Rymal, Hon. John Young,
.lett(', Anglin, and Mackenzie.

"Tlie meeting hroke up about 10..'];> r.M.

" Altl;ou;,^h many gentlemen who had previously been identified with the Government
were present, not one oi' them expressed dissatislaction with the proceedings, or in any
way indicated their dissent. Each member proposed to bring the matter belbre his
constituents at the earliest possiljle moment, and there is little doubt that there will be
a tremendous agitation throughout the length and breadth ol' Canada."

No.

The Eaiu. 01' Dri'FEiux to The Eaui, op Kimukri.ky.
Mv Lonn, Canada, August 18, 1S7.3,

^i^,_.^, Iv my |)revious Desj)at.'h of the ir)th of August,* I had the honour of

informing your Lordship of the circumstances under which Parliament was prorogued
on the l.itii.

As a conse(iucnce of that event, the Pacific Railway Committee of Inquiry became
extinct, and, as I have already mentioned, an interval of eight or ten weeks was to elapse
before the rc-asseml)ly of Parliament. A question consecpieritly arose as to whether,
during this short recess, anything could be done to forward the hitherto abortive impiiry
touching the Pacific Railway Charter.

^Vluii 1 was at Prince Edward Island, and in communication with my two Ministers,
Messrs. Tillcy and Tupjier, shortly after the publication of the McMullen correspond-
ence, — I had intimated to them that, should the Committee of the House of Commons
find itself unable to i)rosecufe the investigation, the truth must be got at sonu'how, and
that i)crhaps an inquiry coniiucted before three .lodges of the land might prov»; a satis-
factory issue out of the difiicully. In making this suggestion I was actuated by a doul)le
motive. In the first place, 1 was deeply distressed at the embarrassing relations which
e.xisteil b"tween my Ministers and myself. These gentlemen were being assailed by
irresponsible newspaper correspondents with accusations t)f the most injurious description.
Docunu'iits which perhajis in themselves proved nothing, had Ixu'ii brought into an
alleged connection with a narrative tliat invested them with a very sinister sigiiilication.
The Parliamentary Comniiltee that had underlaken to discover the truth appeared to
lie jiaralyzed, and the accused were thus shut out from all means of vindicating their
characters. Yet it was to these jiersons I was bound to recur for advice in all matters
alTectiiig the administration of public airair.s. Again, as an Imi)erial ofTirer, it was my
duty to watch with especial care over Imi)erial interests. The allegations current against
my .Ministers and others, was that they had frauilulently dealt with certain monetary
trusts, voted indeed by the Parliament of Canada, but guaranteed, to a considerable extent,
by the Imperial (lovernment. This being so, I was evidently bound, apart from any
action of the C!anadian House of (Commons, whose ])owers of scrutiny seemed for the
present of small av.iil, to obtiiin satisfaction in regard to thi-se matters by any constitu-
tional methods within my reach. Indeed, from this point of view, it was not the
.Ministry of the day — who are but an evanescent Committee of Parliament -but the
Parliament of Canada itself that was responsible to Cireat Britain in respect of any mal-
\ersatioii which might bavi; occurred, as having confided the disiiosal of these inl crests
to imjiroper agents.

At the same time, as long as the Parliamentary Committee was in existence, even
though it had ceased to act, tin? resort to any other instrunu'iit of investiagtion was not
desirable. Beyond, therefore, the casual suggestion to which I hove referred, nothing
further was volunteered by me in this sense. When, however, the prorogation of Par-
liament being decided upon, and the Committee of the House of Commons being aboui
ronse(^uently to iiecome extinct, my Govermnent undertook, on its own rcs[)onsibility, to

■:n

CANADIAN PACIFIC RAILY^AY,

L'nt at whidi it is
jr the rt'suinptioii

n, Mills, Foibi's,
uiinghain, tJolTin,
Ion. John Voung,

tlio Govornmont
cdings, or in any
latter hrloic liis
liat thori! will be

^ust 18, 187.%
till- honour of
; was i)roroguiHl

Inquiry became

ks was to elajise

as to wlietiier,

ibortive in([uiry

f two Ministers,
en corresponil-
se of Commons
somehow, and
t prove a walis-
ed by a dmiljle
•elalions whicli
injj assailed by
DUs deserij)tioii.
roui^lit into an
er sif;ni(ieafioii.
Ii appeared to
iidieatinfi; their
in all matters
vY, it was my
current airainst
tain morietary
derable extent,
\rt from any
eemcd for the
my const! tu-
nas not the
n<'nt -but the
el of any mal-
ihese interests

xistencc, even
if;tion was not
I'ned, nothing
;ation of !*ar-
is lieing abouu
ponsibility, to

* advise the issue of a i'omniission to three .Iudj;es of character, standing, and acknow-
kih'cd intcj^rity, I liad no diiru ulty in ac(piiescinj; in tlieir recuuimendation.

I have now, therefore, to inform your Lordslnp tiiat on the i4th of Au^!;u t I siy;ned a
Conuuission at tlie instance of my Kesp()MsiI)h' Advisers, and by virtue of ti)" powers vested
in the (!overnor-(ieneraI by tlie C.inadian Act of ;il Vict., can. 3S, to iie llonouralde
Judge Day, the Honourable tludge I'olette, and .Iiidf;,o (iow.m, i' .nori/in-^ them tx)
inquire into the various matters connected with tiie issue of the Pacific Railway Charter.
A copy of the Commission I Iiavc tlie honour to apjieiKl.

On rcfcrrinj; to it, your Lordship «ill observe lliat the purview of the Commission is
very wide and inquisitorial, and that tlure is notiiinj; to restrict its reception o!' anytbiiij;
ithat may ajipear to deserve the name of c. idenci'. The professional antecedents ul these
peiitlenien are set forth in the accomiiaiiyinj; document, which has been prepared for ine
by my Ministers. Only one of tlieni is personally knouii to me, viz. .lud^e Day. who,
as Cliancellor of the Mcfiill University, riceived me on my visit to that Institution.
Since that \\v hav(! impi'oved our at(iuaintance, and I have no hesitation in statin^:, liotli
from what I know and have learnt, that I have every conlidence in .ludge Day's high
sense of honour, cajiacity, and (irmn'-ss.

1 have also considered It i.Ty duty to s<'lti^■i\ myself as to the (pialificatioiis of the two
other gentlemen with \\b(i;ii lie is associated, and I am in a p(>sition to inform your
Lordship, tliat they are generally regarded as jiersons of unblemished integrity, sound
ju(igint;nt, and ])roli'ssional al)ilit\-, while the length of time all three have been reinoved
from politics frees them from the suspicion of poliliial partisanshij).

Notwithstanding tlie creditable antecedents of these personages', they have been
8har|)ly assailed by the ( Ijiposition press, lor wiiieb the praises of the Ministerial organs
is scarcely an adequate consolation. Perhaps, however, it may not be amiss that 1
should append two or thrie articdes frcnn newspapers bitti'rly opposed to the (jicvirn-
meiit, who, nevertheless, are compelled to bear a scant aiul niggard testimony to tiie
high (pialities of these genllemen.

Uialer ordinary circumstances, I should have thought it suflicient to have terminated
my Despatch at this point, but as matters now stand, it is necessary that I should describe
to your Lordship the chief features of the controversy to which the issue of this Com-
mission has given rise.

The objections urged against it seem to be three in number.

1st. That the present investigation is not of the kind contemplated by the Act.

This jioint is so entindy a question of legal interpretation that I can only be guided in
regard to it by my law ollicer.

■Jnd. That the issue of tlu; Ccmimissioii is an invasion of the privilege of Parliament ;
that Parliament being seized of the matter, no other authority lias a right to concern
itself in the investigation.

i pin-ehend that this view cannot be sustained. The powers with which tlie Com-
mission is vested bfing h'gal, and granted by Parliament without limitation, it is ditiicult
to b«dieve that their exercise; can be held" an interfervuce with the privileges of I'ar-
liament. It is not a criminal suit, but a simple in([uiiy that has been instituted by the
House of Commons at the instance cd my Ministers. Moreover, Parliament has ceased
to conduct this inquiry. Tlu' Crown jiossesses no absolute guarantee that it will be
renewed, or that when reiicuid it, will be ellectual. If .Ministers liill on a vote of want
of confidence on the .Vddress, it might jn-ove the interest of so many persons to let the
matter droj), that the Committee may not be re-appomted. Unless conducted under
oath, the investigation will certainly prove inellectu.-'i, and 1 am advised that it is
doubtful whether any device exists by which a mere Committee of the House of Com-
mons can he enabled to swear its witnesses. If, tbercfore, an immediate invistigaliou
will promote tlu- "good d'overnment of Canada," to ijuote the words of the Act, I ilo
not apprehend that Parliament can denounce the Commission as a breach of jirivilege.
The House of Commons may declare the issue of the C\jmiliissii)n to be inopportinie and
unadvisable, and may visit with its displeasure the Ministers w ho counselled its appoint-
ment, but it can have no locus standi as against the Crown itself.

Moreover, it must be reiiunibered that the Commission can in noway interceptor
supersede the jurisdiction of the House of Commons, it v ill be quite compeU'Ut for
Parliament to ignore the fact of its having t;xisted. Its inlluence on the present
situation will entirely depend on the way in which it discharges its functions. If the
public is ((invinced that it has elucidated the truth— no matter wiih what result -its
position will be unassjiilable; if it fails to do so, it will not require the action of
i arhainent to proclaim its decheance.

Ihere is yet another wiiy of looking at the matter. Jew iicople will deny that

Ca.wad'.

fi'***

rORRESPONDENrE RELATIVE TO THE

Gakada.

inilividiially I li ivc tlu' rijj'it to require an oxplanafion from my Ministers in rej^ard to
these traiisacti iis. Hut it is evident tliat in resjiect ol' so i-om])lieated a business I have
neitlier the tiin ■, nor tlie knowledge, nor tlie prolessional aeutentss ncressary to unravc;!
the tanfxU'd wet) ol' inerimiiiatory matter jjrevented to me. II' tlicn 1 ])()ssess the lej^al
powi'r, and if, by undortaiiing; to answer lor tlie Aet, my Ministers eunw me with the
eonstitwtional ])ower, ean Parliament ( )m|)lain il" I take advantafj;e of these eircumstances
to sniijeet my Ministers, throu.gli the C'l.nmiission tliat represents me, to sueh an inteTo-
Liatory as 1 may deem advisaliie, or if i order tlie eoUection of sucii other evidenee as niay
he forllieumin'^-, and is ealculated to throw light upon the i)usiiiess?

Nor h;>s Mr. llnntington hims(df any grounds to dispute my riglit to take eognizancc
of tliis aifair. Wliik' the Parliamentary C'ommittee was still in existence, he approaehed
me oirieially .".iid direetly with communications incriminating sworn meml)ers of my
Privy Council. It is true I returned him the documents he forwarded, and declined to
take personahMgnizance of a matter then before a CoiTimittee of tlie Mouse of ('ommoiis,
I)ut 1 retain his covering letter, and it is scarcely com]H'tenl for him — the IJommittec
having ceased to exist — to decline the jurisdiction of the (.lommission so far as it is
«'()ncerncd wilh what he hiniM-lf brought to my notice. l>y liis own act he has
invite(l my intervention, and submiited the matter to tiie direct eognizaiieu of the
Crown.

Thirdly. Tiie " persoi'.nel " of the Commission is complained of as jiartial to the
(JovcrmiKnt, and as having been chosen by the accused. Into the j)ers()nal <juestion 1
neeil not enter further than I have done. That the CJommissioners should have been
named by the(ioveninient is an accident inevitable to the anomalous situation of all'airs ;
but when we consider the character and antecedents of these gentlemen, that It.ey sit in
open court, that their powers of in([uiry are unlimited, that ihey will act under tlie eyes
of uibi)ariiig critics, that any ai^pearance of llinching on tlieit part will only stimulate
the desire both in and out of Parliament for further iiupiiry, and that in such an event
a review of the ca-^,' by the House of Commons is extremely probable. 1 do not think
that any practical objection can be taken to them on this account.

1 should have much prc^ferriil that Sir.hihirs previous olfer to the lb/, m Commons
(Committee should b.ave been renewed, for although this Committee cannot be pro-
nounced free from those characteristics which adhere to all Parliamentary Committees
on such occasions, it might jtossibly luissess gn-ater vigour of evisceration than a
Commission, though its ultimate verdict might not prove unanimous. It would, more-
over, have been able to (ommaad the appearance of iMr. Huntington as a willing
jirosecutor. That gentleman, as I understand, inlends to <juestion the jurisdiction of
Judge Day and his colleagiu";. Of course, the Ministerialists asseverate that he fears
being brought to liook. that having thoroughly j-rejudiced the i)uldic mind through the
ageiic)' <d' '\lr. Me.Mullen's letters, he would willingly let tlir' Oovernment lie as long as
))ossibli' under the odium of a vague charge which accurale inquiry would dispose of;
but this seems a ■rroundless aspersion. Mr. Huntington may be, and indeed 1 trust,
and so far believe, is mistaken. He may have "got hold of the wrong I'ud of the stick,"
and have been too (juick in drawiiej; inferences; it may ';■ doubtfal il" he is well advised
ill di'clining to appear, if that should be his ditevmination, but that altei' all he has
smid and done he should have misgivings as to liis case, is not credible, and such an
injurious sn])j)osition is unjustifiable. liut the di.Rculties in the way of making a second
oiler to Messrs. IMake and Dorion apjieared ini-uperalile, for Ijotli these gi'iitlemen in
declining Sir .lohn's former proposal to makethei'i Commissioiu'rs, grounded themselves
not only on the necessity of oiitaining tlu; Houstrs ;.inction to tlu.'ir change of status, — an
objection which, though somewhat subtle, was peri.'ps sustainable, — but furthermore
asserted that as Commissioners their iiidependence would be destroyed. -Mr. IJlake,
moreover, had slated that on ]>ersonal grounds he could not consent to act on a
Commission appointed under the advice of Sir John Macdonald. As there was no
reason to sup|)o.se that these gentlemen had changed their minds in these resi)eet, it did
not ajijiear advisable to rc-approacb them on the subject.

I'ndi'r tlu'se circumsl.inecs it was evident if th<' interval that must elapse before the
re-assembly of J'arliament was to be utilized — that any inquiry which miglit be possible
must be confided to fresli liands.

That my Ministers should desire an oiiportunity of making themselves licard, ean he
well understood. The language used on their Ixdialf is something of this sort : — "For
" months jiast we have bien the objects of the vile.st calumnies,. Our most confidential
" «locnments have been purloined by an informer, and dishonestly connected with a
" narrative which is itself untrue, ilitherto we have had no opportunity of rebutting
" these accusations. The instrument aj)pointed by tin; House of Commons to do justice

ters ill regard to
I business I have
ssary to unravel
|)ossess the legal
nv me ;rith tlie
so circumstances
such an inte To-
L'vidence as niay

take coguizanco
', he approached
nenihers of my
and (ieclinod to
sc orc'ommons,
-the Oommittee

I so far as it is
)\vn act he has
ni/ance of the

! partial to the

sonal (juestion I

Duld hav(.' heen

at ion of all'airs ;

tliat tl.ey sit in

under the eyes

only stimulate

II sucli an event
I do not think.

■^t- til Commons

cannot l)e pro-

iry C^ommittees

ration than a

It would, more-

I as a willing'

jurisdiction of

e that he fears

nd through the

it lie as long as

uM disjiose of;

indeed I trust,

d of the stick,"

is well advised

fter ;U1 he has

e, and such an

laking a second

• gentlemen in

led iheiiiselves

; of status, — an

it fui'thermore

•Mr. I Make.

I to act on a

there was no

resjiect, it did

i|)se before the
^lit be i)ossiblc

lieanl, can be
IS sort : — " For
ist confidential
nccted with a
y of relnittiiig
H to do justitc

CANADIAN PACIFIC RAILWAY.

"between is and our traducers has jirovcd pouer'e.ss for that object. Considering '.litli
" whom we have? to deal, we require the evidencj agai'ist us to be sultstanti.ited by an oath.
" ^^'e are not willing to place our honour at fiie mercy of our accusers unless protected
" against perjury. ^Ve ourselves arc anxious to be heard upon our oaths. \V\; doubt
♦* wdii'fher a Committee of the House of Commons can acciuire the power of swearing in
" its witnesses without an Imperial Act. \Ve think it but fair before Parliament re-
*• assembles that we should have an opportunity of answ«-ring fully, point I)y point, tiio
•• injurious allegations brought against I'.s. This cannot be done by mere statements. \Vc
.*• desire therefore to subject ourselves to as searching an interrogatory as a skilled tribunal

or our most liittcr opponents can apjily. I^nless we have this oi)porfuiiily we shall meet

Parliament at a disadvantage. Our enemies have possessed themselves of the ear of the

ll" jjiibiic lor months. We have had no opjiortunities of counteracting these influences.

w" Let at least our story be heard before a premature decision is snatched from Parliament,

'"" saturated as it may have become with these calumnies. Wv do not « ish to escape from

" the scrutiny (d" the House of Commons. We know we could not do so, — did we so

" desire, — but since its action is for a time suspen<Ied, do not condemn us to remain, during

" the interval, under the opprobium of such accusations."

It is not my jirovincc to examine the force of this pleading, I merely report it for
your FiO.'dship's infiU'tnation ; but no one can fail to see that my Ministers are fairly
entitled, m far as the law allows them, to do whate.'er in (hem lies to dissipate the
impression occasioned by the enforced silence entailed upon them by the inaction of the
late Parliamentary Committee.

I have now concluded my narrative of the two important occurrences in which I have
found myself so unexpectedly engaged. My anxieties have been very great, and my
position most cmljarrassing. If I have erred in tlie conduct of tlies(> Pii'airs, I feel I can
count upon your Lordship^s indulgence to put a favouralde construction on my intentions.
Trained in the liberal school of jiolitics under the ausjiices of a great champion of Par-
liamentary rights, my jxilitical instincts would revolt against any undue exercise of the
Cn wn's prerogative. Yet it is of this I liiid myself accused. I trust, however, that
.-elU 'lion will dissipate such impressions, and that the people of Canada will ultimately
Ihd t4>at it is A r their iiormanent interest that a (lOveriior-Geiural should unflinchingly
nainti in the principle of Ministerial responsibility, and that it is better he should be too
lardy i i reliiKpiishing this jjalladium of colonial liberty, than too rash in resorting to
acts of personal interference.

Consi(leriiig how I'ager has been the controversy, I cannot hope to escape criticism, but
any '"■.itation thus engendered will jierhaps be softened by the reflection that coming to
this country full of faith in its people and its destinies, I was naturally slow to believe
that widespread jniiilic and personal corruption should exist nmong its most eminent
pul lie men. If it sh )uld turn out that I h;.ve been deceived in my estimate of Canadian
purity, the error is one which Canada may aflbrd to pardon. If, as 1 trust will be the
cas<', the integrity of her chief statesmen is vindicated, I shall be well content if the fact
of "my not having despaired of the Republic"' is forgotten in the general satisfaction
such a result will produce.

He that as it may, there is one circumsfanc(> which we can regard with unmitigated
sat i faction. The alleged revelations which have taken place have ])rofouiidly moved
the w liole po])ulatioii. Apart from the section of society " within politics " whose feeling
may b<" stimulate<l by other considerations, every citizen in the country, no matter how
indid'erent to public afT^drs, has been dismayed and humiliated by the thought that such
things as arc alleged to have taken place by Mr. McMullen and Mr. Huntington should
J be possible. This is a re-assuring sign, and even should it be found, which Ciod forbid,
that the Government has been unworthy of the trust confidccl to it, the indignation and
the searchings of heart that will ensue throughout the land will go far to cleanse the
public life of Canada for many a year to come.

1 must apolf gize for the length of this and my previous Despatch, but in recording
these transactions, I felt that I was contributing to a jiagc of tlu' History of ('anada.

I have, &e.,

The Earl of Kimberlcy. (Signed) DUFFEIUN.

&c. &C. &c.

Oanasa.

mr^^

■W.

.J'

Canada.

(L.S.)

(.'OlMU'lSrONDKXCK RELATIVE TO THE

Enclosure 1 in No. 5.
THE ROYAL COMMISSION.
DUFFERIN. ,.^N^^,,^_

VICTORIA, by the grace ofCuxl, of tlic United K.ingdom of Great Britain a.ul Ireland
QuKKV, Defender of the Taitli, etc., &c., &e.
To the Honourable Charles Dewey Day, of the City of Montrenl, in the Province

of Quebec, in our Dominion of Canada, late one of the

Judges

oi" the Superior

(!ourl, in and for Ijowcr Canada; the Honourable Antoine Polette, of the City of
Three Rivers, in the said Province of Quebec, one of the Judges of the Su])erior
Court, in and for Lower Canada ; and James Robert (»o\van, of the Town of liarrie,
in the Province of Ontario, in our said Dominion, Esquire, Judge of the County
(!ourt of the Clounty of Simcoe, in the said Province of Ontario, and to all to whom
tiiese presents shall come, or wliom the same may in any wise concern

Gkkktino :

John A. Macdonald, Attorney-General, Canada.

WHEHEAS, the IIonourai)le Lucius Seth Huntington, of the City of Montreal, in
the Province of Quebec, a meml)cr of the Honoural)le tiu- House of Commons of
Canada, in his place in Parliament, did, on the second day of Ai)ril, in the year of our
Lord one thousand eight hundred and seventy-three, move the following Resolution: —
"That he, the said Lucius Setii Huntington, is crcdii)ly informed, and believes that he
" can establish by satisfattory evidence, that in anticipation of the legislation of last
'• Session, as to the Pacific Railway, an agreement was made between Sir Hugh Allan,
" acting for himself and certain otlier Canadian promoters, and G. \V. McMullen,
" acting for certain United States capilalists. whercl)y the latter agreed to furnish all the
" liinds necessary for the construction of the c()ntem])lated Railway, and to give the
" former a certain jjcrcentage of interest, in consideration of their interest and jjosition,
" tlu' scheme agreed upon being ostensibly that of a Canadian Comi)any with Sir Hugh
" Allan at its head.

" That the Government were aware that tlujse negotiations were pending between the
" said parties.

"That sul)sequently an understanding was come to between the Ciovernmcnt and Sir
" Hugh Allan and Air. Abi)ott, one of the members of the Honourable the House of
" Commons of Canada, that Sir Hugh Allan and his friends should advance a large sum
" of money lor the purjmse of aiiling tic election of Ministei-s and their sujjporters at the
" ensuing general election, and that he ai.d his friends should receive the contract for the
" construction of the railway.

"That aeeoidingly Sir Hugh Allan did advance a large sum of money for the purpose
" mentioned, and at the solicitation and uikU'I' the pressing instances of Ministers,

"That part of the moneys ex[)ende(l by Sir Hugh Allan in connection with the obtain-
" ing of the Act of Lu-orporation and Charter were paid to him by the said United State>
" ca]»italists under the a|.'reement with him.

'"That a Committee of seven nu'ini)eis be a))pointed to inquire into all the cireum-
" stances connected with the negotiations for the construction of the Pacific Raih\ay will'
" the legislation of last Sessii.-n on the subject, and with the granting of the Charter to Siv
'• Hugh Allan and others, with ;)ower to send for persons, jiapers, and records, and with
" instructions to report in full the evidence taken before, and all jjroceodings of, the said
" Committee," which said K<solution, upon a division of the said House, was lost:

Ami whereas the Uiglit Honourable Sir John Alexander Macdonald, Knight, also ;i
member of the said House of Commons of (Canada, in his place in Parliaim^nt, diii. oil
the eight)', day of April aloresaid, move a Resolution in the words following : — " That ;i
" Si lee t (Committee of five members (of which Commitlei' the mover shall not be ond
'• be aj |)oiiited by this House to iiuiuiii' into and report upon the several matters con-
" taiiii d and stated in a Kesolution nn.ved on Wednesday, the second day of April instant.
' by the Honourable Mr. Huntington. mem})er for the county of Shellonl, relatiin; t*'
" the Canadian Pacific Railway, with power to semi for j)ersons, jiapers, and reconl^. to
" rejtort from time to time, and to rejnirt the evidence fiom time to time, and if imhvI lie
"to sit alter the proiogation of Parliament," which said lust-aamed Kesolulion was
carried:

And whereas, by an Act of the Parliament of Canada, ]mssed on the third day nl
I\Ia\, in the year of our Lord one thousand eight hundred and seventy-three, and in fl''
thirty-sixth year of oiir reign, intituled "An Act to provide for the Examination of VV
" iiesses on Oath In Committees of the Senate and House of Commons in certain cases,
it is amongst other things in ed'ect emcted, that —

^^-

CANADIAN PACIFIC RAILWAY.

tain aiul Ireland

in tlie Province

)i' the Superior

of the City of

jI' the Su]>erior

Town of liiirrie,

of the County

to all to whom

Grkktino :

of Montreal, in
of Comjnoiis of
1 the year of our
ijj; Resolution :—

l)elieves that he
■f!;islatiou of last
Sir lluj^h Allan.
, \V. MeMullon,
o furnisli all the
luid to give the
est and position,
f with Sir Hugh

ling between the

crnment and Sir
le the House of
mce a large sum
jupportiTs at till'
contract for the

' for the j)urpose
Ministers.
wiM» the obtaiii-
lid United State-
all the circum-
if Hallway witli
10 ('haitt-r to Sp
ei'onls. and \vitli
lugs of, the said
, w as lost :
, Knight, also ;i
•liaim-nt, did. on
vnig : — " That :i
lall not be onel
ral iiiatti'rs eon-
of April instant,
onl, n-lalinc tc
, and rword->. to
, and if need do
K«'Solulion was

he third day "t
liree, and in tl'
ninution of X\
I certain cain> .

" Whenever any witness or witnesses is or are to ])c examined l)y any Committee of Canada.
the Senate or lIous<' of Commons, and the Senate or House of Commons shall have
resolveil that it is desiralde that such witness («• witnesses shall be examined upon oath,
auch witness or witnesses sliall be examined ii[)on oath or allirmation, where ailirmation
is allowed by law :"

And whereas, the Honourable John Hillyard Cameron, also a member of the said
House of Commons of Canada, in his place in Parliament, did, after the passing of the
Mid above-named Act of Parliament, and on the tliird day of IMay albresaid, move a
csolution ill the following words: —

"That it be an instruction to the said select Committee, to whom wns rel'erred the
luty of inquiry into the matters meiifioncd in the statement of the Honourable Mr.
buiitington relating to the Canadian Pacific Railway, that the said Committee shall
pcamine the witnesses brought before it u])oii oath," which was carried :

j\nd wlu I'l'as the said Act of Parliament has since the passing thereof been disallowed
by Her Majesty :

''^ And whereas no jiower exists whereby the said Committee, so appointed as aforesaid,
can legally julminister oaths to witnesses brought before it, whereby one of the objects
'dcsircnl by the said the House of Commons cannot be attained :

And wlu Teas it is in tlie interests of the good government of Canada, not omy that
full inquiry should be made into the several matters contained and stated in the said
above recited resolution of the ."^tli day of A])ril aforesaid, Inil that the evidence to be
taken on such iiKjuiry should be taken on oath in the manner prescribed by the said
resolution of the Mrd of May aforesaid, and the Ciovirnor in Council has deemed it
exjiedient si.ch inipiiry should be made : —

Now know ye that, under and by virtue, and in jtursuauce of the Act of the Parlia-
ment of Canada made and jjassed in the thirty-fir.st year of our reign, intituled "An Act
*" respecting iiuiuiry into Public Matters," and A' an order of the (jovernor in (Council,
Tii.ule on the l.'Jth day of August, in the year of our Lonl one thous.uu! eight huiulreil and
seventy-three, — \Ve, reposing especial trust and confidence in the loyalty and fidelity
of yuu, the said Charles Dewey Day, Antoine Polette, and James Robert Gowan, have
■commanded and a])pointi'd you to be our Coinmissionei's for tin- ])ur))ose of making such
inipiiry as aforesaid, of whom, you the said Cliarles Dewey Day, shall be t'hiiirinan. and
Av(! do authorize and reipiire you, as such Commissioners, with all con\enii'iit dcsjiatch,
mid by and with all lawful ways and means, to enter upon sncli iiKpiii-y and to collect
evidence, and to summon before you any parties or witnesses, and to re([uire them to give
evidence on oath, or on solemn affirmation, I' they be parties entitled to aflirm in civil
matters, and to produce such documents and things as you may deem reepiisite to the full
invi'stigation and rej)ort of the matters and statements aforesaid.

And we do hereby order antl direct that the sittings of yon, the said Commissioners
under this our Royal Commission, shall lie held at the City of Ottawa, in our Dominion
'of (aanada.

^ And we do require you to communiiate to us through our Secretary of State (/f Canada,
aiiil also to the Honourable the Sju^aker of the Senate, and to the Honourable the Speaker
of the House of Commons of Canada, as \\t II the said evidence, as any opinions which
jroii may think (it to expnss thereupon. And we do strictly charge and cojiimand all our
ofTiceis and all our faitldiil >iubjects, and all others, that in their several places, and
iicc(Uiling to their respective powers and op[u)rtuiiities they be aiding to you in the exeeu-
tiiin of this our Commi.ssion.

An testimony m hereof we have caused these our letters to be mad(- patent, and the (ireat
i Seal of Canada to Ix l-ereiinto affixed. Witni'ss our right truaty and well-beloved
;i cousin and couiKJllor the Right Honourable Sir Frederic Temple, Karl of DnU'erin,

Viscount and lUroii ('laiidebo\e ol Claiidel)oye, in the County I 'nvn, in the Peerage
.^, "t the Cnited Kingdom, Paron DuU'erin and Clandeboye ol Pallyleiily and Kille-

leagh, ill the County Down, in the Peerage of Ireland ami a Baronet, Knight cd' cnir
^ .Most Illustrious Order of Saint Patrick, and Knight Commander of our Most

Honourable Order of the Path, Cioveriior-General of Canada, and Vice-Admiral of

the same.

4At our Government House, in our City of Ottawa, this fourteenth day of August, in the
' vearof our Lord one thousand eight hundred and seventy-three^ and in the thirty-
seveaih year of our reign.

I3y command,
(Signed) J. C. AIKINS,

Secretary of State.

CORRESPONDENCE RELATIVE TO THE

Q*"*"-^- Enclosure 2, in No. 5.

(Fhom the ' Montreal IIkuald.')

" The Uovat, Commission'. — Wc are in formed tliut tlie Koyal Commission, who are
appointeil to investij^afc the iliari^cs niadi; l)y Mr. Iluntini:;ton af^aiiist tli« Ministry, is to
consist flj' Mr. Jiistiio Day as President, Mr. thistico Polettc, ol' the Superior Court for
the district of 'i'hree Rivers, and Mr. .lustiee Gowan, a country Judge, we believe, oi
Ontario. If tliis be tlie case, apart from the outraii;e of takinj; out of tlic luuids of the
House of Commons, an aH'airof wliieli that body has taken cognizance, there is nothini;
in the distinguislicd character of the men composing the Commission, with the siiii;;lt
excei)tion of Mr. Justice Day, whicli can at all atone for the insult put upon the repie-
sentntives of the ])eople. Judge Polette is a very respectable member of the Bench. A^
to Judge (iowan we know nothing."

(Fhom rirr; 'Montrkal ITkkat.p.')

" Tin; 1'i;r.«o.va[, Composition' of tui: Royal Commission. — Of the Chairman of tin
Royal Commission, Mr. Justice Day, we of course speak only in terms of respect. He i-
a man of great capacity and learning, and he occupies a position which ought to make hin.
independent. AVe cannot, however, we confess, imagine by what eccentric freak of judgmeii;
he has been induced to take a position, the assumption of which no one better than him-
self must know to be a direct breach of the privileges of the House of Commons — ar.
assumption which the Commons of England would })unish, which has already been coii'
demned by the majority of our own House of C'ommons in the most formal manner ii:
which they were a!)le to express an opinion, and 'whose ol)ject is nujrely to enable llu
leaders of a bndceii party *o shelter themselves from the necessity of appearing before tlk
constitutional tribunal. As to Mr. (iowan, we are also ready to award him the jiraise o:
being a highly respectable magistrate, but not one whose distinction, as we beion
remarked, could lessen tlu? insult olVercd to Parliament by his employment in this nid-'
improj)er task. There is, however, one circumstance whieli, if we are rightly informed,
makes his api)oinlment exceedingly indecent on a C'ommissioii, not like the Pariianiiii-
tary Comniittie, composed of opposing forces, but of men whose single merit, if men:
they have, is their imi)artiality this is his well known friendship, amounting almost ti
afTection, for Sir John A. Macdouald. ^Ve are sorry to say that we nuist speak in ([uite;
dillerent manner of tbj third associate in this ('ommission, Mr. Justice PoIette,&c. ^c. \i..

(From 'Lk Jolunai, de Quebec.')

" La commission royale, suivant Ic telegraplie, sc composerait, du juge en chef Drain '
de IVx-Juge Day et du juge Polette.

'• M. Draper I'tait ajjpele 'the artlul Dodger,' ct, avcc sou incontestable habilete, n"cu
jamais la confiauee, ineme de son parti.

" Nous n'avons rien ;i dire, contre MM. Day et Polette, et nous avons seulemeiit
regretter ipi'ils aieiit accepte celte commission, qui est im outrage aux droits du jkuK
ment."

Ijidosure .'5 in No. .'3,

MEMORANDUM.

For His Excki.lknty tiik Ctovkrnor (iknkrai..

Ji POR Day,
Was, in 1S42 and for some years. Solicitor General for Lower Canada in a Coalitioi
Government.

In Is-lOhewas appointed a .ludge of the Superior Court of Tiower Tanada by tH
Reform Governnu-iit of Haldwiii and Lafontaine. \Vhile on the Reiieh he exhibit'^
high qua ities as u .hulge.

Ill Js'iC he was selected )ty the CJovernmcnt as one piculiarly qualified and appoiuti"
Commissioner to revise and consolidate the Statutes relating to Lower Canada. He w •
engaged at that work about seven years. Feeling a distaste for returning to the Bern;
alter so hmg an absence, lie retired on the statutory provision.

TANADFAN PAriFIC RAILWAY.

s;j

imission, who are
tli« Ministry, is fo
Miperior Court lor
ge, Avc believe, oi
the liiuuls ol' the
e, tiiere is nothing'
>n, with the sini;le
Lit upon the repie-
of tlie Bench. As

: Chairman ol' tlii
ol" respect. 1 Ic i-
jught to make liin.
clreakorjudgnuii'
le better than iiim
' ol' Commons — ai
i already been eon
formal manner ii
erely to enable tlu
)pcariiig before tiit
lI him the jiraise m
tion, as we k-l'oii
yment in this nw-'
:! rightly inl'orniid,
ike the rarlianiiii-
gle merit, il' nuTi:
nouiitiiig almost ti
i,st speak in quiti,'.
Polette, &c. i^e. \i

ige en chef Draper

able habilete, n'ti.

avons seulement
IX droits du iwrli

liula in a Coalition

ver Canada by '
encli he exhilnii

ficd and appoints
' Canada. He "•
ling fo the i>ii:'

* Since his retirement from the Hencli he has been very much engaged as an arijitrator r.u«Ai.A.
—chosen because of his high rejjutation for judicial and moral (lualities.

Shortlv alter ConfederatiDn, .hidge Day was ap])()intcd arbitrator l)y tlie Government
of Queixr, to act with .Senatin- .Macpherson and Colonel (!ray, chosen by the (iovt-rnnient
of Ontario and the Government of the Dominion resi)ectively, to adjust tlie relative
debts of Qiieliec and Ontario, arising out of their former union, .bulge Day is Chancellor
^the !\Ic(iill I'niversity.

.Irne.K (tow.w,

then at the Bar, was jiartner in business of the late Hon. James E. Small, who was
[)licilor-Cieneral for LpjuT Canada, in the Reform Government of IMJ-i, when Mr.
lobert Haldwiii was Attorney-(ieiieraI. Mr. Small was considered an extreme Jtel'ormer,
Ir. Gdwan a moderate oiu'. " TIk y practised Law at Toronto. Mr. (Jowim's re]mtation
. a lawyer was sjtcedily established and rose high. In I.SI.S, he was appointed Judge of
iie Conntv Court of the County of Simcoe, by the Uel'orm (iovernmeiit of lialilwin and
E^afontaine. I le has held that jiosilion ever since, and exhibited therein the best (pialities
<»f a Judge, while his cliargi's to the (irau.l .luries have frequently commanded respectful
lltteiition liiroughout the Trovince of Onl.irio.

•J Aiiout the year 1S|<,), Mr. (iowan was api'ointed by the (Jovernor in Council, a Coni-
inissioner, in "association with tlie late Judge Harrison (an Iviglish barrister), O'lteilly,
Campbell, and Mallocb, for llie drawing up and estaldisbing of the rules regulating the
procedure of Division Courts in llj)pcr Canada. He was afterwards api)ointed by the
Governor in Council, in a.ssociatioii with the jjirsent Chancellor Spragge and the late
Judge Ihirns, of the Court of Queen's Bench, a Commissioner to regulate the practice and
procedure in the Surrogate Courts of Up}ier Canada.

After the jjassing oi" the Common Law Procedure Act, in L^^.'it!, the Judges of the
Sujierior Courts of llpjier Canada were em])owered to dra\v \\\^ rules of procedure for the
County Courts, and being empowered to associate with them one County Court Judgo
for that ]nir[)ose, they selected Judge (iowan.

' When the County Court Judges of Ontario held their Convention at Toronto some
years ago, to consult about matters connected with the County Courts, with a view to
Recommending changes, Mr. (Jowan was unanimously chosen as Chairman, notwithstand-
ing tin- fact tliat several of the Judges present were senior to him.

In 1S.")7, the late Sir James Hnclianan Macaulay having retired from the Chief
Justiceship of the Common I'leas in Upper Canada, was asked to accept the appointment
of a Commissionershij) with others, to consolidate the Statutes of Canada and of Upper
Owada ; he declined to accept the position unless Judge Gowan were associated with
lam. Mr. (jlowan, however, declined to accept an appointment, hut agreed to assist the
€5ommis^-oners and <liil so.

In 1^ •_', dis))utes having arisen between the Government and the (-'ontractor for the

iectio.i of the Parliament Ihiildings at Ottawa, respecting the work and the contract, a
fereuce was made to arliitration, the (iovernment choosing one of the arbitrators and
e Contractor another; tliese two arbitrators agreed upon Mr. Gowan as the third
arbitrator, it being jirovided by the reference that they should select a Judge from L'pper
CSanada for that position.

In 1S(J;), he was associated with Judge Wilson of the Court of Queen's Bench, Judge
4^1'yniie of the Common Pleas, and the i)resen1 Vice Chancellor Strong, on the Com-
lission appointed by the Government of Ontario, to iiKjuirc into and report upon the
wking ol the machinery of the Courts of Law and Kquity in Ontario, with power to
Drt a scheme for the fusion of those I'ourts.

ludge (uiwan is the Chairman of the C(mimission of County Court Judges, ajipointed
the Outari.) Goveninnut He has Ikhmi consulted by each successive Attorney-* ieneral
Upper Cana<la since !^{"J, on the subject of proposed changes in the Criminal,
Municipal, and other Laws..

JlDOi; POI.KTTK.
'W*s. from !->+7 to 185S. a member of the Parliament of Old Canada, when he eom-
liKided aiXiition and respect. In 18(10, he was appointed Judge of the Superior Court
<» Lower V anada, and in that capacity he ajipears to Iiave won the unanimous respect of
Ju brctb. 1 Judges of the bar and of the public. He was recommended to Sir John A.
Ipocdonaid by Chief Justice Meredith, of the Province of QueU-c, as a man who is
»culiarly fitted by reason of his ability, his integrity, and his thorough independence ol
cjjaracter to act on the jnesent Commission.

The C;hief Justice M'as asked to act, but he declined, and recommended Mr. Polette iu

i stead.

L 2

Canada.

., 1 1
I,' I

81 COimESPOXDENCE RELATIVE TO THE

No. G.

Tho Kaul 01' KiMiimLEY to The Eaul of Di-fferiv.

My Lonn, Downiiif!; Street, October 0, 187.').

i iiAVK received and liii<l licforc tlio Queen your Lordship's IJespatclies of the Ifttli
Aufrnst, and of llic IStii Auiriisl,* ^ivin!.' an iiccount ol" tlic circuniHtances connected witk
the recent pronii.Mtion of the Dominion rarliunieiit, and tlie issue ofaCornniission to in(|iiire
into liic chariris lirouglit forward liy Mr. liuntinfrlon. Hor .Majesty's <iovernniont have
read tlicse clrar and aide stalcnicnts witli nnicli interest. It is not Iheir duty to express
any opinion np(Ui tlic particular measures adopteil on the advice ofyour responsilile Minister-',
but they fully approve your liavinj^ acted on tliese nuitters in accordance with constitutional
usage.

I liave, lie,
Tho Earl of Dudcrin, (.^igued) KLMUERLEV.

Sc. ^;c. iic.

No. 7.

The E.MU, or Di ri i:iiiN to The Eauf, ok KiMiiKur.KV.

My Lokd, Canada, Octolier 4, 1873.

I iiAvi; the honour to direct your Lordship's attention to tiic sultjoincd extract from
a p])eec]i delivered liy the lion. Ivlward lilake, at TiOndon, Ontario, on tlie 1 7th of August,
in wiiicii he deals with the (picstion as to how tiie Committee of IiKpiiry ou tlio Pacific
Railway Cliarter might lie empowered to obtain evidence on oatli : —

"Now there liave been pointed out several Parliamentary modes by which oatlis may h
administered. I shall refer to one, that which at llu; moment commends itself most to my
judgment. It is tlie jiroposal that an act shouhl be passed authorizing certain nanied
persons, memlicrs of the Committee or others, to adminisler an oath. This would in fact
constitute a J'arliameii.tary as distinguished from a Royal Commission."

'2. I have made the foregoing extract for the purpose of drawing the attention of your
Lordship to the possiliilily of a Mill of the luilure indicated liy Mr. Ulalvc being sent up fur
my sanction when Parliament next assembles, and of the conse<|ueut advisability of my
being provided before hand with instructions from your Ijordship as to the maimer in
which I shouhl deal with it.

;!. Yo\u' L<u-dship will jn'reeive that two alternatives arc suggested by ilr. Blake, cacli
of which had l)etter !)e considered separatelj*.

■I. Mr. Blake's Hrst proposition is that the individual niembers of the actual Committiv
sho\dd be empowered by Act of Parliament to swear in their witnesses.

.'i. InasMuich, however, as I have already been instructed by your Lordship that tlie
Parliament of Cainula does not possess the general jiowcr of enabling any of the Committer-
of tlie House of Commons to take evidence ou oath, 1 shoidd apprehend that it caimot In
supposed to possess the particular power of doing so in respect of the individual luerabir-
of a Committee.

t). 'i'he second alternative of Mr. Blake's is that a similar Act should be passed in whicli
"others" shoidd be endowed with these powers, and in illustratit)n of his meaning he refe^
to the Commission which was constituted by Act of Parliament to examine into tlif
charges preferred against Ixird Melville during Mr. Pitt's administration. But with
respect to this jji'oposition it is to be observed that the persons appointed on tho statutory
Commission of ISO I, referred to by Mr. Hlake, were not nKmibers of the 1 louse of Common?,
and it is especially provided by the Act in question that in the event of the death of one of
the Commissioners Ids successor should be nominated, not by the House of Commons, hut
by the King, and must not be a member of Parliament.

7. Under these circumstances were a Bill of the nature suggested by Mr. Blake to lie
sulmiittcd for my sanction, I should feel bound to reserves it for the consideration of tho
Imperial dioverninent. This course would be rendered still more imperative in consequence
of my liaving received the enclosed memorandum from my res|X)nsiblc law adviser, !^ir
.lohn Macdonald, whose attention I had drawn to the subject, in which ho raises a further
objection to the mode of procedure recommended by Mr. Blake.

8. 1 may remark in conclusion that the conllicting opinions thus expressed by my
Minister of .lustice, and by one of the most eminent leaders of the Opposition, show that
grave and momentous issues would have been immediately raised had Parliament attempted

* Nos. 1 ami 5.

CANADIAN PACIFIC RAILWAY.

)ctober!), ]87:i.
lUliofl of tho lAtli
OS coiinec'tccl with
iiiiission to in((uirc
(iovcrniiioiit have
ir duty to oxpress
|)OMsilil(( Miiiislonj,
kvilli constitutional

KlMIUaiLKV.

lctoI)('r4, IS?.-].
)iii(.'il extract from

tTtli of August,
iry oa tlic Pacific

Iiieh oaths may be

1 itself UKjst to my
iif:; oortuiii nauiud
riiis would in iact

' attention of your
! liciiig sent up fur
dvisaliility of iiiv
to tlio manner in

y ilr. Blake, cadi

actual Committco

fiordsliip that tlio

of the Committei-

tliat it cannot Ik

dividual nieiulHi'.-

he passed in wbitli
meaning he rcfer-
xamino into tin-
ilioii. Hut with

on tho statutory
ouse of ('ommoii>",
he death of one of

of Commons, but

• Mr. ]}lakc to be
isidcratiou of the
ve in consetiuenco
law adviser, ^ir
ic raises a further

'xpressed Ijy my
osition, show that
lament attempted

to proceed to tlie despatch of l»usinesa on the 13th of August, more especially if tho pro-

Samme of the Opposition, as implied by Mr. Blake's speech, included tho reconstruction of
('onimitlee of In(|uiry, and the possibh' selection of new members to serve upon it,
under the authority of an Act which it would have been alleged Parliament was not com-
petent to {>ass.

fi. It is obvious that with seventy members of tho Ilotise of Commons iil)sent, and not a
JAaeii Senators in their places, no arrangements relative to the reconstruction of the Coin-
littec, especially if llicy reipiired any legislative sanction, couKl have been entered upon
■ tbe l.'Jlli of August with ailvantago to tho country, with justice to the unrepresented
^d imperfectly represented Provinces, or with any show of fairness to my Ministers.

I have, &c.
^c Karl of Kimberlcy, DUFFERIN.

&c. (te. iie.

Canada.

'I h.'nclosurc in No. 7.

'f-

OITico of the Minister of Justice,

" Ottawa, October .'{, 187:5.

"With reference to tho suggestion made by Mr. Blake, that an Act might be passed by
the Parliament of Canada authorizing tho issue of a Ifoyal Commission of ln(iuiry, and
giving such Commission power to take evidence on oath, I am of opinion that it would be
within the comi)etoiico of I'arliainent to pass such an Act, and that tho Courts must hold
it to bo valid.

It may be doubted, however, whether a measure of this kind sliould be entertained by
Parliament, excipt at the insUuice of the Crown.

The J^talutory Commission on Naval Accounts, which resulted in the impeachment of
Lord Melville, is cited by Mr. ]{lako. The Act authorizing that Commission was introduced
at the instance of tho Admiralty. Objection was taken to it on the ground that tho
Atliniralty or Navy Board had power sullieiont for the purpose. Tlu' Act was, however,
considered necessary by the Crown, in order to enforce the alteiuhuico of witnesses, and to
enable the Commission to take evidence on oath. Tho Commiss oners were named in the
jBtatuto, but selected by the Crown. I would suggest that your l']xcellcncy should ask lor
'instructions, in anticipation of a measure of the nature indicated being pas.sed hero next
Session.

(Signed) JOHN A. MACDONALD.

No. 8.
The b;.\RL 01'' Dci't'iaiix to The IIaki, ok KiMUKiiLEV.

: (iovernmoiit House, Ottawa,

October L';!, 1 87:5.
My I.OIiD, (Received Itli N(,veinl)er).

I iiAViO the honour to transmit herewith a copy of the Speech with which I this day
opened the Session of the Dominion Parliament.

I have, etc.,
jThe Karl of Kimberlcy, (Signed) DUFFERIN.

■% &c., ite. &.C.

Enclosure iu No. 8.

I, Chamlter of the Senate,

I' Ottawa, Thursday, October 2:i, 1873.

I Ills hxcellency the fJovornor-Gcncral, at throe o'clock i-.m. this day, proceeded in state
ito the Chaniher of the Senatoj and having t;iken his scat upon tiio throne. His Fxcrllencv
commanded tho attendance of the House of Commons : and that House! being present, Ins
iLxcellcney was pleased to o[)en the Second Session of the Second Parliament of tiie
jDominioa of Canada, with the following Speech from the Throne:—

;^ Honourable (Jentlemcn of the Senate,

(.ieiitlenicn of tho House of Commons,
111 aeconlaiico with the intimation given by nic at tho close of la.st Scs.-ion, I have caused
1 arlianieiit to be summoned at the earliest moment after the receipt of the Reiwrt of the

-i

8(1

COUUKSi'ONDKNCK HMI.ATrVK TO THH

('(iiiiinisHii)iifrs iippniiitctl liy nic to iiHiiiire into ocrliiiii matlcrs ciiiinrctotl with the ("utuuliiin
Pacilic Itiiiiwiiy.
Canapa. 'I 1i,. fvitlcnco olitaint'd iiiidcr l\v ('Dtmiiis^ioii deserves curcriil coiisiilcnitifiii. The Ift'port
will lie liiiti iicloiv I'arliaiiR'iit, ami it will lie t'orvoii then to (Icteniiiiic wlictlicr it cuii Ijc
of any assistaiico to yon.

A l'>ill for the Coiipolidatioii ami Aiiioiiilinciit of the Laws in foni' in the several
rrovinci's ivlatinir to tin' li'i'itrcscntalion of the IVoplo in l'arliain<Mit will amiin bn suIh
iiiittcd to yon. \W the po^itponcnicnt of this nicasnro from hist Session yoii will liav(> tin;
advantai-'o of iii('lu(lin;j; in its provisions the Trovinre of J'rince Mdward Island, now happilj
u.iitt il to Canada.

TIk; Canadian rauil'ic I'ailway Company, to whom a 1 loyal Charter was jrranted, have, I
vr'Sri'l to say, hccn niialilc [n make the linaiieial arranLi'i'incnls iicersstiry for the constrnelidii
ol that irnal nndi'rtakiiitr. 'I'lu'y have tlwrclorr exeenteil a surremier of llieir Charter,
wiiifh has lieeii accepted iiy ine.

Von will, I trust, feel yourselves ealled niion to take steps to soenri' the early eoinnicncc.
nicnl and vipiroiis priHi'cntiuM of the ((instruction of that IJailway, and thns to carry
out, in <roo(l faith, the arrnnji'cmcnt made with the i'nivince of l.rilish Colnml)ia. A
measure for this purpose will he sidnnittccl for your consideration.

'i'he extension of the bounds of the Dominion has caused a corresponding increase in the
work of administration, and seems to call for additional assistance in Parliament as well a.^
in Kxeeulive (Jovernnieiit. A Hill on this snltjeet will he laid liefore yon.

Yonr attention will he invited to the consideration of a 15ill for the estahlishincnt of a
(leiieral Court of Appeal.

Measures relatini,' to our navijraldc waters and to the Inspection Laws, will bo laid before
you; as also a Rill for the establishment of a Dominion I'oard of Aericulture.

'I'lic subj(M't of the law relating? to insolvency will necessarily eiij^aj^e your attention.

The elforts made by the several I'rovinces as well as by the Dominion to encouraj;t.'
ininii;_'ration, have met with success, ami a larf^e number of valuable s(!ttlers has been added
to om- population. 1 do not doubt that you will continue yonr liberal aid to this important
oliject.

Ucnllemcn of the House of Commons, —

I iuive directed that the accounts of the past linaneial year shall be laid before you. Tlio
prosperous condition of our linances coiitimies, and the reveiuie has been snllicient to meet
all charfres upon it.

'i'he estimates for the cnsiiinu: year will be laid before j'ou. They have been prcpareil
with due repard to economy, as well as to the elliciency of the public service; and 1 trii-t
that the supplies which are necessary will be granted without inconveiiienco to the peoplo.

iloiioin'alile Gentlemen of the Senate,
(ienllemon ol' the ibnise of Commons,

■^'onr best attenti(m will, I don'ot not, be devoted to the important iutere^ts eonnnitted to
your charije, and I am confident that your deliberations will redound lo the advantage ami
prosperity of the country.

wit

•nd
the

No. !l.

I'he 1]aiu, of Kimukri.kt to The Kakl ov Duffkuix.

Mv LoRi», Downing Stniet, November 7, 1873.

1 iiAVi; the hono.ir to acknowledge the receipt of yonr Lordship's Desjjateh of
October '111* enclosing a copy of the Speech with which on that tlay you opened the
Session of the Parliament of Canada.

I have, (tc,
The Karl of Dun'eriu, (Signed) KLMHKHLEY.

A:e. &.V. &c.

• No. 10.

. 1"

CANADIAN PACIFIC KAILWAV.

with llic Canadiiin

itiori. Tlio lloport
wlietlior it can !«>

••' ill (lio soTiTal
ill ajriiiii ho siili-
I'M! will liavc thij
laiiil, now liappilj

s jrraiiti.'il, liavi-, I
r llio coiistnictiuii
of ilicir Charter,

early coinniciKc.
It! Iliiis to carry
•li Coliiinbia. A

IK iiinrasc in the
iameiit as well aj
I.
stablishnicnt of a

nil 1)(! laid Ijclbro

lire.

ur attention.

ion to onconifi^:!'

rs has Ivon a(l(li'(|

to this iinportaiit

1 licloro you. Tiio
ullicient to meet

Itceii propariil
ice; and 1 trust
c(^ to the pcojjk'.

'its committed to
advantage and

iiijer 7, 1873.
I's l'esj)ateh of
von opened the

MHKHLEY.

No. 10.

The Eaul of DuI'FKUin to The Earl of KiMni'.iu.KV.

Canada. Nov. 3, 187S.
Mt Lord (IJecfived !'.• Noveinher.)

I MAVi: the liononr to forward for yon r T.onIship's iidorniation six copies of the
eyidcnce taken liefon^ the l{()yal Coinniissioii appointed to incpiire into the recent issue of
the Canadiiin I'aeilie Kailway Charter.

, 2. IVelixed to this evidence will l>e fmiiid the Coniiiiissioners' Tfeport of the nnmher iiiul
j(|mes of llie witnesses they Hiiininoiied, jis w(dl as of those who tailed to appear, to'jcther
ith a record of other facts eonnected with their proeeedin^^s.

3. The A|)pcndix eonfaiiis, anion;.,' other dociiinents, a letter from the lion. Faiciiis rteth
(unliiitrtoii, in which he stales the grounds upon which he declined (he Jurisdiction of the

jnuiiission.

4. All these papers having now passed under the consideration of the Mouse of Commons
iod of the Senate, it may Ih; premature as yet to address your Lordship upon them, hut a.H
Ao Commissioners allinle to a communication 1 made to them when ahont l(t enter upon
Ihcir lai)Ours, it is litliiiLr I should ac(|uaint your birdship with its exact nature.

f). When my Mini-leis originally advised the issue of the Conimissioii, altliouLrh I did
not myself cniertain any misgiviiijjis as to the eoiisliditi'iiial riulil I'f ihe Crown in the
IDatter, I considered that t«M) niiieh pains could not be taken to prevent t\w proeeedinp
haviiip oven the appearance of an attiMiipt to withdraw the case h'om the ultimate control
and cognizance of the House' of Commons. With this view 1 had alrca<ly conveyed a
definite pledge to the remonsiiant niemliers on the l.'i!h of August, Ihiit within as short ti
period as could riasoiiahly he fixed upon, rarliament should lie summoned for the express
purpose of dealing with iln* matter in whatever way it might determine, ami in the same
fctention, when the Commissioners, shortly heforo commencing their proceedings, ajtplied to
BC for instructions on one or two points on which they did not feid at lilierty to cuniinuni-
Cale with Sir .lohn Macdonald, 1 took the opportunity of reminding them —

First. That their tunctions were not Judicial, hut cxpurgatory and iiuinisitorial ; and,

Secondly, That their procedure should he c(mducted in such a way as in no degree to
prejii(lic(> any future a(lion which it might please llio House of Commons to take.

ti. Acting upon this recommendation, or rather in harmony with il, as they state in their
Eeport, the Commissioners have very properly confined themselves to llit> eolleetiou of the
evidence, and have not sought to anticipate the verdii't of Farlianient l>y th(> expression of
any opinion of their own upon the facts they have elicited. They add, however, that they
are prc|)arcd to do so if rc(|uired.

7. 1 was the more iiiilueed to take the above step on learning that ^fr. Huntington
would proiiably decline to appear a.s a witness, or in any way to further the prosecution of
the iiicpiir}'.

V 8. Of course, it was evident — if Mr. Huntington would consent to act either in person or
by counsel — that with Sir .lohn .Macdonald, Sir Hugh .\llan, .Mr. Ahliolt, and others in the
witness-box, no concealnient woidd lie possible, for in the eirciimstaiu'es in which they were
placed the refiisal f»f these gentlemen to answer any question would prove more fatal to
tlieir cause than the most damaging admissions; but in default of .Mr. Huntington's assis-
tance, il was equally evident that a far greater burden would 1m' thrown upon the ('ommi.s-
Sioncrs than had been originally contemplated, and that the chances of an exhaustive
investigation wouhl he projiortionalely curtailed.

"?•. 9. It was, therefore, with regret I learnt that Mr. Huntington had finally decided
ot to put in an appearame. Satisfied as ! was, notwithstanding this gentleman's remark-
bly aide argument to the conti-.iry, that the appointment of the Commission was — whelher

Ssailable or not on other groumls — both a legal and a constitutional act, and, to use the
nguage of the Law Ollicers of the Crown, in no sense an interference with Ihe privileges of
parliament, it appeared to me an unfortunate circumstance that the conscientious, but, as I
BOW apprehend it will he admilled, the unfounded scruples i>f .Mr. Hnntingto?i and his
friends upon the point, should have (h'prived the inquiry of that complete and thorough
character it wouhl otherwise have pos.sesscd.

ji _ 10. It is triK! the diligence of the Commissionei-s in meeting the additional responsi-
*^ilities thus imposed upon them, has remedied the defect so far as circumstances permitted,
and I am glad to see signs of their services in this respect having at last obtained a tardy
recognition at the hands of those who were at first most uulavouraldy disiwsed towards
tile in ; for there ha.s, perhaps, been no more disagreeable feature in this Inisine.ss than the
CM laordinary amount of personal abuse which lias been heaped upon the heads of these
/imoU'ending gentlemen.

('.\NA1)A,

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CORRESPONDENCE RELATIVE TO THE

Canada. h. In England many of our Judges have passed straight from the arena of politics t;.
the Bench, and to these high functionaries has now been assigned an extensive jurisdictios
over delicate and hotly contested political issues ; but no matter what tlio verdict they render,
it would never enter into the minds of any of their countrymen to question for a monicni
their professional honour. As far as I have observed the judiciary of Canada occupy as
high a moral and intellectual level in relation to the other classes of society in the Dominion,
as their brethren in Great Britain. They hold their appointments on the same terms,—
their tenure of office is as secure, — nor \\ould it ever have occurred to mc that a taint o!
suspicion could attach to the National Ermine. Yet it seemed to be taken for granted that
because Judge Day, Judge Gowan, and Judge Polettc liadbeen nominated, — as of necessity
was the case, — on the advice of the Government, these eminent personages must therefore
be ready to sacrifice their personal honour, their professional reputation, their sense of duty
to the Queen, and to their country, in a transparent and inclfectual attempt to screen from
justice a ^^inistry of whom they Avere aljsolutely independent.

12. Happily as tim-^ vent on, a better feeling began to evince itself, the language of tlic
hostile press became more moderate, and although occasional complaints were made that
this or tliat line of interrogation was not followed u|) with sufficient pertinacity, it came to
be admitted that some of the main purposes for which the Commission had been appointed
were being promptly and fairl}- accomplished.

13. These anticipations have Ijcen now fulfilled by the acceptance on the part of tlie
House of Commons of the Commissioners' Report, and of the body of evidence placed l)y
them at its disposal, — a result which has found its final consummation in Mr. Mackenzie
having founded the vote of censure he is now pressing " on the facts " — to quote the word:
of his motion — " disclosed in the evidence laid before us."

14. Although I should be unwilling to refer to the appointment of the Commission
in any other terms than those I have already used in my original Despatch of August
18th, in which I state that although "I do not apprehend that Parliament can denounce
" the Commission as a breach of privilege, it would l)e perfectly competent for the House
" of Commons to declare its issue inopportune and unadvisable, and to visit with its
" displeasure the Ministers who counselled its apppointment." 1 cannot help observiiip
that in several respects the practical result obtained can hardly be said to have been
unsatisfactory.

15. On the 13th of August last, althougd four months had elapsed since the inquiry into
the Pacific Railway scandal had been first initiated by Mr. Huntington, the investigation
had not advanced a step ; since then scarcely ten weeks have i)assed away, yet the whole
matter has become ripe for adjudication, and in a day or two a final verdict will have been
pronoimced.

IG. Had no commission been issued, the interval between the 13th of August and tlic
23rd of October would have remained unutilized. A political crisis most detrimental tn
the public service, and entailing the most distressing relationships between the Crown and
its Ministers, would have been indefinitelj' i)rolonged, and at this moment Parliament
might probably be still discussing the conditions under which its Committee was to k'
re-constituted, and what steps were necessary to enable it to obtain sworn evidence.

17. Considerations of this kind however caimot be expected to mitigate the resentment
of those who have all along been disposed — I do not say with justice — to regard the
appointment of the Commission merely as a tactical device interposed by the accused to
clog the course of the inquiry. But with this part of the controversy I have no concern,
nor in making the foregoing observations do I wish your Lordship to understand me ns
undertaking to justify the Commission, or as accepting any responsibility in regard to it
It would not be a convenient practice for the Representative of the Sovereign to indicate
the degree or respects in which he may approve or disapprove of any course recommended
to him for adoption by his responsible advisers. 1 issued the Commission at the instaute
of those whose counsels I considered myself bound to follow, and I did so with the greater
readiness, as it enabled me to obtain from my Ministers in an open Court those explanations
in regard to their conduct which circumstances had rendered necessary, and which I had a
right to require; but the vindication of their procedure in tendering the lulvice on which I
acted does not lie within my province.

18. In conclusion I may observe that, although the Comniission has acted as an effectual
solvent of the political dilliculty, and appears to have elicited all the facs .icccssarj to dis-
play the main features of the story, it remains to lje seen whether a further prosecution of
the Inquiry will be thought advisable by those whom it principally concerns on cither side.

I have, &c.,
(Signed) DUPFERIN.

c arena of politics to
:>xtcnpivc jurisdiction
10 verdict tlicy render,
iiestion for a moment
of Canada occupy as
icty in the Do)ninioD,
1 the same terms, --
to mo tiiat a taint cf
aken for granted that
itcd,— as of necessitv
aages must therefore
n, their sense of duty
tempt to screen froni

the language of tlie
ints were made tLal
■rtinacity, it came to

had been appointed

on the part of the

evidence placed by

»n in Mr. Mackenzie

-to quote the word-

of the Commission
Despatch of August
iment can denounce
3teiit for the House
id to visit with its
rinot help ol)serviiii.'
i said to have been

nee tlic inquiry into
m, tlie investigation
nvay, yet the whole
rdict will have been

of August and tk
nost deti'imcntal tn
'een the Crown and
noment Parliamoiit
)mmittec was to be
)rn evidence,
gate the resentment
tiee — to regard tlie

by tlie accused to
I have no concern,
3 understand me ns
ity in regard to it.
)vereign to indicate
3nrse r-ccommendcd
sion at the instance
so with the greater
, those explanations

and which I had a
) advice on which 1

icted as an effectual
'is .-iccessary to di.^-
rther prosecution of
:erns on either side.
), &c.,

DUPFERIN.

CANADIAN PACIFIC RAILWAY,

S(t

Enclosure's in No. JO.

HE POUT

01' ruv

UOYAL COMMISSIONEES

Aj'poink'd b>i Commission, addressed to them uinl, r the Great Seal of Canada, bearinr/ date
Auffii."/ 14, LSTo, v:htch Cominisslon n-ill be found printed as Enclosure 1 in No. '>.

(.OimESPONDENC'I-: ]{ELATIVE TO THE

Canada.

REPORT.

To the Riglit IIoiunuaMc Sir Frrdorick Tcni])lo, Earl of Duffcrin, Viscount and Baron
C'landehoye of Claiidcbove, in the County of Down, in the Peerage of tin
United 'Xingdoni, l^aron Duflerin and (.'landehoye and Bailyleidy and Killi^
leau'li, in tin- C!ounty of Dommi, in tlie Peerage of Ireland, and a IJaronet, Ki)ii;lii
of the Most Illustrious Order of Saint Patrick and Knight Commander «
the most I lonourahle Order of the Bath, Governor General of Canada, and Viie-
Admiral ol the same:

May it jjlease your Excellency :

The undersigned Commissioners, aitpointed by Royal Commission addressed to tlinn
under the Great Seal of Canada, bearing date the fourteenth day of August, a.d, IST.!,
Have th(! honour to report —

1. That tluy met at Ottawa on the; eighteenth day of August last for the purpose oi
making preparations for the discharge of the duties imposed upon them by the Com.
mission.

2. The course of proceedings was then settled, and the fourth day of September last
was a])poin!e(l lor entering u}H)n tlie examination of witnesses.

3. The Commissioners on undertaking the inquiry they were enjoined to make hiiil
lioped that the entire conduct of it wouhl not have been left in their hands, that tin
lion. Mr. llunlington or some one who believed that the charges specified in the Cora-
mission could he established by evidence, would have conducted the incpiiry before them,
and tliey had resolved in such event, not only to accept such aid in the investigatioi;
l)ut to allow to the promoter at least the same latitude in the mode of proceeding as the
i-ecogniz(xl ofTicers in courts of justice are allowed in ordinary judicial investigations, and
also to give to the nuMubers of the Government a like latitude for defence. This course
appeared to the Commissioners to l)e just, and in accordance with what they believed
to be your Excellency's wishes and ex})ectations.

4. In the prosecution of their work the Commissioners have called before them such
]!ersons as they had reason to believe could give any information on the subject of it, or
otherwise I'acililate Ibc investigation, and especially the Hon. .Mr. Huntington, to whom
a letter annexed to this l'ei)ort,* was addressed on the "2 1st August last past, requestin:
him to i'urnish to the Commission a list of such witnesses as he might wish to examine,
an<l to proceed on the day named with evidence in the premises.

0. A letter was also addresseil to the Hon. the Secretary of State, giving notice of the
day appointed i'ov proceeding, a co])y of which is also annexed.*

(). In the interval, I)etween the first ilay of meeling and the day so appointed, sum-
monses were duly served upon Mr. Huntington and others, to appear and give evidenco.

7. On thelburth day ol' September, the Commissioners met, and after the publicatior.
of the Commission, the witnesses cited for that day were called.

.'^. Mr. Huntington failed to appear.

n. The evidence of the Hon. Henry Starnes was taken, and a sealed packet placed
in his possession by Sir Hugh iMlan and Mr. George W. McMullen was produced and
deposited with the Commissioners.

10. Tlie sealed i)acket Mas opened, with the consent of Mr. Starnes and Sir Ilugli
Allan, and the several pajjcrs it contained w ere put in proof.

11. The Commissioners then examined the other witnesses in attendance, and atUr-
wards, on successive days, proceeded to the examination of those whose names are oa
the list styled "List of Witnesses to be examined," hereto annexed.f

12. Of the tliirty-threc gentlemen wliose names arc on that list, twenty-nine have
been examined.

1."]. Two of these, Mr. George W. McMullen and the Hon. A. B. Foster, failed to
appear, although duly summoned ; the former through a special messenger sent to
Chicago for that purpose.

• Sco Appomlix, p. 201.

t See p. 92.

CANADIAN TACIFIC RAILAVAY.

Viscount and Raioi;

tlic Pcoragc of tin
IJailykiidy and Killc-
nda liaronct, Kiiii^lii
light Commander oi
ol' Canada, and Vice-

in addressed to tlinii
of August, A.D. IST.l,

st lor the purpose oi
n them by the Conv

ay ol" September labl

ujoined to make h;iil

their hands, that tlic
specified in the Com-

iiupiiry before them,
in the investigatioi:

of j)rt)eeeding as tlw
al investigations, aiiJ
lefence. This course

what they believoii

hd l)efore tlicm suih
the subject of it. or

Huntington, to wlioni
last past, requestin:

ght wisli to examino,

', giving notice of tho

y so appointed, sum-
ir and give evidence.
after tlie publicatior.

sealed packet placoil
;n was produced ami

iarnes and Sir Ilugli

ittendance, and after-
whose names are on

st, twenty-nine have

, B. Foster, failed to
il messenger sent to

14. The other two, Mr. Henry Nathan and Mr. Donald A. Smith, arc resident,
the former in British Columbia, and the latter in Manitoba. The distance and
consecpunt delay in securing their attendance, and the large outlay it would cause.
Tendered it iiie.xpcdient, in the judgment of the Commissioners, to call them to give
evidence.

If). In addition to those whose names are on the above-mentioned list, the Com-
missioners have called and examined Mr. Daniel Y. McMullen, Sir Hugh Allan, the
Hon. J. J. C. Abbott, and the Hon. Mr. Ouimet.

,:; 10. Most of these witnesses were cross-examined on Ijchalf of the Government liy
Silir John A. Macdonald, or other numbers of it.

17. Mr. Charles M. Smith, of Chicago, was summoiuxl l)y tl.e Commissioners, Imt
(did not a])pear.

■ 18. Evidence has also been given l)y Mr. Frederick C. Martin, and Mr. Thomas
White, whose names were furnislicd by members of the Government, and Mr. George
Niirris, jun., and Mr. J. A. Perkins, whose names were also so furnished, were cited to
apjicar, but made default.

10. The Commissioners, on the 23rd day of Sejitember, while still in the course of
their examinations^ rerpiested, by public announcement, all persons possessing any
information on the subject of the inrpiiry to ai)pear and give evidence before them.

20. No evidence has been offered in answer to this announcement.

21. The Commission closed its sittii:ii;s for taking evidence on the first day of October,
instant. These sittings were public ,'i.,l open; and accommodation was provided i'or
reporters of the public press.

22. The Commissioners ha\e endeavoured, in obedience to the requirements of the Com-
mission, to ol)tain fnnn the witnesses all the evidence pertinent to tlie subject matter of
the inqiuiry which they were able to give.

2.'{. This evidence is contained in depositions, thirty-six in number, and in certain
documents, all of which are annexed to this Keport, and specified respectively in the
accompanying list and schedule.*

2-1. If the evidence lie considered redundant, it has arisen from the nature and
circumstances of the inquiry, which rendered it inexpedient to limit its range by the
technical rules of evidence observed in the ordinary tribunals.

LT). With respect to that portion of the Connnission which leaves to the discretion of
the Commissioners the ex])ression of their opinions upon the evidence, they liave deter-
mined not to avail themselves of the liberty so given.

2G. They had arrived at that conclusion before they were informed of your Excellency's
views on the subject, and they feel confirmed and justified in it by a communication
received before their labours commenced, to which your I'^xccllency kindly permits them
to allude, relating to one or two points on which they thought it their duty to consult
your Excellency before entering upon the execution of their task.

27. In that communication your Excellency was pleased to express the opinion that
the functions of the Commissioners were rather inquisitorial than judicial, and that the
execution of them should not be such as in any way to prejudice whatever proceedings
Parliament might desire to take when it reassembled in October.

28. The Commissioners coinciding with your Excellency in the view that the terms
of the Commission do not require them to pronounce judicially on the evidence, consider
that their duty will have been I'ully discharged when they shall have forwarded to the
Secretary of State the accompanying depositions and documents with this Report, in
triplicate, as required liy their instructions- unless a Report of their opinion on the result
of the evidence should be specially required.

All of which is resjiectfully submitted.

Camada.

(Signed)

]\oyal Commission Rooms,
Ottawa, October iTtli, Ib73.

CHARLES DEWEY DAY, Chairman.

A P()LETTE

JAMES iiOBERT (JOWAN, Commissioners.

• Sof List of Witncppos Rxnm-ii.?.!. j', 92, and List of Exlitlrfp. p. 2'.1

t'ORKKSrON])l-:xrK UELATH-E to TIU']

Canada

LIST OF

Sir I'Vaiicis llincks.

(iva. W. McMullen. !
lloii. D. L. ]Maci)hcrson.
Hon. ^Miithew Henry

Coclirane.

]Ii)n. Asa li. Fostor. i

1 Ion. Jean Charles CJliapais. i

Norman W. liethiine. |

Andrew Allan. |

Louis Beaubicn. i

Victor Iliidon. i

WITNESSES TO BE EXAMINED.

Edward Leiebvre do Belle-
feu i lie.
Hon, ,Iose])h O. Beaubien.
Hon. Jean Louis Beaudry.
Peti.r S. iMiirphy.
Charles A. Lcblane.
Jackson Bae.
James Dal ers.
Robert N. Hall.
Joseph llamei.
Wm. I51umhart.
Sir Jolni A. Macdonald.

Hon. Hector L. Lans^evin
Danl. McMullen.
Chas. J. Coursol.
Jean Baptiste Beaiulrv,
F. W. Cumberland.
E. B. Burpee.
Sand ford Fleming.
II. N. Nathan, jun.
D. W. N. Smitii.
D. Mclmu's.
Hon. A. Cami)bell.
Hon. "" -

LIST

Abbott, Hon. J. J. C.
Allan, Andrew.
Allan, Sir Hugh.
Iicaubien, Hon. J. O.
Beaubien, Louis.
Beaudry. Hon. J. L.
Beaudry, J. B.
Bcthune, N. AV.
IMumhart, W. E.
Btu'pee, Egfirton H.
Campbell, Hon. Alexander.
C'hapais, Hon. J. C.
Coclirane, Hon. M. H.
Coursol, C. J. I

Cumberland, F. W. i

OF AVriNESSES SUMMONED.

Dakers, James.
Do Belleleuille, E. L.
FJemiuij. Sandford.
Foster, Hon. A. B.
Hall, K.N.
Hamel, Joseiih.
Hineks, Sir 1'.
Hudon, Victor.
Huntington, Hon. Lucius

Seth."
Lanu;eviii, Hon. II. L.
Le i^iauc ( '■. A.
Mac(b)nal(l, Kt. Hon. Sir

John A., K'.C.B.
Macpherson, Hon. D. L.

Martin, F. C.
IJi^Grcevy, Hon. Thomas
Mcliuu's, i).
McMullen, (ieorge W.
McMullen, Rev. D.
McMullen. Danl. Y.
Mitchell, Hon. Peter.
Murphy, P. S.
Norris, jun., George.
Ouimet, Hon, G.
Perkins, John A.
Rae, Jackson,
Smith, Charles M.
Starnes, Hon. Henry.
White, jun., Thomas.

LIST OF WITNESSES EXAMINED.

Abbott, Hon. J. J. C,
Allan, Andrew.
Allan, Sir Hugh.
Beaubien, Hon, J, O.
Beaubien, Louis.
Beaudry, Hon. J. L,
JJ.'audry, J. B.
r,etlume, N. W,
lUuudiart, W. E.
Burpee, Egerton R.
Campbell, Hon. Alex.
Chapais, Hon. J. C,
i!ochrane, Hon. M. II.

Coursol, C. J.
Cumberland, F. W.
Dakers. James.
De Belleleuille, F.L.
Fleming, Sandlbrd,
Hall, R. N.
Hamel, Jose])h.
llincks, Sir F.
Hudon, Victor.
Langevin, Hon. II, L.
Le Blanc, C. A.
Macdonald, Rt. Hon. Sir
J. A., K.C.B,

Macpherson, Hon. D,
Martin, F, C,
Mclnnes, D,
McMidlen, Rev, D,
McMullen, Danl. Y.
Michell, Hon. Peter.
Murphy, P. S,
Ouimet, Hon. G.
Rae, Jackson.
Starnes, Hon. Henry.
White, Thomas, jun.

DEPOSITIONS

Taken before the Honourable CiiAiu.is Dj.wky Day, late one of the Judges of the Supe-
rior Court in and lor Lower Canada, the Honourable Axtoimo Polkite, one of the
Judges of the Superior Court in and for Lower Canada, and Jamks Rohkut Gowan,
Esq., Judge of the County Court of the County of Simcoe, in the Province ol
Ontario, Royal Commissioners api)ointed by Commission addressed to them, under
the Great Seal of Canada, bearing date the fourteenth day of August, a.d. 1873, at
the Parliament Buildings, Ottawa,

(Signed) S. J. VANKOUGHNET, Esq,, D,C,L,,

Secretary.
FIRST DAY.
Thursday, September 4, 1873.
The Secretary read the Commission,
The shorthand-writer sworn was Matthew Hutchinson.

CANADIAN PACIFIC RAILWAY.

'cctor L. L,inp;eviii.

klcMullon.

. Coursol.

iptisto Bcmdrv.

[Cumberland.

5iir|)ei>.

I'd Fleming.

!^at1ian, jun.

N. Smith.

nncs.

.. Camj)bell.

ct( r Mitchell.

, F. C.

ovv, Hon. Thomas

s, i).

leii, (ieorge \V.
len, liov. D.
Ion, Danl. Y.
11, lion. Peter.
U P. S.
Jan., George.
, Hon. G.
, John A.
ckson,
Charles M.
, Hon. Henry.
Jan., Thomas.

rson, Hon. D. L.
F. C.
. D.

en, Ilev. D.
en, Danl. Y.

Hon. Peter.

P. S.

Hon. G,

vson.

Ion. Ilenrj'.
Thomas, jun.

nlges of the Suiic-
iLKiTK, one of the

llOHEKT GOWAN,

the Province ol
id to them, under
;ust, A.D. 1873, at

D.C.L.,

Secretary.

PROvivfK 01 Ontario, ) jp^ '^yy^ MATTER OF THE COMMISSION

City of Ottawa. J

Appointing CirAni,KS Dkwky Day, Antoixk Poi.kttk, and Jamks Rorkut Gowax,
Commissioners to inquire into and re])ort upon the several matters stated in
a certain Resolution moved by the Hon. Mr. HuxTixaTOX in the House of
Commons on the second day of April, a.d. 1873, relating to the Canadian
Pacific Railway.

Present : — Thk Commissioner.".

■On this fourth day wf September, in the year of our Lord one thousand eight hundred
and seventy-three, personally came and appeared before us, the above-named Com-
missioners,

The Ilonblc. HENRY STARNES, of the City of Montreal, Banker, who being duly
sworn, dcposeth and saith :

I received a Sulipiena dxiecs tecum to appear before the Commissioners and produce the
papers described therein, and I hereby produce them to be filed in this matter. The
said papers were placed in my ])ossession for safe keeping by Mr. Abbott on behall' of
Sir Hugh Allan and Mr. McMullen. In producing them in compliance with the orders
received li-om the Commission, I beg to state that I object to their being opened without
the consent of Sir Hugh Allan. I think it my duty to make this objection, as they were
placed in my possession for safe keeping. They are returned as they were placed in my
hands as they were when I first received them. The sujierscription " Henry Starnes, Sir
Hugh Allan, G. W. McMullen" was put on by myself; they were placed in my hands a
day or two before Sir Hugh Allan's (lei)arture for England, to be left with me. Tliere
are three distinct parcels, one to Mr. McMullen, one to Sir Hugh Allan, and one addressed
to myself They were handed to me by Mr. Abbott on behalf of Sir Hugh Allan, Mr.
McMullen was also present at the time I received them from Mr. Abbott.

I have no knowledge of what those papers contain.

I have no objection to the package being opened providing Sir Hugh Allan's consent
is obtained.

(Hon. Mr. Abbott hereupon produced a written consent that the said ])ackage of papers
be oj)ened by the Commissioners.)

Question — Have you any knowledge in relation to such negotiations as are described
in the charges mentioned in the Commission in this matter, as being carried on i)etwcen
Sir Hugh Allan and Mr. McMullen lor the purposes designated in this Commission?

A7isioer. — I have no ])ersonal knowledge.

Q. — Were you a meml)er of an Election Committee in 1872, in conjunction with Mr.
Boudry and Mr. Murphy?

A. — I was requested to go upon that C'ommittee, but did not attend regularly.

I am aware that money was received for election ])urposes. I might state that I was
requested by the late Sir (ieorge E. Cartier to act on tiie Committee, as he felt that the
elections would be hotly contested and that he was aware that his opponents were well
furnished with ample means, and, it -would be necessary to fight them with money. I
objected, as I did not .vish to take iuiy part. He, however, felt that there was a desire
to make the elections by means of railways, and he was determined to have nothing to
do with that, as he wislied to make his election upon his own merits, and it would be
ttpcessary for me to get friends to subscribe and to get as much money ^s we possibly
C^uld, I went round and got subscrii)tions. He then told me that Sir Hugh Allan
#Duld subscribe liberally, and I believe Sir Hugh Allan did subscribe very largely, but

subscription did not come exactly to my knowledge.
,1 cannot say how all the money came, but it was deposited with me, and by what
n|eans I do not exactly know. It was placed in the Bank of which I am President,
<pd paid out by cheques.

This money was derived from other subscribers as well as from Sir Hugh Allan. The
bttlk of this money came from Sir Hugh Allan, I understood. Various parties subscribed
in smaller or larger sums.

*jl have no original receipts which were given by the Election Committee. When the
receipt was published in the Montreal newspapers, I was astonished, as I had forgotten
^1 about it. I was surprised, for I had signed it, I suppose, in the hurry of the election ;
I mig'.it have signed more than one.

I know nothing about the two letters referred to in the nfcwspai)ers in connection with
the receipt. I have no knowledge as to where either of those letters now is.

CANAnA.

COT^RE?rOXDENrE RKLATIVE TO THE

Oanaha.

'!'1h' money was not paid upon any spiviiic conditions contained in tlicsc letters. The;
waA no condition as I'ar as I know.

I sij;n(\l tliis rcccijit inadvertently, and knew nothing at all about it till it wa
pulilislied in the newspapers.

I Iiave no idea or knowledge in whose hands those letters' now are.

1 was not induced to giv that receipt on account of any particular undertaking,
believe tliere were more than one receipt given. 1 liave reason to l)elieve there were.

I do "t know wliat ammuit was derived I'rom Sir Hugh Allan's subscription, excij
wh; ' 1^- ;sed through my liands, and I cannot say now what tliat amount was.

Wiien I first joined the Conmiittec, 1 understood it was to look alter Sir Geor:
Carrier's eh'ction, luit afterwards tlie t'ommittee seemed to assume tlie control oi" electio;
outside ol' Montreal, to what extent I caimot say.

I don't know of any other inl'ormation that would facilitate tlic ol)ject of this impiii

I cannot state exactly the amount I received for the support of the elections, but ;
think it was aliout sixty to seventy thousand dollars, which was raised by way
subscriptions and from Sir Hugh Allan. The envelope of the package having l)n
removed iiy consent of the witness, the following endorsement was written on the iniu
])arctd : —

■' \Vitbin ten days after the end of the coming session of Parliament, the Hon. Hoiir
Starnes is requested to deliver envelope No. ' one ' to Sir Hugh Allan, and envelu;
No. 'two' to G. W. ^IcMullen, unless objection be made by Sir Hugh Allan to I.
doing so. ill which case he will open the envelope addressed to himself and act
instructed therein.

(Signed) "nUGH ALLAN,

"Montreal February "20, 1S73." "G. W. MeMULLEN.

I know the handwriting of Sir Hugh Allan, but not that of Mr. McMullcn. T!:
latter Avas present when the parcel was given me.

I have no objection now, seeing the consent from Sir Hugh Allan, to open the packa;
(The jiackagc was then ojjened by the witness and returned to tlu; Commissioners.)

Anil on this twidfth day of September, 1ST;}, the witness reappeared and nia;
the lidlowing addition to Ids foregoing deposition. Li my evidence I stated that t!
amount ol' money that passed through my hands was ^00,000 to !<70,000 — on refercii.
to the books of the bank I find it was S()(),;!j7.

And further the deponent saith not, and this his deposition having been read to hir
he declares it contains the truth, persists therein, and hath signed

Sworn taken on the fourth of September. 18/3,
and acknowledged on the 12th of said
month and year.

(

(Signed) HY. STARNES.

Signed)

CHARLES DEWEY DAY.

Chairman.
A. I'OLETTE,
JAMES ROBERT GOWAN,

Commissioners.

IN TllK ^LVTTER OF THE COMMISSION

m d

PnovixcK OF Os"T.\;;io, "^
67/// v/ (tit, lira. y

Appointing CiiAi;r.is Di-v.i;v Day, Axtoinic Poi.kttf, and Jamfs Rohkrt Gowa)'
Commissioners to inquire into and report upon the several matters stated i:
a certain Re-<olution moved by the Hon. jNIr. Huxtixotox in the House i:
Commons on the second day of April, a.p. 1(^73, relating to the Canadix
Pacific Railway.

Present : Tnv. Commi.s.=ioxf:u?.

On tliis fourth day of Sei)teml)er, in the year of our Lord one thousand eight liundn
and sevent} -three, i)ersonally came and appeared before us, the above-named Con.-
missiouers.

Sir FRANCIS IIINCKS, of the City of Montreal, who bein"; duly sworn, deposethaiii
saith :

I presume that the best course will be to give a narrative of the circumstances bcgir-
ning liefore the legishition. In fact it may be well that I should commence from tli
earliest stnue of tlu- proceedings in regard to the Pacific Railway. I believe the firj
person wi''i wlimn I had any conversation that I recollect of on the subject of the Pilcili'

CAXADIAX PACIFK' riArL>YAY.

tlicsc letters. The;
about it till it wj

•ular undertaking. ;
l)elieve there were,
suhseription, exo;
lount was.
)()k after Sir Geor.
lie eontrol of electiu:

<)1)jeet of this inciuii
the elections, hut ]
as raised by way
package having h\
! written on the iiiiit

nent, the Hon. Ilciir
Alhxn, and envelui
r Hugh Allan to 1
3 himself and act

Ttll ALLAN,
AV. MciMULLEN,

Mr. aiclNIullcn. T!

to open the packas:
Commissioners.)
eappeared and niiv:
ice I Slated that t!
mO,0()0 — on refercii

ng been read to hie

lY. STARNES.

DEWEY DAY.

airman.

iERT GOWAN,

onimissioners.

^MMISSION

ES ROHKRT G0W.\\

ral matters stated!:
■)N' in the House >:
lug to the Canadia:

lusand eight hundn.
above-named Coiii'

sworn, deposeth ain:

:ircumstances begin-
commence from tli
I believe the firi:
subject of the Pacifr

Railway was Mr. Cyril Graliaiii, a gcutK'nian wiio actcil as Commissioner for tlie lludsj-i
Bay Comiiany, in tl'ie vcars ls7() and JsTl.

On his rctnrii Iroiii tlic Tniti'd States, lie told me tliat he liad l)ieii in comniiinuation
with seveial influential gentlenien, and that he thought satisfactory arrangements could
be made, by which great economy would be jiroduced with regard to the construction of
the Pacific Railway. That be believed the Americans would be jn-epared 1o almndon
the Western sectioii of the Northern I'acific Koad. carrying it through ( 'anadian territory,
if the Canadians would aljandon their Eastern Scclion and carry it through rnilcd States
territory by the Sault Ste. Marie. I heard all that he said upon the sul),ject, and I must
m that it produced some imju'cssion upon my mind.

i About the month of May, 1S7J, Sir John Rose sent me a cojjv of a letter which be
bad addressed Sir John A. Macdoiiald, iu which heinrorninl me, that persons in London
l»d sjiokcn to him very much in tlu' same terms that 1 have mentioned that Mr. Graham
bad represented to me,"and suggesting in the letter either that we sbouhl a])proach these
gfcntlemen in the United States, or let them understand that they might ai)i)roacli us. and
lUltlie same time ollering that if lie could be of any service in l.,ondon. that he wouiil be
happy to be so.

In consequence of these statements, I certainly formed a pri'tty strong idea that satis-
fcctory arrangements could be nuide with ca]iitalists in the liiited States.

The next circumstance that 1 would mention, was the arrival in Ottawa of a nunil)er
of gentlemen of whom Mr. MeMullen was one; ^!r. Smith oJ' Chicago, wa^. a second ;
James Beaty, of Toronto a third; and Mr. KerMeman and Mr. Waddington, and I
think there was another whose name 1 cannot I'c'collect, but I thiuk lu- was a I'oronto
gentleman.

They asked an interview with members of tlie Government. The only numbers in
Ottawa at that time were Sir -lohn A. Macdoiiald and myself. I think 1 was the jjcison
to whom tliey were first introduced, and Sir John A. Macdoiiald eonseuted to ,i;ive tluTii
an interview, which they had. We heard what they had to say ; they iiroduciil a docu-
ment signed by stmiesix, seven or eight gentlemen of standing in the t'nited .-nates, and
of known wealth. I forget their names now, but there was (ieiieral Cass. Mr. Ogdeii was
another, and I think Mr. Scott, of Philadelphia, was another. The ilale was in July,
18/1, probably about from the tenth to the thirteenth of July.

They were told distinctly that it was not in the jioAver of tlie Governmem to enter
into any negotiations with them. I think that ^Ir. Smith and Mr. .Mc.Mull. n had an
interview with me in my own room, and we had some little conversation 'nit did not
amount to anything. It was simply an understanding that it was inipossi])'e ibr us to
enter into negotiations at all at that time. After they had returned to Toronto, I got a
letter from a gentleman who had accom])aiiied them there, and who I understood was
tiieir jirofessional adviser at the time, and I had some corresjioiulence with him. 1 refer
lb JNIr. Beaty. In the course of that correspondence, he mentioiu'd his intention of going
to Montreal to induce Sir Hugh Allan to join the scheme. He had not ul that time
been spoken to. I wrote very discourafiingly to Mr. Beaty in rejily, sim])ly on the
ground that I did not see how it was jiossible to talk about a scheme which the Govern-
ment had not come to any conclusion upon, as to what assistance they could give. I did
not see that the matti'r was in such a stage as aduiitted of its being discussed at all.
Alter that I saw Sir Hugh Allan in Montreal, but as I felt that the suggestion of his
name came from Mr. Beaty entirely, writing with the sanction of Mr. McMullen, I there-
fore inferred that the suggestion of Sir Hugh Allan came from them, and as 1 had been
te means of preventing their opening communication, I thought it was only fair to give
m the list of names wiio were willing to engage in the building of the Pacilie Railway.
'^ That conversation with Sir Hugh Allan must, I think, have taken place about the
■Biginning of August. I cannot recollect the day exactly, but I do recollect that 1 told
bim tiiat Sir John A. Macdonald would be iu town I think, either that evening or the
next evening. Sir John was passing through to a watering place, and intended to go
from the Ottawa boat to the Quebec boat without stopping in Montreal. Sir Hugh did
see him. I Mas not jireseut at the interview, but Sir Hugh told me that he had had
a. discouraging reply from Sir John, as he did not think the Government was in a position
to enter into negotiations. I afterwards went to the Maritime Provinces, and in October
pir Hugh Allan came with these same gentlemen, Mr. McMullen and Mr. Smith liaving
been in communication with him, with another proposition. At that time there was a
^nsidcrable number of members of the Government present. I have seen Mr.
l!c^Iullen's statements, and he gives the names of nine of these persons, and I j)resurae
be gives them correctly. On that occasion what passed was this : The gentlemen were
fotroduced, Sir John A. Macdonald then asked Sir Hugh Allan whether he had a propo-
■? N 2

Caiiai».\.

CORRESPONDENCE RELATIVE TO TilH

Canada, sitioii to make to the CJovcriimciit. Sir llun;h Allan's reply was — " If I make a iiropo-
' "^ilioii arc you prcparcil to ciitrr into ncf^otiatioiis on tlie subject." Sir John answer^

that" lie was not prepared to do so," i.nd Sir llu<;h Alhui rejoined " Tiien 1 am no;
" prepared to make any ])roposition.' That was tlie wiiole conversation on the sulyect thai
took place at that interview. Sir Uwf^h Allan went shurtly afterwards to Enfj;land, aiiii
returned very early in Deeemher. VVhen he returned I had a conversation with liiin
1 must iiave been in Montreal in December, although I have no very special recollection
of it.

Whenever we met, lie was always talking; of the Pacific Railway and inasmuch as j
great luiniber of conversations took jjlace of this kind, I think I oun;ht to state, \\\\\,
regard to evidence of this kind, that where two persons have diU'erent interests, and noti:,
a iH)silion to understand what is passinj; in each other's mind, that very often there \\\..
be misund(a'standings in regard to what passed at these conversations.

My tlesire was to be as reticent as possible. 1 had no i)roposition to make on the par
of the (.iovernment. lie, on the other liand, was most an.\ious to get the (lovernnient t
agree to some proposition, so as to enable him to make progress with his arrangement-
1 say this, because 1 oi)serve by letters wbicli have been i)ul)lished, that it is allegi;d tb:
I said something about advertising for tenders, with the vii;w to avoid the Governnm
incurring blame. Now, I have no doul)t whatever that I did jioint out to Sir llu^''
Allan that it was wholly impossible for the Government to come to any arrangemci;
without the sanction of Parliament, and it is not imiirobable that 1 may have discusse,
the (piestion about advertising lor tenders, but 1 could scarcely have told him that V'
were determined to advertise for tenders, heeausc no such determination was ever arrive;
at. Several conversations took place, and dillercnt jiersons will have diil'erent views. 1
may have suggested to advertise for tenders to find out whether there was any otlic
person besides Sir Hugh Allan, who would come forwanl and undertake the building o;
the road. W'c, as a tJovernnrent, had pleilged ourselves to])rocure the construction of tli
Pacific Railway, and we Iiad also determined to try to do it by the instrumentality ol'i
t'hartered C'omi)any.

^\'e were anxious to find out what persons there were in the Dominion who wouLi
undertake the building of the railway, and upon what terms they would be willing to coi;-
struct it. A number of unauthorized conversations took place with Sir Hugh Allan, bi;:
Sir Hugh knew perl'eitly well that these conversations were unauthorized, and that I wa-
not speaking the sentiments of the (iovernment. 1 simply stated what occurred to my
own mind in the coursi' of the conversations. Sir 1 high also knew jierfectly well thatniv
views with regard to the construction of the Pacific Railway harmonized a great deal
more with his own than any other member of the (jovermneiit. He knew that 1 ua;
not opjiosed individually to the admission of American cajjitali.sts. He was well aivareci
that from tiie first. He was well aware that my views were in favour of coming to soiiu
arrangements with the Americans, as there would be economy in the postjionement of a
certain section to a later jieriod so as to get one complete road through. We had a gowi
many conversations, and lie was also aware that some m<;mbers of the (jiovernment wcti
much ojiposed to admitting Americans into the scheme at all. All these eonversatioib
took place long bel'ore the Session of Parliament — long before any scheme was deter-
mined upon by the (jovernment. They were had with a view to my getting all tlio
information I could with regard to the best scheme for constructing the road.

The next circumstance I would advert to was the final arrangement tint the Govern-
ment came to with regard to the railway, which was submitted to Parliament. Thai
scheme was decided ujjon by the Government, after the most careful consideration, with-
out any conference with any outside jiersons at all, as to the exteni of land and moiuy
they would give.

When Parliament met, I would say that during the whole of IsTl, there was a great
coolness in the jirincipal parts of Ontario with regard to the scheme. No propositions
were made such as those that emanated from Sir Hugh Allan. Nothing was done until
just about the time of the meeting of Parliament, it then liecame evident that then
would be a proposition made to Parliament for the chartering of more than one Company.
The (rovernment did not think it desirable to oppose any of the Charters but to let tlioni
take their own course, taking power to establish a separate Company if they should deem
it necessary to do so. I may observe that during the Session of Parliament, it becami'
more and more clear, and I was very reluctantly convinced, that it was absolutely
necessary to exclude the Americans entirely from the Company, and from that time I may
say this became the settled policy of the Government.
Qtu'ulion. — Whatdate do you give to that ?

Aitsicer. — The meeting of Parliament.

CANADIAN rACIFIC RAILWAY

-" If I make a propo.
" Sir Joliii aiiswerci
ncd " Then 1 airi in:
ion on the subjirl, tk
ards to Eiif^laud, aini
invi'isation witli liim
ry si)ccial rccollccticn

y and inasmuch as 3

. oii|;ht to statu, witfi

nt iiitcri'sts, and noti:

very oiten there \vi,

IS.

11 to make on the par
;ot the Ciovernnient t
ith Ills arrangonuiit'
tliat it is alU'i^cd lb-
void tlif Governnn;
lint out to Sir ]lu|;i
; to any arranf^^onK;;
I may liave discussc:
avc tohl him tliat «■
it ion was ever arrive:
ve dill'erent views. 1
tlicre was any otiu:
[M take tile liuildin^ 0;
the eonstruetion ol'tli'
" instrumentality ol',:

)ominion who wouli

)uld be willinj; to coi;-

Sir llugli Allan, bi:;

orized, and that I \\i-

ivhat occurred to iir.

iirl'ectly well that 111;

monized a great dual

He knew tliat 1 \u-

Ho was well aivairci

ur ol' coming to soiiit

le postponement of a

u:li. We had a good

le (jiovernment \\vi<:

1 these conversation!

)' scheme was dctfi-

a my getting all tk

the road.

,'nt tint the Govern-

) Parliament. That

consideration, with-

of land and momy

1 , there was a great
le. No })ropositioii5
tiling was done until
e evident that thcri
than one Company,
rters but to let tlieni
if they sliould deem
rliament, it became
t it was absolutely
rom that time I may

Q vVas that previous to the passing of the Act ?

^ During the time the Act was under consideration, and before the jiassing of the

Act." It was Then perfectly understood by all tin; members of the Government that the
Americans would have to be excluded. After the Session of Parliament broke uj), aliout
the ritii or the l.'itli of June, 1 think, I went to the West and was engaged in tlie election,
and I'had no communication with Sir Hugh Allan for a great many weeks, proi)ably
months— I must have left Ottawa very early in July, and I was not in Montreal after the
Session to tlie best of my recollection. I do not recollect seeing any one, and no arrange-
ment of any kind was made by tlie Government about the Pacific Railway. Nothing was
tUr be done until after the elections. The next action taken by the (iovernment was, I
dHnk, in the month of Scptcni!,cr or October, l.s7U, after the elections were entirely
0er, when negotiations were commenced with a view of jirocuring an amalgamation of
t^e two Companies— the Interoccanic and the Canadian Pacific— Sir Hugh on behalf of
Ms Company wrote accepting the jiroposition cf the Government, that the two Companies
djould be amalgamated on condition of tlici; being united on fair terms, taking the prin-
djial gentlemen of both I'ompanies. T"1k; Committee of the Interoccanic Company, of
wnich Mr. Macphersoii was Chairman, gave reasons why they could not Join. One of
their principal reasons was that Americans were still in the Company. T'liat document
was sent to Sir Hugh Allan for his Company to report upon it, and they did rejiort upon
it. About the lOtli of October, I think, a Minute of Council was ])re])ared, and that
Minute gave a full and faithful narrative of every Miig connected witli the Paciiic Rail-
way and the negotiations u]) to that time.

It was hoped that that Minute of Council, as it pledged the Government toiircvent the
Americans coming in, and stated that the (jiovernment would take adequate means of doing
so, would induce the Interoccanic Com|)any, as it was called, to join in this amalgama-
tion. They still refused, however, and on tlieii final refusal it became necessary ibr the
Government to see what course they would have to take under the circumstances. Sir
Hugh Allan had been very anxious, and my own opinion is that it would not liave been
an unreasonable demand after the refusal of the other Company to amalgamate, that the
Charter should be given to the Comjiany of which he was Chairman. However, the Go-
vernment, upon a full consideration, determined to adopt a dillerent course ol' jiroceeding.
I have no doubt they were impressed a good deal by some views of Mr. Macphersoii
which he put forward very strongly in his corres])on(lence with regard to amalgamation,
that no iiersons from British Columbia were includi'd in the scheme as i)ut forth, and
that Sir Hugh had stated that if British Columbia were introduced the maritime Pro-
vinces \, ould also require a representation. Mr. Macphersoii thought lliey should be
represented, and I have nodoui)t these arguments had as great a weight with the other
members of the Government as they had with me. Finally it was arranged that a Com-

riy should be incorporated containing thirteen members, divided into fair proportions
letwcen the difl'erent sections of the Dominion ; from Ontario, five ; from Queliec, four,
and from each of the other l^rovinces, one, making thirteen in all. ^Ve gave a great deal
of consideration to the whole scheme, and finally agreed u[)on names after a good deal of
negotiation. Some names were suggested and withdrawn, others were s2)okcii to but
refused to act, and finally these names were agreed upon, certainly without the concur-
pence of Sir Hugh Allan in any way whatever. On the contrary, it is within my own
knowledge that he objected to many of the names. The names were taken as fairly as
possible from the Province of Ontario, one of thorn the Vicc-Chairman of the Inter-
Oceanic Company, another who had no connection with either, but \vhom it was desirable
that we should select, namely, Mr. Sandford Fleming, and there was only one name tiiat
Jlad been originally in the Canada Pacific Company, a gentleman of large means and high
itanding, Mr. Donald Mclnnes, of Hamilton. He was the only one from Ontario at all
(dbnnected with Sir Hugh Allan. From Quebec one name was taken against the most
Urgent remonstrances of Sir Hugh Allan, Mr. Hall, of Sherbrooke. The gentlemen had
tkich of them the same interests as Sir Hugh Allan, who had only a thirteenth the same
0e the others. He had no controlling power in the Company whatever. He got no
benefit of any kind throughout the whole course of these negotiations. I state most posi-
tively that it was impossii)le for any undertaking to be got up with a greati'r desire to
promote the interests of the country than the Pacific Railway. Every detail was con-
Sideied with the greatest possible care, and as far as my own iiulividual opinion goes,
although 1 had very little personally to do with the Charter, I think that the Company —
I do not refer to Sir Hugh Allan iiarticularly — were treated with less liberality than the
Government ought to have shown them. My opinion all along \vas that it was an enter-
prise which to be successful the parties going into it must be treated with the greatest
possible liberality. I should say further that there was a stipulation made when these

Canada.

p^^

('()I?^]•;^!F^xl)KX('r: t^mlativk t(^ tiik

Canapa. lliirtccii i;rnflrmi'ii \vi rr allnwid \o siil)>icril)i' stock tluit tliry wcro to ofTur it with thf
oxccjitioii (il'ii smiill rcsci'ViitioM to iMcli, on the saint" li'i'iiis to tlic pulilii' as licy \\vvv\,
got it, tlu'insclvi's, and olTu'cs were to In- oiiciicd in Ontario, (^iicln'c, and llic otiicr I'ro
vinci's lor the sniiscrii)tioii of stork. I think that is as tar as I can go with irj^ard to tlit
transaction altoL^ctlicr.

(2.- In vonr rcl'iMrncc to July, 1^71. have you stated all you recollect that passed tlia
— your statctncnt was that tliat was an unimportant interview wliieh led to eonversutioii
and discussion, i)nt no results?

.1. — No results. \\v listened to what they had to say, I mentioned that an inform.!
]>roposal was made, signed hy a nuniher of ijentlemen. I cannot at this moment recolUv
the exact numher of acres jier mile tlial was pro]»osed, Imt I re.'(dlect that it was iin'
hased npoii a lumj) sum, hut upon u;rtlinu; a honus of sl'i.iKlO a mile cash, and a certaii
numher of miles on each side of the railway, which I do not oxaitly recollect, likclv
twenty.

(). — Ho you rememher whetlier there was any expression of the \vish or intention u;
the (Government, that prominent Canadian name'i should l)e amonj;' the menihers of tin.
Company; was there any thinf;- insisted upon of tiiat kind?

A. — S^)thin;.; at the meefiuL; of Sir .lohn A. IVIacdonald and myself with these f;eiifli.
men. I think it is jirohahle in private conversation that 1 may have said that it wi:
unfortunate there were no Canadian nanu's in the Company. It was my fcejini;' at tin
time, and knowin;j; that it was so, it is prohaldi' that I minht have expressed it.

Q. — I understood juu to say distinctly that anterior to the le^islal' )n on the sul)joct in
IST'2, there were no negotiations hetween Sir Hugh Allan and .Mr. iNIeAInllen, as repri'
seuting the United States ca})italists, for the jmrpose of putting this enteri)risL' into tin
hands of an American Company, with Sir Hugh Al'iu at its head?

A. — Of course I was perfectly aware iivnn the fact that Sir Hugh .Mian came to < Ittaw;
with these gentlemen, that he was corresi)onding with them, an<l that negotiatioii-
hetween him and them were going on, hut I never saw their agreement, and never kiiiv
there was one until recently, \vhen I saw e.nioni:; the papers jmhlished that there was sunn
agreement which I luive never set n. 1 have no knowledgt" of my own of an agreemunl
lictwcen them, 'and simply kniiw of the fac'; that they were eorresijouiling with om
another.

(l — Have you any reason to helieve that any of the memhers of the (iovernment wen
awart^liat negotiations were going on?

A. — I am sure that they did not know of any agreement, hut they must have known
just as I did, that Sir HuL;h Allan was negotiating with them from the fact that SirHni;!:
Allan came with them to Ottawa, hut they knew of no agreement any more than I djil.
and thev never gave any assent to it.

(i. — Have you in your possession any correspondence ri'lating to this matter that yo:
could lay heforo the Commission?

A, — I had a correspondence very shortly after these gentlemen visited Ottawa in July,
IS"!, with Mr. ifeity who attended them down and introduced them. It originated will
]Mr. Beaty. He wrote me a letter. 1 re|)lied to that letter. He ^\rotl' me another, ainl
I replied to that, i have no ohjection to lay it lu'lbre the CJommission, except simply,
the ohjection of laying hefore you a confidential eorresjmndenco of that kind, but I doiit
apprehend that thert! is anything in it that any great ohjection can he taken to, and 1
hereby produce them to l)e fyled.

Q. — Do you nu\an to contratlict, in unqualified terms, that an understanding was conn
to hetween the Government and Sir Hugh Allan, and Mr. Abbott, one of the members oi
the Honourable House of Commons of Canada, that Sir Hugh Allan and his friend!
should advance a large sum of money for the purpose of aiding the election of niinistcis
and their sujjporters at the ensuing general elections, and that he and his friends should
receive the contract for the construction of the Pacific liailway ?

A. — Yes; and I would add this, that of course 1 cannot ])ositively swear with regard
to anything that passed between individual members of the Government and Sir IIu!,'li
Allan, but I know of my own knowledge that everything connected M'ith the Pacific liail-
way t!harter came under my own observation, and I know that it was not given with any
reference to that whatever.
I positively contradict it.

Q. — Do you know whether sucli an understanding was come to between those gentle-
men — Mr. Abbott and Sir Hugh Allan, and any member of the Government ?
A. — I know of none.

Q. — Were your relations with Sir Hugh Allan as intimate as those of the other
members of the Government, or more or less ?

CANADIAN PACIFIC IJAIIAVAY.

!)!)

■ In od'cr it with til,
ulilir as hey witci,
', iuiil llu' (lilicr I'ro.
;() with iv^anl to tin

illcct that passed tlia
'i k'd to conversation

)ii('(l that an informa:
ills inoiiiciif nroJUv
licet that it was n,,'
I' cash, and n ccrtaii;
ictly rcaillcct, iik,!;

uisli 01' iiitcntidii ,;
the mcinhcrs ol'ilu,

ir witli tluNc fiiciitli.
ivc said that it \\;\-
H my feci in;:; at tin
^pi'cssrd it.

)ii on the snl)jcct in
McMiillcn, as rcpiv.
i ciitcipriso into tin

iliaii came to ')tlau<:
1 that ncg'otiatiuii.

rut. and never kmi;
tliat there? was souk

i* M of an aj^reeniL'ii;

jspondini; with on

ic Ciovernment wen

must liave known
e fact that SirHii-Ii
ly more tlian I (hi,

his matter tliat vo;:

ted Ottawa in July.
It originated will,
ite me anotlier, aini
iion, except simply,
at kind, hut 1 (h)ii'i
he taken to, and I

[•standing was conic
' ol" the members di
an and his l'ri('Ill!^
lection of ministtr>
his friends should

swear witli regniil
lent and Sir llu!.'li
th the Pacific ]{ail-
not given with any

iVeen these gentle-
■nment ?

hose of the other

A, — I sliouM think ahout the siinie, very much uhoni the same.

Q_ — Have you any knowledge that any money was Jhrnished hy Sir Ilngli AHan for tlie
iupport of the ehrtions?

^, — AVell, [ su]ipose I may say I liave that knowledge now, luit if I refer hack to fho
period of the eleclioiis, \o. I am now aware from ciicu' isfanccs I have heard, and
which I suppose the whole puldic have got, that Sir Hugh Allan was a liijcral contri-
butor to the election fund. 1 am aware of this from circumstances that have come since
to my knowledge.

Q. — Had you any knouleilge of that at the time or lieforc the elections?
^Ji. — No. Not until long alter the elections, a coiibideraldi' tinu' alter.
AQ' — I^" yn know for who.e elcilion an} [jarticnlar Mums were contributed ?
TJp.4. — I eaimot say that I do. I liavi' reason to believe that there was a very hirgc
Mnount contributed for tlie Montreal elections.

(^. — Von slate tluit Sir Hugh .\!laii was not to have any controlling influence in the
Company; was it not uiuhrstood that he was to be President?

A. — I do not know that it was so understood. Of course memliers who went in were
perl'ei'tly free, I presume, to vote for whoever they jjleased. I did not take any part
in the communication that passed betv.cen any of these genth'nien, and I really do
■ot know what passed. I don't know whether they were caiivassi'd by any member
of tlie ((overnment on behalf of Sir Hugh Allan, but 1 would not be surprised if
they were.

Q. — Can yon slate any certain sum of money that was contrilmted by Sir lliigli Allan?
A. — No. I cannot slate of my ciwii knowledge. I cannot give hearsay evidence.
^.— Have you any knowledge that any sum of moiic} ' , oil'ercd to any member of
the(iovernment for the purjiose of inlluencing him in connectii'ii with tiie Pacilic Haihvay ?
A.— I am perfectly convincecl there w.is nothing of tlie kind.
Q. — Or any other inducement or advantage?
A. — None.

This may be a proper time to explain a circumstaiue whicli ha been referred to in
the papc'-'^ '\ ,ich seems to imply that I desired some inducement of some kind. Refer-
ence was niado to my having stipulated for a situation on t'le r,u ifie Railway for one of
Ti'' sons. Now I desire to exjilaiti exactly what p.assed. ^\■hen I wrote my letter very
hastily, I at the moment really had forgotten the circ'imstanci- which made very little
imiiression upon my mind, but I afterwards distinctly recollected it. My youngest came
in October, LS/l, to pay a visit to his friends. He llieii held an ofilce in Pritish (Juiana,
and came lion; on leave of ab.sence. I was anxious to keej) him in Canada, ana to esta-
blish him in business. Sometime during the fall of isji, and while Sir Hugh Allan
was absent from the enuntry, a friend in Montreal suggested to ine the idea of pur-
chasing out a forwarding business, which was likely to become vacant in consecjuence ui
the death of a gentleman, who died in the latter part of November, 1.S71, and it was
supposed that his business after his death would be disjioscd of. This matter had been
brought under my consideration, and I took the opportunity of Sir Hugh Allan's being
in Ottawa, to consult him on the subject. He was on a visit for three or four days a\
Kideau Hall, in January, eighteen hundred and seventy -two (1S72), after his return from
England. The cause of my having any conversation with him, was simply to ask liis
advice with regard to this I)usiness, as I considered him more competent to give an
opinion than any one that I knew of. He strongly advised me to have nothing to do
with it, and at the end of the conversation, I simply said. If you hear of any oiiening for

ty son, I would ])e glad if you would bear him in mind. He made the remark that
hen the Pacific Kailuay is started, there will be plenty of opportunities, and so little
., iportance did I attacli to the conversation that I never mentioned it to my son, and it
never crossed Sir Hugh Allan's mind or mine that there was anything corrupt one way
or the other, with reference to the conversation. If it was wrong at all, I am alone
responsible for it. for no other member of the Government knew anything about it, nor
did I attach importance to it. Of course I have seen Mr. .McMullen's narrative, and if
there is anything I have not noticed, I would like to have an opi)ortunitv cd' adding to

iJhis statement.

■ji^ I say most distinctly that no such conversacion was had with me that a round sum of

llnoney down would he preferred hy me at my time of iife. I swear most posit ivelv that
no such conversation ever took place. No such thing was ever mentioned b»' mi; 'to Sir
Hugh Allan or hy him to me. There is a statement that I said something of Sir Cieorge

;. tart ici- s jealousy with regard to the Grand Trunk to the Pacific. Mr. McMullen
■thought I had a conversation to that effect with him. I can only sav that I have no
recollection of any such conversation. I don't think that ii i? at all likely that I had

Canada.

100

CORRESPONDENCE RELATIVE TO THE

Canada, spoken to him about Sir George Cartier's views on tlie subject, but it is quite correct t
say that Sir George was very strongly opi)Osed to the Americans having any interest i:
the scheme.

Mos«^ unquestionably the Americans never received any pledges of any kind c
description, as stated by Mr. McMullon.

Q. — Did you not mention a Memorandum, of which you had taken a copy, given yo.
by the Americans?

A.—\ took I copy of the names, but not of the Memorandum, and these I handed t
Sir Hugh Allan.

There was no money received or paid by the Government for or in consideration c:
giving tlie contract.

There is mention made in Mr. McMullen's letter that I received a specific sum o:
$4,800 from Sir Hugh Allan. I deny this in the most positive terms, I received ii;
sum of money whatever.

Q. — By Sir John A. Macdonald through tlie Chairman.

Can you state when the elections commenced generally, and when they ended ?

A. — My impression is that they commenced about loth July, or perhaps the beginniii:
of July, and I should say from memory that they ended about the middle of August.

Q. — Up to the time of the return of the writs of the elections which took placi
in September, was there any policy suggested to the Government, or before the attem|);
of the amalgamation of the two Companies ?

A. — None.

Q. — During all that period was it or was it not understood that a strenuous attenip;
should be made to olTect an amalgamation of the two Companies?

A— Certainly, and much later I had reason to believe that there was good ground t:
exjjcct that an amalgamation would take place.

During the whole period tlie elections were going on, and until long after, perhaps a;
late as tlie beginning of October this was the case.

Q. — In October, were or were not the efforts of the Government renewed to effect at
amalgamation of the two Companies?

^.— Yes.

Q. — Was there any suggestion from any person to the Government that you are awan
of, or was it tlie jjolicy of the Government to issue a Charter under the Government Ail
till after tlic failure oi' all attempts at amalgamation?

A. — Certainly not.

Q. — Then tiie Ciiarter which was issued and is now in existence is based on a policy
which was only adopted by tlie Government in October or November after the attemit
to anial^amate had proved a failure?

A. — Yes, I should be inclined even to put it to a later period. The arrangement pi
the new Company took a considerable time. I presume that it was about the latter ciii
of Novem1)or that the jiolicy of the Government to work by means of a Company of tliat
kind was decided upon.

And farther, for the piesi-nt, deponent saith not.

And on this fifth day of September, 1873, reappeared the said witness who desires to
give some explanation of his answer to the question on a preceding page of his deposi-
tion, and gives tlie following explanation :

I wish to answer this question at greater lengtli. I never heard of any suggestion to
the Govci.inient to issue a Charter under the General Act, and the Government iievir
contemplated issuing such a Ciiarter till they became satisfied that it was impossible ti
effect an amalgamation betweeii the rival Companies.

The corespondence alluded to in my foreging deiwsition is in the words following:—

Letter markkd " B."
( Confidential.)
Dear Sir, Toronto, July 17, 1871

I liave been thinking over the suggestion about the introduction of some of our
Canadian cajiitalists into the Canadian Pacific Railway Company, and thought it proper
to write to you for the jnirpose of having your views ujion the matter, and especially to
have the names you would suggest. Our American I'riends have no objection ; on the
contrary, they arc anxious to meet the reasonable views of yoursell or the Government
on that jioint. You will oblige, therefore, by naming such persons as you think proper
to have associated in the matter, either from personal or jiolitical considerations. Those
who have already done anything in the way of a formation of a company, or ..ith that
object in view, we would be specially glad to deal with. We have authority, to a certain

CANADIAN PACIFIC KAILWAY.

101

t it is quite correct!
laving any interest i:

idges of any kind o:

ken a copy, given yoi

md these I handed t

3r in consideration o:

ved a specific sum o:
terms. I received ik

II they ended ?
perhaps the beginniii;
middle of August.
ns which took placi
3r before the attemii;

t a strenuous attenip;

B was good ground t:

ong after, perhaps a;

renewed to effect ai

it that you are awari
the Government Act

is based on a policy
3er after the attemjit

The arrangement oi
about the latter omi
■ a Company of tliat

itness who desires to
page of his deijosi-

of any suggestion to
L' Government iicvvr
t was impossible ti

vords following :—

to, July i;, 1871.
tion of some of our
d thought it pnipcr
:r, and especially to
o objection ; on the
or the Government
s you think jiropcr
siderations. Those
ipany, or ,, ith that
hority, to a certain

extent, to distribute some shares in the concern, which if they would not be of any jjrofit, Canjlda.
would'iiot be any loss to the holdei-s, and no money is required. If you could make it
convenient to write by return mail, it would be convenient that we might consult with
one of the American gentlemen now here.

Yours truly,
Sir Francis Hincks, Ottawa, Ont. (Signed) JAMES BEATY, juu.

Lkttj:i{ makked "C."
[Co!ifide7itia/.)
pkarSir, Ottawa, -iOth July, 1871.

;,. I have been almost constantly confined to the house since I received your letter
of the seventeenth, and having at once sent you a telegram, that would enable you to
888«i'e your friends that no such arrangement ;is you suggested woidd be jiracticable, I
pqt ofi' writing until I could do so more satisfactorily. It strikes me that you i'ail to
appreciate tlie suggestion relative to Canadians being induced to interest themselves in
the projected railway to the Pacific. I am inclined to believe that some Americans oi'
capital and iiirtuence might be induced to take hold of the scheme, init in my judgment
they will find it expedient, if not al)solutely necessary, to associate themselves with
Canadians of equal j)osition and means, i)y whose instrumentality this very gigantic
scheme can l)e brought i'avoural)ly bcibre Britisii capitalists. Any scheme requiring
large aid I'rom Government will be viewed with great jealousy by the public. It is not
the business of the (Jovernment to name parties nor to suggest to anyone tliat they
would like jjarticular persons brought into a scheme. Tlie Government have to
consider ])ropositions Itrought before it on their merits, and v.ill be expected, I think,
to see that tlie Canadian promoters of any scheme are not only ablo, l)ut willing to put
money into it — a most indispensable condition, whieh you seem not to attacli any
importance to.

1 fear that you are going altogether too fast when you refer to an authority to distribute
shares in a Company whicli has not even been formed, and the projectors of wiiieh are
not yet in a position to take the most initiatory step. I inferred JVoin what I heard from
the American gentlemen who lately visited Ottawa, that they bad come under a complete
misaj)prelieiisic)ii of facts, and that they believed that Mr. Waddington and Mr. Keistcman
had bad some previous understanding witli the Government. You may rely on it that
one of the niain difficulties in the jn'csent scheme is, that Canada is, as it were, represented
by Mr. Kersteman chiefly, who is looked on by those with whom 1 have conversed, as a
" man of straw." It is clear that men of this type would only be taken hold of by
capitalists on the ground of their having infiueiice of some khui, for wliich they must be
paid, and if paid, the payment must come from the public chest eventually. The
American gentlemen who have means expect, and have a right to expect, a good contract,
but it is clear that if they have to subsidize Canadians, their demands will be higher.
J^ great mistake lias, I fear, been already made, and your letter induces me to think that
you conteinj)late proceeding further in n wrong direction. The first stej) will be for the
Government to determine what aid they will give in land and money, and things would
have gone much smoother if that had been decided before any ap])eal had been made to
capitalists on the other side. ^Vilcn terms have been agreed to, then the names to be
inserted in a Charter will become a matter of considi-ration and negotiation. Tiiis is the
V,iew which I take, but you will understand that 1 am merely giving you my own ideas
and without consultation. I know, however, that there is great anxiety tliat this work
Aould get into fi.st-rate hands.

i Yours faithfully,

(Signed) F. IIINCKS.

Liri'TKU MAUKKI) " D."

( Cvnftdential.)
l>KAi! Sir, Toronto, 'Jlfh July, 1871.

1 am much ol)liged to you for your last letter and tlie ol)servations you make
therein. I had a keen appreciation of the ])roprieties and necessities of the case when I
Understood the matter. You must notice, however, that I never saw Mr. Waddington
Vntil I met him on my way to Ottawa; and I believe I had only spoken to Mr. Kersteman
^boiit two or three times l)efore that Wednesday when I started for Ottawa ui)on a notice
lecei', d two hours before in tlie Court House that I was I'Xiiected to go. I learned
pretty nearly all 1 knew on my way down. I had jii^,t one conversation tliat amounted
to anything before T left, .vitli'Mr.K.

I then perceived that the whole matter was disoru:anized and required complete

102

CORRESPONDENCE RELATIVE TO THE

Canada, reconstruction as far as Canada was concerned, but I could not then back out. I was u|
to that point only introduced as a lawyer, and of course had to attend to my clients
behests. 1 could not do even wliat I thought prudent at Ottawa. The very suggestioni
made; pressed themselves upon my attention from the very beginning ; but how to arrangt
fheni and how to meet obstacles ol' the present ])osition I could not then determine
When I returned home witli the knowledge 1 liad made, I made up my mind both from
the standpoint oI' public polii:y and tlie legal standpoint, tliat no Senator or Member c
Parliament could be in the Comjtany, much less be on the Board as a Director. Thi
settled one question directly, at the same time it opened up new difficulties. The ficli;
is very limited lor selection when you exclude the Senators and Members of Parliament
and where to appeal was another grave question. Of course we do not now serious],
contemplate to have on the Board either Mr. VV. or Mr. K., although they have boll
done a kind of service that must be acknowledged. My own view was, and f think iti
or will be your view, that names must be lu-i'sented to the Canadian and general publii
that will at the least have the appearance of not only being willing but able to commaw
the money or cajiital necessary to built the road, and which will meet with the approvi
of Parliament. These names aie few and far between in Canada.

Taking the cue [ received, 1 at once upon my return entered into negotiation witi
Mr. LaidlaM', who 1 now am fully aware has been to some extent in communication witi
gentlemen in Montreal, such as Allan, Steplicn, and King, to the same end that wt; Iiavi
in view, altliougli nothing substantial has been done. TIu^ probaljilities are, I will u
with him to Montreal liefore the end cf a w I'ck or two on this subject. VVliat it niai
result in I cannot tell. It must not be imagined, liowever, that the present organizatio:
although immatured and incomplete, is to Ix; despised. I assure you that it is not either ii
this country or the United States. We do not mean to make any fuss al^out subsidizii);
Canadians. Canadians will be cpiite willing to come into any undertaking that thi
think .vill pay, and we do not intc\ul, whatever ma)' be the end, to go into anything el"'
We liave room for others, and mean to get them, and there are shares still open, and w
do not expect men to associate in an important v'nterprise ol'this sort without substantiii
inducements. They Mill not do it for amusement, that I have learned in my short lili
As to such men as W'addington and Kersteman, being representative men, it is not thougl;;
of. They will, however, jjut themselves forward, and no one that I know of can prevt'ir
them; but all that will, if it is not already, be satisfactorily arranged. There arc
few men to be thought of in this connection in Ontario, (izowski, Luidlaw, Manniii:
McOivern, and Adam ]5rown, of Hamilton, Wilson, of Picton, are presentable. The
in Quebec, Hugh Allan, Geo. Stei)hen, King, of Bank of Alontreal, and one or two mort
that some one else could name would be all that on first sight can lay claim to an;
notoriety or availal)ility in this direction. Many business men might be suggested boti
here and there if time permitted, but these are prominent, yet after all they are very fen
and of others jiow many would be ^villing to take stock with the Grand Trunk belort
their eyes. Even some of these names are not the most popular in railroiid connection
As the matter now stands, I am t]u> representative of the American gentlemen who arc
interesting themselves in the road. And except ibr the waywardness of Mr. W^addingtni
\vould be Ibe only medium of communication for the Canada gentlemen. I myself am
of the opinion thnt there is plenty of time before the surveys are com])lete or bel'ori
Parliament sits to consider all these questions ; still such a C'oni])any as will be necessai)
'or this purpose to aceonii)lish a work so extensive and inqiortant cannot lie arranged i:
a month even ; so time had iietter be taken by the I'orelock. There is no doubt vi'i;
crude notions have been entertained about this matter, but I think they are now prctt;
well dismissed. I am satisfied, however, unless the Government grants are very substantial
ivw will be inclined to engage in an enterprise of such magnitude.

I remain, yours very truly.
Sir Francis J lincks, Otta^ra, Ont. (Signed) .f AAUJS BllATY, jiiu,

Lkptki! :\r.\i!Ki:n "10."
{^CoiififlentiaJ ,)
My ueak Sm, Ottawa, 'i6th Julj-, 18/1.

I have received your letter of the '2 1th insi . I note that you had yourself arrivnl
at the conclusion, before coming to Ottawa, that " tlie whole nuittcr was disorgaiiiziii
"and required complete reconstruction." You mention your intention of proceeding with
Mr. Laidlaw to .Alontreal to see certain parties. Mr. Laidlaw is represented to be i
shrewd business man, and yet Irom your account he is about to see ])crsons regarding:'
scheme the advantages of which neither he nor you can have the slightest idea of; ai
least I certniuly am wholly ignorant :i1 Ibis moment what aid in land and money tiu'

CANADIAN PAOIPIf RAILWAY.

103

11 back out. I was m
attend to my client;
The very suggestion^
g ; but how to arranjt
[ not then dctermiiit
p my mind both froii
Senator or Member c
I as a Director. 1\,
difficulties. Tlie ficlt
i-mbers of Parliament
do not now serious]
liougli tliey have botl
' was, and I think it i
ian and general publi(
g but alilt' to commaiK
leet with the approvii

into negotiation \\\\'i
n coniminiiciition wit-
;ame end that W(! Iiav^
abilities are, I will j;
iubject. What it mm
(> present organizatioi;
u that it is not either ii
I'uss al^out subsidiziii:
mdertaking that the;
I go into anything eU.
arcs still open, and w
)rt without substantia
Lirned in my sliort liji
■ men, it is not thous,'!:;

I know ol' can prevt'ir
■ranged. Tliere arc

i, Luidhnv, Manniii:
■e presentable. The

and one or two mori
can lay claim to iiii;

ht be suggested bot!
all they are very I'eiv
> Grand Trunk belon

II railroad connection,
m gentlemen wlio mi
5S ol' Mr. Waddingtm;
lemen. I mysell' ;u!:
V com])lete or belbri
y as ^^•ill be necessan

•annot be arranged ii
lere is no doubt veiy
v they are now pntl)
ts are very substantial

Ii:S BKATY, jiiii,

1, 'J6th July, 1871.

liad yourself arrivnl
tor was disorganizi'ii
)n of proceeding witli

represented to be a
;) i)ersons regarding:'

slightest idea of; at
land and moncv tin'

Government will recommend to Parliament to grant.

How anyone under such circum-
Btances can look to men of business about being" concerned in a sclieme, I am at a loss to
comprehend, and T am persuaded that owing to Mr. Kersteman's premature and most
iniudicious proceedings, the greatest injury has been done to a great undertaking.
^ Ik'lieve me, truly yours,

James Beatyjun. ,..,-, v f"""V ^^ M T'^

And farther deponent saith not. and this his deposition having been read by him, he
d^lares it contains the truth, persists therein, and hatli signed,
jrn and taken in part on the i'ourtli of

Canada.

September, and taken in part on the
fifth September, eighteen hundred
and seventy-three, and acknowledged
on the sixth instant.

(Signed)

(Signed) F. IIINCKS.

CHARLES DEWEY DAY.

Chairman.
A. POLETTE,
JAMES ROBERT GOWAN,

Commissioners.

IN THE MATTER OF THE COMMISSION

111
to

the
th(,'

House oi'
Canadian

Province ok Ontario, ")
Citi/ of Ottawa. J

Appointing Cuaulks Dkwkv Day, A.vtotxe Polettk, and Ja.mes Rohert Gowan, Com-
missioners to inquire into and report upon the several matter's stated in a
certain Resolution moved by tin; Hon. Mr. Huntinoton
Commons on the second day of April, a.o. 187'^, relating
Pacific Railway.
Present : The Commtssioxehs.

On this fourth day of Sejitember, in \\\c year of our Lord one tliousand eight hniuh-ed
and seventy-tlirec, personally came and appeared belbrc us, the above-named Com-
missioners,

ANDREW ALLAN, of the City of Montreal, who being duly sworn, deposeth and
saith :
I know Mr. McMullen by sight, but I have never siiokeii to bim. I have heard the
charge read, and I have no knowledge of any such agreemenl as mentioned in it having
Ibeen made by Sir Hugh Allan and Air. McMullen as representing certain American
capitalists. 1 have no knowledge of the subject at all. I liave no knowledge that any
(igreemeiit was ever made of the kind between Sir Iliigli Allan and (1. A\'. McMullen
relating to the furnishing of funds necessary J'or the construction of the Pacific Railway,
tSeorge W. McMullen acting for certain Ignited States caj)italists.

Q. — Have you any knowledge nlating to this matter of the Pacific Raihvay and the
Miarges that liavc been read to you ?
' A. — I have no knowledge of any kind relating to tlie matter.

Q. — Have you any knowledge that any money was advanced by Sir Hugh Allan to
promote tlie elections ?
., A. — I liave not.

I know nothing personally of f lie matter at all. The only thing I know is from wiiat
Ihave learned from reading the newspa]iers.
■ I am a brother of Sir Hugh Allan, and liis partner in business.
, Q.. — By Sir John A. Macdonald through the Chairman —
' Have you lieen in the habit of discussing these matters with your brother?
• A. — 1 was not. Wo never spoke about it at all until these matters were published in
0le newspajjcrs.

And further deponent saith not, and this his deposition having been read by him, he
declares that it contains the truth, persists tlicrein, and hath signed.

Sworn and taken on the fourth -J.ay of September,~i

and acknowledged on the eleventii of Septem- > (Signed) ANDREW ALLAN.
ber, eighteen hnnilred and sevent\ -three )

(Signed) CIIAKLFS DEWEY DAY,

Chairman.
A. rOLETTi:,
, . JAMES ROBERT GOWAN,

Cominissioners,

(■"an.'.iia.

■IB

lOi

('()1{H^:^;P()NI)^]N(U<: HKLATINK 'IT) THK

Proa'ixck ok Ontaiho,")
Cit)/ of Ottawa. J

IN THE MATTER OF THE COMMISSION

Apiwintinp; Ciiaulks Dkwioy Day, Axtoink Pom-ttk, and Ja:mi:s lionKirr (ioAv.w
Commissioners to inqniro into and rcjjort \\\m\\ tlic several matters stated in a
certain Resolution moved by the lion. Mr. JIiNTi.N(iroN in the House a:
Commons on the second day ol' Ai)ril, a.d. 1873, relating to the Canadiaii
Paeifie Railway.

Present: The Comaiispioxki:?.

On tliis fourth day of Se])teml)er, in the year ol" our Lord one thousand eight hundM
and seventy-three, jiersonally came and apjjcared before us, tlie aliovc-named Commi-
sioners,

E. L. dp: BELLEFEUILLP; of tlie City of Montreal, Advocate, who being duly sworn
deposeth and saith :

I have heard the charge read.

Q. — Have you any Ivuowledge of an agreement between Sir Hugh Allan and Air
Mc.MuUen, acting I'or certain American capitalists, witli a view to I'urnishing funds In
tlie Americans, i'or the l)uilding of the Pacific Railway?

A.- — I have none. Not the least.

Q. — Have you any Icnowledge of any negotiations whatever between Sir Hugh Allai;
and Mr. McMuUen ?

.1. — I know nothing personally, except what appeared in the pul)lic newspapers.

I knew nothing of it before it ai)peared in the puljlic prints.

Q. — Did you take a part in the late elections ol' last summer 'i

A, — I did in some counties, but not in Montreal East.

Q. — Are you aware that any sums of money were su])plied from any source whatever
for the purpose of carrying on the elections in Lower Canada?

.1. — 1 know that Sir Hugh Allan did advance some money I'or the elections, but doii'i
know what amount. Tliat advance was made some time in August I think.

(I. — To whom was the money paid '(

The witness oljjects to W\\< question, inasmuch as he does not see any relation between
the question and the accusal ion which the Commission is instructed to inquire into.

Objection over- ruled.

A, — I know of only one sum ol' money which was paid, and only one person ^vli
received money, namely — Louis Beaubien. of llochelaga. It was paid to him lor tli'
purposes of his election.

(^.— Do J ou kno\v of any money that was paid for the promotion of Sir Gcor,
Cartier's ehiction '?

A. — I do not know it personally, but I was not a member of the Committee of Si,
George Cartier.

Q. — Do you know what amount was advanced to Mr. Louis Beaubien for liis election

A. — He got a cheque for seven thousand dollars from Sir Hugh Allan. I have n(
personal knowledge of any further sums being advanced by Sir Hugh Allan. This siiii;
advanced to Louis Beaubien was made in September, I think, and I can now remember
that he was paid this amount after he was elected. I am positive of that now.

Q. — Why was it given to him then ?

A. — To i)ay the expenses made in his election, and I now well remember Mr. Beaubien
gave his note for it. I think he had to refund it. I don't know what delay he would
have given him to jiay it.

I could not say i'rom what source this money was derived, I only saw the cheque of
Sir Hugh Allan. I don't know where the money came from.

Q. — Have you any knowledge whether this money was advanced at the request of any
member of tlfe Govermnent 't

A. — No ; I think that 1 was the first person and only one to ask Sir Hugh Allan to
assist Mr. Beaubien.

Q. — Have you any documents in your possession which would throw light on tlie
subject of the inquiry before the Commission 'i

A. — I don't see that I have. I was acting as Secretary of the Canada Pacific Railway.
and the documents I have are docunients regularly filed.

A good deal of correspondence took place between the Canada Pacific Company and
the Interoceanic Company in 1872, which is in my possession as guardian. They niay
have some bearing on the accusation in relation to its first part as regards its connection

CANADUN ]»A(!JFr(' IIAILWAV.

105

;OMMISSION

Mi:.'^ HoitKIl'l' (»OWA\,

il iriiitters stated in j
ns ill the House ol
ing to tlic Canadian

ousand eiglit hundred
Ijovc-iiamed Comnii-

ho lieing duly sw

nrii

llugli Allan and Mr
) i'urnisliing I'unds hi

iVecn Sir Hugh Alia
blic newspapers.

any source whatev(i

le elections, but doii':
, I think.

any relation between
to inquire into.

)nly one person wK
paid to him lor th'

otion of Sir (Teor,

he Committee of Si.

lien for liis election
1 Allan. I have iii'
;h Allan. This sum
I can now remember
' that now.

ember Mr. Beaubicii
vhat delay he would

y saw the cheque of

\t the request of any

L Sir Hugh Allan U

throw light on tlu"

ada Pacific Hail way.

'acific Company ami
lardiati. They may
gards its connection

trfth the Americans. Hut so far as the Pacific Hallway Company is concerned, I deny
most positively any such coiniection.

I have not got the said correspondence with me, but all the documents contained in it
must be in the hands of the Government and have been laid before Parliament.

To Mr. Abbott, through the Chairman.
' I was Secretary of the Canada Pacific, of which Comjjany Sir Hugh Allan Avas Presi-
dent^ and under the instruction of the President and the Board, I published an advertise-
ment in the newspapers in all the principal towns in the Dominion stating that stock
hotks had been opened and anybody who wished to subscribe could go to such places
ao^ do so. The jjublic were invited to subscril)e for whatever amounts they would
(iiiire to take in the stock of the Canada Pacific Company. That was during the summer
orl872. I was named Secretary in June. I attended to that business in July, 1872.
These books \vere opened in the towns of the difl'erent Provinces of the Dominion. The
advertisement was published and the books were sent liy me, and they remained there
for I think thirty days to enable any person desirous of subscribing in them to do so
within the delay mentioned.

The books were returned to me with a certificate of the agents, stating if shares had
been subscribed and to what amount.

The whole stock was thrown open to the public. There was no reservation of the
stock. Sir Hugh Allan is President of the Montreal Northern Colonization Kailway
Company, and Mr. Louis Beaubicn is its Vice-President; and I know that for two and
a-half or three years they were very intimately connected in order to ensure the success oi"
that railway ; and it may be, so far as I know, in consequence or in consideration oi' the
friendship existing and such relations between them — Mr. Beaubien and Sir Hugh— that
Sir Hugh made this loan of money to help ^Ir. Beaubien in his election of IHJ-J. \\'heii
I asked the money from Sir Hugh Allan, I did not in the least mention any interests of
Sir Hugh Allan or Mr. Beaubien in the Pacific Railway. I only considered Sir Hugh
as a friend of ^Ir. Beaubien, and I thought that, like some others of his friends. Sir Hugh
Allan would help Mr. Beaubien in the election he had made, and which was then
comi)leted.

I have no papers on this matter except those which came into my hands as St;cretary,
except a few letters that can have no bearing on this subject at all.

I have had no correspondence whatever with the Americans.

And further deponent saith not, and this his deposition having been read to him, he
declarers that it contains the truth, persists therein, and hath signed.
Sworn and taken liefore me on the fourth of
September, and acknowledged on the
ninth of September, one thousand
eight hundred and seventy-three.

CvN.inA,

(Signed) E. LEF. DE BELLEFEUILrj],

(Signed) CHARLES DEWEY DAY,

Chairman.
A POLETTE
JAMES ROBERT GOWAN.

Commissioners.

IN THE MATTER OF THE COMMISSION

^oviNTE OF Ontario, ")
^ , ^% ¥ Ottawa. }

4|pointing Charles Dkwky Day, Antoine Poijoite, and James Rokert Gowax, Com-
;■ mis; loners to inquire into and report upon the several matters stated in a certain
^ ' Resolution moved by the Hon. Mr. Hixtinotox in the House of Commons on
the second day of April, A.n. 1873, relating to the Canadian Pacific Railway.
Present : The CoMJtifcsiovERa.

On this fifth day of September, in the year of our Lord one thousand ei<>-ht
hundred and seventy-three, personally -ime and ajijieared before us, the above-named
Commi.ssioners,

VICTOR HUDON, Esquire, of the Citv of IMontreal, Merchant, who being duly sworn
deposeth and saith : " o j ,

I know Sir Hugh Allan. I do not know Mr. MeMullcn.
a w VrA/n**"'"^^ knowledge of any arrangement between Sir Hugh Allan and
U^ >v. McMuUen, having for object the construction of the Canadian Pacific

106

rOTfT^EPPONDENCE RETiATTVE TO THE

Canada. I took some interest in the elertions in Montreal in 1 8"2. I was one of the mclnl((>^
of Sir (ijor,u,e Carlier's Committi'e I'or ^Monti'oal Kast.

I am aware that t.liere were sums oi' money snbscribed to earry on tliat election
Ordinarily in elections we have a Committee and I'riends who sul)ser:be. I do not kiimi
the names of the persons wlut snbscribed at tliis election. I heard that Sir Hugh Alk
was to sul)seribe. 1 do not know how much he did sui)scribe. I know some of t[,.
members of the Committee ; I think all of them snl)scriijed something. A short tim*
hel'ore the election I learned that Sir Hugh Allan had subserilied.

Sir Hugh Allan was not a member of tlie Committee. I do not know the amouii'
subscribed by Sir Ilugli Allan, nor l)y any other members of the ('ommittce.

I liavo no knowledge of anyone having subscribed $2(i,()()() during the elections. I
liave not in my jiossession any letter or document bearing uixni this inquiry.

r have knowledge of tlie subject of this inquiry only by v*liat 1 have seen in the news.
pajKM's, I have no personal knoAvledge on the sul)ject. I have stated all [ know in relb
encc to the sums of money sui)scribed for the elections.

And further the deponent saith not, and this his deposition having been read to liim,
lie declares it contains the truth, persists therein, and hath siji;ned.

Sworn, taken and acknowledged on tht
fifth of September, 187.'!.

(Signed)

V. IIUDON.

(Signed)

CHARLES DEWEY DAY,

Chairman.
A POIjI']TTE

JAMES ROBERT (JO WAN,
Commissioners.

IN THE MATTER OF THE COMMISSION

Province ov Oxtario,
City of Ottaira.

Appointing Ciiarler DiiAVEv Day, Antoink Polkttk, and .Tames Roukut Goavax, Cora
missioncrs to inquire into and report upon the several matters stated in a eertaii
Resolution moved l)y the Hoy. Mr. Hi'.vtimiton- in the House of Commons ni
the second day of ^Vpril, A.n. IH/li, relating to tlie Caiuidian Pacific Railway.

Present: Tin: Coifmissioxers.

On this sixth day of Sej)tember, in the year of our Lord one thousand eiglr

hundred and seventy-three, personally came and ajipcared before us, the above-namti

Coniniissioners,

LOUIS BEAUBIEN, of the City of Montreal, a Member of the Honourable The llou-r
of (Jommous of Canada, who being duly sworn, deposeth and saitli :

I inn a member ol' the House of Commons. I am Vice-President of the Montreal
Northern Colonization Railway. I hold no situation or directorship in the Canadiai:
Pacific Railway. [ have heard read the charges which the Commission has hm.
appointed to inquire into.

I know Sir Hugh Allan, and have met Mr. McMulIen.

Q. —Are you aware of any agreement or negotiation beii g made between Sir Hugk
Allan and ]\Ir. jNIcMullen relating to the matter expr(:ssea in these charges ?

A. — I am not aware of any.

Q. — Do you know of any agreement made by Sir Hugh Allan with Mr. MeMulleii
acting jbr United States capitalists to furnish funds necessary for the construction of tlif
Pacific Railway ?

A. — No, I have no knowledge of any such transaction. I was one of the Provisional
Dii'eetors of the Canada Pacific Company, but I only joined whtni these things ap
supposed to have taken place, and have no knowledge of them whatever.

Q. — Was your connection with the Canada Pacific Railway Company subsequent to
the period referred to and before the legislation of last Session ?

A. — My name was included among the Provisional Directors when that Company was
incorporated, that was the first time I Avas connected with it.

The period I refer to was the Ses..ion before the last. I was not a member of tlif
Dominion Parliament then.

(>. — Arc! you aware of par*^ies who were expected to take up the stock of the Cniuuia
Pacific Com:/any ?

A. — No, 1 was not aware.

Q. — Do you know whether any American capitalists were expected to furnish monVv
for the purposes of the railway ?

CANADIAN PACIFIC RAILWAY.

107

s Olio of tlip mcmlwr

rry on tliat i'lection

'v'-.bv. r do not kno«

that 8ir Hugh Alk

I know somo ol' tlj.

'thing. A short tinif

ot know the amouir

ammittce.

ring tlie eltrtions. I

I inr[uiiy.

lavo sctMi in the now;.

(I all [ know in refer^

ing been read to him,

. nUDON.

VEY DAY,

Cliairman.

:t gowan.

Commissioners.

OMMISSION

lOlIKRl' GOWAN, Com
M's stated in a ccrtaii
[ouse of Commons oi
Pacific Railway.

one tliousand ciglr
us, the above-namei

inourable 'J'he IIouh

saith :

nt of the INIontm!
lip in the Caiiadiai:
Jinniission has hwr.

between Sir Hiigti
•liai'ges ?

with Mr. McMulleii
construction oi" tlif

e ol' the Provisional

t;n these things a^

ever.

iipany subsequent to

that Company was

t a member of tlif

;tock of the Cniiada

I to furnish moiicv

A. — No, I do not. ,.

Q. -Have you ever, or had you at that time seen any list made out by teir Hugh
Allan as to the distribution of stock ?

4.— No, I had not. „ , .• .

Q Do I understand you to say positively that you know nothing at all nMatiug to

this matter oxjiressed in the first clause of the charge which you have just heard read

to jou ?

3l._Nothing at all. .

■jQ I see your name signed to a .Memorandum ol' the Canada 1 acinc Kailway

O^pany, upon a statement sulmiitted by the Interoceaiiic Kailway Company to the
QOvcrnment of Canada, along with the names of Sir Hugh AUcin and J. J. C. Al)bott.
'^lerc vou a party to a Memorandum ol' il> it kind';'
'4li/l.— I ivas. It is signed " Hugh Allan," " .1. J. ('. Abbott," " l.ouis Beaubien."

Q. — Had you any knowledge of any negotiations concerning the amalgamation of these
fifo Companies'!'

' J. —AH 1 know is what is contained in the Blue Book, entitled, ''Charter for the
"construction of the Pacific Kailway, with papers and corrcsiiondence." That is all the
proposal that I ever heard was made.
-1" Q. — Did you take any personal part in any of the negotiations':'

A.- I signed all these documents after being named by tiic Company on its Committee,
which was termed the Executive Committee.

Q. -Do I understand you to say that you signed tliis (iocunieiit,_ and took an active
part in the negotiations which took jdace between the Canada Pacific Company and the
Interoceaiiic Company '.'

A. — I took all the jiart referred to by these documents.

Q. — Had you any interviews on the suVgect of the amalgamation?

A. — No; I had none that I remember of.
' Q-— Have you any knowledge of tiie agreement or understanding described in the
charge between the persons connected with the railway and tlie Government ?

A. — None.
' Q. — Have you any knowledge ol' any money having b^ou advanced in any persons
Connected with the railway in (Quebec, for the promotion of the eiectious ?

A.- A have reason to believe that Sir Hugh Allan advanced a certain amount of money
to be used in the elections.

Q. — What amount':'

A. — I cannot say.

Q. — Was it a large sum '!
„ A. — 1 have no means whatever of judging.

Q. — Do yon know of any specific case in which money was advanced by Sir Hugh
aS.llan, for the purpose of aiding tlu; election of Ministers and their supporters at the
Aen ensuing elections ':'

, A. — Not Ministers. I may mention this fact, a friend of mine and a supiiorter of the
Crovernment, some time before the elections wanted rnc to get up subscriptions for his
election, to a small amount. I went to ."^ir Hugh Allan, and lie conseatcd to help that
gentleman. The (government never knew of it, and the Government don't know (jf it
now at this present moment. As this was a private matter between Sir Hugh Allan and
ifcat gentleman — for I state under oath that the (Jovernmeiit know nothing about it — I
Would not like to give the name of the geu'deman. The amount he received was one
thousand dollars. The gentleman who advanced the money was Sir Hugh Allan.
' In my own case, Sir Hugh Allan was called upon by one of my friends about three
ll^eeks after my election. My election took place on the oOth of August, and the money
i'am going to mention was obtained aliout the middle of September. My friends called

poll Sir Hugh Allan, and told him that my expenses had been a little heavy, and asked
Sm to advance money to hidp me in paying back the expenses of the election, which
Were borne by myself. He consented to do so, 1 received the money and gave him a
Mceipt for it. In that receipt it is not stated that the Government would reinil)urse Sir
Hugh lor the amount of it. I could not find a copy of that receipt, but I saw it a
anoiitli ago when it was mentioned in McMuUen's letter. This morning I was taking it
down as Mell as I could remember in my memorandum hook. If there is any change in
flie wording of the receipt, 1 can swear it is not a material change.

The receijit is as follows : —
; " Kcceivcd fnmi Sir Hugh Allan the sum of seven thousand doUar.s, which I agree to
repay him within one \ear, if he be not sooner reimbursed, along with other sums
advanced by him in aid of the elections."

Cahaoa.

'^^s

108

CORRESPONDENCE RELATIVE TO THE

0ak4t)a. This n()t(! is duo now. The amount ol' tho note was obtained at the solicitation of u;

friend. The Government never knew of this arranp;emcnt at all.

I will correct this answer in so far as I have reason to believe that Sir Ihigli Allj
sul)scribcd money to the Central t^ommittee Fund of Montreal, and I was informed th;
Sir Hugh Allan stipulated that, if necessary, 1 would be helped out of the fund,
understood, also, that Sir George Etieiuio Cartier was opjjosed to any of the funds lieic,
u.sed for that purpose; hut I heliive that gentlemen on the Committee, notwithstaiidi;,.
this, gave without Sir George's knowledge some money to my friends. 1 will state, al-.
that I know that Sir Hugh Allan ludped two candidates who were believed to i.
friendly to the Administration. As the (Government did not know that they wtr
assisted, and as neither of them are members of the House, and it being a private niiitit
between them and Sir Hugh, I did not think it necessary to mention it on Saturdnyi
my deposition. I don't think it fair to these two gentlemen to bring their names bclii;
the pul)lic.

I don't know of any ot'lier sum advanced by Sir Hugh Allan, or by any other pei*
on his behalf. I could not say how mucli was subscribed for the Montreal elections; l^
1 think there was a list passed round, and subscriptions asked from dill'erent gentlemun

I don't know anything i'urther that took i>lace. Sir George E. Carticr's Commifo
was rather against me. I was not on the; Committee; but my ojjponent, Mr. Hudon.u;
President of it, which was suiruient to keep me off.

(2. — Did you aj)ply to Sir Hugh Allan yourself to aid you in the payment of yu;
election expenses ?

.1. — I suppose 1 must have said a word for myself at that time.

(2.— Did you expect before, or at the time of your election, that this money was to!,
forthcoming Irom Sir Hugh Allan '.''

A. — No, I expected to Ik; elected by acclamation and, if it had not been for fi'
George Cartier, I would have been elected by acclamation.

Q.—Why did you apply to Sir Hugh Allan for this money instead of some ollu;
wealthy gentlemen ?

.4.— Sir Hugh Allan was the person more likely than anybody else.

Q. — Had you been in particular relations or in business relation with Sir Hugh AUaii

A. — I was considered as one of tlie most active parties in the railway, and have been;
Director in it from the very beginning, and was one of those who assisted to induce !<l
Hugh Allan to come into that Company, and since then I have been in very close relatior.
with biiU. When I speak above of the railway, I mean the Montreal Nortlur
Colonization Railway. Sir Hugh Allan is President of that road, and I have been Viif
President of it ever since the ijcginning.

To Sir John A. Macdonald.

Q. — Was Mr. Victor Hudon the Government candidate for the county of Hochelaga

A. — If being Sir George Carticr's candidate was being the Government candidatf
certainly he was the Government candidate. I don't say Sir George was opposed to iii.
election at the latter end, but if Mr. Victor Hudon came forward at all, it was due toll:
encouragement that Sir George gave him, and I learned that Sir George Cartier advisi.
his friends to vote for Mr. Hudon.

I know that the gentlemen in the office of Sir George Cartier voted for Mr. Hudon.

I made the application for the loan above referred to, to hel]) me to pay the expcnsi
of my election. I did not ask for this loan as a friend of the Government, but simpl;
on account of Sir Hugh Allan being a friend of mine. It was Mr. E. L. De Bellefeuill
that got the loan for me.

That sum had never been promised to me hel'ore, and I had never e.x.pectcd to get tlia
loan.

Q. — Had Sir George Cartier any knowledgt; or intimation that you were going to asl
for that money hel'ore you got it'/

^'1. — No ; I sui)pose when I got it he knew. I suppose Sir Hugh Allan likely told liini
afterwards, but Sir George may not have known anything about it.

And further, for the present, the deponent saith not.

And on this eighth day of September, IS7'\ the said witness reappeared and made
the following alterations and additions to the foregoing deposition, namely : I wish to
remove the words in a former \)i\vt of my deposition, " so I also went to dill'erent friends.

I have been reminded this morning that Mr. Victor Hudon was not President of fir
George E. Cartier's Election Committe, as stated Ijy me in my dei)osition.

I gave the receipt referred to by me to Sir Hugh Allan. 1 gave it to him in the city
of Montreal. I think it was in his own office.

In my evidence I stated that I saw the receipt al)out a month ago. I never saw tht

the solicitation of m

that Sir Hugh Alli
(I I was inlbnncd th;
1 out of the I'uiid.
iiy ol' tiio I'uiids hfi]^
ittcc. iiiitwithstaiidi;
(Is. 1 will state, ak
were believed to i,
now that they wit
jciiifT a private nmti,
ion it on Saturday i
ng their names beili;

I)y any other ])i'i'so,
ontreal elections ; 1,.

(lillerent_ gentlemen
. Carticr's Commitii
nent, Mr. Iliidon, u,

;he i)ayment ol' yos

this money was to !.
lad not been lor S;
istead ol" some olh.;

■iC.

ith Sir Hugh AUuii
vay, and have been;
jsisted to induce Sl
n very close relatini:

Montreal Nortlur
lid I have been Viir

)unty of IIoch(>lag3
vernment candidiitf
3 was opposed to in.
all, it was due tott
orge Cartier advisi.

m1 for Mr. Hudoii.
to pay the expensi
.u'ument, but simpl;
;. L. De Bellefeuili

expected to get tlia:

u were going to asi

llan likely told him

ippeared and made

namely : I wish to

o diilbrent friend?.

ot President of Jir

tion.

t to him in the city

K I never saw tin

(UNADIAN PACIFIC PAILWAY.

109

original of the receipt since I gave it. It was not the receipt tlial was signed that I kejit,
it was the /iroject or draft whicjj was not signed, as there were some corrections to be
made in the draft. I made a co])y of it, and signed this co])y and delivered it to Sir
Hugh Allan. I have never seen the receijjt I signed since I delivered it to Sir Hugh.
I aaw the draft tliat I kept the next day alter iNIr. McMullen's letter a|)peare(l in tlie
papers. I think I can fnid it. The receijjt was not written in Sir Hugh Allan's ollice.
It was written in Mr. Abl)ott"s ollice. It was written on ordinasy ioolscap paper. For
all I can say, that document is in the possession of Sir Hugh Allan at present.
I consider that receipt to be a note. I think I can produce the drafts.
rjQ, — You say that in this receipt which you have given from memory, "that unless the
**noney was otherwise reimbureed," what do you mean by these; terms'/ from whom was
it topected to be reimbursed ?

t^.' — I have no means at all of knowing where he expected to be refunded,
,i(k2. — In making use of this expression from what source did you think this reimbursc-
wkiit to come ?

A. — I had no idea at all, and my opinion is that Sir Hugh Allan himself did not know
irilere it would come from. Many a time he said that he did not know that he would be
otlierwisc reimbursed. Sir Ilugli told me that all the money he was giving in sui»port
of the elections he thought would be a dead loss to him. I suppose he exi)ected to be
reimbursed from the profits of the enterprise.

Q. — What meaning did you attach to the word "reimbursed" in that respect?
A. — I expected that the friends of the Government would subscribe and would
help me.

Q. — Was there any funds provided ?

A. — There was a general election fund that had been established.
I had not in my mind then any supposed arrangement between the Government and
Sir Hugh Allan. I never knew of any arrangement whatever, and Sir Hugh Allan never
told me that there Mas.

The Commission desires the witness to preserve the draft of the receipt referred to if
he can find it, and enjoins him also in that event to forward it to the Commission.

I wish to strike out the following words from my foregoing deposition : " Many a time
** he said that he did not know that he would bo otherwise reimbursed." — Sir Hugh
told me several times that all the money he was giving in support ol' the elections he
thought would be a dead loss to him.

And further deponent saith not, and this deposition having been read by him, he
declares that it contains the truth, persists therein, and hath signed.
Sworn and taken in part on the sixth of September,
IM?,'!, and remainder taken and the whole

acknowledged before us this eighlli day of

(Signed) LOUIS BEAUBIEN.

September of said year

(Signed)

CHARLES DEWEY DAY,

Chairman.
A. POLETTE
JAMES ROBERT GOWAN,

Commissioners.

"' I IN THE MATTER OF THE COMMISSION

iiPROVIXCE OF OnTATITO,

I C//// of Ottaica.

Appointing Chaklks Drwkv Dav, Axtoine Polettk, and James Robert Gowax, Com-
missioners to inquire into and rejjort upon the several matters stated in a certain
Resolution moved by the Hon. Mr. HivrixoTox in the House of Commons on
the second day of April, a.o. 1873, relating to the Canadian Pacific Railway.

||resent: The Coj[mippioneus.

g On this sixth day of September, in the year of our Lord one thousand eight hnnd ed

>mxA seventy-three, personally came and appeared before us, the al)ove-named Com-
missioners,

lORMAN WILLIAM BETHUNE of the City of Ottawa, Telegraph Manager, who
benig duly sworn, deposeth and saith :
4 I resixle in Ottawa. I am a manager of the Montreal Telegraph Compan\ .
p C2.— Have you in your possession the original of the telegram dated at Toronto
August 20th, 1872 addressed to the Honourable J. J. C. Abbott, Ste. Annes, and signed
yohn A. Macdonald ?

Canada.

rOR|{R^PONDKN('K HKLATIVE TO THK

Caii^i. _|._i i,n,x' not.

<l. — IFiivc yi)ii tliP ori'j;iii;il ol" a tclou;rani datccl Montreal, 2()th August, 1S72, directtii
to Sir .loliii A. Manloiiald at Toronto, ami sii;iif(l J.. I. (). A'il);)tt?

A. — I liavu not.

Q. — Have you in your possession any tclcj^rani tfifincfl liy oitlit-r ol' tlirsc; parties, Si
John A. IMacdonalil. or Hon. .1. .F. ('. Ai)iiott, between tlie first ol" August and llio emi.)i
tliat nu)iitli ?

.1. — None tliat I am aware of.

^2- — Have you searehed lor anytFiintj; of the kind?

A, — I have not innde search, but I caused the books of the ('om])any to l)e examine,
hy the clerks, and they found no messaucs between Sir .h)Ini A. NLicdonald and ^r
llu'j,h Allan or Mr. .1. .1. C!. Abbott, from the Inst to the thirty-lirst of Aui^ust.

The (Jommissiouers desire to have fuller information on the subject, and will requir-
you to examine the books of the Company a month further back and a month afterward,
and would desire that you sliould examine them yourself, that you may be able to stiiti
under oath whether there are any such niessaj;es. and what they are.

..1. — All original messages jirevious to the first of August, 1S7'2, are not now in exisv
ence, the rule of the Company was that messages should be kej)t for one year and tin;.
destroyed. The ])resent rule is that messages shall be kept for six months and thti.
<lestroyed. I thiidv it i)roI)able that none of those messages are now in existence, us it i.
the rule of the Company to have them destroyed.

Q, — In whose hands would messages be in 'I'oronto and Montreal ?

.1. — In Toronto they would be in Mr. Harvey 1*. Dwight's hands, in Montreal ttii)
Mould be iu Mr. .lames Daker's hands. It is impossilde to produce the originals of am
telegrams ])assiMg through the Ottawa olFice anterior to the first August, 1872, but Wt
have an entry of these telegrams in the books.

Q. — Can you not examim! the books a month previous to August and a moutli
id'terwards ?

A. — Cijrtaiuly.

The books oi' the Comjjaey contain no copies of telegrams, hut only a copy of the
address and signature of ])ari>es.

And further, for the present, deponent saith not ;

And on this eighth day of September, reappeared the said witness and continued hi<
deposition as iollows : -

<2. — Have you examined the books of the Telegraph Company in your office?

.1. — I have found it imi)os:;ible to examine them in the period allotted to me. I finj
further by the books that Sir .lohn A. Macdonald was absent from Otttiwa for a largo
portion of the time named \vithin which the telegrams referred to are said to hav

I have examined the books from first .hdy up to si.xth July and for the whole monti;
of September.

Q. — Have the books been examined for the month of August ?

A. — ^They have been examined hy my clerks, and I find that Sir iTohn A. Macdonali
was not in Ottawa during the month of August, and therefore no telegrams could havt
been left in the Ottawa office as being sent or received by him during that time.

(2. — Have you any original telegrams in your office received during August or July,
18/2, between Sir John A. Macdonald and Mr. Abbott?

A. — No; I have no such originals in my possession.

And iurther (lei)onent saith not, and this his dej)osition being read to him, he dcclam
it contains the truth, persists therein, and hath signed.

Sworn and taken in part on the sixth day of \
September, IS73, and remainder
taken on the eighth day of Sejjtember,
and the whole acknowledged on the
ninth ol' September of said year.

(Signed)

(Signed) N. ^V. BETHUNE.

CHARLES DEWEY DAY,

Chairman.
A. POLETTE,
JAMES ROBERT GOWAN,

Commissioners.

CANADIAN I'ACIFIC RAILWAY.

Ill

ii'3;iist, 1872, (lircctt,;

• of tlu'S(! jjartics, ,Si
lUgust, and I In; iii(l„i

\y,xny to be exiimiiie.;
, Macdonald ami Si>
ol' August,
cot, and will rtHjuir
1 a month al'terwiud,
may be able to stai.

are not now in exist-

II" one year and tin;

six months and thn

in existence, as it !•

ds, in Montreal tlu;
the originals ol' aw
UigUHt, 1872, but Wf

ugust and a moiitli

only a ropy of the

ss and continued hi:

your office ?
otted to me. I fiiiii
Ottawa for a laij,'e
o are said to Iiav^

3r the whole montl;

John A. Macdonali
egrams could have

that time.
ing August or July,

to him, lie declan'i

\. BETHUNE.

EY DAY,

Chairman.

' GOWAN,
Commissioners,

pBoviNn; OK Ontaiuo,')
Citi/ of Ottawa. J

(ANAPA.

IN THE MATTER OF THE COMMISSION

ADPointin-' Cihhi.kh Dkwky Day, Antoim: roi.Krn;, an<l .I\mi;s IJoiikkt (iow.w, Coni-
misssioners to inquire into and report iiiion the several matters stated in a certain
Kcsolution moved by the Hon. Mr. Hi ntin(ito\ in the Houm' of Commons on the
• second day of April, .\.i). iHT.i, relating to the Canadian Paeifie Haihvay.
Pipsent: Tni: Commissionkh.m.

fin the sixth day of Septemljcr, in the year of our Lord one tho\isand eight
kipdred and seventy-three, personally came and appeared bel'ore us, the above-named
JSmniissioners,

The Honourable DAVID L. MACIMIEHSON, of the City of Toronto. Senator, who
beini; dulv sworn, deposeth and saith :

I am aniuaiiitwl with Sir Hugh Allan : I know .Mr. MeMulleii only slightly. 1 have
heard a portion of the Commission read embodying the charges which the ( 'ommissioni;rs
«c enjoined to inquire into.

., <^.-l-Are you aware of any agreement or negotiations having rel'erence to the formation
of a Comitany of the character of that mentioned in the extract which hasjusl been read
to you ; if you have will you jdease to state your knowledge of it?

A.— I have no personal knowledge of aiiy agreement being concluded such as is
described therein.

Q. — Have you any knowledge of any such negotiaticn ?

yl.— Sir Hugh Allan told me himself in February, isT'J, that he was n(«gotiating with
Americans with the objirt of having them take an interest in the (Canadian I'acilic Hail-
Way. The date of this was towards the end of February, I.S72. I received a letter
dated 'i7th Feln-uary. 1872, from Sir Hugh Allan, and rei)lied on the 29th ; these letters
have been published, and perhaps the easiest way would be to refer to them. In a letter
dated 8th .July, 1^7,!, and published, 1 give the'subt^tance of the conwirsation which Sir
Hugh Allan liad with me, and also tlie letters which ])ass(d afterwards between us.

The witness read a letter before the Commission embodying the evidence of his know-
ledge of the matters referred to in the extract of the charge which has been read 1o him.
This letter contains a true statement of the facts therein decLired. It is dated July Sth,
187.'J, and is as follows :—

THE PACIFIC UAILAVAY NEGOTIATIONS.

SK.VATOIl MACIMIKHSON'S STATIO.MIiNT.

To the Editor of f/<c' Mail:

SiK, — Sir Hugh Allan having admitted the genuineness of the lettei-s published
*ver his name in the ' (ilobe' and ' Montreal Herald' of Friday last, 1 ask the favour of s])ae«!
in your columns to correct misrepresentations ail'eeting myself contained in some of these
fetters.

Sir Hugh Allan, in his letter to Mr. C. M. Smith, of Chicago, dated Toronto, 21th
February, li-<72, the day after his last interview with me, purporting to be a statement of
what had paseed between us, says :--"He (iMr. Mae])herson) has been aii])li(*d to by our
*' oi)poneMts, and uses that as a lever by whiih to obtain better terms fnmi us. He insists
*♦ on getting !r2r)(),U()0 of stock, and threiiteiis()])iH)sition if he does not get it." Eveiy one
jfl' these allegations is absolutely without loundation.

'■.: I had not been " a])])lied to by the opponents" oi' Sir 1 high and his American associates.
Mid did not say that I had been.

I am not aware that they had op])unents then, i'or the leading features of their scheme
A»r constructing the Canadian Pacific Kaihvay were unknown to the ])nblic.

So lar from demanding !*2r)(),()()0, or any other amount of stock, I avoided the dis-
cussion of all details with Sir Hugh, ai d confined myself in our conversation to pointing
«ut what, in my opinion, were fundamental and insuiierable objections to his project,
4rom a public point of view. And it will be seen from my Icttei-s to him, given below,
that within a week of the date ol' these interviews I had rei'used to connect myself
witii him.

Ill had not been restrained by other, I may say by higher, considerations from joining

Sir Hugh Allan's combination, it is quite evident, from his correspondence now laiiilishe*!,

that he would not have allowa'd the question of "terms' to stand in the way of my doing

so. Sir llugli Allan, in his letter to Mr. McMullen, dated Montreal, ■1th March, IS/j,

jWhen advising his friend (Mr. McM.) that Mr. Rrvdires and m\self had declined to join

— r 2 ' ^ "

112

COiniKSPOXOKNOK IJKLATIVK TO TIIH

Casadv, llicm brnuisc " tlu'ir Conipiiiiy wns too Inrpicly Anu'ricaii, ami timt wo wniitcd to mi
" ill llif hands (if (Jaiiadiaiis," proceeds to say : "Tlicy (Messrs. Marphcrsoii and Hryil.-..
" tried to di'tacii me IVoiu the Company wv liavc I'ornu'd and p't nir to join tlicirs, win,
" ol' coiirsf, I dci'liiu'd." So liir as I am conrcriifd, lliis is «'iitii'(dy luilbundt'd.

Mr. nryd<;i's and I had lornu-d ^no Company ; I was not coniu'ctt'd with oiu; at tL
time, and I am not awaii' tliat one existed, or any assoeiatiou of persons intended to fort
onu. 1 thereloic eould not have asiu'd Sir ilut;li Allan to join any Company. 'IV
nover was any eoncerteil action between Mr. Hry<li;('s and rnys* IT in resjieet to tl
Canadian I'acilie Haiiway. Neifhor of us knew tliat llio other had liceii asked and k
(leelined to join Sir llnu;li Allan's eomhination until alter these j'vonts. Aetiiij; in t|
heliel'that Sir llui;li desired and expected tliat the (ommiiiiications, oral and writtt:
which took place bet ween us in February, 1M72, would be rei;arded as private, I \n\
hitlierlo abstained iVom !;ivinu; them publicity, althony;h in doiii;; so I may have la,
myself open to much misconcei)tion as to my motives in decliniuf;, lirst, to <;onnect nivy
with his American scheme, and then in opposing the amalgamation of the Interoccan,
and Canadian Pacific Kailway Comiianies.

The version which Sir Hugh Allan has permitted himself to give in his pui)lisli
letters of what passed at our interviews, not only released me from any further oliji;
tion of silence, but imposes on me the duty of placing before the public the details 1 iij
furnish.

I'liey consist of tlio following memoranda and letters: -

hit. A memorandum of conversation between Sir Hugh Allan and myself in rebriiar
lW7'i ('prci)arcd soon after those interviows).

2nd. Letters from Sir Hugh to me, dated '27th ami 'ilUli February, 1872.

• ird. .My letter to Sir Hugh, dated 2nth February, \HJ-J.

Ith. .\ memorandum of what passed between the Hon. .1. ,1. C. Abbott, Sir llu;
Allan, and myself, concerning the organization of an amalgamated Comiiany, propan
for the E.vecutivo C()n)mittoo of the luterocoanic Kailway Company. The followinga:
copies iu extouso of those documents.

Isr. — MKilOliANDlM OF C0XVi:i!.<A'l'I()\ IIKTWKKN Slli lli:ai( A

Fi;i!iiUARY, 18/2.

V\ AM) MYSIOM'^ IN

In February, IM7-2, Sir Hugh Allan called ui)on mo and proposed that I should jo
him in undertaking to construct the Canada Pacific liailwuy, for the subsidies tol
granted by Parliament, and to allow my name to appear as one of the Provision
Directors in an Act about to be applied I'or to incorporate the Canada Pacific Kailu.
Company. I said that before I could consider the proposal to join him, I nuisl li;i.
some general idea of his scheme lor carrying out the enterprise. He informed me tli:
he had it understood Mith the Government that the undertaking should be placed in 1:
hands, and that h( had secured the co-operation of i)arties in New York, of great weak:
who would sul)scribo the greater part of the share capital, which it was proposed to [\\ i
ij: 10,000,(100. With the assistance of these American capitalists he had no doubt tl;
enterprise could bo carried to comidetion successfully. He said that he proj)osod to jilai
the management in the hands ol' a lioard of eleven Directors, of whom six, includi::
the President, should be British subjects, resident in Canada, and five should be Americiii.'
resident in the United States.

The Canadian members of the Board to be Sir Hugh Allan, the Hon. A. B. Fostt:
the Hon. .J. J. C. Abbott (or the Hon. Thomas McGreevy), Donald A. Smith, Doiial;
Mclnnes, and mysell'.

The American members to be Messrs. J. G. Smith, G. W. Cass, William B. Ogdcn, o
Chicago ; T. A. Scott, of Philadelphia ; and J. Cooke, ol' New York ; all Direetoi's of tl
Northern Pacific Railroad Comfiany — the two first named being the President and Vice
President of that Comi)aiiy.

I took exception to the projjosod organization of ihc Company, and remonstrated again;;
giving our rivals the control and ownership ol" our Transcontinental Railway, Avliicl
could only bo carried out with Canadian subsidies in money and land. I pointed out li
Sir Hugh that the Americans he referred to would not invest money of their own in tlit
enterprise; that apparently they had none to invest in such enterprises, for that theyhai
obtained from Europe all, or almost all, the capital employed so far, in constructiii;;; tk
Northern Pacific Railway ; that if they were allowed to hold the major ]iart of the stock.
as ho proposed, they would be complete mastei-s of the Canadian Pacific Railway; ani!
that this would enable them to subordinate its traffic arrangements to their interests in

at W(' wanted to mi
I'phcrsDii and Mrjdj,,
If tojoiii tlu'irti, will,'
uiil'oiindcil.
cft'd with OIK! at tl„
I'soiis iiifcndcd to lor;
iiuy ( 'ompaiiy. The
I'll' ill rc'spcct to il
d Ih'cii asked and In
'V(?nts. Actiiij; ill t)
(IMS, oral and w rifle:
lied as iirivatc, 1 \u
X so I may Iiavi! la.
lii'st, to connect hivm
)n ol' the Interoccan,

give in his puMislii
i» any Airtluir olili;
iblic thu details 1 in,

d niyseir in l''t'hriiar

C. Abbott, Sir 11 u.
d Company, prepan
. The I'ollowini' a;

L\ AND MYSKr.P IN

?d that I should jo
• the subsidies tnl
c ol' the I'rovision
lada Pacific limU
in him, I must Ii,h
le informed moth.
)uld be placed in !•
'ork, ol' gr(>at wealr
vas proposed to fix .
e had no doubt l[
he i)roj)oscd to plac
vhom six, incliidi!.
diould be Amcricac:

n I Ion. A. B. FostH
I A. Smithj Doiial;

'^illiam B. Ogdcn, o
; all Directors ol'tfc
President and Vice

remonstrated again;;
tal Railway, wliici:
d. I pointed out tt

of their own in tlu
?s, for that they liati

in constructing tk
or ])art ol' the stocl
icific Railway; anil
to their interests in

CANADIAN PACIFIC RAILWAY.

118

the Cnited States, tliat it would give tiuni control of the settlement of th(! large territory Cabada.
to l)c granted to thi? Company in our North VV«.'st, and, that they might, and possibly
Would, so niiinagc its settlement as to imperil the vi-ry peace oi' (lauada. Sir Hugh
diieented frcmi all these opinions, and in expressing surprise; that I should eiitt'rtain such
narrow views, said that be took a cosmopolitan view of tlu; ([uestion, that in stipulating
Uttt a majority of the Directorv should be IJritish subjects, resident in Canada, he had
refliciently gnardcd Canadian interests, lie added that he was unalde to state jjrecix'ly
how the stock (|(>,()()0,()0n) would be apjiortioned ; tlwit that was then being determined
lliNcw York ; that he exjiected to be fully advised on his return to Montreal, anil would
<>(tiHnunicate the inl'ormation to me, I objected also to the (oniposition of the Canadian
R)ard, as |)roi)osed by Sir Hugh Allan, and urged that it did not fairly or sulliciently
rejircsent the various Proviiu'cs of the Dominion.

I said that ]\Ir. .Mdnnes and myself would not be sunicient representation from Ontario,
•hd that there was no representative from British Columbia, the Province of all others
most il. ''rested in the railway. Sir Hugh said that he considered the Board as proposed
a good oi.i . , :>d that if British Columbia were represented, the Maritime Provincea would
also exjiect to be represented.

. 1 rej)lied tliat I thought they ought to be rejiresented ; tliat the uiulertaking was a
Dominion one in the broadest sense; that all the Provinces should have the opj)ortunity
of taking an interest in the t'ompany, and of being re])resenti(l at the Board; that I was
quite certain Parliament would not assent to, or the country tolerate any scheme which
would place the Canadian Pacific liailway and its subsidies in the hands of foreignerji and
rivals. Alter Sir Hugh's return to Montreal, 1 received the following letters : —

My dkau Sik, ((^"P!/-) Montreal, 'i7th Fob., 1872.

Tlu! papers which have come from New York indicate the amount of stock
allotted to me as $l,4ot),l)00. This 1 propose to divide in somct.iing like the following
shares : —

■ '■w Hon. D. L. Macpherson ....

I lion. A. B. Foster

I Hon. J. J. C. Abbott

Donald A. Smith

Donald Mclnnes
Andrew Allan
John Shedden -
C. S. Gzowski
(rcorge Brown -
Henry Nathan
C .1. Brydges
T. McGreevy -
II. Allan -

• 100,000

- 100,000

- 100,000
■ .50,000

- 100,000

- 50,000

- .')0,000

- r)t),ooo

- 1(10,000

- 100,000

- oO,()00

- 500,000

$1,150,000

This may not be the ultimate arrangement, as I have not yet even proposed the matter
to some of the gentlemen ; but, if I can arrange it, there will not be much change.
/■Please advise me at once if you consent that your name shall ajipear as one of the Pro-
'-Visional Directors, as I must send in the list to the Government without delay.
I Yours truly,

frhe Hon. D. L. Macpherson. (Signed) HUGH ALLAN.

I The information iu .his letter is for yourself alone.

f Montreal, 2nth Feb., 1872.

I My deau Sir,— Since writing to you, I am informed that the Hon. George Brown
.jitvill not be a shareholder at present, and I propose to name Mr. Howland in his place.
4tr TT Yours truly,

|To Hon. D. L. Macpherson, Toronto. (Signed) HUGH ALLAN.

4t^ {Copy 2rd.)

^.Deau Sni HuGii, Montreal, 20th Feb., 1872.

* I have to thank you for your letter of 27th inst., informing me that there
/had been allotted to you in New York, shares in the Canada Pacific Railway, for

• Canadians, to the amount of $1,450,000, and mentioning how you propose to divide the
^ same. Since you asked me to allow my name to appear in the Charter as one of the

114

CORRESPOXDENCR T^ELATfVE TO THE

Cakaba. Provisional Directors, I have rarcrully considorod your schcmi-, and have become ror..
viiiced that Parhamciit will not assmt to it in it^ present shape, or to any scheme whicf.
like it, would place our great Transcontinental Railway I'or ;'ver under the absolut,
control ol' our rivals, our i\nierio;ni neighbours. This would he I'ftected by giving i
them, as you do, seventcen-twenfieths oi" the whole stock oF the Conipan; . \Vhy sluml;
this be done? Canada must give the means in money and land to build the railwav
Why should we hand over the control and ownershii) of tlu" line, Mith all its inealculabi;
advantages, direct and indirect, during construction and Tor ever, to foreigners ? Siul
an arrangement is not indispensable to the building ol'th" road, and nothing short oi'tlih
in my opinion wouhl jnstily it.

Second only in importance to obtaining the railway, is the securing the control el' i;
with all its benefits, to our own peo])le.

We have in Canada men oi' auflicient abilitv to carry out this great undertakiir
successrully, whose character and means would hi' a^iple guarantie to the (Joveriniu:'
and the country I'or the I'nllilment ol" their iMigagciacnts. Money would have to !.
obtained from aliroad : l)ut tlu- st'curities would be Canadian, and negotiations should 1«
(iii'ected by Canadians.

The assistance of iMiglish and fori'ign financial agents would be necessary, and lo;
their services they would ha\t' to be paid : !)ut they should have no interests rival o:
antagonistic to the Canada Pacific Kailway. 1 should be (piite willing that they an;
fheir clients should have an interest in tlie road, but not a controlling one.

The position o\' the Canadian Directors under your projiosed organi/ation of the (Join-
pany would be uncomfortalile and anmnalous, at least so it ap]ieais to me. They woiil!
sit at the Board in virtue of being Canadians, but merely as the nominees and the nii'i.
agents — of foreign shareholders.

The interests of these shareholders might confli v ivith tlio interests of Canada, iiossihl;.
very soon. Then, if the Directors stood by tiieir country, 1 apitrehend they would 1,
required to surn ader their seats at llie first ensuing idection lor more subservient men,

Holding tlu's MJews, which I expressed to you when you first olfered me a Director-
ship, and they have strengthened uitli reflect ion: and not seeing my way to occupy,
seat at the l»oard with that feeling of independence so essential to usefulness as ,;
Director of any undertaUing, especially one of the magnitude of the Canada Pacili
Kailway, it is my duty to decline the olRce. I deem it right to give you my reasoii'
Iherelbr frankly and fri-ely. Thanking you for inviting m\' co-operation,

1 remain, tkc,

Sir Hugh Allan, Knight, i<c., Montreal.

(Signed) 1). L. MACPHERSON.

{('oj''/.)

Toronto, Slh July, 187.'!.

■I. Memorandum. — Early ni duly. 187'-'. I casually met the Hon. .1. J. C. Abbott, oi
Montreal, at the Queen's Hotel here, and had some conversation with him respectiii:
the amalgamation of the Interoeeanic and Canada Pacific Raihv.iy ConiiJanies.

>Ve both understood till- Governnienl wished the two Companies to amalgamate, ami i;
was also uu<lerstood that the (Government I'lvoured a Directory of thirteen members (tli
same nunilier as the Cabinet), of whom 1, as President of the Interoeeanic Comjiain.
should name five from Ontario : Sir 1 high, as President of the Canada Pacific (.'ompain.
four from Quebec, and the (iovernment four — one for each of the other Provinces. .Mr
Abi)ott said that four was too small a number to enable tlu in to obtain an adeipiati
ri'])resentation of nationalities and localities from the I'rovinee of {^ucIjcc; that tlio)
re(piired six, and would like the numbers [o be lor Ontario and Quebec seven and six
1 replied that as between Ontario and Q,uel)ee tiie proportion of five to four \\a-
mnch I'>s than Ontario was "ititled to, while icven to si.s. would make the disino-
]iortion still greater. Finally. 1 said that if amalganiation would l)e entertained In
the Interoeeanic Company, and if all the other details were satisfactorily settled, i'
was possible the Interoeeanic Company would not bri'ak oil' negotiations ujion the iioiiii
as to whether the number of Direelors named by each Company respectively should In
five and four, or seven and six.

ly in our conversation that there would be feeling of unwillini.ness dii
the Dart of the Interoeeanic Company to enter into amalgamation at all, many of lo

1 stated vi'ry early in

donbtiin; whether the (d)jects ol' the two Cnupaiile:^ weir the same, ours being to nialu

the '•■ 1.;-— - :...' .:......,..._■:... ...VM

Alh

No..,.. ^ ,...., ........,,

their hands and under their control. Mr, Abbott assured me that this was not the case,

he Company ultimatety organized esssentially l/anat'ian, while we feared Sir llii:;'>
,Mlan and his associates still clung to their (dd alii nice with gentlenuMi interested in flu'
N'ortliern Pacific Raihvay on conditions that woulil j)laee the Canada Paeil'ie Railway in

and liavo become rot.
r to any scheme whicli,
•er under the nbsolm,
' t'ftected by giving |-
ompany. VV'hy sliouli
to l)uihl llic niihvav
rt'ith all its incalciilali
, to i()n>igners ? Siicf,
id nothing short ol'fhi.

iring the control of j:

:his great underfulcii!;
ee to the Covernnur
ley would liavi; \o !.
negotiations should b,

be m-ccssary, and Ik
> no interests rival v.
Milling that tiny an;
iiig one.

janization ol' the (.'nni
s to nie. They woiil!
ominees and the im-r

^ts ol' Canada, possihh
•ehend they would i
)re subservient men,
IVered me a Director-
: my way to occupv .
;i! to iisel'iilness as .,
>r the Canada Pacili
give you my reasoii-
ation,

'iNIACPIIERSOX.

ito, sth July, 187;!.
n. .1. J. C. Abbotl.oi
with him resiiectin:
^ompanies.

amalgamate, and r
lirteen meml)ers (tli'
teroceanic Compain

la Pacific (.'umpan},
her Provinces. .Mr.

olilain an adccpiati'
r (Quebec; that the}
iuebec seven and six
)!' live to lour w.h
make the dispio-

1 lie entertained In
si'actorily settled, i'
ilions upon tiie poiiii
spectively should In

iof imwillinine.ss nii
at all, many of lo
Durs !)eing to make
e feared Sir Ilii^'i
len interested in the
I Pacilic Kailwny in
is was not the ca-c,

<'ANADIAN PAl^IFrC RAILWAY

U'y

^I replied that it was a point on Avhich it would be difficult to satisl'y tiie Interocoanic
Company.

Mr. Abbott then referred to the I'residency of an amalgamated Company, and inquired
if I would agree to Sir Hugh Allan being apjwinted to that oflice.

In nply I stated distinctly that I would not; that while I did not arrogate any claim
myself to the Presidency, 1 shoi '1 not concede or waive any in favour of Sir Hugh Allan ;
that, if amalgamation siicnild take jdace, the new Provisional Board should l)e left free
tckclect their President, and that it Avas not for Sir Hugh Allan and myself to arrange in
a^yaiice wln' should be President.

|<^r. Abbott was not satisfied with this, and rei'erred to it again on tl:e Ibllowing day,
jrl^fiarkiiig that unless the Presidency Mere promised to Sir Hugh, he was afraid no
vjalgamation M'ould take place.

Sin the course oi' tiie following Meek, Mhen at Montreal on private i)usiness, 1, in eom-

.pgiance M'ith a written request from Sir Hugh Allan, called at his oilice. He at once

Jiferred to the Pacific P.aihvay, and said he understood from Mr. Abbott that the only

tints of amalgamation on Mhicli he (Mr. Abbott) and I diirered Mcri! the iiumlxn- of
rectors 1o be named by each Company, and the question of the Presidency.
■ I rejjlicd that these Averc the only points we had discussed. That I said to Mr.
Abbott, speaking for myself only, that if all the other details of amalgamation were
settled satisfactorily, 1 thought the Intoroccanic Ccmipany might be induced to consider
the lUTcssities of the other Company so far as to make the number ol' Directors to be
named by each of us rcsjiectively seven and six.

That Mith respect to the Presidency, 1 had told Mr. Abbott that if amalgamation took
place, till' choice should b(> l(<l't to the Directors, and asked Sir Hugh il' he did not think
that that Mould be the i)ropcr way.

He re])lie(l that he could not say that such mms his o))inioii.

It might be inferred from Mhat Sir Hugh says in his aftidavit, jniblished on Saturday
last, of Mr. Abi)ott's interviews Mith me, that Me had been for days closely engaged in
discussing terms of amalgamation I'or the Comjtanies, and generally maturing a scheme for
the construction of the Pacific Railway. ^Ve had tnit two brief intervieMS, and the only
•objects discussed Mere those mentioned in the above memorandum.

My reasons I'or declining to assist Sir Hugh Allan to carry out Mhat 1 then regarded,
and still regard, as most ])rejudicial to Canada — I might almost be justified in saying a
conspiracy against Canada — are contained in my letter to him quoted above. My reasons
for ojtposing the amalgamation of the two C;om])anies are. set forth in the Memoranda
addressed to the Clovcrnmeiit by the Interoceanic Railway (.'ompany, ])nblish(?d in the
Toronto ' Clobe ' in .Inly last, and submitted by the Government to both Houses of
Parliament.

A comi)lete statement of my negotiations Mith Sir Hugh Allan M'ith a view to the
flonstructioii of our great Interoceanic Railway is iiom- before the people oi' C!anada, to
whose judgment IJie "ourse which I pursued is unreservedly submitted.

I am. Sir, your obedient servant, &c.,

D. h. MACPHERSON.

In Sir Hugh Allan's letter, dated i^Ttli July, l.^7'_\ he advised me that the pajiers he
•xpected to receive from Ncm- York had been received by him, indicating the amount ol
flock allott.'d to him to be !Sl,ir)0,(M)(), that h(Miig, as 1 understood, the proportion of the
irholeamount of Sl(Ul()0,U()0, which had been allotted to Canada, and he intimated in
ttiat letter how he ])roj)osed to divide that amount, namely 81,ir)0,U(IO. among
Gauadians.

% (j.— Have you got in yo'ir possession the list which he gave you, giving the nami>s ol'

Iposc among Mhom this amount of stock was to be divided ?

'I yl.— His letter lo me lontainint;- the list has been published. 1 thought I bad his

•rigiiial lettiT with me, but I find ! have it not. It is embodied in mv published letter

If the 8t!i July, and is dated L'Tth February, IS7L>.

f My reply to Sir Hugh Allan, dated liHth Februarv, 1872, and referring to Ids letter,

iPie contentsof which I have just described, is embodied in Exhibit " E."

* I am not iK<i-sonally aware that Mr. McMullen act(>(l for certain United States

liapitalisls, but understood that he did.

I^Sir Hugh Allan's letter to me indicates that Ihrec-tMiiitieths cd' the whole stock had

Been assigned to C.niada, and the remaiiiiig seventeen-twenlieths were to be divided

amoiii; capitalists in the United States. Tl is was in l''ebruarv. IH72, before there was

any legislation whatever, but in anticipation oi" the ensiiins;' Session.

I have no knowledjije except what is stal« d in Sir riugh Allan's letter, and know

Canada,

imfWWW

116

CORRESPONDENCE RELATIVE TO THE

Canada, nothing about the cortaiii percentage of interest, that is stated in the charge I have roa
which Sir Hugh Allan was to receive.

Q. — Is it in conl'ormity with your knowledge tliat Sir Hugh Allan was to be at tl
head of the projiosed Railway Company ?

A. — Nothing was said at that time by Sir Ilugli Allan about his being at the heai]
the Company, that point was not raised in Sir Hugh Allan's conversation with me tlui
no personal iputters or details wen; then discussed,

Q. — lliive you any knowledge whetlier tlie (lovernment were aware that these nea;.
tiations were pending between Sir Hugh Allan and tin- Americans?

A. — I had not an aljsolute personal knowledge ; but I understood that the Governmc,
were aware of it, and Sir Hugh Allan himself stated to me that the Government wn
aware of it. The knowledge which I had in respect to this matter was obtained from,'*
Hugh Allan.

Q. — In reference to the following portion of the charge, viz. " that subsequently i
" understanding was come to between the Government, Sir Hugh Allan, and Mr. Abbot
" one of the members of tlie Honourable House of Govercmeut of Canada, that Sir llu:
" Allan and his friends should advance a large sum of m.oucy for tlie purpose of aidii.
" the elections of Ministers and their supporters at the ensuing general elections, and tli.
" he and his friends should receive the contract for th construction of tlie railway
Have you any knowledge relating to that subject ?

A. — I have no knowledge relating to that subject.

Q. — Do you mean to say that you know of no understanding between the Ciovernmt;
and Sir Hugh Allan and Mr. Abbott relating to Sir Hugh Allan's support in t!
elections ?

A. — No ; I have no knowledge of any arrangements between tlie Government and S
Hugh Allan and Mr. Abbott that Sir Hugh was to furnish money lor the elections,
have no personal knowledge that the giving of tlie contract to Sir Hugh Allan depeiidt
on his furnishing money for the elections.

Q. — There was an offer made to you of some of the stock in this contemplate
Comjjany, was tliere not ?

A. — In Sir Hugh Allan's letter of 27th February, 1872, my name is put down in t!
list with others lor 8100,000; but I was no party to that. Nothing of tlie kind w,
discussed between Sir Hugh Allan and myself; everytliing lie alleges connected witli tli.
is utterly unibuiided. I stijjulated for notliing, and I was offered notbing. I at no tim
negotiated in any way for the insertion of my name as a subscriber of any stock in tli:
Company. I state tliis most positively.

Q. — Did you give Sir Hugh Allan at any time to believe that you felt disposed in an:
way to become a party to such an arrangement ?

A. — No ; I took exception to his scheme when he first explained it to me, and, in rcj v
to Sir Hugh Allan's letter of 27th February, 1872, advising the allotment of stock k
New York of the Canada Pacific Company, I, by return mail, declined to have anytliiii;
to do with his scheme.

Q. — You .,ere, I believe, President of the Interoceanic Railway Company, mt-
you not ?

A. — I was.

Q. — I see in the printed pamphlet, marked " Charter for the construction of the Paci!;
" Railway," which was given to Parliament, your name subscribed to a report of a mcetin;
of till! Provisional Directors of the Interoceanic Railway Company of Canada, date
26th Sejjtember, 1872. Was that an application to the Government for the contract lb:
that Company ?

A. — It was informing the Government that the Company was prepared to treat will
the Government, and was organized.

That was long after Sir Hugli Allan's ajiplication to me; at tlie time Sir Hugh Alias
had negotiatioug with me, there was no Company in existence. Had it not been form)
objections to Sir Hugh Allan's scheme, and my desire, in the interests of the country, U
frustrate that scheme, I probably would not have appeared in connection with tlii
Canadian Pacific Railway at all. It was only after I found that Sir Hugh Allan wmilii
not abandon his American associates, 'that I proposed to certain gentlemen in Torontn.
and elscnvhere, to ajjply for a Cliarter and to be prepared 1o do wliatever might si«
best when th "me for action arrived. The gentlemen to whom I addressed iny^ili
agreed in opinion with me, and we petitioned for an Act, incorporating the Interomiiiic
Company.

(J,. — VVas this Interoceanic Company formed with a view ol" defeating tlic originii
scheme, with the American capitalists ?

the charge I have roa

Allan was to be at tl

lis being at the IickIi
ei'sation with mo tliti

aware that these iie»;.

(1 that the Governnie
t the Government wcf
• was obtained fromj.

" that subsequently a.
Allan, and Mr. Abljoi
Canada, that Sir llu.
tlie purpose of aidii..
loral elections, and tli.
iction of tlie railwa}

itween the Governmci
Ulan's support in ti

le Government and S'
;y for the elections.
Hugh Allan dependi

in this contemplatf

tnc is put down in tl
hing of tlie kind w,
;cs connected with tli.
nothing. I at no tiiii
r of any stock in tli:

)u felt disposed in an;

it to me, and, in r('|il
allotment of stock i;
ned to have anythiii;

way Company, \m.

CANADIAN PACIFIC RAILWAY.

117

'A.— Yes.

Q, — Were there any negotiations between the Interoceanic Company and the Canada
Pttcific Company with respect to amalgamation afterwards ?
A. — There was some time afterwards.
(2. — Why was that negotiation unsuccessful ?

^. — Because the Interoceanic Company did not believe that the Canada Pacific
Company had abandoned their American connections. It is quite true that the Com-
mittee of the Canada Pacific Company assured the Government that tlicy never had
communication with Americans. The Interoceanic Company, however, looked
Sir Hugh Allan as really the Canada Pacific Company, and they had reason to
;eve that the American gentlemen with whom Sir Hugh had been in negotiation still
lectcd that the understanding which he had with them would be fulfilled, and for
It reason the Interoceanic Company declined to amalgamate with the Canada Pacific
llompany.

"In the second Memorandum of the Executive Committee of the Interoceanic Railway
CJompany, addressed to the Government, they stated " that they deem it their duty to
** State to the Government, that in their opinion the admitted negotiations of Sir Hugh
* Allan with gentlemen in the United States, resulting in an arrangement or understand-
** ing which is considered opposed to Canadian interests, and which the undersigned from
" inlbrmation in their possession, and referred to above, have reason to believe is still
" substantially existing, will continue to cause the Canadian people to view with suspicion
" and prevent their subscribing stock in any Company in which Sir Hugh Allan and his
** associates appear controlling parties." I give these reasons from the Memorandum of
the reasons on account of which the Interoceanic Comi)any declined to amalgamate.

Q. — Was there any other reason than Sir Hugh Allan's associations witli Americans
which induced the Interoceanic Company to oppose the Canada Pacific Railway
Company ?

A. — I think not, except the reasons which are given in the Memoranda contained in
the Blue Book referred to, endorsed " Charter for the construction of the Pacific Railway,
"with papers and correspondence."

Q. — Can you state your grounds for believing in the fact that Sir Hugh Allan was
associated with American capitalists ?

A.— I had a statement from himself in the conversation which I had with liim at an
early period, that his associates were American capitalists.
Q.- -Had you any statement from him at a later period?

A. — No ; I had a conversation with Mr. Abbott, and he assured me that they had
dropped the American connection. I told him it would be very difficult to satisfy the
Interoceanic Comjiany on the subject.
■ I have no knowledge at all relating to the elections in Montreal.
Q- — Do you remember any other matter which might be of use in this inquiry ?
-^ A. — The only additional matter that took place at all between the Canada Pacific
pompany and myself was the conversation I have referred to with Mr. Abbott, and what
took place then I have also published. It Avas expressing his desire that an amalgama-
tion would take place. Mr. Abbott, I believe, was one of the Provisional Directors of
the Canada Pacific Company, I)iit is not a Director of the present Canadian Pacific
Railway Company. He is Counsel, I believe, of the Company now chartered. This
opnversation took place before the Company was chartered ; that is, before the Royal
©harter was issued.

Subsequent to the issuing of the Charter, I had no conversation with Sir Hugh Allan.

In 1872, two Acts of Incorporation were granted, one to the Canada Pacific (Company

id the other to the Interoceanic Company. It was these two Companies which it was

ioposcd to amalgamate, that is, the Canada Pacific Company, which Sir Hugh Allan

Wished to amalgamate with the Interoceanic Company.

I had this conversation with Mr. Abbott I think in July, 1872. In that conversation

he urged upon me the desirability of amalgamation, and also asked me if, in the event

of the subject being discussed, and favourably considered, would I consent to Sir Hugh

Allan's being President. We also spoke of the number of Directors. The only mi.tt'er

P all personal to Sir Hugh Allan and myself was the question of the Presidency. Mr.

bbott wished that I would consent to the office being filled by Sir Hugh Allan, f

Id him I would not assent to it in advance, but I set up no claim to the office myself.

thought it should be left to the free choice of the Directors if amalgamation should

ke place.

efeating the original |. ^^•— Had you any interview with the Government or any member thereof with rela-
,4fo» to this amalgamation?

Canada.

struction of the Pacil:
1 a report of a meetiii;
my of Canada, datd:
nt for the contract tor

)repared to treat will

time Sir Hugh Allac
ad it not been for ni)
3sts ol' the country, to
connection with tin'
ir Hugh Allan would
'iitlemon in Toronto,
iViiatever might st«
I I addressetl jny^li
iting the InteroccanK'

mmry^'f^'w

'"'i

118

CORRESPONDENCE RELATIVE TO THE

Oanada. jI — No personal interview — I had a conversation — or i)robably two or three co;
vcrsations — with Sir John A. Macdonald on tlie subject, in wliieh he urged the i,i
liortance of amalgamation, putting it on the ground that it was desirable to unite ;
much as possible the influence and financial strength of the country, but nothing beyor
this general expression of opinion. I objected on the ground stated in the Minutes oft:
Interoceanic Company, and because I felt quite certain that Sir Hugh Allan contimi
in association with the Americans, and that this would be fatal to the enterprise in l
hands, and tliat if the Interoceanic Company joined with the Canada Pacific, it won
be involved in failure and disgrace, and I did not wish either the Interoceanic Compa:
or myself to be involved in these.

To Sir John A. Macdonald :

I include the whole of my published letter, dated 8th July, 1873, in my depositic.
In this letter there is contained a memorandum of the conversation which took place:
July, 1872, with Mr. Abbott ; it is substantially correct.

Q. — When was the last occasion on which you had any communication with mjst.
on the subject ol' the amalgamation ?

A. — I think it was in November last, at Toronto.

Sir John A. Macdonald pressed strongly for the amalgamation of the two Companies;
that time. I dissented on pretty much the same grounds as those assigned in the Men;
randum of the Interoceanic Company, addressed to the Government.

The printed copy of the letter above referred to, of the 8th of July, 1873, and whi:
is marked " E," contains a full and true statement of all the matters to which it relate

And further deponent saith not, and this his deposition having been read to him,t
declares that it contains the truth, persists therein, and hath signed.

Sworn and taken on the sixth day of September, 1

1873, and acknowledged before us this [ (Signed) D. L. MACPHERSON.
eighth day of September of said year. J

(Signed) CHARLES DEWEY DAY, Chairman.
A. POLETTE,
JAMES ROBERT GOWAN, Commissiouer>

Pkovixce of Oxtario,
Ciiy of Ottawa.

'•}

IN THE MATTER OF THE COMMISSION

Appointing Charlks Dkwkt Lav, Axtoine Polettk, and James Robert Gowj
Commissioners to inquire into and report upon the several matters stated in
certain Resolution moved by the Hon. Air. Hlntixgtox in the House of Co-
mons on the second day of April, a.d. 1873, relating to the Canadian Paci:
Railway.

Present: The Comjiissioners.

On this eighth day of September, in the year of our Lord one thousand eight hundrr
and seventy-three, pereonally came and appeared before us, the above-named Comnii:
sioners,

The Honourable JEAN LOUIS BEAUDRY, of the City of Montreal, one of tt
Members of the Legislative Council, who being duly sworn, deposeth and saitt

I was a Provisional Director of the Canada Pacific Railway Company, incorporated i;
1872.

I have no knowledge of an agreement between Sir Hugh Allan and G. W. McMulk
acting for certain American capitalists, for] the construction of the contemplated PaciE
Railway, to have funds from capitalists of the United States. I have no knowkd.-:
whatever of any negotiations or corresi)ondence having taken place with reference to tt
matters stated above.

I have no knowledge of an understanding between the Government, Sir Hugh Allaii
and Honourable J. J. C. Abbott, tliat Sir Hugh Allan and his friends should advanft
money for the purpose of aiding the election of Ministers and their supporters at thi
ensuing general elections, and that he and his friends should receive the contract lor tli
construction of the railway in consideration ol' such subscriptions. From the sliof
duration of the connection I had with the enterprise of the Pacific Railway, I had w
means of knowing, and knew nothing of these correspondence. I have no other knof
ledge except of what I have stated that took place at the meeting of the BoarJ
Nothing took place then that had any respect to the correspondence or negotiations will
Americans.

bly two or three co:
lich he urged the it
s desirable to unite ;
ry, but nothing beyor
d in the Minutes oft!
Hugh Allan continu
to the enterprise in l
anada Pacific, it won
Interoceauic Compa;

1873, in my depositic:
)n which took place:

lunication with rnvst!

fthe two Companies;

assigned in the Men;.

nt.

July, 1873, and whi;

ters to which it relate

;; been read to him, I

;d.

L. MACPHERSON
Y, Chairman.

AN, Commissioner!,

COMMISSION

.MES RoUERT GoffJ

al matters stated m
n the House of Coi:
the Canadian Pan:

lousand eight hundrt
ibove-named Comnii:

Montreal, one of tt
n, deposeth and saitl
ipany, incorporated i;

and G. W. McMulIe:

contemplated Pacifc

[ have no knowled;:

! with reference to ti

lent, Sir Hugh Allan
iends should advan«
leir supporters at th
'e the contract for tk
)ns. From the slioit
Gc Railway, I had w
have no other knoit'
L'eting of the BoarJ
B or negotiations will

CANADIAN PACIFIC RAILWAY.

119

The question as to what source the means for the construction of tlie Pacific Railway Cakada.
were to be derived was not discussed at the meetings which I attended.

I have no personal knowledge whatever that these funds were to be expected from
American capitalists.

I took an active part in the elections of Montreal East in 1872 ; I was on Sir George
Cartier's Committee.

When I attended the Committee for the first time there had already been some
organization made, and at the meeting which I attended they asked me to preside over the
mating. It was about the commencement of August, 1872. I was told by some of the
mwnbers of the Committee that they had a list of subscriptions for the object of defray-
ing the expenses of the election.

T did not see the list of subscriptions myself, but at a certain period of the canvassing
I was asked by some of the members of the Committee to go to Mr. Abbott, and I went
to Mr. Abbott with two other gentlemen, and then signed a receipt for $20,000 to
Mr. Abbott. I did not see the money myself. The receipt was signed in Mr. Abbott's
office, in his presence — it was left witli Mr. Abbott. I was given to understand that Sir
Hugh Allan was a subscriber to the election funds. The expressions made use of in the
receipt then signed by me are the only conditions that I am aware of. The Honourable
H. Starnes and Mr. Murphy signed the receipt with me.

The only receipt which I signed in connection with these gentlemen is the one above
referred to. I have not seen this receipt since. I have no personal knowledge of that
receipt having passed from Mr. Abbott's hands, except what I have seen in the news-
papers. I am not aware, personally, of any other sums given by Sir Hugh Allan. That
receipt refers to the letters of Sir George E. Cartier, dated 30th July and 24th August,
1872. I had not seen those letters when I signed the receipt; but subsequently, the
letter of the 30th July was shown to me. It was in the hands of a gentleman who
wanted me to state if the article which had a|)i)eared the day previous in the ' Gazette '
was correct as to the nature of the letter. That gentleman was Mr. Murphy. I did write a
letter in conjunction with Mr. Starnes and Mr. Murphy. T think this letter was handed
to the Editor of the ' Montreal Gazette.' The letter which the Chairman read to me
jast now is the letter which I signed, and the contents of it are true. I have taken com-
munication of a printed copy of the letter referred to, in the following terms : —

Extract from the 'Montreal Gazette,' Jl-lt 23rd, 1873.

THE PAC^FTr^ RAILWAY SCANDAL.
To tL Editor of the ' Gazette"
:■ Sir, — Seeing your Editorial of yesterday, in which reference is made to a letter from
Sir George E. Cartier, to Sir Hugh Allan, dated 30th July last, which letter is referred
to in the letter of Sir George E. Cartier, of date 24th August, published by Mr. McMullen,
We feel bound to state that we have seen the first-mentioned letter, and that your
«jflitorial statement that it has no reference whatever to the Pacific Railway Company, or
to the Pacific Railway contract, is perfectly correct.

(Signed) J. L. BEAUDRY.
H. STARNES.
July 22nd, 1873. P. S. MURPHY.

^I declare the statement contained in that letter to be true, and I make it a part of my
reposition. I don't know, personally, of any other sum of money subscribed for the

Montreal elections, for I did not go round with the list; but I have heard there was

|pras told by some members of tlie Committee that there was a list of subscriptions. I
•n't know what amount was subscribed, and I do not know either what amount Sir
Slugh Allan has subscribed. There was a large sum of money paid to the different
Election Committees. I was in the General Committee, and there were sub-committees
1 every ward. I had nothing to do with the distribution of the money or with paying
la accounts. Considerable sums of money were paid to these sub-committees. Some of
ae sums of money paid were drawn from the Metropolitan Bank by cheques. I am not
ware of what kind of receipts was given for these sums of money. 1 believe these
20,000 were paid on account of Sir George E. Cartier's letter of the 24th August.
Hien I signed that receipt I thouglit that Sir Hugh Allan was a subscriber, and it is the
ply inference which I can draw from the wording of the receipt. I had uo knowledge
fhatever of any conditions except what is contained in the receipt.
3 I have no knowledge of any other subscription, except that some friends told me thev
lad subscribed.

Q 2

pp^^f

J[Ca»ada.

Ill

120

CORRESPONDENCE RELATIVE TO THE ]

Idi;

The receipt was signed and left with Mr. Abbott, and I did not see the money,
not sec the cheque for the drawing of the $20,000 from the Bank.

And further the deponent saith not, and this his deposition having been read by him
he declares it contains the trutli, persists therein, and hath signed.
Sworn, taken and acknowledged on this eighth ^

day of September, one thousand eight > (Signed) J. L. BEAUDllY.
hundred and seventy-three. )

(Signed) CHARLES DEWEY DAY, Chairman.
A. POLETTE,
JAMES ROBERT GOWAN, Commissioners

IN THE MATTER OF THE COMMISSION

Provixck of Ontario,
Cifi/ of Ottawa.

Appointing Chaijlks Dkwey Day, Axtoixe Poletti:, and James RonEUT Gow.iy
Commissioners to inquire into and rejjort upon the several matters stated in i
certain Resolution moved by the Hon. Mr. HrxTi.voTOX in the House c
Commons on the second day of April, A.n. 187 o, relating to the Canadian
Pacific Railway.

Present; The Commis.sioxersi.

On this eighth day of September, in the year of our Lord one thousand eight hundrcii
and seventy-three, personallly came and appeared before us, the above-named Comnik-
sioners,

PETER S. MURPHY, of the City of Montreal, Merchant, wlio being duly sworn,
deposeth and saith :

I am a resident of Montreal.

Q. — Have you any knowledge relating to an agreemcv between Sir Hugh Allan ami
Mr G. W. McMullen, representing certain American capitalists, for the building of tlu
Canada Pacific Railway with American lunds?

A. — I have not.

Q. — Have you had any particular connection with the original Company ?

A. — None at all.

My connection was with the Montreal Northern Colonization Railway Company.

^2- — Had you any knowledge previous to the passing of the Act of Iucori)oration oftli.
Canada Pacific Railway Company as to any negotiations that were going on?

A. — No. I don't know Mr. McMullen by sight.

Q. — Had you any knowledge of tlie uuderstanding, subsequent to that period, between
Sir Hugh Allan, or Mr. Abbott, and the Government, that Sir Hugh Allan and lii>
friends should advance a large sum of money for the purpose of aiding the elections o:
^Ministers and their supporters at the then ensuing general election, namely, that of IS?.':
and that he and his fric.ds should receive the contract for the construction of the Vani<
Railway ; were you aware of any such agreement with the Govermnent or with iiiiy
memlier of the Guvernmcnt. Have you any knowledge on this subject whatsoever?

A. — I have no such knowledge wliatsoever.

Q. — Had you any communication with Sir Hugh Allan, or with the Government, tli;il
would have enabled you to know ?

A. — I had not. I know nothing except what I saw in the papers.

Q. — You were interested in the elections of 1872, and took an active part in them, did
you not ?

A.— I did. I was a member of Sir George Cartier's General Election Committee lor
the Eastern Division of Montreal.

Q. — Do you know of money having been furnished for the carrying on of the electioiij
there, or in any other part of the city ?

A. — Yes. There was a large subscription list passed round, and several gentlcnioi
subscribed. The largest amount subscribed was that by Sir Hugh Allan. Hon. Mr.
Starnes stated the other day that it was seventy thousand dcdlars. My impression is
that it did not exceed sixty-five thousand dollars; that is the gross amount of all the
subscriptions.

Q. — Do you know of any portion, and if so what jiortion, was subscribed by Sir Hugh
\\\m ?

see the money. I dj;

ag been read by hiir,

r. L. BEAUDRY.

, Chairman.

N, Commissioners.

CANADIAN PACIFIC EAILWAY.

121

MMISSION

IIES ROBKRT GOWAN

matters stated in i
X in the House «
ing to the Cauadiaj

3usand eight hundred
bove-named Commit-

mpany ?

hvay Company.
Incorporation ol'tlu

lat period, betwceii

ugli Allan and lii<

ing the elections o:

imely, that ol" 18?.';

action ol' the Pacili'

nment or with any

ct whatsoever?

ic Government, tlw

i'e part in tliem, diJ

tion Committee lor

on of the elections

several gentlenuii
Allan. Hon. Mr.
My impression i'^
amount of all tin

;rihed by Sir Hugh

5 ^.—Ilis first subscription was ten thousand dollars. I was one of those who signed

Tlie next sum was for ten thousand dollars more I think, but I am not sure. It was ibr
atleast ten thousand more. ,..,,.,

Tlien there was the last or third subscription, or at least it is the only otlier one ol
which I have any knowledge. It was for twenty thousand dollars more. 1 signed the

TCceipt for it. , , i • , i • .^ i-

Q.—h the name " P. S. Murnhy," which I see appended to the printed receipt lor

l^'_Yes. Mr. Betournay's name was also on the receipt for the $20,000 I believe. Tliis
^ei'pt is signed "J. L. Betindry," "Henry Starncs," " P. S. Murphy," " L. Betournay."
^ Ours was the Central Coniiuittec. .

m Q,—Do you know in whose hands the original of the receipt for the 1<20,000 now is .'
W ^._The receipt was given to Mr. Abbott. I was present when it was given, and saw
the $20,000 paid. The money was deposited in the Metropolitan Bank.
: (2.— Have you any reason to suppose that this receipt has passed out of Mr. Abbott's

liands ?

' ^._No; I have not seen it since. I think it ought to bo cither in his or Sir Hugh

Allan's hands.

Q._Do you know whether that money was paid in consequence of any letter from Sir
George ("artier?

A. — The money was paid in accordance with Sir George Carticrs letter of the 24th
August, 1872, and upon the conditions contained in his letter of the 30th July, 1872.

I saw Sir George's letter of the 30th July. I saw it in Sir Hugh Allan's hands at the
time, and I saw it a month ago in Mr. Abbott's hands.

It was a little more than a year ago that I saw it with Sir Hugh Allan.

being duly sworn. ^j

Sir Hugh Allan ainl
r the building of tlk

Q, — You jiublished a letter in conjunction with Mr. Beaudry and Mr. Starncs in

ation to this letter of Sir George Cartier's of the 30th of July, did you not ?

^.— Yes.

Q. — ^A'ho has the original of that letter ?

A. — It was sent to the 'Gazette.'

Q. — Will you take communication of that letter now, .and state to tlic Commission
whether the allegations contained in it are true ?

A.— The copy now shown to me is a true copy of the original, and contains the truth.

Q. — You state in this letter that Sir George Cartier's letter of the 30th of July has no
reference to the I'acilie Railway Company or to the Pacific Railway contract, do you not ?

A.- -I do. The statement in relation to this matter, published in the ' Gazette,' is
perfectly correct.

Q. — Having seen this letter of the HOth July, what statement are you prepared to
Hiake ujion it ?

yl.— The same statement as is contained in that letter. I state positively that the con-
tents of 'hat letter are true. I examined Sir George Cartier's letter of the IJOtii Jnlj-,
and it liatl no reference whatever to the Pacific Railway Company or to the Pacilie Rail-
Way contract.

Q. — \Vere there any other sums than those wliich you have mentioned subscribed for
the promotion of the elections?

A. — There were. I was a subscriber myself, and there were ?cveral other subscribers,
among whom was Sir Hugh Allan, who was the largest subscriber. The aggregate
amount was about $1)5,000.

;, We had Committees in all the wards, and the expenses were viy great, but the money
was not all spent in the Eastern Division. A large portion Maj spent in elections else-
where.

I suppose we were robbed, as is general in elections. It was a condition of Sir Hugh

, ^Allan's subscription that the expenses of Mr. Beaubien's election should be paid out of

the fund if there was a contest. And if we had had a surplus the expenses of Mr. Beau-

tien would have been paid, but we were short, and therefore it was not done, and that is

the reason why Mr. Beaubien's note remains unjjaid.

(I — Did the examination of that letter, which was shown to yon by Sir llugli Allan,
purporting to be from Sir George Cartier, leave the impression on your mind which
found expression in that letter?

.1.— Yes.

Q. — Do you know a:iything of any telegrams which passed on the subject of these
advances betw(!eii Sir John A. Macdonald and Mr. Abbott?

^1. — 1 saw them in the papers only, and know nothing more about them.

Canada.

jmwwm^

i^i

122

CORRESPONDENCE RELATIVE TO THE

Oahada. Q_ — Was there any application to the Committee for the $7,000 wliich was given i;
Mr. Beaubien ?

A. — No, I believe not.

And furtlier deponent saith not, and this his deposition liaving been read by him, In
declares that it contains tlic truth, persists therein, and hath signed.

Sworn, laKen and acknowledged on the day, 1

written. J

,, , „ , , .., f (Signed) P. S. IMURPIIY.

month, and year first above written. J ^ ^ '

(Signed) (^IIAHLES DEWEY DAY, Chairman.

A. POLErrE.

JAMES UOBKRT GOWAN, Commissioners.

IN THE MATTER OF THE COMMISSION

PuovixcK OF Ontario,
Cit>/ of Ottawa.]

Appointing Chahlks Dewey Day, Axtoixe Polette, and James Rorert Gow.w,
Commissioners to inquire into and report upon the several matters stated i;
a certain Resolution moved by the lion. Mr. Hini'IN'otox in the House ri
Commons on the second day of April, a.d. 1873, relating to the Canadia:
Pacific Railway.

Present: The Commissioxers.

On this ninth day of September, in tlic year of our Lord one thousand eight hundni
and seventy-tliree, personally came and appeared before us, the above-named Coninii»
sioners,
JAMES DAKEHS, of the City of Montreal, who being duly sworn, deposeth and saitli

I reside in tlie city of Montreal.

My occupation there is Secretary and General Manager of the Montreal Telegrai:
Company.

I know Sir Hugh Allan.

I don't know Mr. ^IcMullen. I never saw him.

Q. — Have you any knowledge of any negotiation or agreement between Sir Ilu.i
Allan and G. W. McMullen, in relation to the building of the Canada Pacific llailwa}

^1. — None whatever.

Q. — Do you mean to say that you have no kind of knowledge relating to that matter at all

A. — Nothing except what has appeared in the public newspapers.

Q. — Have you any knowledge of any arrangement or understanding between tli;
Government and Sir Hugh Allan for the furnishing of money for the elections i:
Montreal in IST'JI?

A. — None whatever except what lias ai)peared in the papers.

(>. — Were you in a position to know anything on this subject to which I refer from
your office occupation ?

A. — Nothing further tlian from the messages which passed through our office, but Lie
not see one out of a hundred perhaps, except there is something of importance brought
under my notice. I don't see one-tenth of the communications that pass througli the
office, and of course I had no means of knowing otherwise.

Q. — Have you any knowledge that money was furnished by Sir Hugh Allan for thi
elections ?

A. — None whatever, except what appeared in the public prints.

(2. — Have you in your possession any telegrams whicli passed through your office,
between Sir John A. Macdonald and Sir Hugh Allan, or the Honourable Mr. Abbott, ia
the month of August, 18/2, referring to the elections, or furnishing money for them?

A. — None; the messages of August, 1872, are all destroyed.

(2. — Are you able to state whether a message signed John A. Macdonald, dated SJtb
of August, 1872, and directed to Honourable J. J. C. Abbott, Ste. Amies, and marked
"immediate, private," in these words, "I must have another $10,000. Don't fail mo-
" last time of calling," ever passed through your office? "

A. — I never saw a message of that kind as having passed through our office. Tlicro
was no sucli message that I know of, of the 25th August.

Q. — Have you any knowledge whether a message purporting to be sent from J. .F. C.
Alibott to Sir John A. Macdonald, directed to him at Toronto, and dated Montreal, 2iit!i
August, 1872, in tlicse words, — "Draw on me for $lO,000,"ever passed through your oflin

A. — No ; I have no recollection of having seen such a message, nor do I know tlut
such a message ever passed over tlie line.

Q. — Could these messages have passed through your office without yourbeingawareof it'

CANADIAN PACIFIC RAILWAY.

128

I which was given tol
been read by him, l,,

3. IMURPIIY.

Chairman.

!^, Commissioners.
)IMMI?SION

K.S KonKRT GOWAV

al matters stated i:
x in the House li
ing to the Canadia:

usand eight hundrt:
)ove-nanied Conimis.

, deposeth and saitli
Montreal Telegrai:

t between Sir IIu.'
ida Pacific llailwa}

to that matter at all

inding between the
or the elections ir.

which I refer from

1 our ofllce, but I do
importance brought
it pass through the

lugh Allan for th.i

hrough your oflRce
able Mr. Abbott, la
loney for them ?

donald, dated 2olh
Vnues, and marked
). Don't fail mc-

i our office. Tiicri

:; sent from J. .1. C
ted Montreal, 2(lth
;hrough your olTu'c ^<
or do I know tlut

irbeinguwareofit'

U.— Yes.

(2. Are you positive tliat all tlie messages of tliat date, that is the original telegrams

of that date, whiili liave passed tlirougli your office liave been destroyed?

, _/!. Yes, 1 am positive tliey liave i)eeu destroyed — and up to tiie 1st of January, 1873,

they liave all been destroyed.

(2.— Is there anything ii: tlie books of the Telegraj)!! Office in Montreal tliat would

Wiable you to state if messages in tlie terms I Iiave referred to ever did pass through office?

yj—Viider date tlie 2'ith of August, the signature find address taken from a message

ftom Hon. J. J. C. Aliliott to Sir .Folin A. Alacdonald, appears on our books, but what

•ipre the contents of this message I know not.

|i^{2. — Is that the only message wliich is entered in your books, as passing between the
one parties ?

,A. — Tliere is anotlier address and signature of a message having passed from Sir John
I. Macdonald, to the Hon. Mr. Abbott, and which appears in our books on the 24th of
fugust, 1872.

Q, — Have you any means which would enable you to state to the Commission what
be contents of these telegrams were ?
A. — No means whatever.
- Q. — Are you enabled to state by what particular operator in your office they were sent ?
A. — I could not tell tlirough what ojieratnr they were sent, and I don't think that any
operator who received them would be able to tell the contciits of them at this distance
of time.

Q. — Why are all the originjvl telegrams destroyed ?

A. — For want of room is one cause, and anotlier cause is that we don't want, eighteen
months, a year, or six months aiter, to have our ojierators dragged up to Court and kept
there for a whole day. This is a standing order of the office.
To Sir John A. Macdonald through the Chairman :

Q. — How long has this regulation existed as to the destruction of the telegrams ?
A. — The regulation for the destruction of tiiem has been in existence for a long period.
The regulation for tlie destruction of them after six months has been in force since
January last.

One cause for this new regulation is that there is very little room in which to keep
these telegrams.

Tills regulation had no connection with the telegrams that passed relative to the
elections in 18/2.

The recommendation for this six months regulation was made by myseli', and had
nothing whatever to do with the elections. It was made before tiiere was anything
iknowii of this Pacific Railway matter at all.

;. And further deponent saith not, and this his deposition having been read to him, he
^iJeclares that it contains the truth, persists therein, and hath signed.

iSworn, taken and acknowledged on the dayj'i

month, and year first above written, > (Signed) JAMES DAKERS.
belbre us. )

(Signed) CHARLES DEWEY DAY, Chairman.
A. POLETTE,
i JAMES ROBERT GOWAN, Commissioners.

C AX AD A.

IN THE MATTER OF THE COMMISSION

RoviNCE OF Ontario,")
Citi/ of Ottawa. }

'lAppointing CiiAULKs Dkwey D.VY, Antoine Poi.ette, and James Robert Gowax, Com-
,\si missioiiers to inquire into and report uiioi^he several matters stated in a certain

Resolution moved by the Hon. Mr. HuNTiN%rox in the House of Commons on the
second day of April, a.d. 1873, relating to the Canadian Pacific Railway,
resent : The Commissioxers.
, On this ninth day of Sejitember, in the year of our Lord one thousand eight hundred
^11.1 seventy- three, personally came and appeared before us, the above-named Com-
issioners,

!IIARLES JOSEPH COURSOL, of the City of Montreal, who being duly sr jrn,
deposeth and saith :
I reside in Montreal, my office is Judge of Sessions of the Peace for the Province ol
Quebec, and Commissioner of Police for tlie Dominion. I have held that office for
several years.

imfl: P'"l 'Iff

Cakaoa.

134

rORRE?!pONl)ENr'K RKLATIVE TO THE

(^2.— Dili you liold any ofhor offuT in 1^72?

.1. — I lu'Id till' (in'icc ol' Mayor ol' tlic city of Montreal. I know Sir Hugh Alln;;
I Haw Mr. IMcMuUon onco or twicv in Montreal.

(i. — Have you any knowlcdi^i' ol' any a;.jrerment or ncf^otiation hot ween Sir llii.l
Allan and INIr. (i. \V. McMullon in relation to tiie eoustruetion of the I'aeilie Kailwav

A. — None! whatever.

Q. — Have yon never known anything of tliat matter?

A. — I liave never known anything: of the kind.

Q. — Have you any knowledge ol' any understanding between tlie flovernincnt, or iin
member of tlu; Government and Sir Hugh Allan, throiigii the lion. .Mr. Abbott r
otherwise, relating to the furnishing of I'unds by them for the promotion of the electioi,
of 1872 in Montreal ?

A. — None whatever; nor is it likely I should have had either. 1 hojje not.

Q. — From your ofiiee would you have been likely to have known anything about tliat

A. — No, not through my olliee.

Q. — Have you any knowledge of Sir Hugh Allan's having furnished any funds for tlit
elections of 1872?

A. — No knowledge v/hatever.

Q. — Do you know of any subscription having been raised lor the promotion of Si;
George E. Cartier's election ?

-1. — I heard that there had been a subscription raised for him. 1 know in one cast
there was a subscri|)lion raised; but I know of no subscrij)tion except one, which dn
not exceed. I believe, two or thre(! hundred dollars. It was given by one of Sir (jcor;:
Cartier's friends.

<2. — Do you mean to say that you know nothing whatever of the subject of this inquiry;

A, — Nothing whatever; I was not a memlxi' o. any Oonnnittee, and did not even vott
at the elections, and took no i)art in them whatever. I know nothing at all of tli
subject matti-r of tliis inquiry, except what I have read in the newspapers.

Q. — Are you aware for what reason your name was put ui)on the list of witnesses oi
Mr. Huntington for examination here;?

A. — I am not aware; 1 saw my name on Mr. Huntington's list when it was publislu;
during the last Session of Parliament. I met Mr. Huntington yesterday in the street, aiii
I asked him if he knew why my name was put on there. 1 said to him that if he ii;i:
any questions he wished put by the Chairman, I would suggest them to the Chairmiii
in order that they might be put to me, and that I might state under oath anything 1
might know in regard to them. Mr. Huntington then told me that my name had hti:
put there on his list, as it had been suggested to him by somebody during the Session oi
i'arliament, but he did not know or remember what evidence 1 had to give.

And further deponent saith not, and this his dei)nsition having been read to him, li
declares that it contains the truth, persists therein, and hath signed.
Sworn, taken and acknowledged on the "J

day, month, and year first above V (Signed) CHS. J. COURSOL.

written, before us. j

(Signed) CHARLES DEWY DAY, Chairman.
A. POLETTE,
JAMES ROBERT GOWAN, Commissioners,

IN THE MATTER OF THE COMMISSION

PuovixcK OP Ontario,
Citi/ of Ottawa.

Appointing Charles Dewky Day, Axtoi.vk Poi.eiti:, and Jamks Roreut Gow.o,
Commissioners to inquire into and report upon the several matters stated in a
certain Resolution moved by the Hon. Mr. Hi.vtin'Gton in the House of ComraoB
on the 2nd day of April, a.d. 1873, relating to the Canadian Pacific Railway.

Present: The Commissioxers.

On this ninth day of September, in the year of our Lord one thousand eight huudrel
and seventy-three, personally came and appeared before us, the above-named Com
missioners,

CHARLES A. LEBLANC, of the City of Montreal, Sheriff, who being duly swoni,
deposeth and saith :

I am Sheriff of the district of Montreal, and have been so for nine months.

I know Sir Hugh Allan ; I do not know Mr. G. W. McMullen.

Q. — Have you knowledge of any agreement or negotiation between these gentlemea
relating to the construction of the Pacific Railway, at any time ?

CANADIAN PACIFIC UAILWAY.

125

low Sir Hugh Alio;.

between Sir IIu.l
he Pucitic Hailwav

frovormnont, or an
lion. Mr. Al}l)i)tt i
ution ol' the electioi,

I liopo not.
anytliiiii^ about thai

led any I'nnds lor tlk

lio promotion of S;

1 know in one ca-
•opt one, which diii
)y one ol' Sir Geori;-

l)jeot of tliis inquiry;

iud did not (?ven vott

lothing at all of tli

)a])ers.

e list of witnesses u:

hen it was publislie:
day in the street, aiii
I liim that if he In:

m to the Chairmiii
iler oath anything 1

my name had Ijli:
luring the Session oi

to give.

jeeu read to him, li

J. COURSOL.

Chairman.

N, Commissioners,

AMISSION . .

K3 ROEEUT GOWAS,

matters stated in i
! Mouse of Comraoai
Pacific Railway.

usand eight hundrcl
above-named Coni

) being duly sworo,

months,
eea these gentlemea

"^._1 have not had at any time.

. Q.— You positively state that you have no such knowledge?
■"yl. — I state so positively.

Q._Are you aware of anv understanding between Sir Hugh Allan and Mr. Abbott
with tlie Government, that Sir Hugh Allan and his I'l lends should advance moni'y for
the jin>ni()tion of the general election in 1x72, and particularly the election of Ministere
and their supporters?

yl.- -I have no knowledge of any such uu<lerstauilin!r

(2.__I)„ you know whether any individual memlier of the Government had any such
understanding with these gentlemen '!

A.— I do not know. That is a matter of which 1 have no knowledge whatever. I
ntvcr had any conversation with Sir Hugh .Mian or any other person with respect to the
elections,

Q.—Yow were not SherilVat the time those eU'Ctions were going on, were you?

A. -No, I was not.
'^ (2._Were you a member of Sir (ieorge K. t'artier's Central Klection Committee ?

yl._Yes; i became a memlier of it al)out eight days after it was formed. I heard that
Sir George Cartier reriuested that I should be there:' so I went, but 1 had no time to be
there during the day, and 1 only went when I saw that Sir George wanted me to go. I
took an active part in the working of the Committee, particularly at night, as I had no
time in the day time.
^ Q. — \Vas there any money furnished for the ])urpose of promoting the elections?

A. — Then; was undoubtedly by the friends of Sir George Cartier,

Q. — Do you know -what amount was subscribed for the jmrpose?

A. — No, I never iu((uire(l, only 1 asked one or two members if they had enough of
money, 'i'hey said that they thought so for the elections in Montreal.
^ Q. — Do jou know by whom the money Avas subscriljed?

■A. — I have not seen the list. I know that I sul)scribed myself, as I always did, for
Sir George Cartier's elections, but I uv.wv had anything to do with the money. I always
put any money I collected for the election purjioscs, in the liatids of the Cashier. Per-
^nally I do not know that Sir Hugh Allan subscribed anything to Sir (Jeorge Cartier's
election. I heard that he did.

Q. — Have you any knowli-dge ol" the receipt that was given for s'J(l,()00 that wa.s
dgned by Mr. Murphy, Mr. Heaudry, Mr. Hetouriiay, and Mr. Stanies ; do you know if
tt was received from Sir Hugh Allan from the hands of Mr. Abliott?
• J.— I know nothing of it except what 1 iiave learnt from the newsjiapers. I was very
nuch surprised to see it at the time it was }iul)lished in the papers.
"j: Q. — Then are you ])re])ared to say that you have no knowledge ol' anv sum luiving
■ fecii subscribed by Sir Hugh Allan except what you have derived through the news-
mjiers ?

^ A. — Nothing more.

i (I — Do you know anything about the manner in which this money was expended?
j"^ .1. — I know it was generally exjiended for the elections. I have not seen the amount.
' There were only two or three little accounts that I was i)ersonally liable for. There
littay have been some of that money spent for the elections in the country, but I don't
know of it ])ersonally.

i And further for the present, de])onent saith not.

1^ And on this tenth day of September, IS7,'I, re-a])peared the said witness and made the
Ibllowing addition to his foregoing deposition: When I said that I knew nothing about
lie contract for the Pacific Railway, 1 meant to say that I knew nothing about the con-
ract bi;tween Sir Hugh Allan and Mr. ^IcMullen, but I now remember that in two
nstances in the month of .Tune, 1S72, Sir George Cartier said, with those energetic words

lat he generally used, something about the Pacific Railway Company, and that he
^ould never, as long as he would be in the Ministry, consent to any American Company
javing the contract for building the Pacific Railway. That there were enough of

inadian Companies who were able to do the work, and that he would resign his place
the Ministry if the contract was given to any such Company ; and he added, that he
-^ojied his friends would see that the two Companies, meaning that of Sir Hugh Allan
i^d that of Mr. Maepherson, would be amalgamated, and that they would be able to
4arry the whole matter through without any trouble.

a (I- — You say that on two occasions, in the month of June, Sir George Cartier made
•^cse remarks you have alluded to. Do you remember when the first conversation
ipceurred?

A. — His first conversation was when I was on a deputation with three other gentlemen.
'^ (2.-Wherc?

Canada.

Ill

12(5

CORHESrOXDKNCE RELATIVE TO THE

Oahada. y\, — III tlio Govprnmont Riiildinfjs at liis olTlfc.

Q. — 'Who was prt'Sfiit (HI tliat occasion '!

.1.— The Hon. .]. L. Mcaudry, Mr. Victor Iliidon, and l\Ir. ('. S. Itodicr, juii., and th«|
Hon. Mr. Chaplcan. I cannot say wlictlicr tlicy licard tluso words or not.

Q. — In what capacity were tlicy present and Cor what purpose?

A. — We canu; to sei'. as he was our ri'iJrescntativc in the East Division, what wore hii|
views on tlie I'aiific Uailway.

Q, — Was it in answer to sudi an appeal liiat these observations were made?

.1. — We iiad a memorial to present to liim whicli was in writing-, Wi' left, it with I
Jiim, and then we had a conversation ; hut I don't know whetlior the other gentlemen |
heard what Sir (ieorj;e said, lor he spoke to me particularly.

Q. — Was any formal reply };iven to that memorial ?

.1. — Not that I know of, \Ve all went into the ofliec! tof;etlier. I think it was thciij
ahout one o'clock. The memorial was read in my presence, and Sir fJeorge answered In
it, and said that as our representative we had a rif^ht to put to him any (piestion we liked,
hut as a minister, he could not say anythinj;;, but that the interests of Lower Canada woulj
not he overlooked.

Q. — Will you give a circumstantial account of what passed on this first occasion?

-I. — I think we have a copy, ])erha])s, of tliat memorial. We wanted to know wliat
he thought of the Pacific Railway. I as one of the Directors of the Montreal Northern
Colonization Railway, wanted es])ecially to know what he thought about the Pacific, ami
if an amalgamation could be ell'ected with the Northern Colonization Railway, so as In
have the termiiuis of the I'acific Railway in Montreal.

(J,. — At w hat time in the course of the interviews were these remarks made by Sir
George Cartier?

.4. — It was just ut the time that we were going to leave his office.

Q. — Was it said to you only?

A. — He did not appear to be speaking to me in confidence at all, it was said openly.

(2. — Do J on renu'mber if any other gentleman was near at the time ?

A. — I cannot remember.

Q, — Can you separate the two occasions, so as to state what was said on the first and
what was said on the second occasion ?

A. — It was al)out the same expression that he used on both occasions.

Q. — On the first occasion what was it that Sir George said ?

A. — To the best of my opinion it was the very words that I have put into my fore-
going deposition.

Q. — AVhat do you mean by " those energetic words " you refer to. Give as near as
possible the very words he addressed to you when speaking of the Pacific Railway ?

A, — The words he used were, as near as I can remember, as follows:

" Aussi longtemps que je vivrai et que je serai dans le Ministere, jamais uno sacrec
Compagnie Amcricaine aura le control du Pacillque, et je resignerai ma place do Muiistre
plutut qued'y consentir."

(^. — Were these words said on the first occasion ?

^1. — I am sure that he made use of them twice, and moreover, I think another time at
his own house. He said these words I am sure on the firtit occasion. He said there were
enough of Canadian Companies able to :lo the work, and that he would resign his place
in tlie Ministry if the contract was given to t'i9 Americans.

Q. — Did he say on the first occasion that lie hoped that his friends would see that the
two Companies would be amalgamate('. r.eaning that of Sir Hugh Allan, and that of
Mr. Macpherson, and that the whole matter would be carried through without troul)lo?

A. — Yes. It was said on leaving the door of his office ; we had a second interview
with him on 24th June, 1872, when we left him iu Ottawa, he wanted us to meet him
in Montreal, and we did so on the date I have just mentioned, there were i)resent on this
occasion the gentlemen whom I have spoken of, namely : — The Hon. J. S. Beaudry,
Victor Iludon, C. S. Rodier, jun., the Hon. Mr. Chapleau. There were a few others
present who had nothing to do w ith our interview.

Q. — Did you still continue in your representative character with him as a prolongation
of the first interview ?

A. — Yes, it was a prolongation of the first meeting, and it was absolutely the same
words that were used as in the first instance.

Q. — Did he enter more fully into the matter then ?

A. — No, he did not go more fully into it, with the exception that he again repeated
those words in the i)resenee ol" all the people who were there, and told us we might ask
him any question that we liked, in his capacity as our representative, as to what he
thought on railway matters, but any question put to him as a minister, he could not

r\NADI\N PACIFTC RAILWAY.

127

isioii, what wcrehj

narks made by Sir j

was said openly. "

lid on the first and '*

put into my lore-

inswor. As wo were at the time iircpariiiK I'or tin' election, lie sitid Ik; did not want
j8 to l)rin}j; the matter lici'dre the pulilie in connection with the railway sclieme, but
ion iiis own merits. He said he tli(iiifj;lil that he had done enouj^h lor his eountry
ind for th(! party he reiiresented, and that he on{!;ht to Ui clceted on Ids own merits.

1 told Idni we would do the best we eould.

Q. — Did Sir Cie()r|i;e speak in I'reneh or English ?

A. — Ihi spoke on both occasions in Freiuh The i^enthmen present were all French
iCunadians.

Q. — On this last occasion, oi' the lllth.ltine, did you say that Sir (loorge siu>ke openly
|in the heavin;; ol' all?

I.- Yes; l)ut as to the first occasion I am not quite sure whether \hc other gentlemen
Iprcsent heard what he said.

Q. — Were you on such intimate terms with Sir George that wr\ild have induced him
Ito speak more particularly to you than to the others?

A. — I sui)pose I was the most intimate with him. I was one ol' his most intimate
Ifricnds in Montreal — I mean outside of politics. Ever since we were at eollei;e we have
|bceii personal friends. I may add that he [daced great I'onfidenci- in me at many times.

Q. — Yon mentioned that tliere was another occasion on which SirCreorge spoke to you
Ipursonally on this sulyect ; was it in the same spirit?

/I.— Yes. This was alter the 21th June.

It was at his own place at Long Point. I was down there, as liis nomination was to
J take jilace the next day, and he wanted to see me, and we had a very long conversation
that al'ternoon. He repeated tho; l; very words to me, that it was not necessary to look to
foreign Companies to build tlu; Pacific Railway, as we had men in the country who could
■do the work, and he added that we should try to have an amalgamation made between
jthu two Companies — that of Sir Hugh Allun and thatoi' Mr. Macpherson — and also said
I tlut he could not say as to what the Government would do.

To Sir John A. Macd'ii.dd, through the Chairman :

Q. — AVhen was the nomination of Sir George Cartier?

A. — It was on the IDth August, 1872.

The election took place on 28th August, 1872.

And further dei)onent saith not, and this his deposition having been read to liim, he
declares that it contains the truth, persists therein, and hath signed.

Sworn and taken in ]mvt on the ninth day of \

Canada,

(Signed) C. A. LEBLANC.

September, \S7'<i, and remainder
taken, and the whole acknowledged
on this eleventh of the same month
and year.

(Signed) CHARLES DEWEY DAY, Chairman.
A. POLETTE,
JAMES ROBEKT GOWAN, Commissioners.

i^ithout trouble

IN THE MATTER OF THE COMMISSION

Province op Ontario,
Citj/ of Ottau-a.

Appointing Chari,e.s Dewey Day, Ax ioine PoLErrE, and James Rorert Gowan, Com-
missioners to inquire into and re])ort upon the several matters stated in a certain
Resolution moved by the Hon. Mr. Huntingtox in the House of Commons on
the second day of April, a.d. 1873, relating to the Canadian Pacific Railway.

Present : The Commissioners.
On this ninth day of September, in the year of our Lord one thousand eight

hundred and seventy-three, personally came and appeared before us, the above-named

Commissioners,

JEAN BAPTISTE BEAUDRY, Esquire, of the City of Montreal, who being duly
sworn, deposeth and saith :

1 reside at Montreal.

I know Sir Hugh Allan, but I do not know Mr. McMullen.

I liave no knowledge of an arrangement between Sir Hugh Allan and certain
American capitalists to procure funds for the construction of the Canadian Pacific
Railway.

I was not one of the Provisional Directors of the Canada Pacific Railway.
I have no knowledge of an understanding between Sir Hugh Allan and Mr. Abbott,
and the Government, that Sir Hugh Allan should advance moneys for the election of

R 2

128

COERESPONDENGE RELATIVE TO THE

Canada. iiuiii;,ters and their friends. I was not a memlicr ol' any Committee for the election of
Sir George Cartier in 1872. I know nothing of moneys furnished for that election
beyonc \vliat I have seen in the newspapers.

I am not aware that Sir Hugh Allan advanced any sum of money lor these elections ;
1 could not know it as I was not a member of any Committee.

I cannot say why my name was placed on the list of witnesses.

I know absolutely nothing of this affair.

I heard from no one why my name had been placed on the list of witnesses, and I was
much surprised when I found it had been so jjlaced.

And farther deponent saith not, and this, his dei)osition, having been read by him, he
declares that it contains the truth, persists therein, and hath signed.

Sworn and taken, and acknowledged on I

the ninth of September, eighteen (Signed) JEAN BAPTIST!:] BEAUDKY.
hundred and seventy-three. | •

(Signed) CHARLES DEWEY DAY, Chairman.
A. POLETTE,
JAMES ROBERT GOVVAN, Commissioners.

IN THE MATTER OF THE COMMISSION

FROVixn; of Ontario,

CiU/ of Ottawa.

Apix)inting Cii.viu.Kfi Dkwkv Day, An'totxk Pot.kitk, and JA>rKS Rohekt Gowav, Com-
missioners to iiKiuive into and roi)ort upon the several matters stated in a certain
Resolution moved by the Hon. Mr. Huxtinctox in the House of Commons on tlu;
second Jay of April, a.d. 187;!, relating to the Canadian Pacific Railway.

Present: Tni: Commission k,;h.

On this ninth day of Sei)tember, in the year of our Lord one thousand eiglit
hundred and seventy-three, personally came and appeared before us, the above-nanieil
Commissioners,

J^VCKSON RAE, of the City of Montreal, who being duly sworn, deposeth ami r,ai'b;

I reside in INIontreal. My occujmtion there is General Manager of the Merchai'.t.'
Bank of Canada.

(^.— Who is President of that Bank ?

J.— Sir Hugh Allan.

(I. — Are you connected with Sir Hugh Allan otherwise than in business by any family
relations ?

A. — None whatever.

Q.— Do you know Mr. G. W. McMuUen ?

.1. — I never saw him, and I never heard of him till the recent corresjiondence appeared
in the newspaper.

Q. — Have you any knowledge of any negotiation or agreement or correspondence
between Sir Hugh Allan or any other person in relation to the construction of the Pacifn'
Railway, which took place in 1 872?

A. — None whatever.

Q. — VV^niUVyour relations with Sir Hugh Allan been likely to have enabled you to
have known something of this matter?
1^^ .1. — Not necessarily so.

Q. — No facts connected with that negotiation came to your knowledge?

A. — Nothing ever came under my knowledge connected with any negotiations carried
on by Sir Hugh Allan in connection with the Pacific Railway. Nothing whatever.

Q,— Have you a knowledge of .any undertaking l)y Sir Hugh Allan, or by MV Abbott.
to furnish funds for ])romoting the elections in Montreal in 1872 ?
•^^ A. — 'I have no personal knowledge.
, Q. — Have you any reason to believe that any such arrangement was made ?

A. -Nothing further than mere rumour.

(2. —Did you take any part in the elections in Montreal in 1872?

A. — 1 did not.
P Q. — Are you aware if any sum of money was raised for the purpose of aiding in these
elections ?

.1. — 1 am not. further than from mere rumour. 1 had no jjcrsonal knowledge of it.

Q. — Do you know whetlK-r Sir Hugh Allan ever subscrilted any money or furnislied
any sum of money for th:it pin-pose?

A, — I have only her.rd tuch reports.

CANADIAN PACIFIC RAILWAY.

129

for the election of
for that election

or those elections ;

'itnesses, and I was
n\ read by liim, lie

STE BEAUDRY.

Jhairman.
Commissioners.

MISSION

KRT GowAX, Corn-
stated in a certain
r Commons on the
i Railway.

e thousand cigiit
the above-nanii'il

osfth and r,ai'h:
r the Mercha.-.t;

ess by any family

ondence appeared

r correspondence
ion of the Pacific

e enabled you to

s>'otiations carritnl

'^ whatever.

r by Ml- Abboit.

lade ?

f aiding in these

lowledgo of it.
ney or furnishctl

Q. — You have not heard that from him?

A. — No, he has not told me.

Q. — Have you any knowledge which would induce you to believe that those rumours
were true ?

yl . — My belief is that the rumours were true, that he did subscribe money.

Q. — Would you give the grounds of your beliel", if you please ?

A. — Simply from casual remarks of his own, made sometimes to other people in my
hearing.

Q. — Have you any idea of the amount which ho furnished ?

A. — I have not.

(2. — Were any cheques drawn upon his account whicli would indicate the amount ?

A. — I never saw any. They would not necessarily come under my notice in any way,
if such existed.

Q. — Would the fact of payment of money for that purpose, he apparent on Sir Hugh
Alla!>'s account in the bank?

-1. — Not upon .the account itself Whether the vouchers or cheques dra'vn would
show it or not, I am unable to state without a personal examination.

(2. — You mean to say then that you have no knowledge that would enable you to
state what amount was subsi "ibed by Sir Hugh Allan ?

A. — I have not.

(2- — Do you know to whom the money was paid ?

.1. — I do not.

Q. — Have you any knowledge whatever of the application of any money, or the mode
in which money given in aid of the elections was expended by the Central Committee?

A. — Not the most remote. I know nothing whatever about it.

Q. — Do you know anything of this printed receipt which has been published in the
newspa])ers, signed by Mr. Murphy, Mr. Stariies, Mr. Beaudry, and Mr. Betourncy,
purporting to be a receipt for )<20,000 received from Sir Ilugli Allan ?

.1. — I have seen it in the new'spai)ers. That is the only place I have seen it or lieard
of it.

(2- — These telegrams of Sir John A. Macdonald to Mr. Abbott, and i'rom Mr. Abl)ott
to Sir John A. Macdonald, have you ever seen them elsewhere than in the newspapers ?

A. — Never.

(2- — Has Sir Hugh Allan got more than one account in the Bank ; lias he a privo*
account dilTerent from his business account?

.1. — His general business account is under the name of II. & A. Allan. He has a
private account besides, but only one.

Q. — Is the condition of that account passed under your view like all other accounts
in the bai.iv ?

.1 .—It is.

Q. — Did you observe at the time of the election of any large cheques passing?

A. — Sir Hugh Allan's account is a very large and active one at all times, and I did
not notice at the time of the elections anything remarkable about the cheques.

(t — Is there any coiniection between your bank and the Metropolitan Bank?

-'I. — There is none wliL'evcr.

Q. — Is there any account that would show exchanges between the two banks; do
you exchange from time to time notes ?

A, — We do exchange notes and cheques every day. The banks all exchange every
day.

Q. — Is there any account that would show the particulars of the exchange each day?

A. — ^Ve can see only the figures. The names of the drawers of cheques do not
appear.

To Sir John A. Macdonald, through the Chairman —

My connection with Sir Hugh Allan is altogether through the Bank. 1 am not his
political nor his Railway Agent. 1 was not consulted as to liis subscrijjtions to elections
nor as to his arrangements about building Kailways.

i^ lid further deponent saith not, and this his deposition having been read to him he
dec.ares that it contains the truth, persists tiierein, and hath signed.
Sworn taken and acknowledged before"

us, on the day, montii, and year \- (Signed) JACKSON RAE.

Oak ADA.

first above written.

(Signed)

I re "J

CILVRLi:S DEWEY DAY, Chairman.

A. POLE! TE,

JAMES ROBERT GOWAN, Commissioners.

130

COERESPONDENCE RELATIVE TO THE

Canada.

IN THE MATTER OF THE COMISSION

PrOVIXPK 01'' OXTAT^IO,

City of Ottawa.

Appointing CIIAlu,I•;i^ Dewfy Day, Antotxe Pou'.ttk, anil J.nirS Rohert Ooava\,
Commissionrrs to inquiro into and Report npon tho several matters stated in a
certain Resolution moved by the Hon. Mr. Huntixgtox in the House oj'
Commons on the second day of April, A.w.. 1873, relating to the Canadian
Pacific l^aihvay.
Present: The CojtMissiONEns,

On this eleventh day of September, in the year of our Lord one thousand eight
liundred and seventy-three, personally came and ai)peared bel'ore us, tlie above-named
Cominissioners,

Tlie Honourable JOSEPH OCTAVE REAURIEN, of St. Thomas, in tlie Province of
Quebec, wlio being duly sworn deposeth and saith :

Q. — Where is your ])lace of r(!sid('nce?

A. — St. Thomas in the Province of Quebec.

Q.- — Were you i'ormerly, and are you now, a member of the Legislative Council of
Qui^bec ?

A. — Yes, and I am now.

I held tlic oiTice of C ommissioner of Crown Lands in the Province of Quebec.

I know Sir Hugh All.in, I don't know Mr. G. W. McMullen.

Q. — Are you aware oi any agreement or negotiations between Sir Hugh Allan and
Mr. G. W. MclNIidlen, or my otlier ])erson, in relation to the construction of the Pacific
Railway with funds to be furnished by American capitalists?

A. — None wliatevcr.

(2. — Do you know anything about any negotiations or agro(!ment between tho:,c ,/,i :it,lt
men in 1872, bel'ore the Act of Incorporation was passed relating to tlie Pacific Rai ly ''

A. — No, sir.

C2.— Had you any relations with those gentlemen that would enable you to knew?

A. — No: I had no relations with Sir Hugh Allan before I became a director of the
Canadian Pacific Railway.

(2. —In relation to the Canada Pacific Railway, the first one which was incorporated,
liad you any rclatioi's with Sir Hugh Allan which would have enabled you to know
of any such agreement or negotiations.

.1. — No; I had no conversation with any members of the Government of the
Dominion belong that. The first knowledge with respect to the Pacific Railway, was
when the Company was formed last winter and the Candian Pacific Railway Company
was cliarterc-d.

I was ajjpointed 71>irector of that Company. I was nominated by the present Dominion
Government.

Q. — Since you have been connected with the Canadian Pacific Company, have you
ever had any conversation with any of the Ministers, or any other persons which would
cnaljle you to say whether there was such a negotiation as I have alluded to V

^l. — No, none whatever. I never had any conversation whatever.

Q. — Do you know Sir Hugh Allan ?

y1.— Yes.'

(I — Do you know of any arrangement or understanding, between him and the Govern-
ment, or any member of the (iovernment, in relation to the furnishing of funds for tl'.c
promotion of the elections of Ministers, and their supporters ?

.l.-No.

Q. — Do you reside below Quebec f

yl.— Yes.

Q. — How far from Montreal?

jX. — It must be sixty leagues — one hundred and «;ighty miles.

II. — Have you ever had any communication with any oI" the Ministers or with any
person as to the I'urnishing of funds lor the support of tlu^ elections in Montreal in
1872?

A. — No, I don't know anything about it. I never received any money from Sir Hugh
Allan, or any person acting as the agent or in the interest of Sir Hugh Allan.

(I. — AVere any moneys received from Montreal by subscriptions for the support of
Ministirs in your neighbourhood ?

A. — Not that 1 know ol'.

(I- — Do you mean to say that you had no manner of comminiciition^ o. Means ol
knowing how the money was furnished for the promotion of tliesi elections '(

CANADIAN PACIFIC RAILWAY.

131

[ON

RERT G0AVA?f,

:rs stated in a
he House oj'
the Canadian

lousand eight
above-named

e Province of

re Council of

icbec.

,i;h Allan and
of the Pacific

I tho;,(: ■^: ;<t,!„

rific llai ,.iy?

to know ?
irector of the

incorporated,
you to know

iment of the

Railway, was

ay Company

;nt Dominion

ly, have you
which would

the Govern-
inids for t!".i-

nv with any
VIontreal in

m Sir Hugh

• support ol

: \ean3 oi

.4.— No. I never came near those men when this affair is said to have been transacted.

Q. — Do you know for what reason your name was put upon the list of witn(!sses?

A. — I do not.

Q. — Have you any knowledge by which you can account for your name being there?

A. — They may have thought that I was acting in the elections in the inlercsis of the
Government or Ministers ; but there are no grounds for that, for about tlie time ol' the
election I ran myself for the County of Montinagny, which 1 had represented for a long
time, and I never saw during that time Sir Hugh Allan or any one of the Ministers.

(2. — Are you a Member of the Dominion Parliament?

A, — No, not now. I was defeated for the Dominion Parliament.

Q. — You are understood to be a Government supporter?

yl.— Yes.

To Sir John A. Macdonald through the Chairman :

Q. — Were you asked by the Ministry to become a Director?

^.— Yes.

Q. — By what Minister were you asked ?

A. — By Mr. Langevin.

I reside in the District of Quebec.

Q. — Were you not selected as a representative of the District of Quebec interest as
against the Montreal interest?

A. — It Avas consideicd so at the time that I represented the (Quebec District.

Q. bj the Chairman. — How long have you been a member ci the Legislative Council,
and iu public life?

.1. — Seventeen years, I think.

I was Commissioner of Crown Lands up to last April. At the time I was appointed
on the Board of Directors I held that office, and Mas a member of the (Quebec Govern-
ment.

And further deponent saith not, and this his deposition having been read to him
declares that it contains the truth, persists therein, and hath signed.

Sworn and taken on the c-u venth of September,
18/3, and acknowledged '"> tbc twelfth
of September of said year

Canada.

(Signed)

;ned) J. O. BEAUBIEN.

CHARLES DEWEY DAY,

Chairman.
A. POLETTE,
JAMES ROBERT GOWAN,

Commissioners.

IN THE MATrER OF THE COMMISSION

ProVINCK of OnI'AI!IO, \

city of Ottawa. J

Ar.,-.oniting Chahi.ks Dkwkv Day, Antoim: Poi.ktti:. and Jamks Rokkkt Gowa.v, Com-

iiiissioners to inquire into and ri^port njion the several matters stated in u

•ertain Resolution moved by the Hon. Mr. Hi minoto.v, in the House of Coni-

■vions on the second day of April, .i.i). 1873, relating to the Canadian Paeiilc

Railway.

1':^.' ■i.t: IjiE Commissioners.

Oh Vl,,:) eleventh day of Roptember, in the year of our Lord one thousand eight hundred
and seventy-three, personally came and appeared before us, the above-named Com-
missioners,

Keverend DANIEL MoJMULLEN, of Picton, Province of Ontario, who being duly
sworn, deposeth and saith:
U. — You are a clergyman, Mr. McMulIen, are you not?
/l.-Yes.

Q. — Of what denomination ?
4.— Methodist.

(I, — Is your residence at Picton?
.).— Yes.

'<{.— Do you know Mr. George McMuIlcn?
yl.— Yes.

Q, — In what relation do you stand to him ?
A.- — He is my son.

Q,. — Do you know Sir llugli Allan?
A. — No. I never saw him to my knowledge

132

COREESrONDENCE RELATIVE TO THE

A. — I have no rci
uliicli it was dccideu
clement from the C'ompi,
no share in tin; huihiini

Canada. ^2— Have you any knowledge of a negotiation in which Mr, G, W. McMullcn your
son was engaged, in relation to the building of the Pacific Railway?

A. — I have some knowledge, the most of which I may say I liavc gathered from what
has been published in the press.

Q. — Have you any other knowledge of a personal character, in regard to this matter,
which has t^omc under your personal notice?

y\. — None that I am aware ol'.

I may remark for the information of the C'ommission, that in *]\v abseiuo of my sons I
liave a heavy burden of domestic care on my hands in the (losition which I have occu-
pied for a great many years. I have always had great coufidence in the ability of my
son to manage any business which he understood. I liave .lever sought inlbrmation from
him unless it was under very i)ressing circumstances, and then it was done chiefly to
relieve myself of the burden and care whidi at this time of life I was not prepared
to bear.

Q. — Has your son been in communication with you in respect to this matter?

A. — No : I know nothing beyond wliat 1 liave read in the public press.

He has calways bee.i very remarkable since early boyliood in business matters, and was
always close, and he seldom disclosed any business transaction to the members of my
own lamily.

(t — lias he been in the habit of communicating or consulting with you?

A, — Not in matters of tiiat kind.

Q. — Has he communicated to you anything in connection with the construction of the
Pacific Railway?

1 ' 'in:' of any communication of that kind except at the period at

■ttled that the Government would exclude the American

ind that the gentlemen ibr whom he was acting would have

Ol the ]{ail\vay, and siii)posing that he had spent a very large

portion of liis time, and that heavy expenses had been connected witli it, which he was

not well able to lose, and that money had been expended through him on behalf of the

j)ersons for whom he was acting, I felt some anxiety lest he might incur some censure

for 'want of energy and fidelity in dealing with the interests of otiiers. I therei'ore took

the liijerty — the only time that I think I did make any inquiry into his business matters

— of asking him what arrangement was likely to be made for indemnifving liimself, and

especially the ])arties for whom he liad been acting, so that lie would not be exposed to

any censure, lie assured me tliat lie was iuUy persuatled and was then in jirocess by

which the jiarties for whom he liad acted would lie indemnified for the time and expenses

he had incurred. I believe that was the only question that 1 asked him.

Q. — How did you become aware of the expenditure of money liy him?

A. — I became aware of it by supposition ; I sui)|)osed that ho would incur expense in
dealing with this matter, but I have no recollection of liim telling me that he did. I
inquired of him in order to relieve my own mind, but it is very little I know intimately
or accurately, respecting the whole affair, except what I have gathered from what has
been published in the public prints.

(I. — Did he communicate to you any correspondence during the time that it was going
on or hold any communication with you on tin: subject of it?

A. — I don't recollect that he described any of iiis correspondence, and I did not ask for
any, as 1 thought it would be interfering, and that perhaps he would feel reluctant to
communicate to me anything on the sulyect, and I was therefore a good deal cautious on
that ground.

It might naturally be thought that I would be intimately acquainted with those
matters, l)ut I am not for various reasons, especially those that I have stated. I had
enough else to inirden my mind and employ my thoughts and attention, and 1 studiously
endeavoured to avoid inducing him to communicate anything to me on the subject.

Q. — You never saw any of the originals oi' this corresjiondence, did you?

.4.— No.

Q. — Cai\ you account, Mr. McMullen, for your name being included in the list of
witnesses; i^re you in possession of any knowledge that would account for it to your own
mind ?

A. — The only reason that I am aware of is the clos(; of the speech made by Mr.
Huntington at the prorogation. 1 read it, but I could not give it in detail.

But he made the remark there, assigning his reason lor placing my name on the list of
witnesses.

Q. — Can you recollect what that reason was in general terms?

A, — I think lie expressed some fear, or suggested to the Committee that perhaps my

CANADIAN PACIFIC RAILWAY.

ion

uction of the

it was going

son mifi;ht absent himself when ealled ui)on to give testimony, ami lie tlioujjlit it would
be butter to sceure some membcu- of the family — his fatlier or some of his brothers — tliat
is tlie only reason that I am aware ol'.

I am not aware of the reason assigned I)y the Commission by whom I liave lieen sum-
moned to appear. If tliere is, I have not seen it. I inferred that tlie reason mentioned
by Mr. Huntington had influenced them.

Q. — Is there any other Daniel McMullen?

.4. — I have ^ son who bears my name that has been some eight or nine years in Par-
liament. His name; is Daniel Y. I have but one name. His name is Daniel Yure
McMullen. He resides in Chicago.

I am a minister of the Wesleyan Methodist Church. I am not in possession of a
regular charge. Tlie state of my health obliges me to hold a retired position.

My son, Daniel Y. McMullen, is now in attendance here. It bajjiiened that at the
time I was summoned to ajjpear here he had come on a visit home to liis friends, and he
came with me.

I am a stranger in Ottawa. I have resided sixty odd years in C'anada, since ISII. I
am intimately acquainted with the western part of the Province, but tliis is my first visit
to Ottawa.

To Sir John A. Macdonald, through the Chairman:

Q. — Do you know where your son, George VV. McMullen, is now?

A. — He is in Chicago ; he is there now. He went there some three or four weeks ago.
He had beeii in Pictou before that.

Q. — Is his residence in Pictou or Chicago?

A. — -His residence and domicile is in Chicago.

Q. — How long was he in Pictou before he went to Chicago?

A.- — Three or four weeks ; I could not tell to the day. <

And further deponent saitli not, and this his deposition being read to him he declares
it contains the truth, persists therein, and hath signed.

Sworn and taken on the eleventh day of Sep-'
tcmber, 1873, and acknowledged on the
t..;'lfth of said month and year.

(Signed)

Can.M)A,

(Signed) D. McMULLEN.

CHARLES DEWEY DAY,

Chairman.
A. POLETTE,
JAMES ROBERT GOWAN,

Commissioners,

IN THE MATTER OF THE COMMISSION

PllOVINCE OF OXTAIUO,

Citi/ of Ottawa.

Appointing Charles Drwky Day, Axioink Poi.ette, and Jami:s Roi!kut Gowax, Com-
missioners to inquire into and report upon the several matters stated in a certain
Resolution moved by the Hon. Mr. Hi.xti.xgtox in the House of Commons on
the second day of April, A.n. 18/3, relating to the Canadian Pacific Railway.

Present: The Commissioxers.

On this eleventh day of Sejitember, in the year of our Lord one thousand eight
hundred and seventy-three, personally came and appeared before us, the above-named
Commissioners,

DANIEL Y. McMULLEN, of the City of Chicago, who being duly sworn, deposcth
and saith : —

Q. — Arc you the son of the last witness, Daniel McMullen ?

^.— Yes.

Q.— Are you a brother of George W. McMullen ?

4.— Yes.

I reside in Chicago.

Q. — What business are you engaged in there?

A. — Banking.

C2. — Are you alone or in co-partnership with any person ?

A. — My brothers and myself are together.

Q. — Do you know Sir Hugh Allan ?

.4.— No.

Q. — Have you any knowledge of an agreement or negotiation in which your brother
was engaged in 1871, in relation to the construction of the Pacific Railway ?

J.— Yes.

m !■

134

CORRESPONDENCE RELATIVE TO THE

Canada. Q, — Wliat is tlic nati o of your knowledge concerning this agreement, is it a personal

knowledge or simply derived I'rom what others have told you ?

A. — It is both.

Q. — Will you state what personal knowledge you have of it ?

A. — I saw the original contract between the American j)arties and Sir Hugh Allan.
I also saw and read (piite a large nunil)er of Sir Hugh Allan's letters, and I saw nearly
all of the documentary evidence that he has or had, tliat is all the personal knowledge I
liave; that is the documentary evidence, I saw the original contract that was signed,
I believe in New York. The personal knowledge is all documentary, that is with parties
directly interested.

Q. — Can you specify any letters which you saw from Sir Hugh Allan?

-I,— I could not specify any of them so that you would understand what I meant,
e.Kcept the first letter that he wrote from Montreal. I cannot specify them by date.
They were dat(!d along from some time in the fall of 1871, up to the fall of 1872. Tiiey
date from tlie beginning ol' the negotiation in 1871 previous to the elections, till about
the first Session of this Parliament.

Q. — Do you know Sir Hugh Allan's handwriting?

-1. — 1 think I would know it. I have no positive knowledge that the signature I saw
was his, but the letters came signed Hugh Allan. Part of letters were addressed to
C. M. Smith of Chicago, and ])art were addressed to my brother.

Q. — Do you know in whose possession those letters are now that you speak of?

-1. — Tile only knowledge that I have as to the i)lace of them is from newspaper reports.

Q. — Do you know wOiether they are or are not in your brother's possession ?

.1. — They are not in his i)ossession.

(2- — Do you know how he disposed of them ?

^l. — I only know what he toUl me. I have no personal knowledge as to how he dis-
posed of them. I can only tell you what he said he did with them.

(2.— What did he say he did with them?

A. — He said they constituted the package in Mr. Starnes' hands in Montreal.

(2.- -Did he say that all the letters be had were in that package ?

^-I. — All of the principal were there he said.

Q. — \Vhat means have you of knowing Sir Hugh Allan's handwriting?

A. — No means at all, only that I know that my ijrother addressed letters to him, and
that letters came back signed Hugh Allan, addressed to my brother.

Q. — How do you know that your brother wrote to Sir Hugh Allan?

.1. — I have seen letters written by my brother addressed to him.

(2. — Did you ever see the parcel which your brother said he gave into Mr. Starnes'
liands ?

J.— No.

Q. — Can you designate any particular letters which you believe to be from Sir Hugh
Allan, besides the one you have mentioned as the first one?

A. — By dates?

Q. — In any way they can be identified.

^l. — There were severa' important letters, in one of which he gave a rough sketch of
the sums of money he had expanded; and one of the last letters my brother received
was in regard to the exclusijn of the American element from the Company; and there
was another letter, I don't know whether it was in the package or not, giving the amount
of stock to be placed in the different parts of Canada.

(2. — What was the subject matter of the first letter to which you allude?

.1. — The first letter that I ever saw from Sir Hugh Allan was addressed to C. M.
Smith. It merely stated that his address had been given to him by a member of the
Government, and that he thought that the time had arrived for the American and
Canadian parties to get together.

A letter is shown to witness.

Q. — Is that the letter to which you refer ?

A. — No, this is not the letter, the letter that opened the correspondence was written
from Montreal, this is written from London. I think it was in 1871, and previous to
Sir Hugh Allan sailing for Europe. The one now shown to me was written after the
negotiations luid proceeded several months.

(I — Is that the letter you mean now shown to you?

.1. — No, it is anterior to that. The first letter that opened the correspondence, I
think, was written either in May or June of 1871.

Q. — To whom was that letter addressed ?

.1.— To Charles M. Smitli.

CANADIAN PACIFIC RAIL"\YAY

135

) how he dis-

s to him, and

Mr. Starncs'

Q.— Did Mr. G. W. McMuUcii tell you that that loiter was included in the package
placed in Mr. Starnes' hands?

A. — lie told me that the package contained all the letters of importance. He did not
indicate to me any sf)ccial letters.

Q. — Are you confident with res])cct to Ihe date of it?

A. — The only moans I have, of knowing is that the negotiations had proceeded some
two or tliree months before tlic Cliicago fire, and that was in October, 1871.

(2. — There are some letters addressed to Mr. Smitli in this package ; tlu-ough whom
were they obtained from Mr. Smith?

A. — I presume they were given to my brother. The relations between Mr. Smith
and my brother and myself are so intimate, that all the correspondence M-as communi-
cated to us. I handled all the letters of Mr. Smitli as well as my brother's, and Mr.
Smith handled all my brotlier's letters in reference to tins matter.

(>. — I low nearly can you particularize tlie date in regard to this matter? If you
cannot say the day, say the month ?

A. — 1 think it was early in May, 1871.

Q. — You don't know where that letter is now ?

A. — It was not considered of sutlicient importance to take much care of.

(2.— What other letter do you recollect?

A.- — Tliere was a letter detailing the sums of money that Sir Hugh Allan had spent.

Q. — Do you remember the date of tliat?

A. — I think it was in Fel)ruary. It was in January or February, 1S72.

Q. — Here is a letter which rea<ls as follows: " It seems jiretty certain that in addition
" to money jiayments, the following stock will have to be distributed : To 1). L.
" Macjdierson, il<I()(),O0O," &c. Is this the letter you refer to ?

A. — No, it is another letter. I said that I recollected that letter in addition to tlie otlier.

Q. — "On whom am I to draw for money." Is that the letter?

A. — I believe that is the letter. On examining it 1 see that this is the other letter.
I recollect this letter. This does not refer to tlie approi)nati()n of stock in Canada.
This is one of the letters that I recollect as having been received by Mr. Smith as
coming from Sir Hugh Allan. I saw it after Mr. Smith received it. ^Vit]lill a day or
two alter he received it, he either called at our ofTici' or we called at his ofTice, and all
these letters were read by both parties.

Q. — Look at that letter ilated IGth September, 1872, and say if it is the letter you
refer to relating to the money?

A. — Yes, this is the letter.

Q. — Are there any other letters you can remember of?

A. — I believe that there were two letters that came IVom Sir Hugh Allan in regard to
the breaking up of the arrangements in the fall of 187'2. I scarcely thiidc they are in
the package, but they may be.

Q. — AVhy don't you think they were in the package f

A. — Because they did not consider them of sullicient importance.

^2. — Sufhcient im])ortance for what?

y\. — In regard to the scheme ; when he put the letters in the package, he put in all the
letters that had important matters in them, in regard to the negotiations, but I don't
think he put them in ; that is letters which close tlie negotiations. They were too short
and abrupt. The letter dated 1 1th November is one that was in the package.

Q.— Look at the other letter now shown to you, and say if that is one of the letters
you have alluded to,

A. — Yes, both of the letters now shown me are the two letters I have spoken of.

Q. — Do these complete the whole series?

^1.— Yes.

(2. — You said there w„re two letters, which were not thought important, and that you
did not suppose they w» re in the package?

A. — Excuse me, I said that they were not important, I meant mybrother told me, he
had jnit in all the important letters, and from my recollections, I suppose he considered
them of little invportance, but I see he has put them in.

Q. — Have you copies of all corresiwndence that passed ?

^.-No.'

Q. — Has your brother ?

A. — Not to my knowledge.

Q— Do you keep a letter book ?

yl.— Yes.

Q. — Do you copy important letters received and sent ?

Canada.

i;56

COKRESrONDEXCK RELATIV.'O TO THE

Canaia. .1- TIicsi' lottiTs weri! iicvi-r c()i)ic.'(l. ^V'o koop a letter book in Mliich wo usually
taki' edjiics of letters reeeived ami sent. They may have been eopied by hand. Nearly
all ol' tlie letters that my brotiier wrote, either he or I usually copied them in letter
Ibrm.

U — Were they in a i)artieulap book?

-I. — Not in/ bonk at all, but on a sheet of paper.

Q. — Are llu'se eojjies iii existeiiee?

A. — I don't know that tlioy are.

(2. — Were eojjies ol'tlie letters dcspatelK'd by you kept?

vl.— Yes, it is tiie eopies despatehed by us that I refer to.

(^.— AVere tlie letters reeeived copied I

A. — No, tliey were simi)ly filed away. After the contents of the letters reeeived were
known to two or tlu-ee interested in the scheme, my brother usually took charge of thera
himself.

Q. — Do you know of any interviews that your brother had with Sir Hugh Allan or
anybody else in reference to these matters ?

-1. — Only what he told me. The only person ho ever consulted in my presence were
one or two gentlenun in Toronto. It was on one occasion when I was with him in
Toronto. We met Mr. James Beaty and his nejjhew. They were the only persons
that we conver.sed witii when I was ])resent.

Q. — You have never been ])resent at any interviews between him and Sir Hugh Allan,
or any other person representing !^ir Hugh Allan?

.1.— I was present at one or two interviews that he had with Mr. Waddington and
Mr. Kersteman, in Chicago, but I did not consider that they were themselves directly
interested. That was at the very opening of the negotiations.

I live in C'liicago. I have been recently in Pictou. I left Chicago on Sunday night.
ISIy brother was tliere at that time. He had not received any subpoena when I saw him.

Q.—Do you know anything more about tliis matter of your own personal knowledge?

A. — Nothing but the terms of the contract. I saw the contract between the New
York \ jrties, my brother, .Mr. Smith, and Sir Hugh Allan.

(2.— Wliat date was that?

.1. — It is a year since I saw it. I think it was in the fall of 1871. I cannot designate
the date.

Q. — Was the contract dated ?

.1.— I cannot swear positively that it was dated. I have merely reference to the time
that it was signed.

(2.— Did you see it signed?

vl.— No.

Q. — How can you say it was signed, if you did not see it signed?

.1. — I know it was signed between the time that my brother left Chicago and came
back, and brought the contract with him.

Q. — Did he prejiare a contract belore he left Chicago?

A.— lie prepared a memorandum on which to make the contract.

Q. — The instrument that you saw aj)parently signed, was it the instrument that he
brought back with him?

^4. — I never saw that instrument until after he came back. I have merely his word
for it that it was signed.

Q. — Can you say the date ?

A. — No, I cannot.

Q. — Have you no recollection at all?

..1. — My recollection ol' tlie date is, that it was either in December or the last of
November, 18/1.

Q. — What names did tlie writing that you saw bear ; what signatures were to it ? .

A. — The American names were W. B. Ogden, George W. Cass, Thomas Scott,
Governor Smith of Vermont, and W. G. Fargo.

The majority of these gentlemen live in New York.

Q. — Were these all ?

A. — No; Winslow Lanier and Co., I believe, signed. I understood that their sig-
natures stood for a number of other parties, and the Presidents, I do not remember
his name, of the United States and Adams Express Company.

Q. — Did the contract purport to bear Sir Hugh Allan's signature?

A. — Yes; there was the signature — Sir Hugh Allan, my brother, and C. M. Smith.

Q. — At what time did your brother leave for the purpose of procuring this
contract ?

CANADIAN I'ACIFIC RAILWAY.

i;n

ddingtoii and

inot desiyrnate

to the time

ISO and came

r the last of

t remember

VI. Smith.

A. — He left very soon after Sir Ilu^h Allan returned from England in the fall of
1S7I- I think it was in tlie last of Novemher.

Q. — What time did your lirother return?

yl.— He returned immediately after the holidays.

(^.— How many days was lu; awny ?

A. — He was away ahout live or si.\ weeks, to the best of my recollection.

Q — Do I understand you to say that he did not frame the contract, hut notes upon
which the contract was to l)e framed ?

A. — I said he prt'ijartd a nicniorandiuu for the contract, with the view to a full
contract.

Q. — Was it signed by Sir Hugh Allan you do not know ?

A. — I did not see these jjarties sign.

Q. — Do you know where that instrunu'ut is now?

.1. — I believe it is in my onice.

Q.—Ih it there?

A. — I have only my l)rotlier's words for it, that a ])ackagc of j)aj)ers in the vault
contains all these jiajii'rs. I have not seen it since a year ago.

Q. — Did you tee your brother place it in the vault then?

J.— No.

Q. — Did he show it to you himsi'lf, or did you ask to see it?

A. — He showed it to me voluntarily, as he did all the decunu-nts.

Q. — Are you interested in his business?

A. — We are partners.

Q. — Did he i)Ut the document into his package after he had shown it to you ?

A. — When he showed it to me we were in Pictuu. He went soon after to Chicago,
and I have never seen tlu' contract since.

(2. — How soon after you left Chicago did you see him in Pictou?

-1. — It was several months, lie left Chicago lor the purpose of getting this contr.icl
signed, and it was afterwards that I saw him in Pictou.

Q. — Had you not sem him in the meantime?

A. — He came to Chicago and returned. The document, as I understood him, remained
in New York for some time, and he afterwards went to New York to get it, and it was
when ])assing through Pictou that ho showed me the Contract. That was the first, and
only time I saw it.

U. — Do you know what endorsement was on the package given to Mr. Starnes?

.h— No.

Q. — Do you not know anything of it?

.1. — All I know of the jiackagc is that he told me that the letters were in the
package, and that there were two notes addressed to Mr. Starnes, to govern him ami his
action in regard to the delivery of them.

To Sir John A. Macdonald, through the Chairman:

Q. — You are a partner of George \V. Mc.MuUen?

^.— Yes.

Q.~l think you have stated that you are intimately aceiuaintcd with all the proceed-
ings and arrangements between your brother and Mr. Smith?

^.— Yes.

Q. — Who else in Chicago are interested?

.4.— There was Mr. Ilurlbert, who assisted somewhat in the negotiations as a friend
of Mr. Smith. Our relations with Mr. Ilurlbert were not very intimate. We did mil
consider that he was really negotiating,

(2.— Did you see those letters as they Mere published in the ' Montreal Herald"?

^4. — I saw them published in the ' (ilobe,' but not in the 'Herald.'

(<!• — Do you know who gave them to the 'Herald' to be published?

.l.—No.

Q. — Did vour brother not tell you?

A.~No. '

Q. — Have you any knowledge?

A. — No, I do not know — I never heard.

Q. — Have you any suspicion ?

A. — I have not.

Q. — Do you swear that you do not know ?

vl.— Yes. .

Q. — Are you your brother's partner?

A. — Yes.

Oawada.

138

rOimESPOXDEXCR RKLATIVR TO TITK

Oanada.

Q, — Ifnve vou seen all the corrcsnnilcnce from end to end?

.1.— Yes.

Q. — And yot you have not the slightest idea how these letters got into the 'Montreal
I Icrald " or ' Toronto Globe' ?

.1.— No.

(2. — Do you swear to that ?

^1.— I do.

(t — Did you nrvcr liear ol' your lirotluT giving copies of these letters to anyone?

J.— No.

l^. — Did you never hear of iiis giving copies to inc?

A. — lie told me tiiat he showed them Id you.

(2. — Do you not remember in oni- of his letters ol" his having said that he gave copies
to me ?

A. — I do not recollect.

(2— Didjie never tell you about giving copies to Mr. Huntington, to Mr. Foster, or
to anvliody else?

yl.— No.

Q. — Have you read your hrotlicr's letters that were published?

A. — I have read most oi'them.

Q. — Do you rcmeml)er in one of his letters that he said he had given copies of them
to me ?

A. — My recollection is that in the interview with you he showed you the letters. He
never saiil to me that he had given copies of them to anyone.

Q.' — Do you know how much he was to get for i)utting this correspondence into Mr.
Starnes' hands?

.1. — 1 have no recollection of his telling me directly.

(j,- — Ahhough vou are in business relations with him, you don't know whether he got
$20,000 or '20,()()l) pence?

A. — At tlie time he gave these letters I was out of the city at a branch office
in another part ol" flic State. I know from hearsay what he got, but he did noi
tell me.

(2.— Was it from Mr. Smith or Mr. Hurlburt?

yl.— No. It was from another brotlier who wrote me while I was absent from the
city.

(2.— How much did you get of these $20,000?

A. — Nothing.

Q. — Does not this amount of $20,000 ajipear in your books?

y1.— No.

Q. — You have no interest in that money ?

A. — No, I got no share or interest in it.

Q. — And yet you are a iiartncr with your brother and Mr. Smith in all the Pacific
liailwiiy matter?

.1. — Yes. I said that I was interested in the proceedings. But as far as this money
was concerned, I had no share whatever. Our partnership received none. The $20,000
were divided round lor current exjienses. Mr. Smith got some, and Mr. Hurlburt got
some. It was divided among all those acting in the negotiation.

Q.--II0W did you know tliat this money was divided round for current expenses?

A. — I heard it from a letter I received from another brother, who was in Chicago
when my brother came home.

Q. — Did you ever hear about a $17,000 cheque that was contained in the same letter?

A. — Yes; I heard l)y the same means that there was a cheque for §17,500; but I
don't recollect what my brother told me about it. All I understood was with regard to
the general arrangements aliout the package.

Q, — Did he tell you nothing about tliis cheque?

A. — He told me the other day that he would forfeit $17,000.

Q. — How was he to forfeit this money?

A. — He said that if the p.ickage was given over to Sir Hugh Allan before a certain
time after the closing of last Session of Parliament he would forfeit $17,500.

Q. — Did he tell you that if the letters were published by him, he would forfeit
$17,.'300?

yl.— No.

Q. — Did he not tell you that if any of the negotiations came out until after a certain
time he would forfeit $17,500 ?

yl.~No.

CANADIAN PACIFIC RAILWAY.

189

the • Montreal

wlictlipr lie got

bsont from the

all the Pacific

after a certain

Q. — Did he not tell you about $25,000 that he was to get from Mr. Muutington '!

A.- 'So.

Q.—IU; did not ?

A. — No. lie told me that no one ever gave him a cent.

Q. — lie told you that, hut ho did not tell you about the other matter?

^1. — lie told me about that, but he knew that I had heard about the other matter from
my otlier hrother.

Q. — You say that the paekage contained all the letters of importance, do you know
if there were other letters ?

A. I have no knowledge of any others. My l)n>ther did not say that it eontain<'d all
the Ictli'rs, and I have no knowledge as to whether the paekage contained all tlie letters
or not.

And further for the ])resent deponent saith not.

And on the twelfth day of Septeml)er, IST.T, re-appeared the said witness, and made
the I'dUowing alterations and additions to the foregoing de|>osition.

I \vi>li to add that the letters, which passed between Sir Hugh Allan and my hrother,
date iVom the beginning of the negotiations, in 1871, until the close of the first 8essioa
of Parliament — also in answer to tlie cpiestion, " Why don't you think that certain letters
" are in the i)ackage?''

I wish to ciiaiige the word t/iri/ in my answer to /, making it read, " Because I did not
" consider them of sufficient importance."

I desire also tn add, that the conversation I refer to, with my hrother, with regard to
the forfeiting i>;17,.''0(), took place a few weeks ago, and that my brother told me that
if tlie Committee was dissolved, and the package fell into tiir Hugh Allan's hands, he
would forfeit $17,i')00.

On another point I have been thinking over in my mind, since my examination, and I
now r('nu'mi)er that my brother and myself had two conversations.

The contract that he showed me at the interview, at Pictou, was a private one between
himself and his New York jjartner.

Tlie contract between the American parties and Sir Hugh Allan was shown to me at
Chicago.

I wish to add further that when I saw the charges in the newspapei-s, that my brother
was a paid witness, or something to that ellcct, I (piestioned to know if he had received
any remuneration. He replied he had not received one cent, and would not even accept
his current expenses.

Q. — I think you said that you saw in your brother's possession, either received by
him directly or from other parties, all the evidence that was published in the news-
papers, is th;'- su?

A. — I said that I saw the letters that were published in the * Globe.'

Q, — Did you see the telegrams that were published ?

A. — I saw them after they were jjublished.

Q. — You did not see them before ?

A.—^o.

Q. — Not any one of them ?

A, — Not any telegrams published in connection with his letter,
them except in print.

(2. — There is a cojiy of an alleged telegram from Sir John A.
Abbott, which was published ; did you see the original of that?

^1.— No.

Q. — Did you see the original of one purporting to be from Mr. Abbott to Sir John A.
Macdonald, which has been published ?

A. — Not except in print.

Q. — Have you any knowledge in resi)ect to how they were acquired ?

yl.— No.

Q. — Can you give the Commission any further information on this subject?

A. — I asked my brother how he got those telegrams, and he said he might tell me
some time, but he would not then.

Q. — You never saw any of the originals of the telegrams that apjiearcd ?

A. — I never saw them till they appeared in print, and I did not know that my
brother had them.

Q. — There is a letter from Sir George E. Cartier published also, did you see that?

^.— No.

Canada.

I never saw any of
Macdonald to Mr.

IK)

( OIIKKSI'OXDKNCK JJKLATI VK TO THE

Canada. 'I'o Sir Joliii A. IMmtlnnald, tlirou^li flu- ChiiinnaM :

<l Hiivc yon «<'<'i> i>'iy other pajcrs (•oiinccffil with llic suhjfct of this inquiry furtliiT

tliiiii Sir llii^li AUiin's (•orrcsiioiKlnici', ami tlic contrart you liavc spoken ol .'
.!.- Not, tliat I have any rccollcctiou of.

(). — You liavc not seen any of the jjapcrs attnclit'il to your l)rotlH'r's second letter I
nil an the teh'granis spoUeii of l)y one of tlio Coiiiniissioners?

.1. 1 (h)n't recoUeit wliiili was liis secoiHl letter. On heing informed, I sny that I
never saw these telegrams till I saw tlieni in print.

r;. — When did your hrotiur tell you that he would inform you at some future time
where he got these teligrams?

.1. -I don t recollect the exact date. It was after the letter appeared. It was in
('iiicago lie told me.

Q.- You had seen all tlie other pajicrs yourself?
yl,— I saw the correspondence.

Q.- But he withheld these telegrams from you, you say?
A. — Yes, I never saw them.
Q.--You asked him where he got them ?

A. — Yes, I asked wliere lie got the telegrams, and lie said that he would prohahly tell
nie sometime.

Q. — You did not jiress the question after?
A. No. I thought it was of no use i)ressing it.

And further deponent saith not, and this his di'jjosition having hoen read hy him he
declares that it (contains the truth, persists therein, and hath signed.
SHorn, and taken in part on the eleventh day ofj

Septemher, IS7:!, and the ''.niainder ^ j^^j^jj.,j^ ^ McMULLKN.

taken and the whole acknowledged on^ f^ '
the twelfth day of said ^r.onth and year. '

(Signed) CHARLES DEWEY DAY,

Chairman.
A. POLETTE.
JAMES ROBERT GOWAN,
Commissioners.

IN THE MATTER OF THE COMMISSION

rKOVINl'K Ol' O.VTAUIO, )

6% of Ottawa. )

Api>ointing Ciiaui.ks Dkwkv Day, Antoink PoLr.-ni-, and Jamk.'^ Roiikut Gowax, Com-
Diissioners to inquire into and report u[)on the several matters stated in a certain
Resolution moved hy the Hon. Mr. Hintinotov in the House of Commons on
tlie second day of April, a.d. 1S73, relating to the Canadian Pacific Railway.

Present: TiiK Commi.ssiom;i!S.

On the twellth day of Beptemlier, in the year of our Lord one thousand eight
hundred and seventy-three, personally came and appeared hefore us, the above-named
Commissioners,

The Honoiiral)le JEAN CHARLES CHAPAIS, of the Parish of St Denis, in the
Province of Queliec, who being duly sworn, d(i)oseth and saith :
I am Senator of the Dominion of Canada I'or the I'rovince of Quebec, and a member
of the Legislature. I was one of the Dominion Ministers from the time of Confederation
up to 2.")th January last, when I handed in my resignation.

Ji i)(;i; Poi.Krri: — 1 will read the first nart of the

charge ;

"That in anticipation of the legislation of last Session, as to the Pacific Railway, an
agreement was made between Sir Hugh Allan, acting for himself, and certain other
Canadian i)romoters, and (J. W. McMuUen, acting for certain United Stages capitalists,
whereby the latter agreed to furnish all the funds necessary for the construction of the
contemplated railway, and to give the former a certain percentage of ir.terest in con-
sideration of their interest and position, the scheme agreed U2>on being oslensibly that of
a Canadian Comjiany with Sir Hugh Allan at its head."

Q. — Have you any knowh-dge of the arrangement there referred to?

A. — Having heard the charge read, I declare that I have no knowledge of it whatever.
I know nothing of any, except what I saw in the press, and the legislation referred to in
Mr. Huntington's charge took place without there being any such arrangement. I did
not learn of any such arrangement being in existence while I was a member of the
Dominion Government^ nor did I hear of any conversations to that effect. I do not know

CANADIAN PACIFIC RAIIAVAV.

McMlILLEN.

loiisaiul cisht

ly ncj^otiiitions Imviiijj; taken jilacc witli any nicinlH-r ol' Iho (iovcriinxiit. Several

.iversatioiis (iceiirred relative to tlie means to lie taken to proenre the moiie/ necessary
lor the eonstriiclion of the Paeilie Kailway, hut 1 (h> not know that mention waM
particularly iruide of any such arranfj;ements as that rel'erred to in the deed ; in ail these
cduversations I ahvays understood that th(< -ieneral desire was that the I'aciiic Kailway
should he huilt with Hrifish capital. 1 never had any interview on the suhject with Sir
lluj;h, nor do I know tiiat any other meinher ol' the (lovernment had any in respect ol'
this matter.

.]y\H,K I'oi.KTTK — I will HOW read another i)art olthe charm':

"That suhsequently an understandiufj; was come to hetween the Government, Sir
Ilugli Allan, and .Mr. Abhott, that Sir llnjih .Mian and his friends slioidd advance a
large sum (d" money lor the jjurpose ol aiding the elections ol' Ministers and their
supporters, at the ensuing general elections, and that he and his friends should receive
the contract lor the construction of the railway."

(I — Have you any knowledge of that sort ?

A. — No; I do not know of nay sum having heen advanced to tlie Government for
election iiurposes.

(J,. — I)o you know of any promise of money having been made?

^1.— No; no sucli promise was ever made to me.

Q. — Was it ever said that any member of the (Jovernment had received money to
assist in the elections ?

A. — It was never said before me.

It is always understood that elections cannot be carried on without money. I under-
stood money was suliscribed by the friends of the candidates, but no sum of money was
derived for tlie service suggested. When I speak of aiding the elections, 1 mean the
money that is spent legally.

1 do not know if any money was subscribed for the elections of Montreal, except from
what has apjjcared in the press.

(2. — Do you know Sir Hugh Allan?

A.— I know him a little. We have never spoken but twice. Those conversations
were not relative to the Pacific Railway. If that subje was ever mentioned, in was in
so light and incidental a manner that 1 never thougbl anything of it. 1 think it quite
possible that I mentioned it to him on the cars, and I may have asked him "what
"progress are you making with your Pacific Railway project?"

I knew that Sir Hugh Allan had an interest in the construction of the Pacific Railway,
because on one occasion there was a question before me regarding an Act of Incorporat ion.

The circumstance to which I allude is this : Sir Hugh Allan was one day introduced
ill the Council Chamber, when I was present, and lie exjiressed there his intention to
take an interest in the construction of the Pacific Kailway. I think this was in the
autumn months of 1871. There had at that time been no legislation on the subject of
tliis railway, but the matter was being discussed. There were only a few words
exchanged at that time, only sufficient to give me to understand what I have just
mentioned.

There were other Ministers present.

The means were not spoken of at that time for building the Pacific Railway.

I do not remember who were the Ministers present, but I am certain the I'rime
Minister was there.

Sir Hugh Allan never spoke to me of the election fund.

I did not know lie had subscribed until I saw it in the newspapers ; I never heard of
it from him nor any one else.

I never had any conversation with Mr. Abbott on the subject of moneys to be sub-
scribed by Sir Hugh Allan for the elections, and have no knowledge of any conversation
of that kind between him and any other person.

Q. — Were you ever informed of the alleged facts into which this Commission is
enjoined to inquire?

yl.— No; there was nothing that could lead me to suspect that any such facts were
true. I think if they were true I would have known them as a Minister.

By Mr. Laxgevin, through the Chairman:

(2-— Could you say what was the opinion of the members of the Government on the
subject of the construction of the Pacific Railway by Americans and with American capital ?

A. — With the exception of one of the Ministers, whom it is not necessary to mention,
the Ministers were hostile to the construction of the Pacific Railway by Americans and
with American capital.

Q.— Can you state the name of the Minister who was considered favourable to the

C'anad*.

Ari'':

1.42

CORRESPONDENCE RELATIVE TO THE

Canada. Americans in connection with the construction of tlie Pacific Railway with American
capital ?

A. — I understand Sir Francis Hincks was not unfavourable to that.

Q. — Do you know particularly if Sir George Cartier was opposed to the construction
of the Pacific Railway with American capital ?

^4. — I have heard Sir George Cartier energetically oppose such a course, and I may
here say the same for myself.

Q. — Can you say if the negotiations for granting the Charter to the Company now cliar-
tcrcd to construct Lhe Pacific Railway, were anterior to or after the general elections ?

A. — These arrangements w<>re posterior to the elections.

Q. — Is it correct that after the general elections the Government did all they could do
to convince Sir Hugh Allan and Senator Macpherson, as representing the two in-
corj)orated Companies, to consent to ai: amalgamation of the two Comj)anies, as provijrd
for l)y the Act authorizing the Government to grant a Charter for building the Railway?

A. — The greatest eflbrts were made by the Government, and the greatest persuasion
was used to induce the interested parties in the two Companies to agree to amalgamation
for tlie building of the road, and it was only after the imj)ossibiIity of arriving at such
an agreement that the Govennnent used the means which the law gave them to exercise
in the presence of suv^h an emergency.

Q. — In granting the Charter of the Company which now exists, do you know if tlie
Government liad in. view the sjjccial interests of Sir Hugh Allan ; or if, on the contrary,
the Government did not do all it could to ensure the construction of the railway by
means of a Company caj)able apparently of securing a representation of the federal
interests of tht Dominion?

A. — From the commencement to the end the efforts of the Government were constant
to form a Company which would afford the best guarantee for the completion of tliat
great work. Those (>flbrts tended to conciliate, as far as possible, the opposing interests
of the two Province^, the most important in the Dominion, I mean Ontario and Quebec;
and to that end W(! chose tlie organization of the Company now existing, the namw
affording the best guarantee that the work will be accomplished. We considered tlie
desirability of introducing into the new Company the names which appeared in both Acts
of Incorporation of the Company.

(2. — Can you state positively that before the general elections there was no agreement
between Sir Hugh Allan and the Government on the subject of the construction of the
Pacific Railway ?

A. — In my recollection as a member of the Government, there never was any such
agreement.

(I — By the President: Can you say whether Sir Francis Hincks continued to hold
his first o])inions about American cajiital, or whether he surrendered them subsecjucntly?

^'1. — Yes; he gave uj) his own opinions afterwards, and coincided in the views of his
colleagues.

And the said deponent saith nothing more for the present.

On the thirteenth day of September, lAl'A, the witness again appeared and desired to
add the following to his deposition :

At the time of the interview between Sir Hugh Allan and some members of the
Cabinet, of which I have above spoken, he was accompanied by two ,jersons named
resjiectively Smith and ^NlcMiiUen. After the usual introduction, the question of the
Pacific was mentioned by them. As well as I can remember, the following was the
substance of the short conversation which took i)lacc on this subject. Sir John .\.
Macdonald inquired if they had anything to say. To this they replied as follows : — " In
" case projjositions are made to the Government, are they ready to discuss the".?" On
Sir John replying in the negative, the gentlemen said that undei" tliese circumstances
they had nothing to say. And the interview thus terminated.

Ii$ And further the deponent saith nor, and this his deposition having been read by him,
he declares it contains the truth, persists therein, and hath signed.

Sworn, and taken on this twelfth day of^

(Signed)

September, acknowledged
Septemljcr, one thousand
hundred and .seventy three.

13th I
eight I

JEAN CHARLES CHAPAIS.

(Signed) CHARLES DEvv^EY DAY,

Chairman.
A. POLETTE,
JAMES ROBERT GOWAN,

Commissioners.

CANADIAN PACIFIC RAILWAY.

143

with American

IN THE MATTER OF THE COMMISSION

ver was any sucli

(l and desired to

it'll read by liim,

S CIIAPAIS.

Province op Ontario,")
CiO/ of Ottawa, J

Appointing Chakles Dewey Da-»', Antoine Polette, and James Robert Gowan, Com-
missioners to inquire into and report upon tlie several matters stated in a certain
Resolution moved by the Hon. Mr. HiNTixacox in the House of Commons on
the second day of April, a.». 18/3, relating to the Canadian Pacific Railway.
Present : The Commissioners.

On this twelfth day of September^ in the year of our Lord one thousand eight hun-
dred iind seventy-three pei"sonally came and appearetl before us, the abovp-named
Commissioners,

The Honourable MATTHEW HENRY COCHRANE, of Compton, in the Province
of Quebec, wlio being duly sworn, deposeth and saith : —

I reside in Compton, Quebec.

My occupation there is I'armer and stock breeder.

I am a member of the Senate,

1 know Sir Ilugli Allan. I do not know Mr. G. W. McMullen.

(I — Have you any knowledge of any agreement or negotiation between Sir Hugh Allan
and Mr. McAlulleu in relation to tlie construction of the Canada PaciiicRailway at any
time ?

A. — None whatever.

Q. — Have you at any time heard any member of the Government or Sir Hugh Allan
himself make any reference to the existence of any such agreement or negotiation ?

^l. — Not to my knowledge.

Q. — Were you, Irom the nature of your occupation, or from any particular position
you were in, likely to become acquainted with negotiations of that character?

^1. — I might.

Q. — Have you had any conversation with any of the members of the Government in
relation to any contemplated agreement for the building of the Pacific Railway with
American capital ?

A. — I have not.

(?. — Have you any knowledge of an understanding between Sir Hugh Allan, Mr.
Abbott, and the Government, or any members of the Government, for the supplying of
money to aid in the election of Ministers and their supjjortcrs in the general elections of
1872?

J.— None, aside from what was in the i)ublic press ; nothing else.

Q. — Has anything in any way come to your knowledge which would lead you to
believe that there was such an understanding ?

A. — None.

Q. — Did you take an active interest or part in the ch?ctions of 18/2?

A. — I was interested in them ; but I was on no committee whatever.

Q. — Do you know of the subscription of any sums of money for the carrying on of
these elections ?

A. — One small sr.ia only.

Q. — Was that in the city of Montreal or in the neighbourhood where you live ?

A. — It was in Montreal.

Q. — Was that sum subscribed by Sir Hugh Allan ?

A. — It was not.

Q. — Do you know what amount was subscribed in Mont il for the promotion of the
elections ?

A. — I do not.

Q.— Do you know whether Sir Hugh Allan added to that subscription in any way ?

A. — I don't, of my own knowledge.

Q. — Have you any knowledge that anybody else, besides this one person whom you
h.ave alluded to, subscribed ?

A. — I have not.

Q. — Have you any objection to state who he was?

A. — It was the firm of Smith, Cochrane & Co., of which I am a partner. We have
been in the habit of doing so at all the general elections, and have '.^-en doing it for
many years past.

Q.~ Have you any knowledge of the matters to be inquired into by this Commission?
any knowledge relating to the construction of tiie Pacific Railway, or to tiie furnishing
of money lor the elections, which you have not stated, and which may be of use to us ?

T 2

Canada.

!'■ d

144

COKUESrONDENCE liELATlYE TO THE

CiifADA. A — I was one of the Provisional Directors of the Tntcroceanic Comjiany.

(2. — Are you aware of the negotiations which took place for an amalgamation between
tliat Company and the Canada Pacific Railway Company?

A. — Only what I have learned from the press. I never met the Directors but once,
and that was in June of 1872, in Toronto. That was before these negotiations took
])lace.

Q. — Do you know why thcpe negotiations failed ; why the amalgamation did not take
l)lace ?

A. — I don't further than what I see in the press.

Q. — Are you aware that your name was put down on the list of witnesses ?

A. — I am not.

Q, — Have you any idea what information or what kind of information was expected
to be derived from your testimony ?

A. — I have nrt ; I have no idea unless it was because I was one of the Provisional
Directors in the Interoceanic Company.

To Sir John A. Macdonald, through the Chairman.

I have no idea why I was put on Mr. Huntington's list of witnesses. I never had any
conversation with Mr. Huntington on this matter except in a joking way after he had
made liis charges.

There was nothing said by me that would lead him to believe that I knew anything
about this matter ; not the slightest.

And further deponent saith not for the present.

And on this thirteenth day of September, 1873, the witness re-appeared and made the
following addition to his foregoing deposition : I wish to add to my answer to the
question — "' Have you had any conversation with any member of the Government in
" relation to any contemplated agreement for the building of the Pacific Railway with
" American capital?" — the following: On the contrary, I have repeatedly heard one
miml)er of the Government say that on no condition would Americans be allowed to
liavo any control.

Q. — What member of the Government said so, and at what time and where was it
said ?

A. — It was the Honourable Mr. Pope, in the fall of 1872, on several occasions at
Ottawa, and also at Montreal.

And further deponent saith not, and this, his deposition, having been read to him, he
declares it contains the truth, persists therein, and hath signed.

Sworn and taken on the twelfth day of "j
September, 1873, and acknowledged I
on the thirteenth day of said month f
and year. /

(Signed) CHARLES DEWEY DAY, Chairman.
A. POLETTE,
JAMES ROBERT GOWAN, Commissioners.

(Signed) M. H. COCHRANE.

IN THE MATTER OF THE COMMISSION

PiinviNCK OF Ontario, )
City of Ottawa. )

Appointing Charles Dkwkv Day, Axtoine Polettk, and James Robert Gowan, Com-
missioners to inquire into and report upon the several matters statt'd in r. certain
RosoKition moved by the Hon. Mr. Huntixoi'ox, in the House of Coinmons, on
the second day ol' April, A.n. 1873, relating to the Canadian Pacific Railway.

Present: The Commissioners.
On this twelftli day of ^-'eptember, in the year of cur Lord one thousand tnght

hundred and seventy-three, personally came and appeared before us, the al)ove-naraed

Commissioners,

FREDERICK WILLIAM ('UMBERLAND, of the City of Toronto, who being duly
sworn, deposeth and saith :
Q. — Where is your place ol residence?
A. — Toronto.

Q. —What is your occujiation there ? ,

A. — Managing Director of the Northern Railway.
Q. — Do you know Sir Hugh Allan ?
^.—I do.

CANADIAN PACIFIC EAILWAY.

145

ation between

1 did not take

ad to him, lie

Q. — Do you know Mr. George McMullen ?

A.— I do not.

Q.~ Have you any knowledge of any agreement or any negotiations Vjetween these
gentlemen in relati JU to the building oi' the Canada Pacific Railway with American
caj)ital ?

A.— I have not.

Q, — (lave you any knowledge of any negotiations in relation to the construction of the
Pacific Railway in the winter of 1872, or the autumn of 1871 ?

yl.— Yes.

Q. — Will you state what that knowledge was ?

A. — Do you mean negotiations between other parties, or negotiations in which I myself
was engaged ?

Answer by Commissioner.

I nuan negotiations in which Sir Hugh Allan was engaged.

Answer by witness.

Noiie whatever, except for the jnirpose of the amalgamation ol" the Interoceanic Com-
pany with that of the Canada Pacific.

Q. — Had you any knowledge of any negotiations having for their object the construc-
tion ol' the Pacific Railway with American capital at any time?

.1.— None.

Q. — Were you a Provisional Director of the Canada Pacific Company, that was incor-
porated in the Session of 1872 ?

A. — I was a Provisional Director of the Interoceanic Company that was incorporated
during that Session, but not of the other.

Q. — Was the Interoceanic Company in some sense the rival of the other Company ?

yl.— It was the Company commonly known as the Mac2>herson Company.

Q. — Was it antagonistic to the other Company?

yl. — Yes, it was the rival of Sir Hugh Allan's.

(2— Are you a Director of the Canadian Pacific Railway Company — the one now
chartered ?

.1. — I am.

Q. — Have you any knowledge of any negotiations which took place for the amalgama-
tion of the Canada Pacific Railway Company and the Interoceanic Railway Company ?

,1. — I was aware of an eiTort being made to bring about that amalgamation, Vnit jjeforc
tlie iflbrts were exhausted I left for I^iigland.

Q. — Were there any negotiations Ijctween the two Companies having that end in view
— tlie amalgamation ?

A. — No, not to my knowledge. The negotiations 1 whiih I referred just now were
those emanating from the Government. My opinion as soup;ht by a member of the
Goveiiiment as to whether such an amalgamation was possible.

Q. — V\ ho was that member?

yl. — Tiie Hon. Mr. Camptell, then Postmaster-General.

(2. -What was your impression as to his views on the subject ?

yl. — Mr. Campbell evinced very great anxiety to bring about an amalgamation, and
asked my opinion as to the possibility of it, so far as I knew the opinions and views of
my colleagues on the Interoceanic Board.

Q. — At what time did this conversation take place?

yl.— T think it was about the end of October or early in November, 1872.

Q. — Did any amalgamation take place?

yl.— No.

(2.— Why not?

-l. — I caiHiot say of my own knowle-lge, because the efforts towards amalgamatin' 'id
not been exhausted when I was obliged to leave for England, and I was not awari what
couiiso these events too,; after my interview with Mr. Campbell. I was aware tliat he
acted in some measure upon my advice, my opinion being that an amalgamation was not
impossible, and that the majority of my colleagues on the Interoceanic Board would con-
sent to such an amalgamation, provided that they obtained u sulRciout guarantee for the
exclus on of American influence, to which I had already expressed our objection. Mr.
Campbell told me that those guarantees would be given, and of a nature that would be
quite satisfactory to us. I then, although recognizing personal difficulties as between Sir
Hugh Allan and Mr. Macpherson, expressed the opinion tliat the majority of my col-
leagues on the interoceanic Board would accept such a guarantee and consent to the
amalgamation. Thai, however, did not priv,j to be correct.

Canad.\.

Q. — Was any sufficient guarantee given to the Interoceanic Company?

m-ii

iff "**

Canada,

I4n

CORRESrONDENCE RELATIVE TO THE

A. — 111 my opinion the guarantees that were then suggested by Mr. Campbell were
amjily sufficient.

Q. — They did not satisfy the Intcroceanic Company, did they?

A. — I don't know. I tliiuk there were some personal reasons that probably offered
additional obstacles.

Q. — I low long were those negotiations going on, tending to the amalgamation of the
two Companies?

A. — It must have been for a very short time, because I left, immediately after my
intcrvi'Hv with ]Mr. Campbell, for England.
Q. — Are you able to say whcni tliey began?

A. — My impression is that Mr. Campbell came to me first, so far as Toronto was
concerned at any rate. I don't linow tliat I am able to state the date of that conversation
witli accuracy, for I only remember it as immediately preceding my leaving for England.
I til ink I left for England early in November.

Q. — Had you any conversation Avith any other Member of the Government on the
subject ?

A. — Yes. I had a conversation with Sir John A. Macdonald.

Q. — What was tlie purport of that conversation ?

A. — It was after my interview with Mr. Campbell, and I think on my way to England ;
the conversation was somewhat similar to tliat which I held with Mr. Campbell. I think
I told Sir Jolin the purport of that conversation, and repeated my own views as to the
possibility of an amalgamation.

Q. — Was there any conversation especially, as to the exclusion of American capital
and of the American element altogetlier, in your interview with Sir John A. Macdonald?

-I. — Yes; both with Mr. Campbell and Sir John A. Macdonald. I explained that the
American element would have to be excluded, but I thought if there was a sufficient
guarantee given as to that, an amalgam<ation might be effected.

So far as my knowledge goes, I understood that the Government always held the same
views as to the desirability of amalgamation.

0. — Have you any knowledge concerning the elections of 1872, in the Province of
Quebec, jiarticularly in Montreal ?

A. — None.

Q. -Have you any knowledge of money being subscribed in aid of the elections of
Ministers and their sujiporters, either in Quebec or Ontario?

A.—\ have some knowledge of efforts being made for raising money for election
purposes in Ontario.

Q. — Do you know whether Sir Hugh Allan contributed ?

A. — I have no jiersonal knowledge ; I have learned it from hearsay, and from the
newspapers, but I have no knowledge of my own.

Q. — Did tliat information come from any member of the Government, or from Sii
Hugh Allan?

A. — No ; from ncitlier.

Q. — AV^ere you on any of the election committees in Ontario?

A. — No, I was not.

Q. — I understood you to say that you know alisolutely nothing of the elections in the
Province of Quebec ?

A. — Nothing whatever.

Q. — You don't know whether any money was subscribed by any party there ?

A. — I do not.

Q. — Do you know of any money being received from Quebec for the purpose of
elections in Ontario?

A. — No, I do not.

Q. — Am I right in understanding that the great standpoint of the Intcroceanic
Company was Canadian influence, and in so far as it was a rival and antagonistic to Sir
Hugh Allan's scheme, it was supposed to exclude American influence. Was that the
chief and prorr.ir."nt distinction?

A. — 'i'l'.at appears in the papers to be the reply which the Intcroceanic Company gave
to the Cfovernment.

Q.~ Was that the fact ?

A, — There is not a question about it. There were some individual reasons also which
offered obstacles.

Q. — Do you know anything about the chief object of the Intcroceanic Company ; was
it based u])on any principle, or was it merely with the object of making money or some-
thing else? .

CANADIAN PACIFIC RAILWAY,

147

nment on the

ections in the

'ompany gave

ns also which

A. — I really don't know. I was invited to join it very early in its history. My im-
pression is that at that time the idea of Canadian and British inlluencc being employed
in it was the basis.

Q. — You were subsequently appointed a director in the Chartered Comj)any, the
Canadian Pacific, were you not";

A. — Yes.

Q. — At whose instance were you appointed ?

A. — I really don't knoM-. The i.ppoiiitmcnt was made during my absence in England.

Q. — It was a Government appointment, wtif it not?

.1.— Yes.

Q. — Do you know ^..^w your name came to appear?

A. — I have no knowledge. I have my own suppositions. My suppositions are l)ased
upon a conversation that I liad with Sir John A. Macdonald belbre 1 went to England.
The sul)ject of that conversation was to, in the event of amalgamation failing, who might
be regarded in Ontario as reliable persons to serve upon tlie new Board.

Q. — Did he at that time give any indications that he desired you to act ui)on this
Board ?

A. — We considered a number of names as to their fitness, and Sir John did nie the
lionour of asking my opinion, and in that list my own name was placed, and I then told
Sir Jolm that I gave him carte blanche.

Q. — You liave been a long time connected wifli Hallways?

A. — Yes.

Q. — You have the credit of being sharj) in these matters?

A. — I had no desire to serve upon that Board.

Q. — Did you gatlier from Sir John's convei-sation that it was his desire to seek out
competent persons ?

A. — We parted with the understanding, that as far as I was concerned, if it was
thought I could be useful or he desired that I should serve, he might use my name.

Q. — ^Yere tliere any gentlemen from the Interoceanic Boiird named in tliis Canadian
Pacific Company ?

A. — Yes ; Major Walker.

Q. — Any other ?

A.— Mr, Walter Shanly.

(2.— Any other ?

A. — I tliink there were four; I forget the last.

Q.—Wlio is Mr. Walker?

A. — He is a resident of London, Ontario, and largely interested in oil works hi that
neighbourhood.

Q. Mr. Shanly is an engineer, is he not?

A. — lie is an engineer of the highest standing, and has largo railway experience.

My imi)rcssiou is, that there were others who were on tlie lntt>roceanic Board appointed
Directors of tlie Canadian Pacific Company, but at tills moment I do not recollect them.
Looking at tlie list I see there were Major Walker, Mr. Shanly, uiid myself — these are
the only ones that I recognize from Ontario.

To Sir John A. Macdonald through the Chairman :

Q. — On this occasion, on wlrich you and I had the conversation anterior to your going
to England, do I understand that tliat conversation was as to tlie formation of a Boanl
in case the amalgamation fell througli ?

J.— Yes.

Q. — And I was negotiating to get your opinion as to fitting representatives from
Ontario on the Board of the Chartered Company ? We considered a great many names,
including your own, did we not ?

A.—\VH.

Q. — You said that if you could be of use in the Company or out of the Company tliat
I might use your name ?

A.~l did.

Q. — You took part m the Elections in Ontario, did you not ?

A.~l did.

Q. — In Toronto and vicinity ?

A. — Yes.

Q. — Did you subscribe to the Elections at Ontario?

A. — I heljied at the Elections pecuniarily.

Q. — In subscribing to the Elections, did you consider in any way that you were
recompensing the Government for any interest in this railway.

Canada.

148

CORRESPONDENCE RELATIVE TO THE

Canada. A, — CtMtaiiily I did not. I subscribed and paid as a member of the party. I may
just add this that I expressed rather strong reasons originally when I was invited to go
on tlie Interoccanic Hoard ; and to yourself, I think, subsequently, with rel'erence to tlie
possibility of my name being ])laced on the Board of the present Company, and at that
interview, anterior to my going to England, I said that I had no desire to serve upon that
Board, that I saw nothing in it : That tlie terms then described by the Government were
not sucli as to attract anybody to the work, but that I was willing to work as a public
servant. I did not consider that the terms were sufficiently liberal.

Q. — You agreed to serve upon the Board if it was necessary, from public and patriotic
motives ?

-1. — As a public servant. I saw nothing in it.

And furtlier deponent saith not, and this his deposition having been read to him, he
declares tliat it contains the truth, persists therein, and hath signed.

Sworn and taken on the twelfth day of \

Septcmbe;, 1873, and acknowledged /•si^ned^ V W C'lMRFRT AND

on the thirteenth day of said month K^^6^<^V i ■ W. bJMlil.KLAMD.

and year. J

(Signed) CHARLES DEWEY DAY, Chairman.

A I'OLETTE,

JAMES ROBERT GOWAN, Commissioners.

"•}

IN THE MATTER OF THE COMMISSION

1^'

Province op Oxtario,
Citi/ of Ottawa.

Appointing Craiiles Dewey Day, Antoine Polette, and James Robert Gow;*x,
Commissioners to inquire into and report upon the several matters stated in a
certain Resolution moved by the Hon. Mr. Huntixgton in the House of Commons
on the second day of April, a.d. 18/3, relating to the Canadian Pacific Railway.

Present : The Commisstoner.«.

On this twelfth day of September, in the year of our Lord one thousand eight hundred
and seventy-three, personally came and appeared before us, the above-named Com-
missioners,

DONALD McINNES, of the City of Hamilton, Merchant, who being duly sworn,
deposeth and saith :

I reside in tlie city of Hamilton. My occupation there is that of a merchant.

I know Sir Hugh Allan. I do not know Mr. Geo. McMullen.

Q. — Do you know of any negotiation carried on between these gentlemen, or of any
agreement between them in the autumn of 1871 or the winter of 1872 for thepurpose
of building the Canada Pacific Railway with American capital ?

A. — No ; I know nothing about it. I may state that I think it was in tlie autumn
of 1871, Sir Hugh Allan asked me whether I would consent to become a director ol tlic
Canada Pacific Railway, and I consented. I think he told me in general terms that he
was negotiating with some American capitalists, but I know nothing whatever beyond
that. I don't think he stated who they were,

Q. — Do you remember about the time this took place?

A. — No. I do not.

Q. — Can you fix about the time?

A. — I cannot charge my memory exactly. I remember the occasion. It was on
the train between Cornwall and Montreal. We had been at Cornwall to attend the
meeting of a manufacturing company, in which we were both interested, and it M'as on
the way back to Montreal that we had this conversation.

I think it was about the latter end of 1871.

Q. — Had the winter set in ?

A. — I think so.

Q. — Did he mention to you the name of Mr. McMullen ?

A. — No. I don't think I ever heard of his name until it appeared in print recently.

Q. — Did you understand that any agreement had been made ?
'■ ^. — No. I understood that no agreement had been made.

to. — Were you one of the Provisional Directors of the Canada Pacific Railway ?

^.— Yes.

Q. — In that capacity did it come to your knowledge that any negotiations M'ere being
carried on ?

A. — No : it so happened that I never attendod any ,»f the meetings.

CANADIAN PACIFIC RAILWAY,

149

ead to him, he

IBERLAND.

Q, — IIiivc you had any conversation witli any member of the Government that .Canada.
wouUl lead you to tliink that such negotiations were going on?

^.— No.

Q. — Do you mean to say that you liave no other knowledge than that which you have
stated above in rel'erence to these negotiations?

A. — None ''. natever, except, of course, what has recently appeared in the newspapers.

Q. — Are you a member of the present Canadian Pacific Company?

A. — Yes. I was named a Director wlien I was in England, by Sir John A. Macdonald.

Q. — Can you state why that Comj)any was chartered, instead of the old Company,
"the Canadian Pacific/' going on?

A. — No, I cannot state the exact reasons. I was absent in England when that Company
was formed.

Q. — Have you any knowledge of any negotiations between the Canada Pacific Company
and the Interoceanic Company with respect to an amalgamation ?

A. — None excejit what appeared in the public pa])ers.

(2. — You don't know otherwise than from the public prints that such a negotiation was
carried on between the two Companies?

A. — No ; I may have heard it mentioned in conversation that sucli a thing was going
on, but nothing beyond that.

(2. — Do you know whether there arc any American capitalists among the Directors of
the Canadian Pacific Company, or any American capital invested there ?

A. — I am not aware of any.

Q. — Have you any knowledge, Mr. Mclnncs, of money having been subscribed for the
sujiport of Ministers and for the aiding of elections of Ministers and their supporters in
1872, at the general elections in Ontario ?

.,•1. — Yes ; I know there was money subscribed in the constituency where I belong,
find paid.

Q. — ^Do you know whether any money was subscribed by Hir Hugh Allan or Mr.
Abbott ?

.1. — No; I do not know of any.

Q. — Was any money sent up from the Province of Quebec ?

A. — None that I am aware of,

(2.— Have yon any knowledge relating to the elections in the Province of Quebec?

A. — None whatever.

To Sir John A. Macdonald, through the Chairman :

Q. — I think you are one of the principal merchants in Hamilton ?

A. — I am a merchant there.

Q. — It was in your capacity as being a merchant largely engaged in business that Sir
Hugh Allan asked you to go on the Board of the Canada Pacific Company?

A.- — I presume so.

Q. — And to get a representative from Ontario?

A — I think so.

Q. — From whom did you first get any informa^^ion of your being selected to serve on
the Board of the Chartered Company ?

A.- — From yourself I was in London at the time, and received the news by cable.
I received no information other than from yourself I answered accepting the appoint-
ment.

Q. — Have you any jjarticular relations with Sir Hugh Allan?

A. — No, none. I am quite independent of him in business matters, except that we
have a joint enterprise in Cornwall in a manufacturing Company.

I know u? subscriptions being made at the last elections in Hamilton. That always
hajjpened at t^ections, unfortunately. I know that I subscribed.
Q. — On the right side, and at the right time ?

A. — Yes ; I did that of my own accord, and not on account of being on the Pacific
Railway. Decidedly not. I did not show any great anxiety to get on that Board, or to
be connected with that enterprise.

Q. — Was it altogether as a matter of duty and principle that you consented to serve
on that Board ?

A. — I felt that it was a great national undertaking, and if my services would be of
any use in its promotion, that it was my duty to place them at the disposal of such a
public work.

And on this thirteenth day of September, 1873, reappeared the said witness and made
the following addition to his foregoing deposition :
I desire to add with respect to some correspondence which was published in the news-

150

rOERESPONDENrE RELATFYE TO THE

CANAnA. pajjcrs, in which my name was i)ut ns receivins hy wuy of gilt, as I undi-rstood it, the
sum ol' !ir)O,0()0 ol' thi' C'anathi Pacific stock. I beg to state that Sir Hugh Allan, nor
any one else, never made such an unworthy proposal to me.

And further deponeth saith not, and this his deposition having been read to him, he
declares that it contains the truth, persists tlierein, and hath signed.

Sworn and taken on the twelfth day of September, "J

1873, and acknowledged on thirteenth day V (Signed) D. McINNES.
of said month and year. J

(Signed) CHARLES DEWEY DAY,

Chairman.
A. POLETTE,
JAMES ROBERT GOWAN,
Commissioners.

•}

IN THE MATTER OF THE COMAHSSION

P ^L*

^r''

Provixce op OxTAnin,"
Citi/ of Ottawa.

Appointing Charles Dkwey Day, Axtoine Polette, and James Roiiert Gowax,
Commissioners to inquire into and rejiort upon the several matters stated in a
certain Resolution moved by the Hon. Mr. HrxTrxoTON in the House of Commons
on tlie second day of Ajiril, A.n. IS73, relating to the Canadian Pacific Railway.

Present : The Commissioners.

On this twelfth day of September, in the year of our Lord one thousand eight
hundred and seventy-three, personally came and appeared before us, the above-mamed
Commissioners,

ROBERT N. HALL, of the Town of Sherbrooke, in the Province of Quebec, Advocate,
who being duly sworn, dcposeth and saith :

I reside in Sherbrooke. My profession is that of an advocate.

I know Sir Hugh Allan. 1 do not know Mr. G. AV. McMullen.

Q. — Have you any knowledge of any negotiation or agreement between Sir Hugh
Allan and Mr. McMullen, relating to the construction of the Pacific Railway ?

A. — Not the least, no knowledge of it whatever.

(2 — Have you ever had any conversation with any member of the Government in
relation to any such agreement ?

A . — I have not.

Q. — Have you ever had any means of knowing whether such a negotiation was going
on with a view to an agreement of that nature?

-.1. — I never saw anything to indicate it.

Q. — Is it then a matter concerning which j'ou know nothing at all?

A. — I have no knowledge of it Avhatever, not the least.

Q. — Have you taken an interest or have you been engaged in railway enterprises ?

-1. — I have taken quite .in interest in the promotion of railways in the section of
country in which I live.

U- — Have you had any interest or taken any i)art in the movement for building this
Pacific Railway?

.1. — I was ajipointed one of the Directors of the Canadian Pacific Company, that is the
CJiartered Comi)any.

(I. — When did your acquaintance or connection then begin with the enterprise for
building this Railway ?

-1. — It was only a short time before my appointment and before the signing of the
contract.

C2. — Before that did you know anything about it or had you taken any interest in the
matter ?

A. — I had taken quite an interest in it, although I did not identify myself in any way
with its promotion.

'i. - You had not been consulted by Sir Hugh Allan or any other person in relation
to the construction of it .

-^^1. — No, I had not. I had no connection with Sir Hugh Allan in reference to it. In
fact I did not know him before the contract was signed. My acquaintance with him is
only since that time.

Q. — Did you take any part in Lower Canada in the general elections of 1872 ? .

A. — I did not^

CANADIAN PACIFIC RAILWAY. '

161

bee, Advocate,

i^een Sir HurIi

Q. — Do you know of any money having been subscribed in aid of tlie election of
Ministers or their supporters?

A. — No, I do not. Tliere were very lew contested elections in the Townships, the
elections were by acclamation — those at least in the part of the Townships were I reside.

Q. — Do you know anything of the Montreal elections?

A. — Nothing whatever.

Q. — Do you know whether there was any subscription of money for the carrying of
them on ?

A. — I do not.

Q. — Do you know whether Sir Hugh Allan contributed anything in aid of the
elections in any part of the Province of Quebec ?

A. — I do not. No contribution ever came to my knowlege in anv way.

Q. — Are you aware of the reasons for which your name was put on the list of
witnesses ?

A. — I cannot imagine any reason. I never had any conversation with Mr. Hunt-
ington at all. I had no knowledge of anything that tended to support the charges made
by him.

To Sir ,Iohn A. Alacdonald, through the Chairman :

Q. — Do you know at whose instance it was that you became a member of the Board
of the Canadian Pacific Railway ?

A. — At the instance of the Hon. Mr. Pope, Minister of Agriculture ; at least I under-
stood I was nominated by him. He is tlie representative of the Townships in my part of
the country. He asked me to become a Director. He said it was desirable that that
suction of the country should be represented on the Board, and asked me to act. He saiti
there were two representatives from Montreal, and one from Quebec, and he thought
therefore that the Eastern Townships should have a representative on the Board.

I was in no respect, that I am aware of, the nominee of Sir Hugh Allan.

I had no personal acquaintance witli Sir Hugh Allan at the time. I had reason to
believe that Sir Hugh Allan wished to name another gentleman in my place. That
gentleman was Mr. Foster. I understood tliat negotiations, at least the signing of the
contract, was delayed on account of Sir Hugh Allan's pressing the nomination of Mr.
Foster.

And further deponent saith not, and this his deposition having Iteen read to him, he
tleclares that it contains the truth, persists therein, and hath signed.

Sworn and taken on the twelfth day of
September, 1873, and acknow-
ledged the thirteenth day of said
month and year.

(Signed) CHARLES DEWEY DAY, Chairman.
A. POLETTE,
JAMES ROBERT GOWAN, Commissioners.

Canada.

(Signed)

ROBT. N. HALL.

IN THE MATTER OF THE COMMISSION

Province op Ontario,)
City of Ottawa. §

Api)ointing Charles Dkwky Day, Axtoine Poi.ktte, and Jamks Robkkt Gowax, Com-
missioners to inquire into and report upon the several matters stated in a certain
Resolution moved by the Hon. Mr. Huxtixotox in the House of Commons on
the second day of April, A.D. 1873, relating to the Canadian Pacifin Railway.

Present : TiiK Commissiox'ers.
On this thirteenth day of September, in the year of our Lord one thousand eight

hundred and seventy-three, personally came and appeared before us, the above-named

Commissioners,

JOSEPH IIAMEL, of the City of Quebec, Merchant, who being duly sworn, deposeth
and saith :
I know Sir Hugli Allan very slightly. I never had any conversation with him.
I do not know G. W. McMullen.

Having heard read that part of the charge contained in the Royal Commission which
reads as follows :

"That in anticipation of the legislation of last Session, as to the Pacific Railway, an
agreement was made between Sir Hugh Allan, acting for himself and certain other

U 2

152

COimESPONDENCK RELATIVE TO TTIIO

Canada,

ifi'

Canadian promoters, and (.i. W. McMullcii, acting for certain United States capitalists,
wliercl))' tlio latter agreed to furnish all tlie funds necessary for the construction of the
contemplated railway, and to give the former a certain percentage of interest in con-
sideration of their interest and position, the scheme agreed upon being ostensibly that
of a Canadian Company with Sir Hugh Allan at its head,"

I declare that I know nothing of tliis arrangement. 1 only know wliat I have seen in
the news])apers, nothing more,

I am not aware whether the Ciovernment knew of the existence of such an arrange-
ment between Sir Hugh Allan and G. ^V. McMuUcn.

I do not know whether there existed any negotiations between certain persons for the
construction of the Canada Pacific Railway,

No Minister or meml)er of Parliament spoke to me on the subject, I declare that I
only know of this affair through what 1 have read in the newspapers.

Having heard read the other part of the charge contained in the Commission, which
reads as follows :

"That subsequently an understanding was come to between the Government, Sir
Hugh Allan, and Mr. Abbott, one of the members of the Honourable House of Commons
of Canada, that Sir Hugh Allan and his friends should advance a large sum of money
for the purpose of aiding the elections of Ministers and their supporters at the ensuing
general elcci'ons, and that he and his friends should receive the contract for the con-
struction of tht railway,"

I declare that I know absolutely nothing of such an arrangement, except what I have
learned tiirough the press. Sir Hugh Allan never told me that he had advanced money
for the elections of Alinisters and their supporters, nor did Mr. Abbott, whom I know
very slightly. No member of Parliament or Minister ever told me that Sir Hugh
Allan had advanced money for the elections of 1872.

I have no knowledge that money was subscribed (or ihe Montreal elections. As to
other places, 1 am aware that subscrij)tions are always raised to assist the elections of
JViends of the Government. I do not know that Sir Hugh Allan subscribed to aid the
elections, nor Mr. Abbott either. I do not know if the friends of Sir Hugh Allan
advanced sums of money for the elections of Ministers or their friends. When I say
that I do not know that sums of money were advanced for the elections of 1872, I mean
sums coming from this source — that is from Sir Hugh Allan, There were moneys
subscril)ed by other friends of the Government towards the elections, but it was not for
the election of Ministers. The subscriptions I have just Mentioned may have reached
five or six thousaiul dollars for the election at Kamouraska. I am not aware of any
moneys for other eUctions, I have never had any conversation with members of
Parliament or Mith Alinisters on the subject of subscriptions by Sir Hugh Allan or Mr.
Abbott, or their friends, for the elections of Ministers or their partisans, and no conver-
sation occurred in my presence on the sulyect. I know absolutely nothing, of my
jiersonal knowledge, of the charges mentioned i i the Royal Commission.

I can form no idea why my name was on th j list of witnesses unless it was because I
am a friend of the Government,

I persist in declaring emphatically that 1 have no knowledge of any arrangement or
understanding such as that mentioned in the charges before the Royal Commission, and
I declare that I have had no conversation with Ministers or members of Parliament on
this subject, and that they have never spoken about it in my presence.

The money subscril)cd for Kamouraska was subscribed at Quebec and Kamouraska.
It did not come from Montreal,

And further deponent saith not, and this his deposition having been read to him, he
declares that it contains the truth, persists therein, and hath signed.

Sworn, taken and acknowledged on the day,^

month, and year first above written, > (Signed) JOS, IIAMEL.

before us, j

(Signed) CHARLES DEWEY DAY, Chairman.
A. POLETTE,
JAMES ROBERT GOWAN, Commissioners.

Sfi.'.,

f'AXADIAN PACIFIC RAILWAY.

ina

IN Tin: MATTER OF THE COMMISSION

have scon in

rsoiis lor tlie

vas because I

PlvOVINCK OP OmTARIO,

City of Ottaira.

Ajipoiiiting Ciiai!m:s I)i:\vi:v Dav, Antoini.; Pouottk, and Jami:?! Roiumit Gowav, Com-
inissioiu.'i'H to iiKiiiire into ami i\-\)q\-\ upon the st'vcral matters stated in a certain
liesol'.itiiin moved hy the Hum. 5lr. I[i .ntin(JTO\ in the House of Commons on
the second day of April, A.n. iS/;?, rclatinjj; to the Canadian Pacific Railway.

Present: Tni: C'o.mmissio.nkks.

On this fifteenth day of Septemlier, in the year of our I^ord one thousand eight
Innidred and seventy-three, personally came and appeared before us, the above-named
Commissioners,

ECEllTON K. lU'RPEK, of the City of St. John, in the Province of New Brunswick,
Civil Engineer and Contractor, who being duly sworn, deposeth and saith :

Q. — Are you a member of the Dominion Parliament ?

yl.— No.

Q.— Wi you know Sir Hugh Allan ?

A. — I am acquainted with him slightly.

Q. — Do you know Mr. (Jeo. McMullen ?

^.— Yes.

^.— When did jour acquaintance witli Mr. McMullen begin, have you known him
any length of time?

.1. — No; I have known him since about the Session of 1872.

(l — ^Vere you one of the Provisional Directors upon tlie Board of the Canada Pacific
h'ailway Company, incorporated during the Session of \S72''.

A. — Yes.

Q- — Have you any knowledge, Mr. Burpee, of any agreement between Sir Hugh Allan
and Mr. .McMullen, representing certain American capitalists, for the building of the
Pacifii- Railway with American capital?

,1. — I was told by Mr. McMulh.'U that there was such an agreement.

(2— Do you remember when he told you that ?

.1. — At the same time — the Session oi' 18/2.

Q — Can you specify more nearly the year, month, or day?

A. — It was about the last of the Session.

Q. — Was it after the Act of Incorporation had been passed or before ?

A. — It was before.

Q. — What did he say to you on that occasion?

A. — I met him a great many diflerent times. He told me there was an arrangement
made with American capitalists, in connection with Sir Hugh Allan, to build the road ;
and he wished me to become a member of the Company.

Q. — Did he state if there was any condition of that arrangement by which a certain
interest was to be paid to Sir Hugh .\llan?

.1. — No. There was a condition that Sir Hugh Allan was to be one of the Comjjany.

Q. — Do you know who were the American capitalists whom Mr. McMullen
represented ?

-I. — I cannot remember them all; there was a large number. There was Governor
Smith mentioned. Jay Cooke, and General Cass.

2. — ^Did you understand that the (Government of the Dominion was at that time
favourable to that arrangement ?

A. — No, I did not. It was rather adverse.

Q.. — Did ^Ir. McMullen say anything to you on that subject ?

A. — Nothing definite at all, except that he wanted the Government to acquiesce.

Q. — Was this after the agreement to which you have adverted had been signed ?

A. — He said it had been signed.

Q. — At whose instance did you become a Provisional Director?

A. — At the instance of Sir Hugh Allan and Mr. Abbott ; but I was for a long time
interested in the Pacific Railway. We had been talking about it for some four or five
years. I was solicited by both the Interoceanic and the Canada Pacific Company to join
with them. I had a desire to be interested in the work, having already spent four or five
years in working in connection with it

Q. — W^ere jou requested to become a Provisional Director of the Interoceanic Com-
pany before you were connected with the Canada Pacific Company ?

il.-Yes.

Q, — Was the Government aware that you had been requested to become a Director of
the Interoceanic Company ?

Canada.

1S4

COIIIIESPONDENCE RELATIVE TO THE

. K ■

II.

Canada. /J. — J cnnnot say timt they wore. Tlioso mombors of tlio Govfrnmeiit with whom T
had any coMvcrsatioii liad always told mo that tlie two Companies would l)c amalga-
mated ; or at loail lliat was their imi)ressioii.

Q. — Who were those members of the (ioveriunent?

A. — The members from the Province of New Bi uiswiek, M/. Tillcy and Mr.
Mitchell.

Q. — What reason had you to !)clievo that the Government was adverse to the intro-
duction of American cajntal?

A. — I liad l)een told by members of the Govi'rnment that it was intended that tlic
road should be built with Canadian or British capital.

Q. — Will you name tlie {gentlemen who told you so ?

A. — I d(i not rcniembc.'r e.\actly, Init 1 know tiuit it was Mr. Mitchell's idea that the
road shoubl be; so built.

Q. — Any other besides Mr. Mitchell?

A. — I tliink there were several others besides him. 1 tliink it was Mr. Tillcy's
idea also.

Q. — From your several conversations with members of the Government what was the
conclusion tliat you came to as to the disjjosition of the Government in the matter '!

A. — I was (juite convinced that the two Companies would hv united. For that
reason I thoui^lit that it was immaterial as to wiiich Comi)any I belonged to. My
opinion is, from the conversations I had^witli members of the Government, that the
Government was adverse to the admission of American capital.

Q. — Had you any personal knowledge of negotiations tending to the amalgamation of
these two Companii's — the Interoceanic and the Canada Pacific?

A. — No personal knowledge.

I took no part in these negotiations.

Q. — Do vou know why the negotiations were unsuccessful ?

^.— No."

Q.- — An- you now a memljcr of the Board of Direction of the Canadian Pacific
Company ?

^.— Yes.

Q. — By whom were younominatcd a Director?

A. — By the members of the Dominion Government for tlie Province of New
Brunswick, Mr. Tilley and Mr. Mitchell.

Q. — That Company consists of how many Directors ?

A. — Thirteen.

Q. — Do you recollect the date of that Charter ?

A. — I think it was in January, 1873. I cannot remember precisely. I was here at
the time. Perhaps it was February.

Q. — When you were asked to become a Director of the Canadian Pacifi • Company, or
rather before you were asked to be so, were you consulted in regard to the terms of the
Charter?

A. — I liad talked it over with different parties, and I was told what the provisions
were, and I also liad an opportunity of reading it.

Q. — When was the contract given under this Ciiarter ?

A. — At the same time, if I recollect right, or a few days afterwards.
Q — Having seen the Charter, what was your opinion in regard to it, and the terms of
the contract upon it ?

A. — It was to be entirely Canadian under this new Charter.
Q. — Was the stock subscribed in order to lead to that result?

A.— It was. It was distributed in the dillerent Provinces in proportion to their
population. I was retjuested to get up one-thirteenth of the stock, and before I became
a member the greater portion of the stock for New Brunswick was subscribed by other
people.

Q. — Then tlie stock was to be redistributed by the thirteen Directors in their several
Provinces ?

A.~Yes.

Q. — Were there any prescribed terms on which the stock should be given out by
these thirteen Directors?

A. — Yes ; there was no one allowed to exceed a certain amount, and it was to be kept
entirely in the hands of British subjects. It was to be given out to the difi'ereiit
Directors in j)roportion to the population of the Provinces which they represented; lor
instance, one-thirteenth of the wliole stock was allotted to the Province of New
Brunswick.

CANADIAN PAf'IFIC RAILWAY.

155

idcu tluit thu

adiaii Pacific

nee of New

was here at

ic provisions

the terms of

their several

;ivcn out by

Q. — Were you prohibitt'd from putting any premium uinm it?

^.-Yes.

(}. Were these thirteen Directors on an equal footing?

A. — Yes ; so I understood.

Q,- 'I'lure was no i)refcrencc given to any one over the others?

A. — I never could see any.

Q. As a man experienced in the construction of railroads, do you consider the
('liarter to he, or the contract to t)e, one of a particularly favourable and profital)le
duiracter ?

A. — I did not consider it satisfactory,

Q.- .Satisfactory to whom ?

A. — I mean that I did not consider it advantageous. I considered it a liard contract.

(2.— You stated, did you not, in the beginning of your evidence, that you are a rail-
road contractor?

A.-Yes.

Q. — Were you induced to take a ])art in tlie Directorship of this Company with the
]]0])c of making a i)rofit out of it ?

A. — I thouglit so at first, but when I cam" into this last Comi)any I could not see
mucli chance lor making a profit. I exi)ecte(l in the first i)Iace when I was working in
connection with tlu; road that a profit mijjbt be made out of it; that is, years previously
I tliouglit so.

(2. — Have you any knowledge of any undirstanding Iictween the Government and Sir
Hugli Allan and Mr. Abbott, for the furnisiung of money for the promotion of elections
iu 1872?

A. — None whatever.

Q. — Where were you during the period of these elections ?

A.— In New Brunswick, I think.

Q. — You arc not in a position to know anything of the matter ?

^.— No.

Q. — Have you any reason to believe that any money was subscribed in the Pi'ovince
of {^uelicc or Montreal for the purpose of the elections?

^l. — It is a matter of wliich I have absolutely no knowledge.

Q. — I suppose you took some interest in the elections in New Brunswick ?

A. — In some of them.

(2. — Do you know if money was subscribed there for the supjwrt of the elections?

A. — I did not see any subscribed ; but I know money was spent.

Q. — Do you know from what source the money came ?

A. — From individual candidates and from their friends for them.

Q. — Have you any knowledge that Sir Hugh Allan or Mr. Abbott furnished any
money for election jjurposes ?

A. — I do not know. I have no knowledge whatever.

Q. — Do you know whether any money was sent to New Brunswick for election
purposes from tlie Provinces of Quebec or Ontario?

A. — I iiave no reason to believe there was.

Q. — Have you had any conversation with any member of the Government which
would give you any knowledge upon that subject?

^.— No.

a— Or with Sir Hugh Allan?

^.— No.

Q. — You say you know Mr. McMullen. Have you any knowledge of the correspond-
ence! which took place between him and Sir Hugh Allan ?

.1. — Nothing, excejjt what he told me of the correspondence.

(2. — Have you anything to add to what you said he told you iu relation to that
correspondence ?

yl.— No.

Q. — You have never seen the correspondence between them — any of the original
letters ?

. I. — I have seen some of the original letters, but I cannot say now what they contained.

Q. — Would you be able to identify any of them now ?

A. — I am not certain. I don't think I would.

Q. — Were any of the letters which you saw afterwards published in the public prints ?

A. — No; but I have- not read them all. I cannot say for certain that they are the
same. I would not undertake to say that I could identify them, as I paid at] the time
very little attention to them.

Canada,

FipF'

li'"'^'

15(1

COimESPONDENCE RELATI'^E TO THE

■VI"'

if'

Canada. (2.— Were you present at any of tlic conferences between Sir Hush Allan and :\Ir
McMnllen?

J.- No.

0.- — Or with either of these gentlemen and any member of the Government ?
A. — No.

Q- — ^o you know anytliing about tlicse telegrams which have been publislicd ?

.•1. — No knowledge whatever.
i Q. — Have you any further knowletlge relating to tlic subject of this inquiry ?

-1. — I don't think of any.

'-2- — Do you know wlietiier Sir Jlugh Alhin received any money from United States
capitalists ?

A. — Mr. McMullen told me tliat lie had advanced liim money for the preliminary
ex])enses of organizing the Company and getting llie (.'harters.

Q. — Have you any other knowledge ijesides that?

-1. — Nothing except from him.

Q> — Did Mr. McMullen say to you for what purpose the money was furnished by him .'

A. — It was ior the preliminary ex])cnses in getting the Charter and organizing tho
Compan;, . It was bel'ore the lirst Cliarter was got.

Q. — Was the use of American capital ever contemplated in the new Charter?

yl.— No.

To Sir John A. Macdonald, through the Chairman:

1 am a civil engineer as well as a railway contractor. I have had large cxjiericncc
in railways in New Brunswick and elsewhere lor the last fifteen years. During the last
live years I have directed my attention towards tlie Pacific Uailway — I gut \\\) sonic
statistics in reierence to it at oir' time.

I expi'cted to make some profit out of it at one time.

I was asked by the representatives of New Brunswick in the Caliinet to act as a
Director. They informed me that they had put my name down and asked nic to serve as
a representative man I'roni New lirunswick — at least I took it in tliat light. I had no
idea of making any profit out of it as a Director. I had a misgiving as to whether the
arrangement was a ])rofital)le one for the Company.

I was not asked l)y Sir Hugh Allan to become a Director of the present Comjiany.

I am quite certain that it was not due to Sir Hugh Allan that I was ajipointed.

I cannot say that Sir Hugh Allan was opposed to me, but my impression was that he
was ojiposed to me ; but I do not know it directly from himself. I thought at the time
that he was opposed to me.

The interest of N w Brunswick in this Company was one-thirteenth of the whole
stock, and as a Di: .tor I subscribed one-thirteenth 'if the stock, and i)aid a tenth of that
amount; at least my friends and myself together paid it. That is, my New Brunswick
friends. They took some of the stock for me before I subscribed. Those persons who
subscribed for me were all Canadians. No American money was admitted on that
snl)scri])tion list. There was an agreement between me and those New Brunswick friends
that the stock should l)e transferred from me to them.

I know that tlie Charter iirovided that there should be no transfer of stock without the
consent of the Government, and they understood it so too.

If this were not done, the money deposited was to be paid back by me to them.

Mr. McMullen told me that Sir Hugh Allan had received from the Americans a sum
of money to meet the preliminary expenses in getting the Charter for the first Company.
I iiave had a good deal to do with getting up Railway Comiianies, and have had con-
siderable ex])erience in that way. That is always the first step taken to get funds for
jireliminary exjienses. It always requires money, and sometimes we are obliged to pay
it ourselves.

In my cmiversation with Mr. McMullen, I did not tell him tlmt American capitid
would be excluded until after this last Cliarter was granted, or a short time before it was
granted. I'nder tlu; new Charter, as it was drawn, it was not jiossible ibr American
capitalists to get in without the consent of the (ioveniment ; at least, I cannot see any
way how they could, and I told Mr. McMullen so.

QueMion by a Commissioner. — VVliat are the names of the persons who joined in the
subscrii)tion of stock with you?

A. — There were several. There were Mr. Domville, who lives at St. John, and
Mr. Hyan, of Miramaclii. His home is in Ontario somewhere, I believe. He had some
one or two friends with iiim, whose names I do not know. Their stock was put in his
name for them; Mr. McKean was one of them, I think. I have no other names, but
both Mr. Uyan and Mr. Domville base Iriends joined with them in their stock.

CANADIAN PACIFIC RAILWAY.

157

Ian and Mr

My rcenson for supposinp,' that Sir Hugh Allan was not iavourahle to my becoming a
director was, that I met him several times, and he seemed adverse to have anything to
say to me about it. and I never had any conversation with him about it until after I had
signed the articles, and then nothing but the ordinary intercourse of one with another;
nothing was said with respf^ct to my name having l)een [)lace(l on tlie directorship.

And further deponent saith not, and this liis deposition having been read to him he
declares that it contains the truth, persists therein, and hath signed.

Sworn, taken, and iicknowledged on the ]
fifteenth day of Septeml)cr, 1873.

(Signed) CHARLES DEWEY DAY, Chairman.
A. I'OLETTE,
JAMES ROBERT GOWAN, Commissioners.

C.\NAU.\.

}

(Signed) EGERTON R. BURPEE.

IN THE MATTER OF THE COMMISSION

gut up si<nH'

•k without the

PKOvixrK OF Ontario,")
Cify of Ottaica. /

Appointing Ciiarlks I Dkvkv Day, Antoim-: Por.KrrK, and Jamk.s Romnrr Gowan*,
Commissioners to inquire into and ri-jjort upon the several matters stated in a
certain Resolution moved by the Hon. Mr. HiMiNd ro.v in the House of Commons
on the second day of April, a.d. 1^73, relating to the Canadian Pcicific Railway.
Present: The Commipbionkrs.

On this fifteentli day of September, in the year of our Lord one thousand ei;j;ht hundred
and seventy-three, personally cami; and ai)peared before us, the aljove-named Com-
missioners,

The Honourable ALEXANDER CAMPBELL, who being duly sworn, deposeth and
said :

I residi' in Ottawa. I am a member of the Privy Council. 1 am now ilinister of the
Interior. 1 have been a member ol' the Goverinncut since tlie first of July, 1S(1"; that
is, of this Government.

Q. — Have you any knowledge of an agreement between Sir IIuLrh .Mian and Mr. G.
\V. McMuUen respecting the construction of the Pacific Railway with American caj)i'al?

A. — I have no knowledge of any such agreement.

I know Sir Hugh Allan, Iiut I do not know Mr. G. W. McMullen.

Q. — Are you aware of any negotiations being carrieil on ljet\veen these gentlemen
liaving that end in view, — that is, the construction of the Pacific Railway with American
capital ?

,1. — Not of my own knowledge.

(I — Have you been prcs^ent at any interviews with those gentlemen, or with either of
thcni, relating to that matter?

.1. — None; I never saw Mr. McMullen in my life, to my knowledge, and have been
present at no interview with him.

Q. — Are you aware whether the Government encouraged any negotiations for the
l>ur|)ose of building the road with American capital.'

.1. — I am aware that the Government did not encourage any such negotiations ; that
they declined to promote or favour any such arrangement.

(I — When did it first come under your notice that any negotiations tending to that
did were going on ?

A. — Merely i)y rumour. I think either during or shortly after the session of 1872.

Q. Was tlie ojiinion of the (Jovernment decided upon that matter — that of e.\cluc'ing
American capital ?

.1. — Yes; decided for excluding it.

U. — When was that decision of the Ciovernment apparent ?

..1. — I think shortly after the end of the session of 1H72, it became the pronounced
policy of the Government to construct the railway altogether by means of Canadian and
British ca])ital, and by means also of the amalgamation of the two Companies.

I think it was made a})i)areiit shortly alter the close of the session of \^72.

(.^. — When you refer to the two Companies, do you mean the Interoceanic and the
Canada Pacific ?

A. — I do. It was the policy of the (Jovernment to amalgamate these two Cominmics,
to exclude American ca})ital, and to give tlie Charter to the Company, to be composed of
these two amalgamated Comjianies.

158

CORRESPONDENCE RELATIVE TO 'IHE

Oak AHA.

i;'

(2. — Have you any knowkulge of the coirespr,ndeiice which took place bctwiven Sir
Hugh Allan and Mr. McMullen?

A. — None whatever.

Q. — Would you be able to identify any of tlie letters that passed between them?

.1. — Not in the least.

(I — Have you read the published letters ol" Mr. MclMuUeu — t!ie two letters in the
j)iess ?

A. — I read those whicli appeared in the ' Montreal Ilcraid.' i have not read a recent
account of an interview whicli some on(; had with him in Chicago.

Q. — VVeve you present at any of tlie interviews wliidi the Government had with liim ?

A. — No. I never saw Mr. McINIullen.

Q. — Are you aware whether Sir Hugh Allan ever received any promise, or any
encouragement from the GovernmenI, in his u.gotiations vvith American capitalists?

A. — None whatever, so iar as I knt)w.

(j,. — Do you know by wliom tlie negotiations for an amalgamation of the Interoceanic
and the Canada Pacific Companies were originally suggested ?

^•l. — 1 do not.

Q. — Were these negotiations looked upon favourably by the Government, or otherwise?

A. — Favouraldy. I myself went to Toronto at tlie request of Sir John A. Macdonald
about the end of October, 1871!, for the purpose of mideavouring to bring about such an
amalgamation, and I know tliat from the end of the session of 1S72 — I don't remember
exactly what time tlie session closed but irom that time uj) to the time of my visit to
Toronto, and ai'tervvards - 1 should say uj) to tlie end of November- there wi're con-
tinuous cflbrts being made by the (Jovermneiit to liring aliout an amalgamation of those
two Companies. Besides my visit, eil'orts were also made by correspondence. Alter (
returned. Sir .John Macdonald went himself lor a like object. lie went some weeks, I
think, after I returned. I wi'nt u]) towanls tlie end of Ocl()l)er and saw Mr. Macpherson,
the President of the Interoceanic Comjiany. I also saw Mr. Cumberland, wlio was one
of tlie Directors, and I went to Loniloii and saw Mr. Carling, wlio was another of tlie
Directors, and Major Walkir, who, I think, was a membtu- of tliat Com])any, but I am
not awar(! whether he was a Director or not. 1 endeavoured to ])ersuade M'". Macpherson
that ills oi)JLrtions as to tiie American element in tlie Canada Pacific Company were ill
founded, and that the guarantees which the Government were prepared to give we're so
complete and so absolute, that they wcnild entirely exclude the possiliility of the
Company being controlled by Aini'ricans. i did not conceive that Mr. Macphei'son was
afraid of Anu'rican capital, Init that American views might control it, and that the lands
which were promised to the Company might, fall into Ameiicau hands and be; usi'd for
American purposes, 1 endeavoured to convince him by the clauses which would be j)ut
in the Charter that it would bi: impossibl..; for Americans to get control of it, and tliat
the railway would be really and thoroughly controlled by Canadians. That was the
object wliicii 1 had in view, and these were the endeavours which I used. Tliis was late
in October.

Q. — You failed to convince him?

A, — Yes; Mr. iMacpherson did not bimself put forward the idea that he claimed to be
at the head of the Comjiany. He stat«'d that he had no personal objects of bis own to
gratify, but he was persuaded that if it was not stipulated that Sir Hugh Allan should
not be at the head of the Company, that American interests would not he excluded. I
failed to convince him bicause ol that view which he strongly adhered to. I may add,
that during the same visit in the west, 1, also saw Mr. (Jzowski, his partner, on other
matters, and I think that 1 satisfied him that the guarantees proposed by the (iovernmcit
were sufficient for the; ])urposeof excluding American control. I did not, however, suc-
ceed in convincing Mr. Macplierson.

Q. — Did Mr. Macpherson's opinions seem to be shaieu by all tlie other members of the
Interoceanic Com])any V

A. — Uy no means. Mr. Cumberland was quite satisfied that the guarantees were
sulTu'ient. Mr. Carling and Major \Valker were also satisfied. All three of these gentle-
men exprmsed to me the; opinion that Mr. Macpherson in holding firmly to these views,
after what 1 had stated to him, would not continue to represent the views of the gentle-
men who had formed his Cdinpany.

These gentlemen were satisfied, and they thought that the larg(!r number of the
members would be satisfied that the guarantees were sufricient to exclude American
control.

Q. — Did anything further pass at that conference with Mr. Macpherscn?

A. — No. My visit failed on the ground that Mr. Macpherson could not l)elieve that, so

CANADIAN PACIFIC RAILWAY.

isn

between Sir

1 them ?

Icttei-s iu the

read a recent

id with liim !

mise, or any
[ipihilists?

u Interoceanic

or othorwisf ?
\. Macflonald
al)oiit such an
)n't romembi-r
ol' my visit to
ore wi're con-
ation oi" those
LMK'o. Alter I
some weeks, I
r. Macplievsoii,
, wlio was one
nother ol' tlie
any, but I am
['•. Mat'iihersou
Huiny were ill
I givi' were so
)ility of the
acphei-son was
lat the lands
id be usi'd for
would be put
■ it, an<l that
'hat was the
This was late

laimcd to be
>1' liis own to
Allan should
oxcludcd. 1
I may adil,
tner, on otiier

(Jovorinne'it
however, si .'-

embers ol' the

xrantees were
these ^entle-
I) these views,
ol" the }>;entle-

imbi-r of the
ide American

■lieve that, so

long as it was not agreed that Sir Hugh Allan would be excluded from the Presidency of
this C!ompany, American interests would be effectually excluded.

Q. — Did you explain to the gentlemen with whom you had the conference what the
Charter was to be "/

A. — Yes. Tiie guarantees which we i)roposed, and which are now in the Cliartor,
were that the original stock list should be subject to the supervision of the Government,
and that no changes should take place in that stock list without the consent of the
(lovcrnment; that the cdcction of Directors should be subject to the ai)probation of the
(lovernment, and that no changes sliould take place in the Directory without the consent
of the (iovernment.

There were also provisions made in respect to the control of the lands.

Q. — You M'ent uj) to Toronto to represent the Government V

A. — T wiMit at the re(|uest of the Government, or rather at the request of Sir John
Macdonald.

Q, — ^Vhat time did Sir John Macdonald go there?

A. — Two or three weeks after that, in NovemlxT.

Q. — What was the result of the whole negotiations?

A. — We could not convince Mr. IMaepherson that these guarantees were sufficient
unless it was also conceded, and that wo should sti|)ulate to exclude Sir Hugh Allan
i'loni the Presid(!ncy. Rut, at the same time, he clearly led me to miderstaml that he
(lid not himself put forward any particular claim to the Presidency, but that Sir Hugh
Allan should be excluded from that position.

Q.--Was .Sir Hugh Allan aware of the ])art the Government was taking for the
purpos(f oi i)ringioL'' about this amalgamation ?

A. — I do not .now. 1 never had any conversation with Sir Hugh Allan about the
Canadian Pacilic Railway at all.

I presume that be was aware of it, but 1 don't know it myself.

Q. — Was any further guarantee suggested besides that of excluding Sir Hugh Allan
from the Presidency l

A. — No, not in addition to those which I have mentioned.

(2. — Do you know wlun it was announced to Sir Hugh Allan that the Government
would not consent to the admission of the American element in the (,'onipany ?

A. — ?<fot of my own knowledge. 1 apprehend it must have been during the Session
of 1S72.

Q. — After the failure of the negotiations for bringing about the amalgamation, what
course did the (iovernment then determine ui)on?

A. — They determinefl to avail themselves of tlu? Act which had been jiassed during
the previous Session, in conteriplalion of such an event, and to form a Comjiany under
this Act ; a Company emnijoscti of tlie wealthiest and most intluential men in the country,
giving to each Province a representation on an analagous basis to that wbich prevails in
the Privy Council, I'ive members from the Province of Ontario, four from (Quebec, and
soon, it being considered that the Privy Council fairly represents the im])ortance and
inlluence oi' each Province.

That Charter was granted in consecpience of the failure to amalgamate, but very many
of its provisions would 'lave found their way into tbo contract, ^vitb either of those
Companies, or into that \'ith the united one, supjKJsing we liad dealt with an amalga-
mated Company.

(2. -What was the fundamental principle of that C'harter wiLli respect to the distribu-
tion of stock: how was it to be divided'/

A. — It was an ai)proximation of the representation of the dilTercnt Provinces compos-
ing the Dominion.

Q. — In the choic(> of the Directors of the Ctmipany as representative men from the
difi'«!rent Provinces was there any preference or advant^ige given to one over another "i*

A. — None : and the desire was to get into the Company nun of standing, nun ol capital

and men of railway knowledge. 'I'lu' Government also desired to procure from the

several Provinces the best men of resp*Htability, stJinding, wealth, or railvvay knowledge.

U. — Was there any inetiuality among themselves as to the footing on which they stood

as Directors?

yl.— None whatever.

Q. — Were the t(Tms iijion which this Charter was granted and on which the contract
was based more or less favourable than the terms cont/'Hriplatcc' by the tiovernment at
the beginning "i*

A. — They were the same terms in so far as these terms would bt; deduced from the
Act of Parliament. Where the Act <lid not prescribe terms the tjbjeet was to make the

X 2

Oahada.

ifin

rOfiHESPOXDENCE RELATIVE TO THE

ii«

Oak An A,

Charter as perfect as possible, and to absolutely exclude the possiljility of Americans
having any control, and to so frame it as to make it secure tlie objects we had in view. "Wo
spent a great deal of time over it, and so far as m/ knowledge and ability enabled me to
judge, I believe that that Charier was made as perfect in tliese respects as it could be
made. The Charter was intended to exclude American control, to retain control of tlic
lands and money subsidy, to enalile the Government to make a safe disposition of that
money, and generally to accomplish the objects wliich the country had in view in granting
a Charter for the construction of the Pacific Railway.

Q. — What time was the dral't of that Ciiarter made?

A. — Tlie Charter, when I waa first asked to take any i)art in it, was in draft ; it was,
I should say, about tlie middle of Jaiuiary. It was completed on the fifth of February,
It had been siii)mitted on behalf of tlie Clovernment to Sir .loliii A. Macdonald and
myself, and on behalf of the Railway Company to Mr. Abbott. VVe spent a great many
days over it, discussing the various points. Some put forward by I\Ir. Abbott on the jjart
of the Comj)any, that such a clause was too stringent, and another clause did not give the
advantages which he considered they ought to have, and so on. These clauses were dis-
cussed for several days, Mr. Abbott consulting now and again with the jiersons who were
to be Directors of the road.

Q. — On what calculation or data was the price fixed for the construction of this
railway?

A. — We did not fix the price ; we fixed our contribution to it. It was fixed by statute
that the country should give the Company undertaking the works $30,0(K),l)U0 and
50,000,000 acres of land.

Q. — On what data Avere thesi- fixeil ?

yl. — They were fixed liy I'arliainent.

Q. — Have you any knowledge personally to state whether the contract given would bo
a profitable one to the contractors or not '!

A. — No, I have not. I may state that the data on which the 8'">0,()OU.()0() in money
was fixed was .'i.oOO miles of railway at ,<10,nOO a mile.

Q — You have seen the printed letters of Mr. McMiiUen you say, with the exception
of one?

A. — I have.

Q. — Do you know anything oi' the sums of money whicl , are mentioned there as having
been disbursed liy Sir Ilugh Allan?

A. — I do not.

Q. — These sums are !rH,r)00, to Sir John Mc.cdo}>ald and Sir Krancis Ilincks, and a
large sum of money to newspapers, and a sum promised to the llonouralile Mr. Langeviii ;
do you know anything about these sums of money .'

A. — Nothing whatever,

Q. — Do you know anything about the matters alluded to in Mr. McMullen's
letters ?

A. — No. I was present at none of the interviews. I never saw Mr. McMuUen.

Q. — Have you any knowledge that Sir Ilugh Allan advanced $200,000, as stated in
Mr. McMullen's letter ?

^.— No.

Q, — Do you know anything about tlie sums of money alluded to, that is, moiuy
advanced for the purposes of the elections ?

A. — No; 1 know nothing about those sums — nothing whatever.

Q. — Do you know anything about money payments to ilifierent individuals ?

A.— No.

Q. — At tiie conclusion o( this last letter of Mr. McMullen's, I find it printed in these
terms :— " From Sir tieorge Cartier to Mr. Abbott, dated August 24th, 1872. In the
" absence of Sir Hugh Allan, I shall be obliged by your supplying the Central Committee
" with a further sum of 820,000, upon th(! sanie conditions as stated by me at tlie foot
" of my letter to Sir Hugh Allan of the ;iOth ultimo. (Signed) George K. Cartier.
" P.S. — Please also send Sir John A. Macdonald $10,000 more on the same terms." Do
you know anything about that letter?

A, — Nothing.

C2.- l>o you know anything about the if 20,000 uentioned in it?

A.- I was in Kingston immediately after Sir John A. Macdona'ul's election, and I
understood fiom him that a certain sum ol money had be(;n contributed towards the
elections in Ontario by Sir lliigb Allan. I bad no personal knowb^lge of the matter.

Q.- -Have you ever seen these teli'grams which have been publishtni?

A. — I have not.

CANADIAN PACIFIC RAILWAY.

161

uction of tliis

tlicre as havino;

Uiiicks, ami a
Mr. Lauscviu ;

r. McMullen's

lat is, moiuy

Q. — Ilavp you not seen one from Sir John A. Macdonald to Mr. Abbott in these
terms: — "I must have another $10,000, will be the last time of calling. Do not
" fail me " ?

>1.— No.

(2.— Nor the answer of Mr. Abbott—" Draw on me for $10,000"?

A. — No. '("Ik; telegram i)urports to be sent Irom Toronto. I did not see Sir John
after be left Kingston. 1 l<now absolutely nothing of them.

Q. — Have you any knowledge, as a matter of fact, that there was any money supplied
for the elections by Sir Hugh Allan?

A. — None, except the knowledge I have mentioned.

Q. — Have you any knowledg(! concerning the elections in Montreal, and in tlie
Province of Quebec ?

A. — None.

Q. — Have you any knowledge of any understanding between Sir Hugh Allan and the
Govi-rnment, or any member uf the C»f)vernuiert, tliat money should b(; furnislied lor
sujjporting the elections?

A. — None whatever. The Goverinnent is ch; rged, as I understand, with having made
a corrupt bargain with Sir Hugh Allan. Now I think that I am in a position, as a
member of the Government, and having beeu particularly concerned in this Pacific Kail-
ttny Charter, to say that there was no such bargain with Sir Hugh Allan or his associates,
citlu'r corrupt or incorrupt. There was no bargain to give them or any one the contract
at all. I do not believe that Sir Hugh Allan had any sort of understanding beyond that
one given by Sir George Cartier, which was given by him on one day and rei)udiat:ed by
Sir John A. Macdonald on the n('xt. I saw Sir John's telegram to tbnt ellect imme-
diately afterwards. Beyond that I do not Ijclieve tliat Sir Hugh Allan had any under-
standing with the Government, or that then; was any l)argain, either corriij)t or
incorrupt, to giv<' him or anylmdy else this contract until the Charter was about being
signed ; that would be perhajjs the end of January or tlie early part of February. I am
persuaded he had no such understanding. I say this because the allegation is that a
(•orruj)t bargain was made either before or during the Session, or at the time ol' the
elections, an<l I know that during all tliat time tlie Government made no bargain to give
the contract to any one. I was engaged in Toronto endeavouring to bring about the
amalgamation of these two Companies as late as Octol)er, and 1 know that Sir .lolni A.
Macdonald wai- there lor the same i)urpose as late as November, and it was nearly the
end of November Inlore we were satisfied that an amalgamation could not be brought
about. When I was in Kingston I saw the telegram from Sir George Cartier, giving the
terms of the arrangement, whidi, if I rightly remember, were that the amalgamation of
the two Comj)anies should be brought about and the contract given to the amalgamated
Ck)mpany ; but failing that, it should be given to the Canada Pacific. These facts were
communicated to Sir John A. Macdonald, and he immediately sent a telegram back
stating that he would not a.sscnt, and that he would go down to Montreal.

I am stitisfied there was no bargain with anyone to get the contract until it was
absolutely given at the end of January, 1873.

Q. — That letter from Sir (Jeorge Cartier, dated 24th August, 1872, which I have read
to you, contains an allusion at the close of it, to ' the same conditions as the amount
" written by me at the foot of my letter to Sir Hugh Allan of the 30th ultimo." Have
you seen that letter ?

^.— I hfive not.

Q. — Do you know where it is?

A. A do not know of my own knowk'dge. I understood some time ago that it was in
the hands of Sir Hugh Allan. I never saw it.

To Sir John A. Macdonald, through the Chairman :

1 Mas not present at any interviews between the Cabinet and Mr. McMuUen. never
saw him.

I was aware that there were two interviews, but I was absent on hot! those
occasions.

The t 'barter was the result of the failure to amalgamate. I don't mean to convey the
idi-a tliat tlie terms of the contract with the ainalganm'ed ('ompany, had there beeu an
iiiiialgamation, wouhl have Ix.eii difTerent from the terms in the Charter. I presume that
the Charter would have been nuuh the same. We were anxious to make the best
Charter we could, and to carry out the wishes of the country in relation to the Railway.
Whether the amalgamation had taken place or not ; whether it had been arranged \r/
the Interoceanic Comjmny or the Canada Pacilic, or by a Chartered Company, in any
case it was the policy of the Government that the terms should be as I have mentioned,

Canada.

1G2

rOKRE3PONDENCE RELATIVE TO TTTE

Canada, aiid as are contained in the present (!harti3r. That was tlio policy of the Government
immediately alter the Session ol' 1872.

Q. — You say you were aware, and that you had means of knowing:, as a member of tlie
Government, that thero was no bargain, corrupt or incorrupt, with Sir Hugh Allan
l)ef()rc the ilections or before November?

A. — None whatever.

Q.- — Could there liave been such a bargain without your knowing?

A. — It could not be without my knowledge.

(I — Supposing any one of tlu; thirteen Ministers had made any agreement with Sir
Ilugli Allan, would it liave been of any value whatever ?

A. — Not unless it had been yourself. It would have been of no value. In such event,
I appreluMul. if any one of your col'eagues could not have concurred in the advice whicli,
in that case, you would have given bis l^xcellency, lie would have been obliged to retire.

Q. — Ivccept myself, any agreement made by a member of the (»ov(!rnment witli any
j)arty would be so nmch waste paper unless it was sanctioned l)y the Government ?

A. — That is my opinion.

Q. — If Sir George Carticr had made any arrangement with Sir Hugh Allan at Montreal
or elsewliere, you say it would liave been futile ?

yt.— If Sir George (lartier liad made such an arrangement, and it had not been accepted
by his colleagues, he would have been obliged to retire or have given it up and sacrificed
his own views.

Q. — As a matter of fact, and in justice to Sir George Cartier's memory, do you know,
.as one who was socially and intimately ac(piainted with Sir (ieorge Cartier, what his
sentiments were with respect to the introduction of American capital into tbe Pacific
Railway enterprise ?

yl. — Very strong against the admission of either American cajiital or control. The idea
then was not ojijiosition so much to American capital as to Americans controlling the
road. He took tbe extreme ground of excluding American cajiital as well as American
capitalists.

Q. — From the conclusion of the Session to the granting of the Charter, did tlie
Government policy vary for a moment with respect to excluding American capitalists and
American control ?

A, — Not lor a moment. I think the only member of the fjfovernment who at any
time beld diflerent views Avas Sir Francis Ilincks; but finding his colleagues unanimous
in the otlier direction, he yielded his views.

lie saw, as well as ids colleagues, that tbe feeling of Parliament was decidedly oppos(!d
to American connection.

(I — Tiien be yielded to the sentiments of others ?

A. — Yes; I think the fixed jiolicy of the Government during the whole period, from
the end of the Session of 18/2 to the time the Cliarter was granted, was to exclude
American control, and to give the Charter to Canadian or Hritish capitalists, in order to
make it a national work, and to carry out national views and oljji'cts.

(2. — Was it not also the fixed ])olicy of the Government that the Company whicli
should be entrusted with the building of the Pacific Railway should not be a sectional one?

..4. — Yes; the desire was to embrace imiiortant interests in tiie difi'ereiit Provinces of
the DoMiinion, and to get each province as much as possilile rei)resented by men of
standing, wealth, and railway knowledge. Tliis was done in order to prevent sectional
jealousies which might impair the progress of the work.

Q, — Do you know, as a matter of fact, tliat the existence of the Government greatly
de])end('d upon there being no sectional difl'erences, and would not the (government have
been greatly endangered by bringing in a sectional Company?

A.— I think so.

Q, — Would it not have been impossible to exclude either Ontario or Quebec ?

A. — Impossilde. I believe that was the reason why in tlu; very early stage of the
matter, I apprehend before the close of the Session of 1872, it was considered to be
impossiide to give tbe contract tuther to the Canada Pacific, Sir Ilugli Allan's Company,
or to the Interoceanic, Mr. Macpherson's Company. If it were given to Sir Hugh Allan's
Comjiany, it would exclude many reiiresentative men from Ontario, Mr. Macpherson's
Company being comprised principally, though not wholly, of Ontario men.

If the contract were given to the Interoceanic Company, it would have excluded rejire-
sentative men from tlie Province ol' Quebec, who wi!re in Sir Hugh Allan's Company,
and who considered him as their representative in Railway matters, and who had put him
Ibrward as the head of the organization, and .as the mouthpiece of their views and wishes.
I think V(!ry early it ]x>came quite clear that the Government could not proceed and deal

CANADIAN PACIFIC RAILWAY.

163

c Governmont

ment with Sir

Ian at Montreal

;ll as Aimu'icaii

with cither Company, but must endeavour to procure an amalgamation, and so d(;al, if
[)0ssiblc, with the Dominion at large.

It was a matter affecting not only the interests of the railway, but the political
existence of the Government.

I am convinced that the Quebec interests could not have been excluded from any
arrangement for building the road.

Q. — If so, could Sir llugli Allan have been excluded?

^.— No.

4j._VVhy ?

A. — Because he was put forward as a leading representative man. He was a
liromincnt business man, and had been largely engaged in promoting tlu" Nortliern
(olonization Railway, and for two or three years lie had |)uc himself forward as the
k'ailer of Lower Canada in Railway matters, and \» as aceeptetl as such by l^ower Canada.

(I — Are you aware tliat a deputation irom Lower Canada — Montn-al — came up lo
Ottawa, and saw Sir CJeorge CJartier, to insist tiiut Sir Hugh Allan be viewed as the
representative man ol' Lower Canada '!

A. —1 was not aware of it.

Q. — You \vere not a\vare that Mr. Iludon and Sheriff Leblanc came to Ottawa lor
that purjjosc ?

A. — No, I am not.

(2. — Sir Hugh Allan is an exceedingly wealthy man, is he not?

.1.— Yes.

Q. — \Vluit is he rejjuted to be worth ?

.1.— From 8r)()(),()(M) to ^OOO.OOO a year, I have heard it rejiorted.

Q. — Reference has been made to Sir George Cartier's letter, and to my telegram td
iiini repudiating his quasi arrangement. You were at Kingston at the time I received
liis telegram. I su})posi' you saw it almost at the time I received it?

A. — The same day or tlie next.

(2. — Do you remember my repudiating it at once?

A. — Yes, and also of your tek'graphing that you would go down to Montreal, at
once, and of your making preparatory arrangements with me to go down if necessary that
night.

(2. — My election wiis then going on, was it not?

A. — I thinii this was during the nomination week.

Q. — So I made arrangements with yon, to enable me (o go down and break n[) such
an arrangement, and aslvcd you to attend to my interests in my absence ?

J.— Yes.

Q. — Did you see the answer to my telegram ?

.'I.— Yes.

(2. — The arrangement stood according to my previous telegram?

.4. — Yes ; the only thing you said, I think, was that the influence the (iovernmeut had
on the Board would be used to get Sir Hugh Allan niadi' President.

Q. — You assented to tliat, and tliouglit it reasonable that tlie wealthiest man in
t'anada, and tlu- oldest on the Board, should be President?

A. — Yes; and also because he was the lirst jierson who came forward as a Canadian,
and took an interest in the project, and was willing to embark his means in it.

Q. — Had Sir Hugh Allan any special reason for desiring the extension of railways
westward ?

A. — 1 don't know, except tliat he was largely interested in the Northern Colonization
Road.

(2. — Was he not also largely interested in steam transportation?

/!.— Yes.

Q. — Are you not aware that there was an attempt made to get up a rival Company in
England ?

A. — I have heard so.

Q. — Under whose auspices ?

A. — Of the (irand Trunk Railway, I understood. It was however a mere rumour?

Q. — Did that present a cause of fear to Sir Hugh Allan that the steamship line might
lie excluded from the ^Vestern trallic ?

A. — It may liave been so. I never had any conversation with him on the subject, but
1 undt'rstood that he had those views.

(2. — Arc you not aware that he was also interesting himself very much, and pressing
on i)idjlic attention a road still further west than the Northern Colonization Railway.
Tile Toronto and Ottawa Road?

Canada.

Ti I"

16-t

CORRESPONDENCE RELATIVE TO THE

Canada. j{ — Yes, it was to be a Road to run from here to Carlctou Plat'o and Peterl)oroiigh,
throuf^li the interior of UpjHU- Canada, and come out to tlie lake at Toronto.

Q. — The fact is Sir IIu<;li Allan had determined upon the extension ol' the Railway
system, and desired to connect himself with it?

A.— I understood from general rejjort that In; had the idea of a railway system from
Montreal westward independent of the Grand Trunk Railway.

To the Commissioners :

I understood you to say that the terms of the Charter were finally settled some time
in the latter end of January ?

yl.— Yes.

Q. — You mentioned also that you had several interviews with Mr. Abbott, as repre-
senting that Company ?

^.— Yes.

Q. — And his praying that certain alterations might be made?

yl.— Yes.

Q. — Did that touch the question of the exclusion of American control ?

A. — It did not. That was a conceded ])oint before we sat down.

Q. — Did the Government in any way concede the jKiint in regard to American
control ?

-1. — Not in any way, and he did not desire it. It was a conceded point that it
should be excluded before we sat down, and our desire was to frame a Charter so as to
make that secure, and he was eciually anxious with us that it should be so.

Q. — What was the nature of the alterations he suggested ?

A. — I can hardly remember. He may have suggested forty or fifty.

(2 — What principle did they affect?

^4. — There was a great deal of detail as to the mode and rapidity I)y which the
$!;50,0()0,000 were to be paid, whether the payment was to depend on the construction
of certain sections or upon a certain quantity of laliour on several sections, and iiow fast
it was safe for the Government to pay it out. He endeavoured to get stipulations for
this money to be i)aid out as rapidly as possible. Sir .John Macdonald and myself, on
the other hand, endeavoured not to have; the money ])aid until assured evidence had been
effected that value had been received lor it by the country. And in the same way with
regard to lands, his object being to obtain the land as quickly as possible, while our
desire was that it should hv granted only as the construction of the road [jrogressed.
What I mean to say is that he endeavoured to obtain some mod(> of determining the rate
of progress in the work, more favourable than that of leaving it to the decision of the
Government or its engineer. It was understood that the payments were to be depi'udeut
on the rate of i)rogress. Then as to the way the land was to be dealt with as to the
possibility of its being used, in any way injuriously tollie interest of the country at large ;
as to the mode and rajjidity of its being patented and a variety of questions of like nature
which must occur in a large national undertaking, came up from day to day.

Q. — On how many occasions were you [)resent when Mr. Abbott also was present?

^1. — In the discussion of this Charter, we may have spent the best part of seven or
eight days.

Q. — Were you there on the lust occasion ?

A. — I was there every time.

Q. — On that occasion was there anything said with respect to American control or did
he claim that any alteration should be made in that part of the Charter which was to
exclude American control?

A. — No. It was a conceded point before we sat down, that it should be excluded,
and there was no effort made on his part to get the Charter changed on that point.

(2- — That referred to American capitalists as well as American control?

A. — Yes. Whatever Sir Hugh Allan wished, or may have done originally with his
friends, Mr. Abbott, as his representative, and that of the Companies said he and they
had entirely abandoned any intention of having American interests introduced, and Mr.
Abl)ott was equally anxious with Sir John Macdonald and myself to preveiit the
possibility of this control or influence being brought in.

Q. — Can you state what was the date of the first intervie\v between the members of
the Government and Mr. Abbott, in relation to the final settling the exact terms of the
Charter?

yl.— I should say towards the end of January, probalily about the 20tli. I do not
remember whether the time was given consecutively or not. I think Mr. Abbott may
have had occasion to go to Montreal once or twice.

Q. — In what form was the draft, I mean was it a rough draft ? . .*

CANADIAN PACIFIC RAILWAY.

165

ay system from

ttled some time

bbott, as reprc-

d to American

A. — It was originally in manuscript, and at the time it was p seiited to me it was in
type — in galley.

To Sir John A. Macdonald, through the Chairman :

I think it was the end of January that Mr. Abbott was jmt in communication witli
you and mysell", but the communications and negociations had been going on long before
that. What I was asked was as to the interviews which resulted finally in the settlement
of the Charter.

Q. — The draft of the Charter commenced with a few headings, and by degrees exj)anded,
and became more and more worked into details, until at last we sat down and framed
the Charter.

A. — It was set down in detail, printed in galley, revised and reprinted. I think it
was printed four or five times, as the alterations were going on before it was finally settled.

I desire to add one word. In that last letter which Mr. McMullen publishes he says,
I think with reference to a hill or note made by Mr. Hillyard Cameron, that it was
renewed by the Merchants' Bank, and says that the renewal was at the instance of the
Government after a visit of the Postmaster-General to Montreal. I was tlie Postmaster-
General at the time, and am the person to whom he referred, and I wish to say that the
insinuation conveyed by that paragraph is false ; that I knew nothing of the renewal of
Mr. Cameron's paper, and that no visit of mine to Montreal had any reference to any
such renewal, nor did I ever ask anyone to renew such a note.

And further for the {iresent deponent saith not.

And on this sixteenth day of September reappeared the said witness and made the
following addition to his foregoing deposition : — At the dose of my dci)osition I spoke
of a statement which Mr. McMullen had made in a letter, that I took some jiart in having
a note renewed which had been made by Mr. Hillyard Cameron. I was sjjeaking from
memory as to what Mr. McMullen had stated. Since I gave my testimony I have looked
up the statement as it appeared in the pajiers, and I find his statement is not as to the
renewal of a note but as to the inception of it. The statement is: "And now let me
" add one more fact which will illustrate the position of tlie Committee and of the
"al)Solute control which the accused and their friends have exercised over it. Outside
" of the amounts which may have been furnished him by Sir John A. JMacdonald, the
" Chairman of the Investigating Committee applied through the Premier lor a loan of
" |.'>,000 when the elections were all over, and Sir Hugh Allan supposed that he was through
*'|)aying, and he objected, but after a personal visit of the Postmaster-(«eneralto Montreal,
"and urgent letters and telegrams of Sir John, who announced that it was to help us, the
" thing was done."

I desire to say in reference to the inception of the note and the original loan, that the
insinuation of any visit of mine to Montreal had anything to do witii it, is false. I knew
nothing of such a loan, and no visit of mine to Montreal had anything to do with it.

Q. — Did you visit Montreal about that time ?

A. — I can hardly tell. I never spoke to Sir Hugh Allan on the subject, nor to any
officer of the Merchants' Bank. I was not aware until long afterwards that there was
such a discount.

Q. — Do you know of Sir John A. Macdonald having written to Sir Hugh Allan in
respect to this note ?

A. — I do not of my own knowledge.

Q. — Do you know of any telegrams; did you send any telegrams respecting this
matter ?

A. — None; nor do I know of any having been sent.

Q. — Do you know of any application by Mr. Cameron to any member of the Govern-
ment to assist him in obtaining this discount?

A. — Not of my own knowledge, but I believe there was some communication on the
subject, and that Sir John Macdonald did assist him to get this discount ; but I have no
personal knowledge of it.

And further for the present deponent saith not.

And on this 17th day of September reappeared the said witness and continued his
deposition as follows : —

The amount which I learned from Sir John A. Macdonald in my conversation with
him at Kingston, as that which was to be contributed by Sir Hugh Allan to the Ontario
Election Fund, was $25,000. This was after Sir John's own election.

Q. — Did you hear of any other sum being promised by Sir Hugh Allan?

A. — I did not until after tlese discussions took place in the newspapers.

Q. — Did you from any other member of the Government?

A. — I did not, until, as I have said, these matters became rife in the newspapers.

Canada,

ICP)

COHUKSl'ONDKNCE RELATIVE TO THE

Canapa. q. — Ho you know nt niiy time of ixny otlirr sums bdn^ furnishal l)y Sir IIuj^li Allan,
than the $2r),(t()(»?

A. — Not until those newsiMiper reports came out. But afterwards I did hear so from
the conversation I had with Sir .lohn A. Macdonald himself.

Q. — Did it then come to your knowledge that further sums had heen suljscribed by
Sir llufjh Allan?

A. — Yes ; there were sums in the aggregate which amounted to $ }."f,000.

Q. — Eor the Province of Ontario ?

.4.— Yes.

Jdesire, with the permission of the Commissioners, to add that on my visit to Toronto,
and in the interviews I had with Mr. Macpherson to bring about the amalgamation
between the two Companies, I did not desire to make any stipulation as to wlio was to be
President, nor did I desire to make any stipulation upon the subject of the Presidency.
It was Mr. INIacpherson who desired it to be stipulated that Sir Hugh Allan should not
be President

Q. — Upon the grounds he stated ?

.4.— Yes.

I desire to say further, that I have had no corresi)ondcnce whatever with Mr. Al)l)ott
about the amount or mode of distribution of any election fund of which Sir Hugh Allan
was the chief or sole contributor, or of any other election fund whatever.

I make this statement, as I see in the ' Montreal Herald' it is suggested that such a
correspondence took place, and I desire to contradict it.

Q. — Had you any correspondence with Sir Hugh Allan?

^1. — No ; not witii anybody.

And further deponent saith not, and this his deposition having been read to him, he
declares that it contains the truth, persists therein, and hath signed.

Sworn and taken on tlie fiileenth day of
September, 1S73, and acknow-
ledged on the seventeenth day of
said mouth and year.

(Signed) CHARLES DEWEY DAY, Chairman.
A. POLETTE,
JAMES ROBERT (iOVVAN, Commissioners.

(Signed) A. CAMPBELL.

IN THE MATTER OF THE COMMISSION

PllOVINCK OK OnTAIMO,

C% ()/ Ottaira.

Appointing Cii.\um:s Dkwi:v Day, Antoivi; Poi.ktte, and Jamfs Rohkiit Oowax, Com-
missioners to inquire into and rejmrt upon the several matters stated in a certain
Resolution moved by the Hon. Mr. IIuntkv(1T0V in the House of Commons on
the second day of April, a.d. 1873, relating to the Canadian Pacific Railway.

Present: TiiK Co.m.missio.\ers.

On this fifteenth day of September, in the year of our Lord one thousand eight
lunulreil and seventy-three, personally came and appeared before us, tlie above-named
(Jonunissioners,

The IIonounil)ie I'ETER MIT(TIELL, of the City of Ottawa, who being duly sworn,
deposcth and saith :

I am a member of the Privy Council, and Minister of Marine and Fisheries in tlie
Dominion Government.

Q. — I will read to you the terms of the charge which the Commission is enjoined to
inquire into, the first clause of which is as follows : — " That an agreement was made
" between Sir Hugh Allan, acting for himself and certain otiier Canadian i)romoters,
*• and (i. W. McMullen, acting for certain United States capitalists, whereby the latter
" agreed to furnish all the funds necessary for the construction of the Pacific Railway,
" and to give the former a certain percentage of interest in consideration of their interest
" and position. The scheme agreed upon being ostensibly that of a Canadian ('ompany,
" with Sir Hugh Allan at its head." Have you any knowledge of any agreement or
negotiation of tlie kind ?

A. — No, not of my own personal knowledge. I have such knowledge as the public
prints have lately afforded.

Q. — Is all your knowledge confined to that which you have derived from the press?

A. — Entirelv so.

CANADIAN PACIFIC RAILWAY

1C7

Q. — Were you not aware at any time previous to the publisliing of tlie corres-
pondence that such negotiations were Roing on ?

A, — I was nwarc from public rumours tiiat Mr. McMullen and Sir Hugh Allan had
some intercourse in relation to lliis matter, and (hat they had talked ol arranging some
plon by which American capital could be acquired. That information I got from Mr.
McMullen himself.

Q, — You know Sir Hugh Allan and ^Ir. McMullen, do you not?

A. — Yes; I know both of tlieni.

Q. — And tile inibrmation you possessed in regard to these negotiations was derived
from Mr. McMullen himself.

A. — Yes, as to the fact that such negotiations were going on. I never had any conver-
sation witli Sir Hugh Allan on the subject.

Q.- Were \ou jircsent at any interviews between tl'e members of the Government
and t:^ir Hugh Allan and Mr. IMcMullen?

.1.— I was I I'sent at one interview with Sir Hugh Allan, Mr. McMullen, and I
think Mr. Sni li, but I am not sure whether Mr. Smith was there or not. I don't
remember tlie (uite, but it was the first interview which Mr. McMullen in Iiis publisbeil
letter states that I was present; although I don't kiu)w whether it was the lirst or Mcoud
interview except from what 1 have seen in the jiapers.

I tliink it was the interview which McMullen states in hi letter took ])lace early in
July, \^7\, at which I was present. It will lie iu the one win re he states I was present.

(>.- 1'bis interview at which Mr. McMullen says you were present, took place the 5th
October, was that the one 'i

A. — I jiresume so,

Q, — What passed on that occasion?

A. — Not very much. I understood that these gentlemen came there to make sonic
proposition to tb- Government, and that he asked an interview with the G<»verninent lor
that purpose, 'lliey got the interview, and the sul)stance of what took place was, that
when tlie gentU men ol)tained the interview, and the ordinary courtesies bad l)cen gone
through. Sir Ilugli Allan was asked by Sir John A. Macdonald if be had ,iny jiroposition
to make to the (tovernment. Sir Hugh asked the <iuestion in re[)Iy, ' If ibe («u\inunent
" were in a jiosition to entertain a proposition if he made one? " and Sir .loliii, on bebalt
of the GovernmeMt. stated "that the CJovcrnnient were not in a position to aicept a pro-
'■ position" if made at that stage of the proceedings, and Sir Hugh Allan tiu-n declined
to make any jtroposition. N'cry shortly afterwards tbey|bowe(i llieniselves out in the
ordinary eoiu'se, as there was no business to i)e done.

Q. — Was there any discussion at that time concerning the source Irom which the
capital was to l)e derived ?

.!,— Not between the Council and Sir Hugh Allan and his associates. I tiiink that
the discussion that took place during the intervi( w was exceedingly limited, ami almost
entirely conlined to Sir John A. Macdonald and Sir Francis llincks, on behalf ol' the
Government. There was a discussion also amongst members of the Government alter
they had left.

(j,. — \Vas Mr. McMullen understood to be representing American capitalists on that
occasion ?

A. — I do not know. I understood so myself from what I bad heard, but lam not
sure whetiier Mr. McMullen told the other members ol the Govt-rnment or not. I think
the conversation was mainly, on their side, conlined to .Sir Hugh Allan. After they left,
the ([uestion about American caj)ital was raised and discussed by the Cabinet, and the
opinion of each member present was given on that occasion.

(2.— What was the view generally taken?

.1.— With the single exception of Sir Frauds Hincks, every gentleman was opi)osed to
the admission in any way of American control, and that Americans shoubl have no
interest in the construction of the road. Some gentlemen were against American capital
too My own opinion was exceedingly decisive on that point. At tbefii'st interview with
Mr. McMullen, I told him that I would never consent to the Americans having control
of our national road. He spoke of the inlluence of Sir Hugh Allan in the country, and
of his great wealth. I said that Sir I lugh Allan was not all Canada, and I t(dd him that
I did not think that my colleagues would consent. After that, Mr. McMullen bad very
little to sjiy to me.

Q. — It was then the settled policy ol the Government at that time to exclude American
capital ?

A.— It was, with the excei)tion I have mentioned, and I accepted it as the settled
IK)liiy of the CJovernment.

V 'J

Canada.

IfiS

CORRESPONDENCE RELATIVE TO THE

Cahaha. Q.— Do you know nnything of tlit; correspoinlciice whicli took place botwcfii Sir Hu|^h

' Allan and Mr. McMullcn?

A. — Nothing whalever, except what I have seen in the publie prints. 1 sow none of
the original letters. I was told by a member of the 0])position, with whom, onirially, I
am often brought in eontact, that there was a correspondence of a most damaging
charact»'r between Sir Hugh Allan and Mr. McMullen. He oflered to show it tome,
l)ut the next day hi' informed me that he could not get it. I could not helieve it mysell,
and I I'elt that there was a misrepreseutiition made in relation to it.

Q. — Was this the only interview at wliiih you were present when Mr. McMullen was
also present '!

yf.— I think so.

Q. — Have you had any conversations with Mr. McMullim apart from that interview?

.^1, — On two or three occasions when he was here. At the conversation which took
I)lace in Chicago I gave a very decided expression of my own opinion as to Americans
being permitted to have any control of our Pacific Railway.

On several occasions al'terwards, I think when Mr. McMullen was here, or at least
once or twice when In; was here, he spoke to me of the progress of their work, and seemed
to feel very confident about it.

I always told him what my opinion was on the subject.

Q. — Are you prejjared to say that the Government or any member of th(> Government
never gave him any encouragement or favour in this project or enter})rise, so as to
induct" him in any way to believe that American capital would be admitted in the build-
ing oi the road ?

-1. — I am prepared to say the Government never did, and, except what Sir Francis
Hincks said, I am not aware that any member of the Government did. There was no
encouragi-ment nor any insinuation of any kind that Americans would be permitted to
liave any interest in the (construction of the railway.

I only speak of my own opinion, and of what transpired in the Council Chaml)er. I
am sjifislled in my own mind that no expectation could have been held out that American
control would l)e permitted.

Q. — Have you any knowledge of any negotiations that took place for the bringing
about of an amalgamation between the Interoceanic and the Canada Pacific Com-
panies ?

.1.— I took no i)art in such negotiations. I was aware that negotiations were goiii,'
on, l)ut what the ])articulars were I did not exactly know. All I know was this, that it
was the desire of tlie First Minister to bring about such an amalgamation, ami that
oi)inion was coincided in l)y all of his colleagues.

Q. — Who took an active part in these negotiations?

A. — Sir John A. Macdonald, Hon. Mr. Campbell, and perhaps Sir Francis Hincks?,

I don't think Sir I'rancis took part so much as the others.

Of course the other membei-s of the Cabinet stated their views and a])proved ;, dis-
.•i])|ii'()vcd as it struck their min<ls at the time that the stcjw were taken or proposed to lie
tulien.

Thtse negotiations ln-gan, if I recollect right, shortly after the elections, or it may havt;
ijeen during the Session of 1872.

The Session of 1S72 closed, I think, early in June.

The result of the negotiations, as I understood, and as I learned in the Council, was
that they failed. Mr. Maci)herson declined to accept the terms of amalgamation as
])roposed.

I had no personal interview with Mr, Macpherson nor with any oth(;r gentlemen of
the Interoceanic Company. 1 took no personal part whatever outside of what took place
in the Council. 1 took no part in the negotiations for amalgamation.

Q. — Did you take any personal part in the framing of the Charter?

A. — No. The framing of the draft of the Charter was almost entirely conducted by
Sir John A. Macdonald himself, with Mr. Campbell on the part of the Government.
The part that I took in thf Charter was this: After the first draft was made it was sul)-
initted to the Cabinet. We went over the Charter section by section and clause by
clause, and si)ent days over it, sometimes discussing the phraseelogy and at other times
discussing matters of detail. A good deal of difference of opinion was manifested ])y the
different members of the Cabinet in regard to the details. But one prominent point was
always kei)t in view, as to how we could liest accomplish the satisfying of the public mind
that American control was excluded from the Charter. Outside of that I took no part
in the framing of the Charter.

4^. — The determination of Government to issue that Charter — when was it arrived at?

CANADIAN PACII'IC UAILWAY.

lf)D

•(•en Sir Huj^h

I saw none of
m, onicinlly, I
nst (lamagini;
ihow it to m«-,
lii'Vf it myst'lr,

VIcMul It'll was

at interview?
)n wliich took
to Amoricaiis

re, or at least
rk,und seemed

10 Government
)rise, so as to
m1 in the buihl-

lat Sir Krancis

There was no

L' iierinitted tu

1 Cham))er. i
that American

ir tlu' hriiif^ing
, Pacific Com-

oils were goiiii;
as tills, that it
ition, and that

icis Ilineks?,

)])roved ;. dis-
projiosed to lie

or it may have

Council, was
lalgamation as

' gentlemen of
hat took place

r conducted hy
> Government,
vde it was sul)-
and clause by
at other times
nifested by tlic
iueiit point was
he public mind
1 took no part

s it arrived at?

A. — My imjirension is that it was immiHliately after the return of Sir John A. <'a»'\i>*.
Macdonald from Toronto,

I think that was late in the fall of 1872; we had Hoverul discusHJoim about it in tho
Council liefore that decision was come to. My impression ih, although I am not confident
aiM)ut it, that the determination to issue that Carter was fixed ujwn in the month of
December, that was alh'r the failure of the negotiations; at least that s<'em«'d to be the
settled s«Mitiments of the Governm«!iit, but it may not have Ixt-n settled upon before
January.

^2. — Was it ill eonsequence of that failure that they determinecl iiiHni that courst??

A. — It was as tlu; only means left open to the Cabinet for carrying out the wishes of
I'arliament.

Q. — Was that contract given under that Charter under any more favourable terms
than had been previously contemplated by tlu" Government?

A. — None that I am aware. It was on very much Itss favourable terms than Sir
lIuLth Allan asked. My recollection i that Sir Hugh Allan asked a greater amount of
money and a larger <iuantity of land.

Q. — Had Sir Ifugli Allan any advantage over his co-Directors?

A. — I know of none.

As a member representing one of the smaller Provinces, my anxiety was to see that
Sir Hugh Allan got no advantage. Both Mr. Tilley and myself, I believe, gave very
sjiecial attention to that point, and I saw no desire on the part of the Government to
give him any special advantage, but on the contrary, looking upon him as a very wealthy
man representing the sentiments of a large portion of Quebec, we felt that the great
danger was of any man in his position having too much jiowcr, for that reason we
siiecially guarded against it,

Q. — Another |)ortion of the charge is, "that sulisequently an understanding was come
" to between the (iovernment. Sir llugli Allan, and Mr, Abbott, one of the members of
'• the Honourable House of Commons of Canada, that Sir Hugh Allan and his friends
" should advance a large sum of money for the purpose of aiding thetdections of Ministers
" and their supporters at the ensuing general elections, and that he and his friends should
'• receive the coiifrnct for the construction of the railway ;" do you know anything about
an understanding of that kind ?

A, — I do not.

Q. — Was any such understanding made with the Government ?

A. — None that I know of.

None was ever heard at the Council Board when I was there. I know none was made
with the Government. What might have taken place with individual members of the
(lovernment I cannot say. I could not but have been acquainted with it if it had been
made with the (Jovernment. The whole course of the negotiations and transjietions
ignored the ])ossil)ility of any such contract having been made.

Q. — Do you know whetlicr any such understanding was come to between these
-gentlemen — Sir Hugh Allan and Mr. Abbott, and any member of the Government?

.1.-1 do not know of any.

Q. — Do you know whether any money was in fact subscribed by Sir Hugh Allan or
.Mr. Abbott?

.1. — I do not know of a dollar being subscribed, except from what 1 have learned in
the public prints.

(2. - Do yon know whether money w-as subscribed by any person for the promotion of
the elections in IST'J in Quebec or in your own Province?

.4. — I do not know of a d(dlar exci'pt a small sum I authorized a friend to suiiscribe
lor me, to one of the elections in our Province.

Q. — Do you know of money having been received from Quebec for promoting the
elections in your Province ?

.1. — I never heard of a dollar having been received, nor do I believe that there was a
single shilling given to our Proviiici- for any such jjuriiose. If there was, I am entirely
ignorant of it.

Q.— Do you know anything of a printe<l letter purporting to be a letter from Sir
(ieorge Cartier to Mr. Abbott, dated the 2ltli of Aui^ust, 1S72, which is as f(dlows:—
"In the absence of Sir Hugh Allan, I shall feel obliged," &c., do you know anything
about that letter?

-1. — I do not, nor did I ever see it until I saw it in one of the Montreal papers,

Q. — Do you Iviiow anything of the letter alluded to in this letter as being of the 30th
of .July?

A. — I do not. I never heard of it until I saw it in the public prints.

WfF

170

(CORRESPONDENCE RELATIVE TO THE

Canaia. q. — Do voii know anvthing of this tel<>gram uhidi reads, " I must have another ton
"thousniul." A'c?

A. — I know nothing of it, or of any othor telegram of that cha'. actor ; I never heard
of it until I saw it in the newspajK-rs.

To Sir John A. Macdonald, through the Chairman :

Q, — What was Sir (leorge Cartier'b opinion as to the admission of American capital
into this enterprise ?

A. — He was always hostile to allowing American capitalists to he interested in it.
His opinions were very decided, and suffered no variation from the bi-giiming. I leariiecl
liis opinions by his statements at the Council Hoard, and also visiting occasionally at his
house, an<l in jjrivatn convei-sation with him. \ occasionally met him at dinner, and I
never I'ound hut the one opinion entertained by him. And, like myself, he was very
decided in his opinion on this point.

Q — Who selected Mr. Burpee to be a Director on the Canadian Pacific Company?

A, — Mr. Tilley and myself. I never spoke to Sir Hugh Allan in relation to this
subject, and c«'rtainly not in relation to Mr. I^urpee's ajjpoinfmenl. Tin- ground of our
selecting Mr. Bur|iee was, that we consideri-d him the most prominent representativi'
railway man in our Province, and that he would act indejundently of Sir Hugh Allan.
We did not wish that the interests of New IJrunswick should be overlooked, and we were
anxious to select a man that would represent the interi-sts of New Brunswick at that
Board. We selected Mr. Burjjee foi- the purpose of watching Sir Hugh Allan, and to
holdout against him if he were inclined towards the Americans. Mr. Burpee was aware
of this, and I think sympathized with that feeling himself Tiiere was one opinion
entertained by Mr. Tilley and myself, and that was, that with the great wealth and
influence of Sir Hugh Allan the interests of our Province should not be overlooked.

Q. — Do you know, or do you not, wln'tber Sir Hugh Allan was favourable to Mr.
Buriice's appointment when he heard of it?

..1. — I had no means of knowing, but I understood tluit he was adverse to the selection
of Mr. Bur})ee. I had no conversation with Sir Hugh Allan on the subject, I learned
this from outside rumour.

And lurther I'or the presi nt deponeth saith not.

And on tlie KUh day of September the said witness reap|)eared, and made the
following addition to his fo'vgoing deposition.

In answer to a ([uestion ])ut me as to the exact views entertaini'd liy Sir Francis
Hincks, in relation to the adnussidu of American cai)ital oi "ontrol in tlie l)uilding ol
the Pacific Railway. I say that I understood Sir I'rancis had no olijection to any person
building the road. My impression is, that Sir IVancis looked upon the undertaking as
one tiiat, so far from being a benefit to the contractor, would be a b)ss, and he was
anxious tbjst any jierson would undertake tiie building of tlii' road. Sir I'rancis would
not, I tliink, have objected to Americans having control in tlie building of it. But
alterwards Sir Praneis coincided iii the views of his colleagues, that it was desirable to
exclude American control. But jireviously be looked upon it as so had a speculation
that he would be i^lad to see Americans or any one else undertake it. He was ipiito
ready to see it luiilt by .uiy ju'rsoii. After the matter, however, was discus.sed, ht
coincided in the general views of the majority of the (iovernnu'nt.

And further dejioneth saith not, and tliis his deposition having l)e( n read to him, he
dtrlares that it contains the truth, persists therein, and hath signed.

Sworn and taken on the fifteenth day of
Septeniiii-r, Is?.'!, and acknowledged
on the sixteentlj day of said month
and yi'ar.

(Signed)

(Signe.1)

MITCHELL.

CHARLES DKWEV DAV,

Chainnan.
A. POLET'l'i:.

.lAMKS HOBKRT (JOWAN,
Conimissioi»ers

CANADIAN PACIFIC RAILWAY.

171

IN THE MATTER OF THE COMMISSION

nd inadu tin-

Protince op Ontario,)
City of Ottawa. f

Appinting Ciiaiu.kh Dkwky Day, Antoine Pot.ettk, and Jame? Roukkt Gowan,
CommissioiiiTs to inquire into and icjwrt upon t\w scvenU matters stated in a
certain Resolution moved by the Hon. Mr. IIuntinoton in the House of
Commons on the second day ol" April, a.d. 187r>, relating to the Can. lian
Parifie I'ailway.

Present: Thk ('ommipsionkrs.

On this seventeenth day of September, in the v.ar of our Lord one thousand night
hundred and seventy-three, iK»rsonally came and appeared before us, the above-named
Commissioners,

The Right Honouralde Sir JOHN A. MACDONALD, Knight, Commander of the liath,
and Minister of ilustice for the Dominion of Canada, who, l)eing duly sworn,
de|)oseth and saith :

Q. — You are aware of the charges relating to the construction of the Pacific Itailway,
and to the raisin;; and distribution of lands for the promotion of the elwtions in 1872,
recited in the Cominission; will you have tlie got'dness to state to the Commission all
the facts witliin your knowledge relating to th.N (.latter?

A. — I suj)])ose it had lu-tter be done as a narr, five.

In the Session of 1S7I, Resolutions were pa^sed admitting British Columbia into the
Dominion, an<l it was then provide*! that a railway connecting tlie Pacific with the
Canadian system of railways should be constructed within ten years. At the same
Session th<'re was a Resolution pass«Ml in the House of Commons, that the road should be
construc1e<l by jirivate enterprise, aided by i)ublic subscriptions in money and lands.

There were no other jiroreedings that Session except a vote to defray the exjK'iises of
surveying the line, l)ut it was understood that the Government should prepare and lay
licfore Parliament at its next Session a scheme for tlie construction ol the road. The
surveys were commenced and carried through during tiiat summer, but the (iovernmeut
took no action lor some time with respect to the construction of the road, or the
lonnation of Cyompanies llir that puri)ose ; in fact, had not prejiared a scheme, when I
was one day waite(l upon by Mr. Waddinglon in Ottawa.

Mr. \Vaiidingt()n was an English gentleman whom I knew. He formerly resided in
Ikitish Columbia, and bad spent a good deal of money in railway surveys and explora-
tidiis, and was an < nthusiast in the matter. He (old me that by his invitation, ;us I
umlerstood it, some .\merican capitalists from Chicago were coining to Ottawa to make
a proposition to the (Jovernment for the construction of the Pacific Railway. 1 told Mr.
Waildinglon thai I thought this movement was premature; that the (iovernment could
ui)t make any arranginuMils at all until it had siilmiitted a schenii! to Parliament, and
olilained the sanction of Parliament. He seemed to be a good deal disapi)ointed, and
tbked would 1 refuse to • .-e them. I said certainly not, I would be glad to see them ;
and Sir l''rancis llincks ana myself, we being the only two .Ministers then in town, saw
lliese gentlemen. U'e Inldthem that we thought their visit was premature. \Vi' said, as
a matter of poiii'Micss. that we were glad to see that American capitalists were looking
far investments in Canada, but that \\c could not enter into any arrangement or receive
any pro])osition from any hody until after tin? lU'.xt Session.

They said tli.it tliey had communicated with other capitalists in New York and else-
where, whose names they mentioned at the time, and, 1 think, exhiliited a list of tlnir
iianies to Sir l-'rancis llincks and myself, who were ready to c<»-o[ierale with llicm if they
mil Id make an arrangement for the construction of the road. Some of the names 1
knew, some of them 1 did not, but have since asci;rtained that they wer»' all of them
nii'ii of standing and .apital in the Cnited .States.

Q. — Do you recollect the naiTies of the gentlemen present at the con fere n<. ■ .''

.^1. — There was Mr. Smith of C^hicago ; !Mr. Mt.Mullm was with him, also from
Chicago. He was, however, a Canadian. 1 think Sir Francis llincks meiitionei,' other
luiincs, but I cannot ncollect them at this moment.

I think there were two others.

(^,--Can you fix the date of that interview '.'

..4. — I cannot v.ithout reference.

Q, — It was the first interview on the subject?

A. Yes. The fact of these gentlemen bavin.!; made this proposition, called our
attention, and through Sir i'rancis llincks ami tn\sclf the attention of our colleagues, to
the necessity of attemiiting to get Canadian capitalists to enter upon the subject.

('a.vada.

ii.''ij

1T2

CORRESPONDENCE RELATIVE TO THE

r»i»*PA. I first rommuuicati'il with several gentlemen in Ontario, principally in Toronto,
endenvonring to enlist their interest in the enterprise. I told them that it was n great
pity that a great work ol' this kind should be carried off hy foreign competitors, and if
American capitalists could make it a jMiying enterprise, surely Canadians could do su <ia
well. I sjjoke to my friends and mentioned the I'act that these Anprican gentiemeii had
come and made this j)roposition. Sir Francis Ilincks, subset) uently, on one of his visits
to Montreal, saw Sir Hugh Allan on the subject. He did so without any arrangeiiient
or instructions from his colleagues or from myself as First Minister. He did so on his
own res]u)nsibility, just the same fis I did to any I'riends tlia*. I saw. As I understood
he had a communication with Sir Hugh Allan, whicli he st«ted in liis evidence, On Sir
Francis Hincks's return to Ottawa, he mentioned that he had this conversation, and 1
thought he had made a mistake, and so did, I believe, most of the members of the
Government. At that time it had not occurred to me, or I think to anyone, that these
American gentlemen were in an)' way connected with the Northern Pacific llaihvay.
That liad not occurred to any of us. It certainly had not occurred to me, and the reason
why I thought that the action of Sir Francis Ilincks was [)remature, was that I thought
that the true plan would be to endeavour to get up a strong Canadian Company, in which
would be represented the caj)ital of the difl'erent sections of the Donfinion, and after a
body of Canadian capitalists were so formed, they might extend to tlu; United States, or
to I'iUgland, and 1 thought that it would frustratet hat |)olicy to iiav(! conununication in
the li'st place with Americans. After Sir Francis Ilincks had made tliat communication,
Sir Hugh Allan came to Ottawa, with several of these American gentleman, Mr.
McMullen again, Mr. Smith, ami I think ]\Ir. llurlburt of Chicago. We received them
in the (.'ounoil lloom, and had sonK- (•onversation with respect to the railway, but only
as a matter of conversation as to the importance of the road and its great advantage to
Canada, and so on; hut the only business that we did was my asking Sir Hugh Allan,
who seemed to be the principal spokesman of the jiarty, if he had any proposition to
make. Me told us that he had an arrangement with American gentleniiii,sonu" of whom
w«'re there, for tlie purpose of getting up a Company to huihl tin; Pacific Railway. I
said we wen; desirous of getting applications and jiropositions of every sort from all
])arties who took an interest in the matter. He then asked me if we were jirepared
to consider and enter upon any such ])roposition ii be made it. We .said no, we were
not ])re|)ared ; we could enter into no arrangement at that time; \\v bait no authority
from Parliament to do so. Sir Hugh Allan said, "I am, then, not prepared to make
' any proiwsition," and then they left.

Q. — Do jou remember the time of that interview?

A. — I do not. But 1 see it stated in oiw of Mr. McMuUen's letters that it was on
October the .Hh, 18/1.

Q. — That is the interview to which you allude ?

..1. — Ves, I cannot say whether this is correct or not, but I have no reason to
doubt it.

Q. — Tliere were several members of the (iovernment present besides yourself?

A. — Yes. The Cabinet was jjretty full. Mr. McMullen says tlu-rt; were present Sir
John A. Macdonald, Sir Francis Ilincks, Sir (I. E. Cartier, and Missis. Tilley, Tupper,
Mitchell, Morris, .\ikens, and Chapais.

I presume his statement in regard to those present is correct.

I would say in referenci- to this, that before that meeting, I see it observed in the letter
of the IHth of July, signed by Mr. McMullen, which appeared in the ' Montreal Herald'
and ' r<ironto (ilol)e,' that he sjiys that the result of the communical ioi lM;t\\< en Sir I high
Allan and these American capitalists, was an interview in " Montreal larly in S(!|)tenibcr,
'• 1H7I, by which pridiminaries were settled Ixitween Sir Hugh Allan, Cliarles M. Smith,
" and myself, by which Sir Hugh was to receive a large perstmal interest in the stock, ami
" an ainoiint for distribution among [Hi-sons whose accession w-mld lie dei-irable, and that
" till' (dhb instalment on such stock would be advanc<?d an<l carried on by others." He
go«'s on to say " that an interview was held by myself with Sir Jidiii A. Macdonald at llic
'• .St. Liwrence Hall the day before we m<;t Allan, at which he ( xpicssed the approval ot
" the (»o\<riimeiit at the proposed meeting, and rcfpu^ttMl nic to meet him in Ottawa.
N')«. Ilmf IS an incorrect statement. I was at the St. Lawrence I la II, met Mr McMullen,
aiid be told nic that he was entering into negotiations with Sir Hugh Allan; that they
proposed to make a projiosition to the (iovernnient. I heard his statement, and neither
e.\piisst;d a|t|iroval or disapprov.il of it. In September we were <xactly in the sain*'
position as when he had previously met us in Ottawa, and the (iourniuent were not in a
p<fsitioii to enter into any i)roposition of the kind, because we liad iu)t got the sauct'onol
Parliament.

li'fe

CANADIAN PACIFIC RAILWAY.

173

ly in Toronto,
t if was ft great
petitors, aud if
could do so as
{iionticraoii had
me of his visits
ny arrangeiiu'iit
[f did so on Ids
Vy I understood
dcntc. On Sir
vcrsiition, and I
nt'tr.bers of the
yoiie, that these
'acitie Railway.
, and the reason
^ that I thouglit
iij)auy,in which
ion, and alter a
uited States, or
nimunication in
eommunication,
i;entleinan, Mr.
(■ received them
ill way, but only
at advantage to
;ii- Hugh Allan,
ly proposition to
1, some of wliom
ilk' l{aihvay. I
•y sort from all
e were ^irepared
iaid no, we were
uui no authority
•epared to niakt^

s that it was ou

e no reason to

ourse

ere present Sir
I'illi'y, Tupper,

ved in the letter
mtreal Herald
\uvn Sir Ilugli
\ 111 S(!pteinl)er,
arles \1. Sniifli,
utile stock, ami
iirable, and that
)y others." He
acdonald at llu'
the ajtproval of
lint in Ottawa."
Mr. MeMuUcM.
Uan; that they
eni, aud neither
ly in the same
It were not in a
t flie sanction of

I said w'c would consider any projiosition that was mad.-, when it was tnado. I observe
also that Mr. McMuUen in the same letter states "that at the meetin:;- in October ."itl), it
" was at once apjjaient that th >y were not fully in accord amongsi themscdves, in conse-
" quence, as Sir Francis Ilincks informed nie, of (Jrand Trunk jea'.ousy of Allan repre-
" sonted in tiie imjjortant ju'rsonagcr of Sir (ieorge t'artier." This is altogether an
erroneous statement; we were quite in aeiord among ourselves.jwe were all in accord that we
could not consider any i)roposition until after wc hail the sanction of I'arliament ; that we
were not in a condition to make any arrangement until Parliament had authorized us to
do so. In consecpieiice of its being known that Sir Ilugli Allan had entered into this
arrangerricnt with American capitalists, it was known to every one- a feelingof fear arose
in Ontario, especially in Toronto, that tiie I'acilic Railway might get into American hands
and under American control, or might get into Anu'rican and Montreal iiaiids, and that
in the construction of the Hoard the interests df Ontario might be forgotten or neglected.

This, I think, ;ulded to the urgent request of myself on frequent occasions to a number
of gentlemen in Tomnto, induced I think the formation of (he Interoceauic Conqjany. I
liad sjioken to Mr. Macjdierson, Mr. How land, .Mr. Cumberland, Mr. Worts, and a mimber
of other gentlemen in Toronto, to try to interest them in it, and the Conqiany was formed.
Mr. Mac])herson took a warm interest in the forming of il early in the autunni of 1871.
The statement had got into the newspai.ers, and the imjiression had goiu' abroad that
American capitalists were not interesting themselves in the Canada "acillc Railway on its
own merits, but that tlu'v were connected with the Northern Pacilic R.'dlway. and were
nideavouring to make it subservient to the interests of that railway : and ^1u! lear arosi^
;iMd s|)read through (Canada, 'hat our railway would be nuult^ sidiordinate t't American
interests ii' they were admitted to any share in the enter])rise. I was one of those who
|iarticipated in that fear, and itseemr-d to be also the o])inion of my colleagues, in( luding,
la.'U'rIy. Sir Francis Ilincks when hi' iipuiul that the opinion was ;;enerally shared by his
colleagues against the admission of foreign cajdtal, and that the object of the Ann-ricans
in getting control of our railway was to connect it with tlieir system of railw.iy;:. I think
the (lovernment became as (me in the oj)inion that American caj)ital should be excluded,
although we had not cimie to any formal decision on the matter. During the Session of

Oanaii.\.

who usually sn])portcd the tlovernnunt that the majority of
■ere of thf* same (qiii.ion. It soon became apparent to everyone,

1S72 we I'ound that tho'

flic House of Commons

1 think, to Sir Hugh .Mla.\ who was lu're occasionally promoting the Rill for the nicor-

poration cd' the Canad i I'ai'fie t'omjtany, that S'arlianu'ut would not saiiili )n any scheme

wiiich would involve the aiinission ol American capital.

The (lovernment then ci me to the conclusion that as there were two great bodies
of ca])italists, one from Mon n-al aud the otlier from 'i'oronto. both petitioning for Acts of
Incorporation, I say the (Tr.crnment came to the conclusion to aid in the passage of Acts
of Incorporation of any resjiectable body of persons who would ajjply for that purpose;
;ui(l then the <iovernment might judge afterwards which of the ('ompanies would best
suliscrvethe interests of the country, and i.ivetlu'm tin; const ruition of the road. .At tlii'
same time we sulmiitted to I'arlianient the (iovi'rnnieiit Rill, to w hich allusion has been
made, enabling the (lOvemnuMit to give the contract to any Conqany that might be incor-
jKirated lor the purpose with ]U'ovision'< for the amalgamation v>f those <'ouq>anies, an<l
uitli a ])rovision, if il w.is thought for the ad\antage of the country that a Rosal Cliarter
>luHdd be granted, giving the (lOvernment the power to grant such Royal Charter. The
(lovernment .Act contained a cdause to enable the (Jovernment to grant a subsidy in land
and money. Then were two Acts of Incorporation p.issed, as has alnady been several
times l)ronght liefore your notice; one for the Interoceanic Railvvay Company, of which
the prim ipal seat was in Toronto, and the other for the Canada Racilic Railway Company,
liie principal seat of which was in Montreal. So soon as the Session was over, which I
lliink was in June, when Parliament was ))rorogue<l, the (Jovernment addres.sed itself to
llie task of attempting to procure the amalgamation of these two Conq>anies. Tliey
n'jiresented l)ie interests principally id' (^lU'bee and Ontario, although I lielieve both of
those Companies contained names of gentlemen as Corporators fromtheother Provinces.
Still it was generally understood that the Interoceanic Company was the Ontario Com-
pany, and that the Canada Pacific was the (Quebec Company. The policy of the Covern-
nu'iit, from the time of prorogation until n(>w, I may say, had never varied. Il was that
an ain.dgamation of these two llonqianies should be procuri'd if possible. We were
salij-fuil that such was the jealousy that had arisen between tlii' two Companies, that it
would be impossible to give tlit! (Iiarter to either of these Companies, that is the const nic-
tiuii of the road to either of ther'.- two Companies. ^Ve knew that no (lovernmeiit could
exist that would give the contract to either section. If it were gi^'en to Sir Hugh Allan's
Company, the Government would be certain to alienate the suj-.port of their Parliamentary

174

roHHKSPONDKNCJK HELATIVK TO TIIK

Canada. l'iii>ii(ls IVoui Oiiliuio, and I'Ici' I'erm; so tluit wo spared no pains in tli(! altomj)! at. amal
<;aniati()n. Tlif Canada Pacific Hailway Hoard always expressed their willinf;iiess to
aniali;amale. I lie liit( roceaiiie Board (Xjjre'iscl an umvillinj^ness to amalj;ainate. lin-
niediafely alter the Session of l>i7^,or shortly alter, I went to Toronto lor the purpose nl
seeing; my IViends there who were inleresled in the Int'-roceanic C'om})ui)y, and I jiresscd
then; as much as jiossihle to acfpiiesce in theamaljianialion. 'riieelections weretoconic
on hetween duly ami Septemher, and we I'elt as a (lovernnienl that it was very important
to us to jj;o to the ctnuitry with a sclu'ine perlivted iuid an amalf^amation eirecled with
tlie capitalists oi' Ontario and Qiiehcc, ready to co-oi)eral»! in the construction ol' the
Pacific Railway.

After talUinj; tlie matter over with Mr. Macpliersou and other }^entlemt;n in Toronlo.
I wrote to Montreal and I asked Sir Hn^h Allan to come up to Toronto, and Mr. Ahhott,
a memher ol' i'arliament, and who had taken ureal interest in the (Canada Pacilic Kail-
way, also to eomo to Toronto and discuss the matter with Mr. Macpherson. Sir lltii;ii
Allan wrote me that it was im[)ossil)Ie lor him to come up, hut that .Mr. Ahhott mij^til.
Mr. Ahhott did come up, and saw Mr. Macpherson, and you will lind in the evidenif
piven hy Mr. ^hu•pherson a memorandum ol' the sui)slance ol' the conference hetween
those two }^entleinen. That memoraiidum I helieve to he substantially correct from the
inlbrmation that 1 had from huth (d'the ^'cntlemen who attended it.

I left Toronto to <;o to Kiny;ston, to attenil to my own election, impressed with tlit
iilea that there were no insuperalde didh-ulties in the way of amalgamation.

They liad approached very nearly each other. There were only two |)oints ol
•lilVerence. The oni" was the (|Uestion of the Presidency, and the other was the nunil)( i'
of the Directors. A\ith respect to the numlier of Directors, it was sujigested that tlu\
should he thirteen, 'i'his suu;^estion emanated from the (Jovermnent. W'v took tlir
Mumher in the C'ahinel, which v.as thirleen, as a sort of precedent, and it was su<j;);estcil
by the (iovernment that the Poaril of Direction should i)e chosen in t)u; same way thai
tin; C'ahinet had been selected; that there should hi; twc members of the Hoard from
Ontario, four from (Jiiebcc, and one from each of the other Provinces, 'i'hat is a detail
ill which they varie<l from the Cabinet, as there are no re|)resentalives from Manitoija
and Hritish Columbia in the Cabinet. We tliouj;ht that would be a fair mode of adjust iiii;
the representation of the Hoard, and adequate to reiiresiMit the interests of tlu; dilfercnt
Provinces on the Hoard. 1 think it was Mr, Abbott's proiiosition on behalf of the
(Canada Pacilic (!ompanj, that iiist«'ad ol thirteen tlure should be seventeen Directoi;.
for some reason or another; that it would require a larp;er number of nieinbei's to
rejiresent all the intc'-ests ; but, as will be seen by the Memorandum, Mr. Macphersui!
did not approve of this, but lhous;lit that this point mi^lit be yiehh'd, althoii^di it \\i\>
not, of course, so advantai;eous for Ontario to have seven representatives as af^ainst six
from Quebec, as it would le to have live from Ontario ajj,iin.>t four from Quebec, on a
Board of tliirteeii members.

Then, as reijards the Presideiny, Mr. .Macpherson always lield to llu' same position;
tliat lu; did not look forward to it him. -elf, he did not press his o\\n claim for it in any
way, but he thoujjlit that Sir llufjii .Allae,from his Iniviiif^ ori!.;inally maile this arran^'c
Itieiit witii the .Americans, if he wen ph'ced in the position ol President, from his
aeknowledu'ed wealth and influence, would h.ive too much poweron the Hoard, and that
lie mi;;ht exercise that poW(.'r in favour of briiiniiij.; in Ami.'rican cajiital.

SJill it seemed to me. that as that was really the only (piestioi , that is. the (juestion
of the Presidency that we were very near an amalu;amation, and I left Toronto, as 1
have said, impnssed witli the idea that that dilliciilty would be removed av could lie
removeil, and that there would be an amalgamation.

When I WHS ai Kiiiy;ston, ;itteiidiiit^ to my election, I was comniunicaliiiK, I may say.
with Sir (ieorne Cartier, Kivinj;- him ar. account of the pro<;ress I had been makiiii,' at
'I'oronto, and my commniiicalions were always of an eiicourajiinf;- iiaturi; because 1 believed
tli.it the two ('oinpanies would be amalgamated ami we would ;;et over this dilliculty.

When I was at l\iii;;stoii Mr. .Macpherson came there either to see me, or was there
accidentally, I really lor;;et whiidi, but he was at Kiiiffston, and we had a diM'ussioM
about it, and I found the dilliculty still I'xistini^ aboiil the Presidi'iu^y. and I made ii|i
my mind tlnit there was no use in attempting- to procure the anialf^aniation before tin
elections, and that matters should be allowed fostaml on the terms as discussed betueiii
Mr. MaepherHon and Mr. Abbott at their nieetiiif;' in Toronto. I tele>;raphed Sir
Ceort^e C^arlicr in that sense. Tliat telen;rain is net out in th(! allidavit of Sir llui,'li
Allan made in Montreal. I have, howt'ver, t,'ot a rouj;h draft of it. The lel(!}j;rain is
dated the 'Jiitli .hily. and is herewith produced and fylid marked "(«."

I may say, with respect to the exprebsion in that tchj^ram, "that this should I'c

CANADIAN PACIFIC RAILWAY.

175

itUsmpt at amal
r williiij^iuss to
lalj^aiUiUc. Im-
)!• till' pai'ixwc of
•y, and I jUH'sscd
Diis writ- ti) ronii'
s very iinpoitiuit
on cirfclcd witli
bti'iulioii ol' tlu'

mi!ii in Toronto,
and Mr. Al)l)()tt,
,da I'ai'ilic Kail-
I'son. Sir llii;;ii
r. Al)l)<)tt nii;::lil.
in flic I'vidcncf
ruri'iu'c bctwt'eii
forirct from the

)irssi'<l witli till
lion.

y two points ol
was the iiunilu r
Igi'stL'd lliat tlu)
;. \Ve took tlir
it was snfj;f^i.'stc(l
iir wiinc way thai
■ till- l?oard Iroin

That is a detail
i from .Manitol)a
node of adjust ill;.;
s of the dilU'iciit
11 lu'lialf of tiu'
iMitefii l)iii'('toi>

of iuciuIhts tn
Mv. iMacplu'i'smi

although it wa^

rs as a<;aiiist six
im (iiaduH', on a

ic same jiosilioii;
lini for it in any
adf this arrange
■lidcnl, I'rom his
t'oard, and that

is, flif (lucstidii
it 'I'orontu, a^ I
vcd or could iif

iliiifj;, I may say.
hccn niakiuf; at
I'cansi' 1 ht'licvi'ii
this diHicult).
nc, or » as tluTf
hail a disi'ussioii
, and 1 iiiadi' up
lation liiiorc tin
iscusscd lii'txM'di
tflc,i;raplicd Sir
vit of Sir llui,'li
Thr trh'firani is

tliis should •'<•

"acropted hy Sir Ilii<?h Allan:"' that T had rogrcttcd to find that thorn iiad hccii a sort
(if coohioss lictwL'cii Sir lliif^h Allan and Sir (icorf^*; ('arfii'r, and nut only lu'twei'ii Sir
(icory;*^ Cartic!' and Sir lliif^h Allai., iait hftwei'ii Sir (icorpc and his Lower Canadian
j'ricnds. They had !;c<>t the id(>a that Sir Ccortcc was not so friendly as he oii{j;ht to havu
liecii t<» the Northern Colonization Koad, in which a larf^e nunilier of Lower Canadians
look great interest, esi)eeially Ihe I*,lontrealei's, and of which Sir Hugh Allan was
Pii'sident, ami that in fact they had got the impression that Sir (fcorge (^artier was
throwing C(.!d water on all those (;nter])rises which Sir Hugh Allan had entered ujion,
and this, of course, unless it were removed, would he fatal to Sir (leerge ('artier, and in
Jiower Canada would lose him l'arliannntary snpport, ami, of course, lose the Govcrii-
mciit I'arliamentary sujiport. The idea had lieen industriously spread ahroad that Sir
(leorge, as being the Solicitor or C<nnis»d of the (irand Trunk Hallway (^niipany, was
not anxious to ])romole any Kailway enterprise that might he a rival or competitor of
that Railway. This was so much tin; case that a good deal ol IWding had heen created
I'fspectitig Sir (ieorge Carfier's supposed course of actir)n, and that a dejiiifation, which
has heen already spoken of, whicli I am aware had come to Ottawa tc press upon hi.n,
so far as they could, the necessity of taking an active interest in the Northern Coloniza-
tion Head and other Hail\\a\s. exlendir.u' the Northern Colonization west, including the
I'acilie Kailway. ami that the Montreal interest, as re|)resented hy Sir llngh Allan,
should not he ignored. 1 sent that telegram on the I'lith of July, and. I was glad to
receive a c(nnmnnicatioii from Monf 'al, 1 am not sure whether it was from Sir (ieorge
liinisclf, or from Mr. Ahhott. or Sir ilugli Allan, hut from one of the three, slating that
Sir (icoi'ge had expressed himself with respei t to all ihese enterprises in a manner which
satisfied the iMontrcal interest, including Sir Hugh Allan and his ]K)litical friends in
Montreal. And 1 may say here, that it was on lie;iriiig that, that any cotnmunication
arose resjiecting election lunds. ^Vhen Sir (»<'orgeCarficr and 1 parted in Ottawa, he lo
go to lM(>iifreal and 1 to go to Toronto, cd' course, as h'ading niemhers of the (iovern-
nienl. we were anxicms for the success of our Parliamentary su))po.ters at the elections,
and I said to Sir (ieorge that the severest contest would he in Ont;irio, where wf might
expect lo rei-eive all the ojiposition that the Ontario (iovernnicnl could give to ns and to
oiir friends at the pidls. 1 said to him you must try and raise mhIi funds as yon can lo
help us, as we are going to ha\i; Ihe chief hatlle tliei-e. 1 incut ioni-d the names of a few
iViends to whom he might apjdy, and Sir I high Allan amongsl the rest, and thai he waa
interested in all those enterprises which the C'oN'ernment had heen Ibrwarding. When,
llierefon . I ascertained (hat Sir (ieorge Iiad put il all rinhtwith his friends, I then com-
nnniicated to my friends in Montreal, Sir Ceorgi" and Mr. Aliliolt, slating I hoped
they would not forgi't our necessities; that they would s«v to v;iise some fiiinls for us iit
Ontario.

On Ihe .'{nth, 1 think, ol. Inly, 1 ie(ti\ed a h'tter from Sir Hugh .\l!an, addressed to me
at Kingston, stating thai he hail cmne to an arrangemenl with Sir (Ieorge Cartier. He
(lid not send me a copy of the arrangement itsidf, hut he said he had come to an
arraiigenunt and !iad reduced it to wrifiii;.-, slatinii; generally the terms of the .irrange-
ineiil. 1 was not salislicd with ihis. It was not in accoidanci' with my telegram (d' the
'Jilth, and although it was «'xceedingl\ inconvenient lor me, for I was in the heat of my
I'iei'tion. and was recei\inga most stern opposition, I t(degra]>hed hack at once that I
would not agrn- to ii at all, hut that I would go ihiwn to Montreal that night or Ihe
next night, and see them, so that there n\iuht Ik- n > mistake or misapprehension in the
matter. It appears that Sn deorgi' Carlier saw Su lluuh Allan al once, ami iulormed
him that I ohjecled to the arranmnient that li»d lieen made, and that unless the propo-
silii'i! ( ontained in my Irlegram ol the 2(it!i .lulv was adhered lo, that I would go down
to Montreal and discuss the wliole matter with th«'m. I then received two telegrams,
line from Sir Hugh Allan and the other from Sir (ieorge ('artier, which I Ibrtunateh
kept. whi« )i 1 shall read 'I'his is datvd .list .lnl\. It is from Sir (ieorge Carlier. ll
(ommences as ii)|lows : '• I have seen Sir I lugh Allan. He withdraws the letter writieii
■■ to yon, siiu'c vou make ohjection to it, and relies lor a hasis of arrangement on your
" telegram to me, of" which I gi\e him a cony, A'c. "

I herehy prfxince and fyle it inarkj-d "II.

At the -aiiie time I received this one from Sir Hugh Allan, aildressed lo myseUof the
same daU*. It eommences as follows : " I liave seen Sir (ieorge Cartier to-day, you may
• letiini my letter, ite."

I hen-hv jmiduei' aiul tyh- il marked " I."

'Vhai was the «"»ly arningt-ment that was ever made lietwccn the (ioveriinient and Sir
llugli Allan, ir • le C.mada Paiilii- Kailway Conipany which he represented, and I had
■10 disensstoii or "•<Hner<4atio»i in r. <'ontrnrv sense, eitlur from Sir Hugh .Mian or any

'/. •_•

C.'AyAi).*.

17(5

CORRESPONDENCE RELATIVE TO THE

Canada. moiTihtT ol' his Company, or from Sir (n'or^c Carticr, IVom tliat timo until this. That
was tlic arranf;;i'mi'nf that was made, l)y which, till tht; elections won; over, tho whole
matter connected with the coiistrnctioii of the Pacific Railway should stand in abeyance
and that alter the elections wen; over an ;;iiempt should he mach' to amalmamate ; and
that tlu'se two gentlemen. Mr. iMucph';rson and Sir Hugh Allan, shouhl meet in Ottawa,
and form a Provisional Poanl.

I see that it is mentioned hy '*>lr. McMullen in one of his letters, that there was a
snhsequent arrangement made on the si.\th of Auf^ust betwe(;n Sir (leorge Cartier and
Sir Hugh Allan. If such an arrangement was made I am ([uite unaware of it, and more
tiian that I don't bclievt; it.

lam quite satisfied that if Sir (ieorge Cartier had made anv such arrangement, lu;
would have nientioned it to me. Sir (ieorge was a man of the highest honour, and
between him and myself there wen; no ])olitical secrets, arid if he had made any arrange-
ment of that kind respecting tin- railway he certainly would have communicated it to mc.

I ol)serve that Sir Hugh Allan says in one of his letters, which has been published,
dated the (ith or 7th of August, he '•yesterday concluded an arrangement with Sir (ieorge
"(!artier." The way I read this is that by yesterday he meant a day or so before, which
Avould be about the .'!Oth .July when he signed these pa|)ers.

After the elections were over, we renewed our attempts to promote the amalgamation
of the Coni|mnies.

At my refjucst, my colleague, the then Postmaster (icneral, Mr. ('am])licll, went to
Toronto, with what results you know from his own statement. Early in November,
about the Tth or Stli of November, I went to Toronto, and once or twice I thought 1 had
succeeded in overcoming tin; reluctance of .Mr. .Maci)hersoii, but after discussing it with
hiin fre(|uently, and pressing all my vii;ws upon him, I had at last to leav(; Toronto
unsuccessful in my mission. On my return to Ottawa the Government then addressed
itself to the formation of a (-'om|)any under a Koyal Charter. As I have; aln-ady stated,
the (iovernment were satisfied that it wouhl be ii> tiu- highest degree ine.v.pedient and
impolitic to grant the construction of the Koad to either of the incori)orated C(mi|)anies.
We canu; to the conclusion that we should exerci.se the power conferred upon us by the
(iovernment Act of the Session of 1S72, and endeavour to form a (Company in which all
the din'ercn' Piovinces would lie represented in one, as I have mentioned. And we did
grant that ('barter as is known.

In the s(;lectioii of the first Hoard of Directors and sharelndders, the (iovernment had
oidy the one object: that of getting men who would command the conlidence of the
country, either from being men of capital or being men of known staiiding, or of being
men es]iccialiy accpiainted with the subject of the construction of Railways. The nanus
of various gentlen.in were discussed, some were originally selected and afterward^
changed. At first the (iovernment tliought of some hailing men who were in Parliament
on accoimt of their \v»'altli and standing. There were several gentlemen who were
selected wlio \vere members of one bouse or the other, but afterwards on consideration
o!' the whole (|uestion, tlu; (ioverinnent came to the conclusion that it would l)e better
to exclinleall mend)ers of Parliament Irom the Doard.

There had been a motion made in the House of (yommons <luring the previous Session
to <\(lude nn-mlicrs of Parliament from the Company, and some feeling had b.'en shown
on the subject.

The (iovernment therefore came to tlu; conclusion that under the circumstances it
would be better to exclude niember.s of I'arliament iVoiu the Directory.

And now I would state tin; rea.sons, ,m) far as 1 know llu-m, why the gentlemen com-
])osing the Board of Direction were cbosi'u.

In Ontario there were five g(;ntlemen selected. Major Walker, of London, was chosen
as being a man of standing and w»alth, and at the head of the oil interest of Western
Canada. He liad'been connected with the Literoceanic ('ompany as a corjHJrator, and
be was selected as re])rescnting the western interest. At (irst we had asked Mr Carling.
the memlu'r ibr liomlon. to be a Director, but wlu'u we came to excdude members ol'
Parliament, Major Walker was selected in his stead. He was selected without any
rd'crenei; to Sir Hugh Allan, or the (Quebec interest at all. I don't know whether Sir
Hugh .Allan was ac(|uainteH with .Major Walker before or not.

Mr. Mclnnes was sebicled as ;i leading nurcbant at Hamilton. He was known to Sir
Hugh Allan. He was a member of the Canada Pacific Railway ('omi)any. He is a
western man, and of high staudinu and < haracter, and the Hamilton interest could not
be ignored. Mr. Mclnnes was in JOngland at the time, and when selected by myself, 1
telegraphed him by cable, and got his answer by letter accepting.

Col. Cumberland was selecti-d as l.'cing a Railway man, and a civil engineer of high

CANADIAN PACIFIC RAILWAY.

le amalKaiimtion

•irciimstaiicrs it

xnitlcmcn com-

sfaiKliii<;, and as Immiij; a groat ]U'rsoiial IVioiid of myself. Ho was goiiip; to England at
llic tiinc, and 1 asked him il' lie would agroo to serve. He said he would rather not, hut
lli.'t I might eoniniand him (lither in the Company, or outol'the I'ompany, il'he could be
of any service, and I selected him.

Mr. Sandford I'Meming was selected hy mysell' and he also went on the Hoard with the
greatest reluctance, and it was only hy my stronjj^ pressure that he consented. I may
add that Sir Hugh Alian was strongly ojiposed to his heing appointed in the Hoard. He
(lid notol)ject to Mr. Fleming, from any jjcrsonal reason, hut he thought that his services
as an engineer would he of more value to tlu; (.'ompany if he were not in the iJoard.
1 thought that it wouhl he a great advantage to the Company to have a man of Mr.
I'leming's standing on the Hoard, and I insisted on his a])pointnient.

Mr. Shanly was the last; he was placed on the Hoard at my suggestion. I asked him
to serve on the lioard. He declined at first, and he came to see me especially on the
suliject, and at my earnest soli»'itation he became a niemiier of the lioard. He wjis a
niciiihcr of tlu; lateroctanic 13oard. 'J'he Directors for Nova Scotia and New Hrunswick
weir selivlcd by my colleagues in the Ciovcrnmeiit Irom these I'rovinces. Ami I believe
ill botli cases without communication with Sir Hugli Allan, and certainly not at his
instance. ^Vith respect to Nova Scotia, Mr. Colliiigwood SchriMber, an Upper ('anadian
originally, but who had been connected with the coiistnictii»n of railways in the Maritime
Provinces, was originally selected as a Director to represent Nova Scotia, but afterwards
as (iovernor Arcjiiliald had returned from Manitoba, and as he was a man of high
standing and great inlluence in Nova Scotia, he was sulistituted by the Nova Scotia
inembcrs of the (!abinet for Mr. Schreiber.

Mr. Hurpee, as Mr. Mitchidl has said, vns chosen by Mr. Tilley and himself, without
any reference to Sir Hugh Allan.

.\s regards tin; members of the lioard I'rom Quttbce, there was first Sir Hugh Allan
liimself, Mr. Heaudry, a merchant of high standing in Montreal. He may be considered,
though I don't in fact rememln-r, as being selected by Sir Hugh Allan, as being his
special choice. Mr. Hall was selected l)y Mr. Fope to represent the Kastern Townships
(111 the lioaril. Sir Hugh .Mian pressed strongly for the apiioiiitment of Mr. l''oster, or a
person representing Mr. {"oster. Mr. Foster himself could not lu! a member of the
Hoard after we came to the conelusion to exclude members of Farliameiit, as he was a
Senator Sir Hugh Allan tlu;refore desired to liave a representative of Mr. Foster on the
Hoard, lint Mr. Hall was selected by Mr. Fojie.

Hon. Mr. Heaubien, the Commissioner of ('rown l^ands for Lower ('anada, was named
by Mr. Laiigevin. lie selected Mr. lieaubien to represent the District of Quebec interest
iis separate Iroin th«, Montreal district interest.

The Charter w.i>. lianicd with great care. The principal heads of it were prejiared by
myself; that is, the leading principles of the Charter were jotted down by myself, and
iicipiicsccd in by my colleagues, and were coinmnnicatcd to the gentlemen whom we
li;id selected to \\n-\n this Hoard. We had several meetings, I fancy in December and
•iMiiuary, at Citawa. where these matteiN were iliscussed.

The provisions I'l' tlu; Charter w-re adibd to and enlarged IVom time to time, and at
last Mr. Abbott was selec-teii to meet Mr. Campbell and myself and settle all details of
every nature. Mr. Abbott w.^s acting, not on his own account, but as [ understood as
counsel for the new Company, which was about to be formed. He was early selected as
the legal 7Tian of tin Com[)anv, and in that cajiaeity he met us and we worked out the
details, most painfully worked at them for a considerable time; had them printed and
reprinted, and at last they assumed the form in which they now are in the completed
Charter.

I think that 1 have given you ast.atementoi all the facts connected with the jiromotion
(if the Co'T nany and what I know of the communications and original arrangements with
the Aiiii ,nis. 1 may say that every prtvaution that we could think of or that was
^uggj-s! u to u^ to prevent the .\iiiericans gi-nnig in either dircitly or indirectly so as to
have control oi the Conijianv, w;is adopted In the first place, by the election of the
thirteen gentlemen who were iirf, only Dirtvtors of the Company, but were also share-
lioldei's and held all f.be stock

I'hcy were all gentlemen M higli sbuidingand Canadians, and certainly would not, any
"lie of theni, be in any w;iv a party to handing over the Canadian Pacific liailway to
foreign control. Thej held the whole of the stock, and not a single share could he
trnnsfern;d l»r the first six years until the sanction of theCJovernment had been obtained.
The reason we select«!d si.\ years was this ; we gavi- the Coni})any one year — to the
first of Janairy next — to raise the necessary funds, and we thought that after five years
of activi' prosecution of the work there would be no fear of the road getting into foreign

Oamada.

178

CORRESPONDENCE REI.ATIVE TO THE

Oamada. hands, and that point onco giiinod, tlie loss the Govornmciit had to do with the stock the
~~~' hcttrr, lor it would letter the trnnsler of the stock and of course render it less vaUiuhle.
The uncf>rtaiiity as to whether a purchaser would \w approved ol' l)y the Government
would ojnrate ap;aiust the vfilue of the stock in the market.

Q. — Have you any further statement to make ?

A. — Nothing lurther occui-s to mc.

I can state and propose to take up the question as to the contribution of election funds.
As I have already mentioned, wlu-n Sir (ieorge Cartier went to Montreal I'rom Ottawa,
and I went to Toronto, 1 asked him to endeavour to i;et what pecuniary help he could
from our rich friends in Montreal; and when 1 wiis in Kingston at the tinu" of my own
election, I got a letter from Sir Hugh Allan stilting that lie would contribute $2.'),()((()
to the election fund. He used the exjjri-ssion that he would contribute $'2r),()l»() to help
the friends of the Administration in their elections. I may say here that 1 considered
myself a trustee to that fund, and certninly did not apply any of that money to my own
(dection,

Q. — Have you got that h'tter?

A. — No ; I destroyed it.

It was sim])ly informing me that lu; would contribute to that extent.

I paid the expenses of my own election; and in fact, I did not receive any funds at
all Irom Sir Hugh Allan until after my own tdection was over. 1 was at Toronto the
most of the jK-riod during which tlu; elections were being held, going olf occasionally to
one place or another to communicate with my friends. 1 got jjecuniary assistance where
1 could. Ill CaiKida we have not the same organi/.alioii that they have in Kiigland.
We have neither a Uelorm Club nor a Carlton Club to manage! elections, and the
leaders liav<- to undertake that for themselves. 1 found as the contest went on that it was
getting mine severe ; rejiresentations were coming to me from all parts of Ontario that the
Opjiosition. to use a general expression," had two dollars to our one, and 1 redonbh-<l my
exertions to get subscriptions from all our friends. Sir Hugh Allan wius then in New-
foundland, as 1 understood, and 1 wrote twice iiei-soiuilly to Mr. Abbott, who was acting
in Montreal for him, and twice received contriljutions to the extent of si 10,UU() each.

Q. — Were these sums both from Mr. Abbott?

A. — 1 am not sure, but 1 think so.

(2.— That was in addition to the s2r),(K)(), making !?-15,(J0() ?

J. Yes.

I si-e that in oni- of Mr. McMullen's lettel^ ol' the l()uith of August, published in the
' Montreal Herald,' he stat(;s that " over .S100,00() were sent to Sir John A. Macdonald,
" from Montreal, besides a large amount paid to the (Jentral Committee." As to the
funds I got from Montreal, they are exactly the sums I liav<! mentioned.

As to the contribution of $2.'i,(K)(), it was sent to me without my having previously
asked for it. I had no communication with Sir Hugh Allan, and nvwv asked him for
any sum whatever at the time that 1 rec('ived the !<2."),U00, but 1 have no doubt .Sir
(leorge asked bim to subscribe, and 1 got the intimation Irom Sir Hugh Allan that he
had subscribed that amount. The other two sums of sl(>,UO() each were given at ni;
re<iuest. I wrote to Sir (reorge Cartier in Montreal, with i-espect to these additional
advances, that as we had such a bard fight, he must cither borrow or beg funds for me,
aid 1 have no douiit that be asked for them. I was not aware until 1 saw the communi-
cation ill the newspapers, tiiat he had written to Mr. Ablxitt, to endeavour to get it for
me if he could.

I think this is all the statement I have to make.

Q. — Is there any other matter coimected with this charge on which you desire to
make a general statement ?

A. — There are a number of statements made by Mr. McMullen, which 1 would like
to ciill your attention to or to which I have already adverted, but would wish to specify
moi-e ])articularly. Mr. McMullen in his letter of the iHth of July, slatis that Sir l-'rancis
Hincks suggested that the Clovermnent would be obliged to advertise for tenders, in order
to avoid blame, so that the conclusion of an agreement would havi; to be postponed for
several weeks.

To that I will say that the idea of advertising for tenders had been mentioned, with
many other suggestions that were made, but it never came to anything. The (iovern-
ment never came to any conclusion to advertise for tenders. Indeed we saw that there
would be no object in advinlising for tendere as we excluded American capitalists
altogether. There was no suggestion that there would lie any (Jompanies formed in
England to build the road, and all the cai)it<j lists in Canada who desired to have anylbing
to do with it were parties to the Interoceanic, or the Canadian Facilic Comiianies, and so

c:anadian pacific railway.

170

•oil (lesiir to

tlH!ro was no olyirt in julvortisiii-i. Mr. MfMullcn says he (Sir Iliiph Allnii) at oiui
time aiiiiouiufd to INIr. Smith and mys*;!!' that tint !*H,ri()0 of which hv speaivs in mw ol'
his letters, had l)eeii hnt to Sir .loliii A. Macdonahl and Sir Francis Iliiicks in sums
of ><I,(IU() and !j!l,f>()(> resjjeetively, with very Kood knowl»Hl)j;e that it was never to Ix;
repaid.

With relercnee to that sum of ^4,000 to myself, that isn eomjihte and utter falsehood.
I never received i«il,00li from Sir Ilu^h AUaii. I never liad any money transactions with
him in my life. He nev(!r pave me any money or never lent me any money in his life.
It is utterly false, aud I have reason to helieve Sir IIujj;h Allan never said so. Mr.
McMullen does not stiite tliat we received the money, hut tliat Sir Hugh Allan said so to
him, Init I do not believe he ever did say so, for two reasons;

In the first place, if In; ever did it, it would have been a I'alseliood, and in the nc^xt
place, when INlr. .McMullen came to see nie in Decemlier, I think it was then tliat he
came to «•(' me, the .Hrst time alone; alter the elections, 1 I'orget the exact date, he came
evidently for the pur|)ose of attemptiiif; to ItuUy me, and levy black mail upon me, and
he spoke vi'ry mysteriously of what he could prove.

That Sir lliij^li Allan hud told him some very str ii'j;e stories about expenditure of
money for members of Parliament, and so on. I was very much surprised to hear that
statement, and he said anions other things, "In; never mentioned your name in con-
" nection with any of thi-se expenditures, luit he has tlie names of persons who are very
" near yon." I said he could not very well have nu-ntioned my name, bwause 1 m-vcr
hud any money transactions with him. In the Hrst place I know the st^itcment is false,
and I am satislied for these two reasons that Sir llu};h Allan never said so. A^ain Mr.
McMullen says: — " I met Sir John Macdonahl in Montreal after the ch)se ol the Session.
" while on his way to meet Lord Duilerin at Quebec, and he sngscsted that as Allan lia<l
" made so many enemies, 1 should <xo to .Mr. Macpherson and ;ry to bring al)out an
" amalgamation, i)romisiiig to writt; a personal letter to Mr. Macpherson, to aid in the
" desired object." Now that is in substance untrue, entirely untrue, ixcept the single
fact that 1 saw Mr. McMullen. Mind you I did not seek him out, Mr, McMullen sougiit
nie out. I was going to Qinibec to see Lord Lisgar olf lor I'ngland. I wt-nt from here
in the steamer, and went direct from one steamer to the other, and did not enter
Montreal at all. How Mr. McMullen found out 1 was on the boat, I do not know, but
certainly he cjime down to see me. He said the Canada Pacific Kailway Board was
sitting and was going to take some steps. I was very guarded, I did not know what he
had to do with it. I luulerstood of course, there were to be no Aniericans having any-
thing to do with our Pacific Railway scheme, and I did not therefore understand what
he had to do with the matter at all, or why he !md come to see me. lle\>as a (.!anadian
himself, but I did not know whether he had anystcnk or inttu'est in the Pacific Ctmipuny.
I was exceedingly guarded with him. I heard what he had to say. Hi; said the
t'ompany was orgaiii/ed. 1 said it is not the slightest use having anything done until
thi'rc is an amalgamation. lie then said to me that he was going to leave Montreal for
Chicago, and he tlu-ught he would stop at Toronto on his way home and see Mr.
I\Iaci)lierson.

I think 1 said it would do no harm, or some answer of that kind. I did not encourage
him to go. He informed me that he would go. 1 made no suggestion to him in regard
to it. It would be (piite absurd to sii|)])ose that if I could not lU'isuade Mr. Macpherson
to go in for the amalgamation of the two incorporated C-'ompanies that he could do so.
It is quite a misstatement. Mr. McMullen says again : "After having Sir (ieorge sign
" an agreement, as stated in the h;tter of August (Jth, he commenced paying miniey, but,
"as he told me, having (^artier's order in each case, and taking a receipt therefor. When
" making the agreement he had no idea that the anioiinl of money Would In; excessively
" large, and when it had run np to between $ir)0,0(IO and !^200,()IH) he became alarmed,
" and told Chattier that he must stoj) paying the drafts which were coming in so rapidly
" uuh'ss the whole Government would sanction the bargain. He then stated that Sir
" Cjieorge sent to Ottawa and receive<l a telegram from Sir John Macdonahl confirming
" his action. After this Allan said he jji-oceedt-d paying out money until he had
"advanced s.^.'iS.onn in addition to sK»,(IUO drawn from New York." Now this is
altogether untrue. He received no such telegram I'roin me. He could not do so, because?
I never was in Ottawa during that time. 1 was always in the west attending the
elections. From the time 1 left Ottawa at the end of June or the i)eginning of July,
until the elections were all over, 1 never was once in Ottawa, and I never made such a
communication. It is altogether a falsehood.

Then again as to tht; meeting which he allegej to have taken place on the .TIst of
December, he says, "On the .'!ist of Deeember, 1 had an interview of some two hours'

Canada.

D'"

i|*i ii|,«!psq^i

180

h'l

COHRKSI'ONnKNCi; KKLATIVK TO Till:

Cajiada. "(liirntion witli Sir .Folni, and |ila(c<l liim in possession of all the thets nn<l sliowrd liini
" tlic Ifttirs wliifh I liad IVoni Sir llii^jli in rcfrard to the matters as well as the orifjinal
'* contracts, and the letters to the New York Haiiroad President, whieli were recently
'• ]inl)lis|ied in connection witli otlier corres|)ond<'nce. ' lie (Mr.McMuilen) came fo nic
and complained very miuh oT the way he had luen iis«'d ; that he had devoted liiniMir
for stime time to this snl)Ject and liad lu-en thrown overixiard. lie did not show inc
tliose impers. He read me jmssafics Irom some of tlie letters. I recoi;nized some of the
imssnf;es wlien ! read tlie corresiiondence ])iil)lished as some of the jiassages rend. I
jieard wliat lie had to say and what I ihi'U said was that accordini; to his own statement,
if his statements were true, and tliose jiassajjes read seemed to carry out his statement
that I thoii|;hf Sir lluj;h Allan had not used him well, I said, "heouj^ht to have heen
*' more I'raiik with you. lie could not if he had trit-d have olitained whiit he wante<l U)
" get. He must have ascertained that last session. II(! could not hy any possihility have
" eirecte<l the iiurjioscs you wished him to ell'ecl of ^'cttinj; your associates the American
" capitalists interested in the Company. He lould luit do so, the jxihlii- I'eelinij; was so
*' great," The I'eeling cxpressj'd in Parliament, nnd the pcdicy of the <iovermnent were
nil opposed to it, so that, liowever willing; or anxious Sir lluijh .Allan mij^ht he to carry
out that arrangement, it was imjiossihle to do so, and his lault I thought was in not
having at once candi<lly told the American gentlemen with whom he hail made this
agreement, that such was the fact. On the 'Jlird ol'.Ianuary, that was a very short time
hefore the contract wns signed, and after all arrangements had heen made, and the selec-
tion of the Directors or most of them had lieen completed, Mr. McMiillen canu'
accompaniiil hy Mr. Smith, of Chicago, and .Mr. liurliiurt, of Chicago, and they went
over the story again. They told me that they had heen very hadly usnl, and they hail
in good faith advance»l for |M'eliminary expenses oi'the Kailway a sum of money, that is
for the prtdiminary expenses of the Canada I'acific Kailway Coini)any which was incor-
jun-ited. I stated to them that of cours«' Sir Hugh .Mian was liat)le to them liu' that
money, and must, it seemed to me, as a matter of course, refund it, if he had not already
done so. They said they would not put uj) with such conduct and would si'e him. I
said it is your own afl'air. Mr. McMuUen said they would seize his ships in AmiM-iean
j)orts and take proceedings against him. 1 said it was (piite opi'ii fur them to do so. I
went so far as to say, " I think you are ([uite right, if I were in your place I think I
"would jiroceed against him." They said they would go down to Montreal, and iiotli
Smith and Hurlburt said, " Vou must distinctly understand that we do not come here for
" the i)urpose of idack-nuiiling you or black-mailing the ( Jovernment, hut for the purpose
" of stating our ca;;e." In fact they wanted to know whether, hy any chance, they could
be admitted to have an interest in the Railway.

That'vas, I understood, the object of their communication. I said to them that it was
utterly impossible ; that American capital must he excluded, and that the ('ompany must
he I'ormcd by Canadians, and was, in tact, in jtrocess of formation, in the maimer in
which it now presents itself. They said they would go down and see Sir Hugh Allan, and
return this way and sec mc. I said I would he very glad to see them, and if I could be of
any service in settling matters between Sir Hugh Allan and them, 1 would be very
glad.

They did not come this way, however, but I received a letter from Mr. Smith, of
Chicago, making a great comjilaint, that they were excluded, and he wanted to know if
I would have any objection to their petitioning the C'anadian Parliament for redress. I
did not answer that letter. There is a report aj)i)earing in the ' Chicago Times' of
Septendier .{rd. which was sent to me, containing an account of an interview betwe»'u a
reporter of that newspaper and Mr. McMuUen in Chicago.

C2.— Which Mr. AIcMulhn?

A. — Mr. CJeorge W. McMullen. Most ol that report repeats what has heen already
published, but I wish to recall the attention of the Commission to it. He says: "That
"we went to Montreal in Sepember. 1h71 — and arranged preliminaries — Sir Hugh was to
" be the agent of the (Jovernmcnt. He was to receive for himself a large interest, and an
"amount of stock which was to be placed where it would do most good, and the cash
"instalments on the stock w(!re to he advanced by us."

The interviewer asked then — " Was the Government aware of this.'"

Mr. McMullen replied : '" I told Sir John Maedonald all about it before our meeting
" with Allan. At the Premier's request I visited him after the meeting at Ottawa, and
" told him everything, and he was well satisfied." As I said before, I saw Mr. IVIcMulhn
at the St. Lawrence Hall, and he told me Mhat was doing. I heard liiin. On both
occasions my statements were uniform, that the Government could not enter into any
arrangement until after Parliament met.

CANADIAN pacific; UAIIAVAV.

]f^]

III- rcvt'ris ill fliat interview to n stateiiuiif tliaf Sir IFii};Ii Allan liml iiifdrnictl liiiii
that III' IiikI loaiu'il ^I.OIH) to inc; tliat Sir lliii;)) Allan liail said so.

" Some time alter this, Allen staled that lie had loaned sl.dtHi and !? I.find fo Sir.Iohii
A. Macdonald and Sir Francis llineks respectively, with the Kiin\vied;:f llial it was never
to he returned." That is untrue. I have already <\|il.iiiied why I helievc that Sir llu^h
Allan did not say so, and il he had said so, Mr. MeMullen told nie a lalsehood when lu;
^aid that Sir Iln^h Allan had never mentioned my name in eoniiei tion with these Irans-
actions. l!«'re is another statement The I{e|iortef says: " Have yini any liirtlier inool
'• that the (lovernmeiit was aware of Sir llu;;li .Mian's liarj,'ain with ('artier ?"

Mr. .MeMullen said: " I do not I'eel at lilierty to suhmit all lor |iiibiieation. I will
"f;iv»' a short item that will jirohaiily he sullieieiit. Sliorliy alter the elirtioiis were over,
" and while .Sir llnf;h Allan was pressing; for a luHilnieiil ol his hafiiain, he lieuaii to tiiink
"that the (iovernnieiit intended to play false, lie prep:ir( d a ((iinplrlc Iraiisciipt ol' all
" tile transaction lietweeii him and Carlier .uid Macdonald, the contrails, supplementary
"contraci, orders I'or money, telej^rams lor money, teie;;ranis of Sir .luhii, and memoranda
"generally, all ready for puhlication. On the follow iiiij; morning' the (Mivernmenl was
" notified of this, and they yielded to the tlircat." I can i nly say tiial. I iievi r he:ird of
such a statement; never saw it; no such threat was ever maile, and no coniniuiiicatioii
of the kind was ever made. It is a falsehood complete and entire, without one semhlanec
(if truth, lleri! is another statement which, perliaps hereafnr, hefore this Commis-ion
closes, can he more specifically re])lied to, as it is not a sul>j<,'et with \\liicli I am very
cdiiveisant. The Keporter says: "Hut ^ |(i(),()(i(t is a pretty ;;ood sum of money for one
" man to lose. Does .Sir IIut;h really sulfer this loss.'" .Mr. MeMullen sa\s: "Sir lliif;h
" is President of the Merchants' Hank of Canada, u very lar>;e iiis»ituti(i;i, which in its
"current Meport shows a (•overnment deposit, without interest, of over !«l,*Jltti,0()(l, and
" as all its funds are directly uinler his control, it is safe to suspect that up to the presi nt
" lime he is even. 1 iindersland that another iiank in .Montreal furnislicd a port ion of
" l\w sum hy discounting iioti's secured hy Allan's eiidorseiiunt, and that these are still
" heinj; carried. This hank also has over ::^.'!00,(l(i(l of (Jovernmeiit money on the eipially
" lilieial terms of no interest." That statfinent is untrue. I do not helieve the
.Men hauls' Hank have ever at any time dejiosits of over s.'l()(i,(((il) witlioiil interest.
Funds accumulate in the dill'erent hanks, and aiij' profit yoes to the shan holders and in
no way to Sir lluf^h Allan cxcejit as he is a shareholder. !5ut the sum of ."r^l.'JOO.lKiO is
alto;;ellier lalse. I think these are all the remarks I have to make.

Tliere is one more statement which 1 desire to make in justice to Mr. Ilillyard
Cameron. It is stated that at my pressinj; instance Sir Hugh .Vllaii advanced moiie\ or
(lisidimted a note of Mr. Cameron's of some !j!'),0()0. Mr. MeMullen says: ••The
"(Chairman of the Investigation Committee applied through the Premier I'or a loan of
" :S,'>,(I(M» after the (dections were all over, and as .\llaii supposed he was through jiaNing,
" he oiijected, hut after a personal visit of the Postmaster-deiieral to Montreal, and the
'■ urgent telegrams an 1 letters of .Sir John, who annminced that it was to hel|) iis, the thing
" was done." The eireumstance was simply this: Mr. Cameron told mu— we are very
great friends —that he was very hard-up, and that he wanted some money and was
anxious to get a discount, and he asked me if I would drop a line to .Sir Hugh Allan
asking him to get his note diseoiinted hy the iMereliants' Hank. 1 wrote down asking
Sir Hugh to u.s(! his inlluenee to get a discount for Mr. Cameron for ;<r),()00, and he got
that discount. That is all I know ahoiit it. That was in January, before this Investiga-
tion C!ommittee, as it is called, was thought of Parliament did not meet niifil March.
Mr. Huntington did not make his charge against the (iovernnieiit respecting the Pacific
Railway until April, and such an idea as the charge heiiig made or tlu; Committee
being struck, had certainly not occurred on the '2'.\rd January, 1S7.'!. I have just this
further to say, that when it was proposed to strike the Committee, there was a good deal
of excitement in the House at the time on the subject, as of course you cannot but
be aware of, and it was the opiniim, or it was believed, as it jirovcd, that there would
be u strong party struggle as to the composition of the Committee. I suggested
some names to be on that Committee, to my friends. Mr. Ilillyard Cameron was not
one of those whom I suggest«'d, and wh(;ii I found it had been so arranged by
some of our friends I was disapjwinted. and expressed my disaiipointment. So that
Mr. Cameron ^vas jiut on that Committee, I may say, without my consent, 1 having
suggested another and a dill'erent member of Parliament, and was (piite disapjiointcd
that Mr. Cameron was selected. 1 feel bound to state this in justice to Mr. Ilillyard
Cameron.

Q. — Mr. McMulhni's letters seemed to allege that copies were given you of certaia
letters between him and Sir Hugh Allan. Did vou see these letters 'i*

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23 WEST MAI^' STREET

WE3SVER,N.Y. 1 4580

(716) 873-4503

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182

CORRESPONDENCE RELATIVE TO THE

Oasaw. a. — On tlie 23rcl of January he saw me and said he would send me copies, and he did
— ^ send me copies.

Q. — Are these copies of the originals which were afterwards included in the sealed
packet ?

A. — Yes, I think so.

I have got them.

Q- — Are you able to state whether these copies you have are copies of the originals
here ?

A. — I have got all the copies.

It would take some time to bring them now, as they are at my house.

Q- — You will produce them to-morrow?

A. — 1 did not get them on the 2iJrd of January. He promised to send me copies of
all the pa])ers, and I subsequently got them.

Q. — 1 lad you any knowledge that that correspondence was going on at that time ?

A. — No.

<2- — When did you first become aware of it?

A. — I became aware of this correspondence by seeing it in the 'Montreal Herald.'
Of course I was aware of the correspondence at the time I got the copies, and I next saw
it in the ' Montreal Herald.'

And further for the present deponent saith not.

And on tliis eighteenth day of September reappeared the said witness, and continued
his deposition as follows : —

Q. — Have yoii any knowledge of the sealed packet of papers which was placed in the
hands of Mr. Starnes ?

A. — The first I heard of these papers was when application was made on the floor of
the House by Mr. Huntington to have them impounded. I then afterwards saw the
packet when it was produced beibre the Committee by Mr. Starnes. It was sealed, and
the members of the Committee who were present put their initials in the vicinity of the
seal, but it was not opened.

Q.—U that envelojie now shown to you the one which you saw ?

A. — I have no doubt but that is the one. I recognize Mr. Hillyard Cameron's writing
on it, and also that of Mr. Blancliet ancl Mr. Dorion.

Q. — Will you have the kindness to look at the letters contained in that sealed packet,
and numbered from 1 to 19, and say whether the copies which have been given to you
are coi)ies of these letters ?

A. — I would say with respect to these copies that Mr. McMullen, at the meeting
V .ucli I have spoken of already, stated to me that he would send me copies of the corre-
spondence between Sir Hugh Allan, and Mr. Smith and himself. He did send me
copies of that correspondence two or three days after. I see in that correspondence two
letters addressed to a gentleman in New York. These letters appeared in the ' Montreal
Herald,' and, I think, without the name of that gentleman.

His name I see in those papers. These letters belong to that gentleman, and I do not
wish to be a party to making them public, but I will hand them in to the Commission.

On comparing the correspondence sent me with that in the packet which was placed
in Mr. Starnes' hands, I may say that there are two telegrams, and a letter previous to
the 8tli of December, 1871, the earliest date of any communication in the packet.

Q.— Do these copies of the correspondence which were sent to you purport to be
copies of a correspondence between Sir Hugh Allan, Mr. McMullen, Charles M. Smith,
and this New York gentleman ?

^.— Yes.

Q. — These copies have continued in your possession since you first received them?

A. — Yes.

Q. — No copies of them were given by you to any person ?

A. — None.

Q. — I i)erceive that there are some statements in these letters, several of which I wish
to call your attention to. In the letter of the 28th of February, 1872, Sir Hugh Allan
mentions the distribution of stock in the Canada Pacific Railway Company, $100,000 to
Mr. Mac])herson ; A. B. Foster, $100,000 ; and so on. Have yen any knowledge of
an arrangement between Sir Hugh Allan and these gentlemen, of that kind, or of any
arrangement which Sir Hugh Allan projmsed to make with respect to the distribution
of stock ?

A. — Not the slightest. I never saw this document or knew that Sir Hugh Allan
proi)osed to distribute the stock among Canadians in this proportion; but I heard from
Mr. Macpherson that in a conversation which he had with Sir Hugh Allan, that he had

CANADIAN PACIFIC RAILWAY.

183

ameron's writing

t'ived them?

mentioned or written the manner in which ho thouglit it would be right that the stock.
in the case of amalgamation, should be distributed in Canada, but the particulars 1 do
not know.

Q. — Then there is the letter of the 7th of August, to which you have already adverted
in your examination in chief. In the letters of tlie 6th and 7th of August, two distinct
letters. Sir Hugh Allan states that " We (meaning himself and Sir George Cartier)
" yesterday signed an agreement by which on certain monetary conditions they agreed to
"form a Company of which I am to be President, to suit my views, to give my Iriends a
" majority of stock, and to give the Comjjany so formed the contract for building tlie road
" in the terms of the Act of Parliament, which are $30,000,000 in cash, and 50,000,000
"acres of land, with all the advantages and privileges which can be given to us under
" the Act." Have you any knowledge of what agreement he refers to in that
statement ?

A. — No; the only agreement is the one I have mentioned in my examination, namely,
that of the 30th July, to which I objected.

Q. — You have no knowledge of such agreement being made on the 5th and Gtli August,
by Sir George Cartier, or any other member of the Government ?

A. — No, I don't believe he ever did maice such an agreement.

Q. — Do you know of any agreement which was entered into between Sir Iliigli AUan
and Mr. McMuUen, and certain capitalists in New York, in relation to tlie construction
of the Pacific Kailway ?

yl.— Yes.

Q. — When did you first become acquainted with tliat agreement ?

A. — I know that Sir Francis Hincks had mentioned to Sir Hugli Allan the names of
these gentlemen, and had suggested that Sir Hugli should put himself in communication
with them. After that I cannot speak with any certainty. I was not aware that any
arrangement had really been come to until shortly before Sir Hugh Allan came witli
these gentlemen to Ottawa, and then when they came to Ottawa we declined to enter
into any discussion of the matter with them.

Q. — Did you see the agreement ?

A. — Not until I received a cojjy of it from Mr. McMuUen.

Q. — Is it among the pa])ers you handed in ?

A. — No; I have only given you the correspondence. I also produce and fyle other
papers marked " K." Though these I received at the same time as the copies of the corre-
spondence, the papers I now produce show drafts of Sir Hugh Allan to tlie extent of
$40,000 mentioned in Mr. McMuUen's letter, and the contract as originally entered into
in New York, with a modiiication of it afterwards.

Q. — When was the decision arrived at by the Government to exclude American capital ?

A. — I don't remember when there was a I'ormal announcement of our policy on that
point, but from the time it was first mooted in the press that American capitalists who
were seeking to be concerned in the construction of road, were interested in the American
Northern Pacific Railway and other United States systems of railways, the Government
began more and more to doubt the expediency of allowing American capitalists to have
anything to do with it. The Government was not I'avourable to allowing Americans to
come in, inasmuch as we foresaw the difficulty of preventing the control of the road, al'ler
its construction, from falling into their hands if they were allowed to construct the load.
This feeling grew in the country more and more intense as the subject was discussed by
the press, and as public excitement and public feeling was increasing against it, the
Government individually, and as a body, before Parliament met, came to the conclusio.i
that it was impossible to allow Americans to have any interest in the road.

Q.— Was this before April, 1872 ?

A. — Before April, 1872. When Parliament met and I had an opportunity of seeing
the members of Parliament, it was then evident that this was the general, almost the
universal, feeling in the House.

Q. — Was any encouragement at any time given to the proposal to buiid the road with
American capital by the Government or any member of it ?

A. — No, except the communication I have already mentioned made by Sir Francis
Hincks, I am not aware of any communication of any kind between any memlier of tbe
Government and these gentlemen. On the two occasions when these gentlemen were
present in Ottawa I principally conducted the conversation with them, and certainly I
gave no encouragement to Mr. McMuUen or the American capitalists.

Q. — Was there any communication or correspondence with Sir Hugh Allan on the
subject which would lead him to believe that the Government would favour that mode
of building the road ?

2 A 2

Canada.

HIP

184

CORRESPONDENCE RELATIVE TO THE

Canada.

1^'
II

A. — No, I am certain Sir Iliigli Allan when lio camo up he found out tiiat the
GovertimiMit and I'arliamont were ('(lually ojjposcd to tlie admission ol" American ca])ital.
Q. — You say when Sir Hugh Allan came up hero lie Ibund that out. Can you fix the
(late ?

A. — No, I don't at all renieml)er. I remember this fact, however, that Mr. Abbott,
who took a great deal of interest in tlu; jjromotion of the Bill before the House, stated
distinctly to me as a member of the (ioverrinient that he had undertaken it on the solemn
assurance that only Canadian capital should be concerned in the enterprise, and that he
had that assurance from Sir Hugh Allan.

Q. — When did the f Jovernmcnt first determine to unite the interests of Ontario and
(i)uebec and the other Provinces together in one common Company for the building of
this road under the Royal Charter?

^1. — Immediately after my return from Toronto, in November, I think. I got here
ai)out the 22nd of November. We then came to the conclusion that we would not —
altliougli the Interoccanic Comjiany had declined to have any amalgamation — give the
construction of the road to the Canada Pacific Company, but that we must issue a
Koyal Charter. Even if tluiy had consented to an amalgamation taking place between
the two Companies, it would have been too late to amalgamate under the Act. By the
Government Act it is provided tluit the amalgamation must take place within one
montli after the ])assing of the Act; so that if the two Companies had amalgamated
they could only have gone on under one of the Acts of Incorporation. It would have
been a matter of indilference whetiier they proceeded under one of the Acts of Incor-
poration or under a Royal Charter.

(i. — At what time was it that the Government determined not to give the contract to
the Canadian Pacific Com])any, and contemplated the formation of another Company by
the amalgamation of the Interoccanic Company with that of the Canada Pacific, for the
purpose of carrying on the work ?

A. — We at no time contemplated giving tlie construction to any one of the Companies,
but we formally came to the conclusion to grant a Royal Charter on my return from
Toronto.

Q. — WIkmi was the idea of forming the Interoccanic Company first originated?

A. — During the summer or autumn of 1871. I had been pressing Mr. Macpherson, Mr.
Wm. Ilowland, son of the Lieut.-Covernor, Col. Cumberland, and other gentlemen
to take uj) the question, and had spoken to my friends and leading n jn in Ontario, not
to allow Americans to come in and l)uild the railway.

Q. — Have you any reason to believe that the Company was formed because of the
opinion you expressed to your friends in Toronto?

A. — I am sure of it.

(2. — Was it from the beginning formed upon the basis of excluding all American capital ?

A. — No. With res])ect to the Interoccanic Company I am not perfectly informed ;
I do not think that when they first commenced to discuss the formation of the Inter-
occanic Company, they contemi)lated the exclusion of American capital ; I think on the
contrary, that in the Interoccanic Company's Act of Incorporation, if I remember aright,
there is some jirovision that the majority should be British subjects ; I forget now what
the expression is, but there is something in that Act which from my recollection indicates
that there was no jmsitive exclusion of American capital.

Q. — Was there anything which indicated an intention to exclude the controlling
influence of American capital in the road?

A. — I have no doubt that they had that in their minds ; that those who were pro-
moting the Interoccanic Bill had determined that they would not allow American capital
to have control. I have no doubt that that was one of the inducements to their getting
up the Comi)any. In the first place they thought it was a great thing for Canadians to
be engaged in tliat great national enterprise. In the second place, as I thought myself,
and as I expected they thought that Canadians ought to be interested in it, and no doubt
their desire to be interested in it was greatly increased by their fears and the rumours
which some of them had heard that it was an attempt of American capitalists to get
hold of the control of this gr(!at work, but I cannot s|)eak specifically on that.

Q. — Have you stated at what time you gave up the expectation of bringing about an
amalgamation between these two Comjjanies ?

A. — About the 14th, 15th, or Kith of November. I had thought at one time that I had
succeeded in removing all tlie objections, and that amalgation would have taken place,
but I failed.

Q. — Was it at that period that the Government determined on issuing the Charter of
the present Company ?

CANADIAN PACIFIC RAILWAY.

185

jecause of the

le controlling

he Charter of

A. — I returned here about tlie 22nd November, and of course we had no time to lose.
We immediately addressed ourselves to get uj) a Com])any composed of representative
men from all the different Provinces who woukl accept llie Royal Charter.

Q. — Was that determination the result of the failure to bring about the amalgamation ?

A. — It was.

(i. — You stated yesterday that the number of Directors in tlie Company is tliirtcen,
and tlie distribution was a good deal governed by the princijjle wjiich had governed the
selection of members of the Cabinet. \Vas there any inequality of condition or advan-
tages among the several Directors ?

A. — There was not. I forgot in -my statement yesterday one or two points. In
speaking of the personnel of tlie Directory, I forgot to alLide to the two Directors from
British Columbia and Manitoba. With resi)ect to Manitoba, the Government asked Mr.
Donald Smith, a member of Parliament I'rom that part of the country, the representative
man in Canada of the Hudson Bay Comi)any, to be a member of the Board. The
Government thought it would be a great advantage to get the asssistance and influence of
that i)owerful corporation in England if the Company liad to go to that market to
borrow, to get them interested in the Pacific Railway, and we asked Mr. Smith to become
a Director; and with that view, and a person greatly interested in the matter, he
attended several of the inlbrmal meetings that we had. We had a good many of them
here ; but when the Government came to the conclusion to exclude members of Parlia-
ment, Mr. Smith was, of course, 'excluded, and we consulted him as to getting a repre-
sentative man from Manitoba, ile recommended Mr. McDermott, whom he represented to
be a wealthy merchant in \Vinnipeg, J'or whom he acted, and from whom he had procured
a power of attorney to act. That is how Mr. McDermott was appointed. In the same
way Mr. Ilelmeken, of British Columbia, was aj)poiiited. He is a gentleman of very
high standing there, who was one of the delegates to Canada to settle with the Canadian
Government as to tiie terms of union between lirilisli Columbia and the Dominion, and
who was alterwards asked to become a senator, from his well-known higli standing and
character in British Columbia ; and I know, as a matter of fact, that he was asked to be
the first Premier since Confederation, by Lieut.-Governor Trutch. lie also declined that.
He is considei'ed a man of high standing, and, therefore, we asked him to become a
Director. He did become a Director, and Mr. Nathan, a member of Parliament from
British Columbia, representing Victoria, was his attorney. I had forgotten to mention
these two things.

Then you asked me as to whether there was any advantage of one Director over the
others. There was none. The plan upon which the Government acted was this ; there
were to be thirteen Directors, each to take one-thirteenth of the stock, and each to pay
up a tenth to form a deposit of $1,000,000 which the Government Act required. We
stipulated with these Directors that they should be in fact trustees for their several
Provinces ; that they should not hold more than $100,000 each of stock at first, on which
they would each pay $10,000; and that they should give an opjiortunity to the peoi)le
of their different Provinces to subscribe for the rest of the stock as they chose. Such
subscription being of course i)rovibioiial, until sanctioned by the Government, as it was a
provision that no transfer could be made of any shares without the consent of the
Government, and then, in case the stock was not subscribed in the different Provinces,
whatever was unsubscribed should be placed in the open market with the same condition
that no person should get any stock whatever until their names Avere submitted and
apjiroved of by the Government.

Q. — Who was elected President ?

A.— Sir Hugh Allan.

Q. — Do you know whether he was elected through the influence of the Government?

A. — I know that he was not elected through the influence of the Government. I know
it in this way : that, for convenience sake, I was made the sole means of communication
between the Government and the Provisional Board of Directors. I know, therelor
that when they met I made no suggestion at all, because it was not necessary that 1
should do so. They all seemed to assume that Sir Hugh Allan, from his wealth and
standing, and having taken it up first, was to fill the position as a matter of course. That
seemed to be understood by all the gentlemen. If there had been any doubt about it, I
should have carried out what I said I would do in my telegram. I would have said I
liope you will elect Sir Hugh Allan, but I did not do so.

Q. — The Government did not find it necessary, then, to exercise its influence, promised
by your telegram of the 2(ith of July ?

A. — They did not find it necessary. I do not remember making any communication
to any member of the Board on that subject for all seemed to take it as a matter of

C.INADA,

186

CORRESPONDENCE RELATIVE TO THE

If ^'-

pi:'

Oax&oa.

coui'st'. I am more jiarticular about that, because several of them did speak to me about
who sliould l)e Vice-President.

C>.— Who is the Vice-President ?

A. — Major Walker, of London.

Q. — Does Sir Hugh Allan, in consequence of being President, enjoy any peculiar
advantages, other than the dir'inction, of course ?

A. — The only advantage he has is sitting at the head of the table regulating the pro-
ceedings, and having tiie name of President ; but by law he has no advantage, and that
view I pressed strongly on Mr. Macijherson and other members of the Interoceanic
Com])any, and that every Director made liis own position on tlie Board according to his
abilitv.

Q. — Did Sir Hugh, then, in tlie course of his

negotiations

in relation to this whole

matter, obtain from the Government any advantage greater than these other gentlemen '!

A. — No, none whatever.

Q. — I think you Stiy, in your examination in chief, that after your telegram of the 2(Jtli
July — after that arrangement was made — that tliese arrangements were made between
Sir George Cartier and Sir Hugh Allan, with respect to the furnishing of funds for the
supjmrt of the elections. Did you not state something to ihat effect ?

A. — No ; I did not state that.

(2. — Have you any correspondence relating to that matter — of the money to 1)0
subscribed in Montreal by Sir Hugh Allan?

A. — No, I have not.

Q. — Was Sir Hugh Allan the only one that you mentioned ?

A. — I mentioned other names.

I think it liardly fair to mention the names of those other gentlemen. I mentioned
Mr. Brydges' name, and Mr. George Stephen's name, and several other names. I have
no doubt I mentioned Mr. Ogilvie's name, and otlier friends.

Q. — Had you any reason for mentioning Sir Hugh Allan's name beyond that which
actuated you in mentioning the names of the other gentlemen ?

A. — Yes, I had. I tliought Sir Hugh Allan was especially interested in getting a
Railway Parliament returned, and that he was interested in sustaining the Government
which would carry out the railway policy which they had inaugurated.

Q. — Did you consider him then to have a direct personal interest in the result of
elections ?

A. — Yes. I considered him to have a strong personal interest in this way. Sir Hugh
Allan had, as is well known, a very large interest in the Steamships line, and in getting
freights for that line. He knew, as it was well known in tlie country, tiiat there was an
opposition line being got up, under the auspices of the Grand Trunk Railway Company,
to run to England ; and it is well known that he was alarmed at this, because he
naturally assumed that, if the rival line were connected witli the Grand Trunk Kaihvay,
there would be prelcrence given to that line over his own in matters of freight from the
wt^t. Sir Hugh Allan, I think I am not wrong in supposing that this excited him very
much, and that it was the primary cause of his connecting himself with the Northern
Colonization Road from Montreal westward, and encouraging the building of the
Northern Road between Montreal and Quebec, and the extension of the inner line
between Ottawa and Toronto, so as to have another and competing line which would
giv<! his line of steamers fair play. I think I am not wrong in believing that this was
the origin of his connecting himself so strongly and warmly with these lines, and these
lines would not, I think, especially the road from Ottawa to Toronto, be early under-
taken unless there was a chance of the Pacific Road going on westwards. I think ho
had a special interest in this line and the western extension, and besides, as he expressed
himself to me and everyone else no doubt, he liad a great i)ride, at his age and with his
means and standing, in connecting himself with tiiis great national enter])rise. Sir Hugh
Allan could have been uiider.no mistake as to his position long before the elections took
place, with reference to the Pacific Railway.

It was not necessary for him to advance or subscribe one shilling in order to ensure to
himself, if he thought proper, an interest in the Pacific Railway Company. He knew in
the first place that the Canada Pacific Railway, of which he was President, and the
representative man irom Lower Canada, could not be ignored in any Company that was
formed to build the Pacific Railway. He must have ascertained early when Parliament
met, from the feeling in Parliament, that he could not get for his Company the c lusive
right to construct the road. Tlie interests of Ontario forbade that. His Company
could not be excluded, but could only have an interest in common with Ontario. So
that without his subscribing a single sixpence to elections, or to any other purpose, he

CANADIAN PACIFIC RAILWAY.

187

ik to me about

y any peculiar

alating the pro-
itage, and that
le Interoceanic
.ccording to his

I to this whole
er gentlemen ?

ram of the 2(Jtli

made between

f funds I'or the

money to bu

. I mentioned
names. I have

)nd tliat which

ed in getting a
he Government

n the result of

vay. Sir Hugh
and in getting
it there was an
way Comi)any,
lis, because he
'ruiik Railway,
•eight I'rom the
;cited him very
the Northern
iiilding ol' the
tiie inner line
e which would
g that this was
incs, and these
)e early under-
I think he
as he expressed
;e and with his
rise. Sir Hugh
} elections took

er to ensure to
He knew la
ident, and tiie
ipany that was
len Parliament
y the c lusive
His Company
I Ontario. So
er purpose, he

knew quite well that the Quebec interest must be represented to any Railway Company that
was I'ormed, and that he was the representative man from Quebec, and would be sujjported
by the whole influence of Quebec as such. The only danger was that the Railway policy
adopted by the Parliament, which had expired, might be reversed by the coming Parlia-
ment. He knew that the ])olicy of the Government in carrying out the Pacific Railway
had been strongly opposed by the Op])osition to the Government; that it was argued
very strongly that the road was beyond our means, and would over-tax our resources ;
therel'ore, that was the danger to him. He desired to connect himself with the Pacific
Railway, which would be the complement of all those other lines with which he had
connected himself. And the whole Railway policy of the Government might be reversed
if the Opposition succeeded in carrying the country. He was, therefore, interested in
exactly the same way — to use an illustration from England — he had the same interest
in supporting the Government in its policy in this country, as the great body of licensed
victuallers, in England, have to oppose the present Government there, because they
disapproved of some of the legislation of the past, and fear hostile legislation in the
future. I consider that Sir Hugh A Han had a very strong interest in the securing a Govern-
ment majority in the present Parliament.

Q. — You said that you received a letter from Sir Hugh Allan, during the progress of
your election, subscribing $25,000 for election ])urposes ?

A. — Yes. Stating that he was ready to subscribe $25,000.

Q. — What became of that letter ?

A. — I destroyed it; it might have been stolen.

Q - Did that letter contain any terms or conditions upon which the subscription
was made ?

A. — None whatever.

Q. — Can you recollect the terms in which it was expressed ?

^'1. — [ cannot pretend now to recollect the Avords, but it was simply stating that he
was (piite ready to help to assist in the election of the Jriends of the Government or our
Western friends; something like that, to the extent of $25,000.

Q. — Was that the only letter or communication you received from him. on the subject
of his subscription ?

A. — That was the only letter I received from him, and I had no personal communi-
cation with him on these points at all. Sir George Cartier doubtless had in Montreal.

Q. — I think you stated that you received two other sums of $10,000 each ?

A. — Yes. I must retract my statement tliat they both came from Mr. Abbott. The
first $10,000 was from Sir Hugh Allan, and I have no doubt that is the $10,000
mentioned in that communication of Sir George Cartier's. The other $10,000 I got
subsequently from Mr. Abbott, Sir Hugh Allan being at the time in Newfoundland,
I think.

Q. — These were all the sums ?

^.— Yes.

Q. — Was Sir Hugh Allan's subscription of the $25,000 before or after the 24th of
August ?

A. — It was before the 24th of August. It was early in August, I think.

Q. — I see in that letter of Sir George Cartier's a reference made to terms and condi-
tions of his in a letter of the 30th of July, and that is repeated in the postscript. Have
you ever seen that letter of the 30th July ?

A. — ^Never until it was alluded to in the publication. I have seen it since.

Q. — In whose hands is it ?

A. — In Sir Hugh Allan's hands. No doubt he has it to produce. I know the general
contents of it, but I cannot give it with any degree of accuracy.

Q. — That is the letter to which reference is made in this letter and postscript of Sir
George Cartier's, is it ?

A. — I presume so.

Q. — Because there was one letter of the 30th July published. It is not that ?

A. — No, it is not the published letter.

Q, — ^What was the disposal of the money which was sent to you ?

A. — I used it to aid our friends in the different parts of Ontario in their elections.

Q. — Had you an Election Committee in your election at Kingston ?

A.~l had.

Q. — Was any portion of it applied to your own election ?

A. — No portion of it whatever.

Q. — Was any employed to reimburse what was expended on it ?

A. — As to reimbursing my expenses, I paid every farthing of my own election

Cmjasa.

188

C'OllHESPONDENCE UELA TIVE TO THE

Canai>a. exix'iisi's, iiiiloss somo of my constitiioiits paid some money that I do not know of out ol
their own pockets. I i)aid all the ex])onses of my own election, and did not reimhursc
my^-elf for any portion of my own election expenses out ol' these funds. On the contrary, 1
jidfled to the election fund out of my own lim'ted means to help my friends elsewhere.

<i. — Do you know the entire amount Sir Hugh Allan contributed to the elections Ijoth
in Ontario and Qutdjcc ;

A. — I cannot speak with any certainty.

1^ — The second sum of money rciceived by you, of $10,000, was in consequence, I think,
. •■ telegram which has ai)])eared ?

A. — I would not like to swear that I sent exactly that telegram, hecausc I do not
remember its terms, but I sent a telegram, and I have no doubt that this is the telegram.

Q. — It is given at the end of Mr. McMullen's letter ?

A. — That was the second " and last time " I supjiose. It jays it will be the last time
of calling, so I take it that it refers to the last $10,000. I have no doubt it did.

<2.— That telegram is dated 2nth August, 1872, addressed to the Hon. J. J. C. Abbott,
and signed by yourself. Is that the one you mean, " 1 must have another $10,000; will
" be the last time of calling. Do not fail me. Answer to-day ?"

A. — I have no doubt I telegraphed to him, and I have no reason to doubt that this is
a copy of tlu! t(degram.

Q. — ^Vas that telegram answered ?

A. — 1 have before me this telegram, "Draw on me lor $10,000." I don't remember,
but I have no doubt he did answer and did send me such a telegram. I did draw upon
him for $10,000, and I would not have drawn upon him without authority.

Q. — ^V'ere there any other telegrams between you and Mr. Abbott, or Sir Hugh Allan,
or recei])ts relating to money lor election jiurposes?

A. — No. There were no other telegrams with Sir Hugh Allan, and those I have
referred to. I may have telegraphed to Mr. Abbot in connection with the elections, but
I have no recollection of doing so.

I may jicrhaps now refer to a statement which I see in the Chicago ' Times,' which 1
intended to have spoken of yesterday. It is as follows. The Reporter asks him: "Can
" you prove that Sir John Macdonald knew of this bargain ?" Mr. McMullen replied,
" I can, and will even show his telegrams, one admonishing Allan to shell out, because he
" had a big thing ; another telegram declaring in the most positive manner that he
" endorsed the arrangement made by Sir Hugli with ('artier, and would hold himself
" bound hy it. He confirmed the bargain unreservedly." Reporter asks, can you i)rove
that ? Mr. McMullen answers — " I will put witnesses on the stand who saw the
"telegram, one of them a very prominent man and a friend of Cartier's. I will name
" the man who wrote the second of these transactions." I can only say that I never sent
such a ttiiegram. It is quite an untruth. I never sent any telegram to Sir Hugh Allan,
saying that 1 endorsed any arrangement made by Sir George Cartier and Sir Hugh
Allan. I cannot understand how the idea that I sent such a note or telegram got
abroad, or how Mr. McMullen could have got the idea that I sent any such telegram to

Sir Hugh, calling on him to shell out
how

for he had got a big thing. I have been think-

he could invent such a thing, and the only clue I have is simply this: I
remember in writing or telegiaphing to Mr. Abbott, that I said that we had a great
enteiprise before us, and we should fight it out thoroughly. I made use of some such
exi)ression to Mr. Abbot, as it was a great game or great enterpri a that we had before us,
which was quite true ; we had a great game in seeking to carry as many elections as wc
could in Canada, and to secure a majority. That is the only clue which I can think of in
regard to that telegram. " A big thing" is an American expression which I never use
that I am aware of.

Q. — Do you know what ])assed between Sir Hugh Allan and Sir Gem-ge Cartier on the
subject of this subscription ?

A. — 1 do not ; I may say that Sir George wrote me no letters ; hcAvus then in very bad
health, sinking under the disease which caused his untimely death ; what communications
we had were by telegraph, and they were very short.

Q. — Was there any understanding that for any subscription more or less, direct or
indirect Sir Hugh Allan was to receive any exceptional advantage from the Govern-
ment ?

A. — I ^y distinctly there was no arrangement that he was to get any advantage of any
kind.

Q. — Was there any understanding ?

A. — No understanding. There was no agreement or understanding to give him any
advantage of any kind.

CANADIAN PACIFIt; RAIIAVAV.

ISO

; know of out ol
I not reimburse
n tlio contrary, 1
lids elsi'wlu're.
\c elections Iwth

qucnce, I think,

tecansc I do not
is the telegram.

be the last time
bt it did.
. J. J. C. Abbott,
cr $10,000; will

loubt that this is

don't remember,

I did draw upon
rity.

Sir Iluoh Allan,

nd those I have
tlie elections, but

' Times,' which I
asks him : " Can
icMuUen replied,

II out, because lie
manner that he

dd hold himself
cs, can you prove
who saw tlic
I will name
that I never sent
ir ilun;h Allan,
. and Sir Hugh
or telegram got
such telegram to
lave been think-
simply this: I
we liad a great
_ise of some such
ive had Ijefore us,
y elections as we
can think of in
lich 1 never use

(je Cartier on the

then in very bad
communications

r less, direct or
■om the Govern-

idvantage of any

to give him any

(2- — Have you any reason to believe that Sir Iluj^li Alhin gave that liirge subscription
ill cDnsetiueiice of an exjicctation of any kind ?

,1.-1 have no doul)t Sir Hugh Ali.in gave these suljscriptions for tlie on(> object of
sustaining the (lovernment and their railway jjolicy in connection with tlie Pacillc Kail-
way, h'" lieing assured that that policy would 1)0 sustained with the inlluence and power
of file Government if it remained a (iovernment.

To tlie Hon. Mr. Canii)bell, through the C!liairman: —

Q. — You have had verv many years' experience of elections?

yl.— Yes.

Q. — During thirty or tliirty-five years?

A. — Durinj^ about Ibrty yeai's, from 1830.

(2. — At all elections, I believe there is a certain expenditure of money ?

yl.— Yes.

(I — AVhat is the' character of that expenditure?

A. — ^It is an uncertain expenditure. There is what they call the legitimate expenses,
which every candidate has to undertake — the expenses of canvassing, printing, and
advertising — those are tlie legitimate exi)enses. Tliere is also a very large expenditure,
which isvery common in this country, although it is contrary to the Statute. It is, how-
ever, I believe, so universal that I have never kno\vn any serious contest before an
Election Committee on that ground. 1 refer to tiie ex])enditure lor teams to bring the
voters t'" come to the jioUs. iMy experience has been, with respect to this item, that you
cannot g.'t the voters to come to the polls on either side unless some effort is made to
provide conveyances for them.

(>. — That constitutes a very serious item?

A. — Yes, 1 have always imderstood tliat to be the chief iicm.

Q. — Then tlierc; is more or less treating ?

A. — Ye •, and dinners and things of that kind, all of which are contrary to the Statute,
but they generally ])revail in Canada.

(2. — Did you find at the elections which occurred last, in 1872, any particular necessity
for spending money?

A. — ^Therc was this necessity, that I don't su])pose there ever was a fiercer struggle for
the mastery than that which took place between the two parties, especially in Ontario.
Every cIRirt was made on both sides to carry their candidates. There was an unusual
amount of exertion jnit forth, the exertions of the Ojiposition being much greater ui 1872
than they were in 18C7.

(2. — The exertions of the 0])position ?

A. — Yes, and of course there was a corresponding exertion made by the party to whidi
I belong.

Q. — And there was a corresponding increase in the expenditure ?

yl.— Yes.

Q. — You had a very general knowledge of the contest in Ontario ?

^.— Yes.

Q. — You found that there was an expenditure of a much larger amount than usual on
lioth sides ?

^'1.— Of course I am not in the secrets of the Opposition, but I found such a concurrent
opinion in Ontario from independent sources that money was being spent very largely,
unusually so by the Opposition, that I had no doubt aliout it. Of course some of those
statements might have been exaggerated in particular localities, but the same report came
from all quarters. I have recently seen statements tliat may perhaps at some time see
the light verifying that liict.

Q. — You were at the head of the (Jovernment during the last elections, and also during
the previous general elections ?

A. — I was during the election of ISfi/, and of the last elections. I have been, if not at
the head of the Government, a member of it since 18r)4, with the exception of the twenty
months which Mr. Sandfield Macdonald was in power, and the six or eight days during
which Mr. Brown was in power.

Q- — Is there any other machinery in Canada for raising funds to meet election expenses
except the efforts of individuals ?

A. — There is no such machinery here as prevails in England. In each constituency, I
sujipose, the different parties raise a fund, and they usually have a central fund.

Q- — There is no such machinery as the Carlton Club and the RelbrmClub in England,
but the head of the Government cliarges himself with doing as much as possible among
his friends for the general funds ?

A. — The leaders of parties which divide the country, exercise their influence amongst
their friends to raise funds for that purpose,

2 B

(!.\\AI)A.

WT)

100

('0U1U:S1'()NDKNCE HKLA'IVE TO TllH

Canada. (}, — Von spoke ol' tlic a])i)()intnu'iit, of IMr. IIall,aiul said tliat tlic fust naino siigsostcil

\\as that ol'tlic Hon. Mr. Foster. Do you nicaii that the appointment of Mr. Foster was
strongly pressed on tlie Governnu nt l)y anyone?

A. — liefore we settU'd that there were to be no members of Parliament on the IJoard,
Sir Ihijih Allan and ^fr. Al)hott both asked that Mr. Foster should be ajtpoiuted.

Tile («ov( riuuent left that to Mr. Fope, who is a member of the (Jovernment, and he
seleeted Mr. Hall, as I understood, on Mr. Foster saying that he would not resign his
yenatorship to become a Director.

Q. — That was just about the time of the Charter being signed?

.4.— Yes.

Q. — U]) to that time ^Ir. Abbott and Sir Hugh Allan had been pressing the appoint-
ment of ^Ir. Foster ?

A. — Yes. And, if I remember rightly, Mr. Foster was offered a ]iosition on the Hoard
if he would resign his Senatorship, which I understood he declined to. I was informed
by Mr. Pope of the fact, and he selected ^Ir. Hall. If I remember rightly, Sir Hugh'
Allan desired that if Mr. Foster was not appointed some one representing him should be
chosen, and he suggested his brother.

I wish to make one remark. I stated that when Sir George Cartier and I i)arted, when
lie went to Montreal before the elections, I suggested to him certain names liesides Sir
Hugh Allan, and I gave him those names. I do not wish it to be understood that I know
that these gentlemen subscribed. I do not know whether they did or not. I merely
suggested seme friends of the Conservative party.

And further deponeth saith not, and this his deposition having been read to him, he
declares that it contains the truth, persists therein, and hath signed.

Sworn and taken in part on the seventeenth day
of Se])tember, 1873, and remainder
taken on eighteenth day of said month,

and the whole acknowh.'dgcd on the
twenty-second day of said month and
year.

(Signed)

(Signed) JOHN A. MACDONALD.

CHARLES DEWEY DAY,

Chairman.
A. POLETTE,
JAMES ROBERT GOWAN,

Commissioners.

Pi;ovi\CE OP Oxtahio
Citi/ of Ottawa.

}

IN THE MATTER OF THE COMMISSION

Appointing Charles Dewey Day, Antoine Polette, and James Robert Gowax,
Commissioners to inquire into and report upon the several matters stated in a
certain Resolution moved by the Hon. Mr. Huxtin'otov in the House of
Commons on the second day of April, a.i>. 1873, relating to the Canadian
Pacific Railway.

Present: The Commissioxers.

On this eighteenth day of September, in the year of our Lord one thousand eight
hundred and seventy-three, personally came and appeared before us, the above-named
Commissioners,

The Honourable HECTOR L. LANGEVIN, of the City of Ottawa, who, being duly
sworn, deposeth and saith :

Q. — You are aware, Mr. Langevin, of the terms of the charge recited in the Com-
mission ; the alleged agreement with American capitalists for building the Pacific
Railway ; the knowledge of the Government of this agreement, and the subsequent
charge that there was an understanding between the Government, and Sir Hugh Allan,
and Mr. Abbott, to furnish funds for promoting the elections in 1872, for which they
were to receive the contract for building the road. You are familiar with these allega-
tions, will you have the goodness to make a statement in detail, giving all the facts
within your knowledge relating to these charges?

A. — About the arrangement for the contract between Sir Hugh Allan and the
American capitalists, I kneAv nothing until I saw it mentioned in the newspapers.
I may say, as was said by others, that the Government and the diflerent members of the
Government were from the beginning opposed to Americans obtaining the contract and
the control of the Canadian Pacific Railway, with the exception of Sir Francis Ilincks,

CANADIAN PAt'IFIC RAILWAY.

IDl

ng the apiioint-

read to him, he

CDONALD.

i)iit finding afterwards that liis coll(!af;iii's wen- unaiiiinous on tlio .siilijicl, lie ^avf up his
own opinion, and af;r('('d with us tliat the Companv to ho I'oriiicd should lie rorincd by
(.'anadiuns or IJritish suhjccts. The cliargo niade l)y Mr. I huitin|i;tou that the (ioverii-
inentor mcmliors ol" the (ioverinncut, in consideration oi' I'unds to he rurnisiu'd or paid to
tlie (jovernnient, or any memher or menihers oi' the (fovernnient, nuKh,' any ai;rieinent,
or had any uii(U'rstaudinf; with Sir IIuj;h AHan and .Mr. Ai)l)ott, or Sir lluf^h Alhm or
Mr. Ahhott, or anyone else, lor tlie building ol' the Canadian Pacilie Railway, or I'or the
obtainiiii^ ol' the eontraet.or I'or any advaulaf^i; t)r any }j;ain connected with it ; that charge
is false. 'I'lie (iovernuieul never had any such nuderstandini;, or ever made any such
promise or any such harfz;ain, aiui in so far as I know, and I liave no doultt that it it
liad been otherwise I would have known it, there has been no bargain, no contract, no
understanding of that kind between Sir Hugh Allan and Mr. Abbott, or citlicn- of them,
or the Americans on the o!ie side and any mend)er of the (lovernment on tlu' other. I
try to make it as general and as spi cial as ])ossible, because 1 want to give a complete
denial to the charge. I may now say about the giving of the contract to Sir Hugh .Vilan
or to anyone else, that the statements made l)y me here about the action of tlu; (ioverii-
ment are perfectly correct. The Government did not make any arrangement with Sir
Hugh Allan, or with anyone else, for the building of the Canadian Pacific Railway
until after the general elections of 1.ST2. Up to that time there was no promise or
arrangement of any kind made by the Government or any member of the Governnrjiit
about the building of the road. I may i....o add that the Government Mere determined
from the beginning to give no advantage to one Province over any other. We knew I'uU
well that Sir Hugh Allan was considered i)y the Lower Canadians as their representative
man in this matter. We knew that he had taken Irom the begimiing a very important
part in the promotion of the railway : but on the other hand we had to consiiler that
this railway was not for tlu- Province of Qui;bcc alone, but also for the other Provinces,
I should say for the whole Dominion. On the other hand, the Toronto interest was very
iiui)ortant. Our Toronto friends were very jiressiiig, and by Toronto I'rii'uds I mean
the financial interests of Ontario ; that interest was very pressing, and of course they as
well as the Quebec or Montreal interests were dring their best to have the upper hand
in this railway. We had therefore to be very careful as a Government, that no pre-
ponderance should be given to one Province over the other, but that in giving the
Charter the interests of the wholi; Dominion should be considered and taken care of.
We therefore did all that we could to bring about an amalgamation of the two
Companies; that is to say, the Canada Pacific Kailway Company and the Interoceanic
Railway Company, the first having as its representative Sir Hugh Allan, and the other
the Hon. Mr. Macpherson. However, the negotiations which we had Mith those two
Companies failed. We could not induce the Interoceanic Company to amalgamate, and
therefore we had to decide what course the Government should then take. We had
only those two Companies incorporated by Act of Parliament, ^\'ere we to give the
contract to one or the other, we would necessarily have given oflence to one section or
the other, and also given an undue preponderance to one Province over the other. The
consequence was that the Government took advantage of the clause in the Act relating
to the aid that Parliament allowed the Government to give to this undertaking. We
took advantage of that clause, and formed a new Company, composed of some of the
leading men of the (^mada Pacific Company and of the Interoceanic Company, adding
to them some other leading men of the Dominion.

The composition of tlie new Company has already been described by Sir John A.
iMacdonald, and I have only to say that I would have only to repeat w hat he lias just
said on that point. As to the names, that is a correct description. The Charter of the
Canadian Pacific Railway Company was given, I think, in the first days of Februaiy.
1873, if I am not mistaken.

Q. — \Vill you now proceed to the other branch of the subject, respecting the money
furnished for the elections ?

A. — As I have already stated, there was no bargain of any kind. I mean that neither
the Government nor any member of the Government, so far as I know — and I would have
known of it if it had been otherwise — made any bargain or agreement by which the
Government, or any member of the Government, was to receive any sum of money, or
any advantage from Sir Hugh Allan, or from anyone else, for the granting of tlie
Charter, or for the influence of the Government, or any member of the Govermnent, oi
for the services of the Government, or of any one of tlnim. Respecting the sums o.
money that Sir John A. Macdonald had stated as having been received for the Ontario
elections, I know nothing. Respecting the sums of money iurnished to the Moutrea.
Central Election Committee, I knew nothing either.

2 D 2

CAJfADA.

192

COUKKSrONDKNCi: RKr,ATIVi; TO TIIH

Canada. Durinf; the Session of iM/'i [ hail a conversation with Sir (icorj^o Cartif r, my (iucluc
Itnuhr, on tl,c I'U'ftions that wvw coniin;; on, and I stated to iiini that we should divide
the worli in Lower Canada, in order that our Irieiids shonhl lie al)le to refer with
certainty to one of us, in ease they neech'd advice or ntherwise. It was so unih'rstond
hetwecn us, and I went farther I told him the e\iierienc( 1 iiad had at previoiw
elections, and that I couhl not niyscdf jirovide the finids that niiiiht lie re(]uire(l in ni\
rey;ion without help from the exterior. That of course I had friends that could helji
me to a certain extent, hut that he was aware that the ^Mvat wealth of the Province of
Quehec was centred in ^^tntreal, and not in (^iieliec, ai\d that therefore I woidd exjiecf
that whencNcr he ohtained from his weallhv friends in Montreal coutriliutinns to the
election fund for the Province of Queiiec, he shouhl remember that 1 should have a share
to help in tlu" election contest of ni}- ret^ion— that is, the eastern part of the Province ot'
Quehec. He proniise<l me that he would do his lest. Whilst on this suhjeet I may say
that, alhulinsj; to the change that has heen made puhliclv in a letter pul)iished in tin
' .\h)ntreal Herald' hy Geor:j;e W. McMullen— a charge that Mr. Ahiiott, had Iji en
i^K^t^ authorized, hy he docs not say whom, to promise nw !«!'jr»,()(K) for my gooil will, or for

my services, or futun; services in connection with the Pacifu' Hallway, and that .Mr.
Ahhiitt had ri'ported havinii,- done so; I may say lirst, tiiat .Mr. vVhiiott never told uic
that he was authori/ed to promise me ^•2r),(i(l(t, or any other sum. .Mr. Ahhott never
]m)mised or oilered me anythiui;. lie never spoke to me of anything; of the kin<l, anil
therefore, in so far as I am concerned, tliat char:;e is false. I h' ive, of course, to .Mr
Ahhott, who may he examined on a future day, to say whether he was authorized to no
anything of tlie kind, and whether the charij;e made against him. tliat he said he had
pronnsed anythinsj; of the kind, is true. So lirr i>s I am conci'rned, 1 say positively that
he never s])okc to me on the snl)ject, and never promised me anythinj; at any jjcriod.
The oidy time I had a conversation on election matters with Mr. AI)i)olt was, I htdieve,
some time duriuL!,' tlie Session of IST'J, when he, hiiviuu; occasion to conn- to my depart-
ment to see me aliout some ni:ili,er eomu'cted with a public work in his county, I
spoke to liim. as being one of my best political friends from my own Province, on tliu
prospects of the electoral contest that was to take ])lace durinij the simimer. I told him
that the last eonlest Jiad \iv'.'i\ a severe oi\(; for nu-, in so far as my small purse was
concerned, and that, of course, my position beiuLi,' more prominent now than it was tluii,
I was afraid that the claims or the calls uj)ou me would iii' still f;reater, and on that lit;
remarked that it would not be fair that the burden sliouhl all fail on my shoulders, but
that certainly I should he helped by my irieiids. That is the only conversation I ever
had with Mr. Abbott on that subject, and of course it is one of those conversations I
could have had with any other political friend supporting,' me in Parliament or supportiiii;'
me out of Parliament ; and I may add that Mr. Abbott never spoke to nu* ai)out the
Pacific Railway, or the IJills tliat wiuu; bi'fore the House, and he never asked my support
of any of the measures that ■were then befort! the House, or asked whether I would
support or oi)pose them. In consequence of the conversation I had with Sir (•eori;e
Cartier, as I stated just now, dm'ing the elections of IS/L', I rt.eived from Sir Georuc
Cartier, hy the hands of Sir Ilu^h Allan, Sl<'),"l">, he (Sir Hugh) statinj; that he was
instructed by Sir George ('artier to remit me that sum for the election I'luid of my
region. Sometime afterwards I received a note from Sir Hugh Allan stating that on
my giving a receipt to Mr. Abi)ott he (Mr. Abbott) was instructed to deliver me, also
by ilircction of Sir George Cartier, ij!l(),()OU additional for the same oiijcct As I was
ahout leaving Ottawa for Quebec during the elections, and understanding that Sir Hui;li
Allan had gone to Newfoundland, I telegraphed Mr. Abbott at Montreal to be kiml
enough to nuct me on board of the Quebec boat at Montreal, wdiich he did. I told him
there tliat I had received a note from Sir Hugh Allan, as I stated just now; that I liad
asked no money from Sir Hugh; that the sum of ;< I. 5,01)0 that he had sent me before
came from Sir George Cartier; that I had understood from Sir George Cartier that any
sum of money that he would send to me would he a portion of the subscription of his
wealthy friends in Montreal, and that therefore 1 could not for a moment think of
giving a receipt or of receiving any money on any condition whatever, and that if this
sum of !«;I(),()0() was not on tlie same footing as the Slo,<*0() first sent, 1 could not
receive it. Moreover, if there had been any misunderstanding about the first sum, ami
if that first sum was not a pure giit on the part of the subscriijcrs to the fund, I would
go down to Quebec, and would return that amount immediately. Mr. Abbott told me
that there must he some misunderstanding, that he was sure that there must be no
intention of putting any condition or exacting any receipt about this money. So wc
parted. Mr. Abbott sent me afteruards the SHI,000 without any condition, and I
believe stated that his explanation to me was the proper one. Some time afterwards

i.;/^^

CANADIAN I'ACIFK! UAILWAV.

m,",

Ik; Proviiu'i- ol'

Sir Gi'()r|;f('artiiT, wliom I had seen en imssaiit in Moiifniil, mid who lind ask inc in

wlrit jiosilioii I 1(11111(1 inyscll jiixnit tlic clcctidiis in in\ rc';;i()n, >\as iniornicd iiy nic llial,
iicsiiics ni;, own clcition and what I iiad contiiljiilcd jicrsonally tn otlicis, 1 was sliort to
tiic anidimf of i^7,r)()0 or !i«7,(l(IO. He told mo he tiioiij^iit his Klcition ConunitUi!
would !ia\c to provide lor that additional snni ; and simc time al'tcrwards I received it
witli a note IVoni Sir Hiiuli Allan, ^^tatin^; llial Sir (Icorgo ('artier liad iiistruitid him to
liand ine tlial amount. 1 never iiad any conununicatioii on this suliject with Sir Hugh
Allan, beyond what i liave just, stated,

By my statement tiio ('ommi^sioners will see tliat none ol" tliat money was emi)K)yed
in j'ayinfi- tlie expenses ol' n)y own eleetion.

(I Did yon take as active an interest in the nejjotiations eonfernin<; tlie hniMinj; of
the Paeille Railway in the earlier stages of it, as other meml)c'rs of the Cahinel'/

A.~ No. 'I'he first nejidliations were condueted by Sir. John A. Maedonald jirineipally.
Till- nei;otiati()ns hetween Sir i'raneis llineks and Sir Iln^h Allan and others were con-
ducted as com in;,; from hiinself at the hcninniii;;' ; and. as Sir .lohn INlacdonald staled
correctly when we heard that he was favouring the introduction (d'tlie American interest
in tlu; projjosed Railway Company, we expressed our dissent from tliat action ; and from
that moment until the end, the Cahinct never wavered on that jioint, showing tlu ir
determination to exclude Americans from the I'acillc Railway Comiiany.

(I — Do you recollect about the time that that decision was arrived at'/

J.— The formal decisoti on that point was, I think, in April or May, l^'7-^ liut I am
not sure.

Previous to tlie Session of 1872, that deterniiii.u ; mi was arrived at on the part of the
Government. Although. ])erliaps, it was not know a ;a outsiders, yet it was the settled
jKdicy i)revions to the Session of lST2, and when we met Parliament and had an oiipor-
tunity of seeing the members of the House oT Commons, it was clear that any other
policy would fail.

Q- — ^^'el•e yon present at any of the intervu^ws \v ntioiu'd by some of the witnesses,
and ilso in Mr. McMuUen's letter relating to this m;itier'.''

.1. — No; I was not i)resent when the Aniericai) gentlemen were there.

At the first interview I understood that there W(^re only two members of the (lovein-
ment present — 5iir John ^lacdonald and Sir Francis Flincks. The second interview was
reported to me on my arrival here, I think I Jiad gone to Montreal or Quebec.

Q — You liave no recollection of having ever met those gentlemen in conference?

-/I.— No ; I never met them. 1 never sa\v Mr. (Jeorge McMnllen.

(2- — Mad you ever any conversation with Sir Hugh Allan on the subject of the agree-
ment they had entered into ';■

.1.— No.

(2-— Then you know very little of that ?

-L— Very little, indeed.

Q. — Did you take any ]iart in the eilbrts which were made to bring about an amalga-
mation of the Intei'dceanie and the Canada Pacilic Companies?

A. — Nothing more than as a member of the Privy C'ouncil.

(2.— You knew that the negotiations were going on "/

A. — Yes. The action was determined in the Privy Council before being taken.

(2. — Kespecting the organi/ation of tlie Canadian Pacific Comiiany and tlie appoint-
ment of Directors, you state that the evidence you would give would ije that givi n by
Sir John A. Maedonald '!

A. — Exactly what he gave. The Hon. Mr. Reaubien, who was specially selected !)y
me, was so selected to represent the interests of the District ol' Quebec, not as opi)osed
to that of Montreal, but as being distinct from that of ^Montreal. That was the object
I had in view in selecting him from that jiortion of Lower Canada.

Q. — Sir Hugh Allan was elected President of that Board':*

A.— Yes.

Q. — Have you any knowledge of any iniluencc being used to procure liim that
position ■?

A. — 1 am not aware that the Government used any special influence or any iulluence
to bring about his election.

Q- — Do you know whether his election was unanimous or not '.'

A. — I understood it was.

Q- — You liave no personal knowledge on that subject '!

A. — No ; I was not present.

Q. — Had you any communication with Sir Hugh Allan ui)oii the subject of money to
be furnished for the elections before your communication with Sir George Cartier'.^

Canada.

!«::>

194

CORRESPONDENCE RELATIVE TO THE

Canada, A. — No, never ; at no time.

Q. — You liad no conversation with him on the subject ?

^.— No.

Q. — Do you know how much he subscribed in all for the elections ?

A. — No ; I don't know.

Q. — Have you in your possession the letter that Sir Hugh Allan wrote, to which you
have referred ?

A. — No. 7 don't keep any of these lett(!rs, nor any letters that are mere formal letters.
It has always been a rule with me as soon as I have finished a letter to destroy it, unless
it is an official letter to be filed iu the department. But my own letters I destroy, and I
think, l)y what I have seen since, that I was perl'ectly right in this.

Q. — Do you remember the terms of that letter ?

A, — No ; there was nothing special in it.

Q.— Did it lelate to the advance of that $10,OUU ?

A. — Sir Hugh Allan stated, so far as I can recollect, that Mr. Abbott would pay me,
or hand me §10,(100, and that Sir George Cartier had wished him to send it to me on my
giving him a receipt.

Q. — Was that the only condition in the letter ?

A. — As I'ar as I can recollect, there was no other condition than that.

Q. — You have said, I believe, that you received another letter from Sir Hugh Allan,
enclosing tlie last sum you received?

A. — No, I don't think there was any note with it ; if there was any, it was simply
stating tliat, " I send you $7,000, or $7,(JO0, by order of Sir George Cartier." I think he
must have sent some such note as that, but I have no special recollection of it.

Q. — You don't remember the terms of the letter ?

A. — No ; it was nothing more than a mere business letter that might be written by one
person to aiiotlicr.

Q. — Me mentioned to you that he had sent you that sum of money ; did he say
anything elbe?

^.— No.

Q. — Did he not say anything else?

A.— lie said, " by the direction of Sir George Cartier," or " by the wish of Sir George
" Cartier."

Q. — Nothing more than that?

^.— No.

Q. — You say you mentioned to Mr. Abbott that unless it was ■> free gift on the part of
the subscribers to the fund you Avould go to Quebec, and at once return the first $15,000.

yl.— Yes.

Q. — AVhy did you make that remark ?

A. — Because when I saw tliat Sir Hugh Allan, in his letter, stated that Mr. Abbott had
§10,000, which he would hand me, or send me, or pay me on my sending a receipt, or
giving a receipt, I thought that meant that it was not a mere subscription, and therefore
thinking that the same thing might apply to the first §15,000 that had been sent, and for
which no receipt had been given, 1 stated at once to Mr. Abbott that if this money that
had been sent by direction of Sir George Cartier was not a mere gilt on the part of
the subhcrilxi's, I must return it, and I was going down to Quebec and would return it
at once. The reason for that Avas apparent. The object I had in view when I spoke to
Sir Gee rge Cartier in the Session of 1872 was to see tliat the heavy expenditure of the
elections siiould not fall on me, and that I should not be responsible for the whole
amount, and if this had not been a mere gift on the part of the subscribers, I would have
found myself responsible for the whole amount, which I would not undertake to be.

Q. — You use the word " gift " in opposition to " loan " — not a loan but a gift ?

A, — Yes, that is what I mean.

I wish to add in regard to Sir George Cartier on another point. It is that from the
beginning he showed his opposition to the introduction of Americans or American
capital in the Pacific Railway Company to be esUiljlishcd or to he incorporated. He
expressed himself so to me more than once, stating, I cannot recollect his exact words,
but the meaning of the conversation was this, that lie would not allow the Americans to
build our railway. Their interests commercially speaking being difierent from tliose
of tiie Dominion ; and that we had in Canada and in England men who could find tlie
necessary capital, and who would have the necessary skill to build thij railway. He
was very positive and never wavered on that point.

Q. — Do you know anything of the letter from Sir George Cartier to Sir Hugh Allan
of date t!ie 30th of July ?

CANADIAN PACIFIC RAILWAY.

1.1(5

ir Hugh Allan,

1 of Sir Georae

,1. — No. I know (f no letter except tliat which lias been published in tlie neswpapers. Camada.
TiuM-e is one of that date publisjied.

Q. — Do you know of any otlier letter of that date which has not yet been published ?

A.— 'So.

Q. — Did Sir Goorge Carticr mention any such letter to you?

A. — I never had any conversation with liiin about that.

To the Hon. Mr. Campbell, tbrou^h the Chairman:

Q. — You stated that 3 ou concur in Sir John Macdonald's statement of the mode in
which the present Directors of the i)reseni; Company were chosen ?

A. — Yes.

Q. — Did Sir Hugh Allan exercise any influence in the choice of these Directors?

.tl.--No, not that I am aware of; and if he had exercised any influence, there is no
doubt I would have known it iVom the knowledge I had of the business of the Council.

Q.— Did not both Sir Hugh Allan and Mr. Abbott press for the appointment of a
person in lieu of Mr. Foster, Avhen the Government arrived at the determination that no
member of Parliamcit should be on the Ijoard^ as Mr. Foster's nominee in fact?

A. — Yes, they did.

Q. — And no such appointment was made ?

A. — No such appointment was made.

Q. — They continued to press for the appointment up to the last moment^ did they not?

A. — They did.

By the Commissioners :

Q, — Who was the person put forward ?

A. — I think Mr. Foster's brother.

Q. — And they were pressing for the appointment of Mr. Foster up to the last moment,
until they were told, in fact, it was no use ?

^.— Yes.

Q. — So Sir Hugh Allan exercised no influence in the selection of the persons who are
on the Board ?

A. — None whatever.

And further deponent saith not, and this his deposition having been read to him he
declares it contains the truth, persists therein, and hath signed.

Sworn and taken on the eighteenth day of N

September, 1S73 and acknowledged ^g; ^^^^ HECTOR L. LANGEVIN.

on the twenty-sixth day of said month |
and year. j

(Signed)

CHAELES DEWY DAY,

Chairman.
A. POLETTE,

JAMES ROBERT GOWAN,
Commissioners.

IN THE MATTER OF THE COMMISSION

Province op Ontario")
City of Ottawa. J

Appointing Charles Dewy Day', Antoine Polette, and James Robert Gowan,
Commissoners to inquire into and report upon the several matters stated in a
certain Resolution moved by the Hon. Mr. Huntinotox in the House of Commons
on the second day of April, a.d. 1873, relating to the Canadian Pacific liailway.

Present : The Commissioners.

On this eighteenth day of September, in the year of our Lord one thousand eight
hundred and seventy-three, personally came and appeared before us, the above-named
Commissioners,

SANDFORD FLEMING, of the City of Ottawa, Civil Engineer, who being duly
sworn, deposeth and saith :

Q. — You reside in Ottawa, I believe ?

A. — Yes, at j)resent.

I am a Civil Engineer.

Q. — Do you know Sir Hugh Allan ?

A. — I know him very slightly.

Q.—D0 you know Mr. G. W. McMullen?

A,~ I do not know him.

Q. — Have you any knowledge of an agreement between Sir Hugh Allan and Mr.

ilh

in'

196

CORRESPONDENCE RELATIVE TO Till]

i^*'

Oanada.

G. AV. McMiillen, representing Unitoil States capitalists for the construction of tlic Canada
Pacific Railway with American funds?

A. — None whatever, except what I have recently seen in the newspapers.

Q. — Were you brought in relation to the parties lo that transaction at the time it was
going on ?

^.— Not at all.

Q. — You therefore know nothing at all about it?

A. — Nothing of my own knowledge.

Q. — Have you ever had any conversation with Sir Hugh Allan relating to it ?

A. — No conversation wiiatever.

Q. — You were, I think, one of the Provisional Directors of the Canada Pacific Railway
Company ?

A. — My name is in the Charter of the present Company. I was not connected in any
way with any of the Companies that were incori)oi'ated by Act of Parliament.

Q. — When did you first become interested in the movements for the construction of the
Pacific Railway?

A. — In 1871. I was called upon by the Government to conduct the surveys.

Q. — That was all your connection with it initil you^were appointed a Director of the
Canadian Pacific Railway Com])any ?

A. — Yes, until I was asked by Sir John Macdonald to consent to be one of the
Directors.

Q, — About what time were you requested to become a Director?

A. — It must have been in January of this year, 1873. I am not quite sure, but I think
it was only about two or three weeks before the date of the Charter, the Charter is dated
the 5 th of February.

Q. — How many Directors are there upon that Board?

A. —I believe tiicre are thirteen names in the Cliarter.

Q.— Tliey are all upon an equal footing as Directors?

^.— Yes.

Q— AA'ho is President?

j4.— Sir Hugh Allan.

Q. — Were you present at his election ?

A. — I was.

Q. — W' as there any difference of opinion on his election ?

A. — I don't think there was. It seemed to be agreed upon by common consent that he
should be President.

Q. — What were the motives which induced the unanimous election of Sir Hugh
Allan?

A. — He had taken a very active ])art in the whole affair, and he was one of the
wealthiest men, if not the very wealthiest man. He seemed disposed to embark his
capital in this enterprise to a very large extent, and it was also thought that he would as
President be better able than almost any other man to influence capitalists in England
to join in tiie work.

Q. — Was it considered an advantage to the undertaking to have hiia at the head of it
as President?

A.- — It was then considered so unquestionably.

Q. — You have extensive experience and reputation, and knowledge as an Engineer,
JNlr. Fleming. Can you give an opinion as to the pecuniary ])romise of this cnteriirise
under the Charter. Does it apjjcar to you to be of a j)rofitaijle character ?

A. — Anything I can say on that head must be very Kj)eculative. I suppose I have had
a better opportunity of judging tlian any other member of the Board, on account of being
connected with the surveys; but I always had grave doubts about the financial success ol
the scheme.

Q. — Did you accept a Directorship from a desire, or with the expectation of making
money out of it?

A. — I accepted ii Directorship because it was pressed on me by the Premier. I hesi- ,
tated very much about accepting it, and did not do so solely with the idea of making
money out of it.

Q. — Do J ou know anything about the general elections in 1872 — about the raising of
funds for the i)urpose of carrying them on ?

A, — None whatever. I was not in this part of the country at the time.

Q. — Aiul nothing has since come to your knowledge with respect to these elections?

A. — Nothing, except what anyone can read in the public papers.

Q. — You stated the reasons which seemed to operate with the Board in selecting Sir

CANADIAN PACIFIC RAILWAY.

197

I of tlic Canada

be one of the

ITugli Allan as President. Were they the reasons which operated with you — that is, his
wealtli, his position, his I'acility for obtaining means, and so on ; were tliese the reasons
whicli operated with you ?

A. — I tliink so. Everything pointed to Pir Hugh Allan as the proper man.

Q. — Had you any other reasons than those you liave named lor giving him your
supi)ort as President ?

A. — I never gave the matter very much consideration. Everything pointed to Sir
Ilugli Allan as the pror jr man to be President ol' the Company. His name was first on
the list of names given in the Charter, and he had no rival.

Q. — Was any influence used with you personally to induce you to support Sir Hugh
Allan as President ?

A. — -I am not aware of any. It seemed to be generally understood by everybody that
lie should be President. He seemed to have no rival.

And further deponent saith not, and this his deposition having been read to him, he
declares that it contains the truth, persists therein, and hath signed.

Sworn and taken on the eighteenth day of

Canada.

September, 1873, and acknowledged
on the twenty-ninth day of said
month and year.

(Signed)

(Signed) SANDFORD FLEMING.

CHARLES DEWEY DAY,

Chairman.
A. POLETTE,
JAMES ROBERT GOWAN,

Commissioners.

IN THE MATTER OF THE COMMISSION

\t the head of it

xtion of making

it the raising of

Provixct; of Oxtario, 1
Cit>/ of Ottawa. J

Appointing Ciiarlk.'? Dkwky Day, Antoixk Polette, and Jamks Roi!Ert Gowax,
Commissioners to inquire into and report upon the several matters stated in a
certain Resolution, moved by the Hon. Mr. IIiiXTiNaioN, in the House of
Commons, on the second day of April, a.d. 18713, relating to the Canadian
Pacific Railway.

Present : The CoMiiissioxEns.

On this ninteenth day of September, in the year of our Lord, one thousand eight
hundred and seventy-three, personally came and appeared belbre us, the above-named
Commissioners,

Sir HUGH ALLAN, of the City of Montreal, Knight, who being duly sworn, deposeth
and saith :

I am a resident of Montreal.

Q. — You have taken an active interest in the negotiations and operations for the
constructing of the Canada Pacific Railway '!

A. — I have.

Q. — There are a number of letters which have been found in a package entrusted by
you and Mr. G. W. McMullen, whom 1 suppose you know, in the hands of Mr. Starnes,
and we desire, in the first place, to prove those letters to bj in your handwriting. Will
you take the package and examine it, and state if they are so ?

A. — With reference to the parcel itself, it was not I who put it into the hands of
Mr. Starnes, or made it up. I cannot swear positively as to the originality of the
package. I can, however, identify my own handwriting.

Q. — These letters now shown to you, were they all written by you to the gentlemen
to whom they are addressed ?

A. — Yes; they were private letters for private information, and not lor publication
at all.

Q. — Are the telegrams also correct ?

A. — I think so. I have only a knowledge of their general terms.

Q. — Are there any other contents in that s(!aled package which you can identify ; that
is, for instance, the sealed packet and other documents, one a letter addressed to tiie Hon.
llciu'y Starnes, is that your letter ?

A. — Yes; that is my signature.

Q. — Is that Mr. McMulleu's signature to it also ?

A. — I think so.

2 C

TTTTT

iCh

108

(.:ORRESP()NDENCE RELATIVE TO THE

Canada.

Tlicrc is also another envclojjc here containing a cheque for $17,500, and I hereby
produce and lyle it, marked " N."

Q. — \Vliat was the letter addressed to Mr. Ptarnes with the memorandum and
agreement ?

A. — Tlie letter is herewitli ])rodiu'ed and fyh'd, marked "O."

Ci.— You have said tliat you liave taken an active interest in the negotiations for the
construction of the (Janada Pacific Railway. I will now read to you the formal charges
that have been made against the (lovernment on that subject, with the view of receiving
a statement of what you know about tliem. ^Vill you liave the goodness to state all the
facts within your knowledge relating to the subject matter of these charges?

A. — If the Court will permit me, I will read a statement which I have drawn up
relating to tlie matter.

With rel'erence to this statement, and any other I may make, I wish the Court to
understaiul that at this distance of time — I'rom one to two years — during which many
changes have taken place, and, as a nuitter of course;, I cannot exactly charge my
memory as to conversation about i'acts and figures which then took place, and therefore
I can only state what occurred to the best of my knowledge and l)elief.

The witness then made the following statement : —

I have for some years past taken a strong interest in the development of railway
conmiunication throughout the Dominion of Canada, and particularly through the
district of country lying to the westwanl of Montreal, with a view to increasing the
facilities of communication between tlie seai)oar(l and ^Vestern America. And that,
amongst other projects, my attention was early direcfed to tlu; sclieme for constructing a
railway between Montnjal as the most westerly Atlantic seaport, and the Pacific Ocean.

That in the autunm of 1871 I learned, in conversation with Sir Francis Ilincks, that
certain American cajiitalists bad j)ro})ostd to the Government, through Mr. Waddington,
to organize a Company for the purpose of building the Canadian Pacific Railway, but
that no action had been taken upon their proposition.

That, thereupon, inasmuch as no movement ajjpeared to be contemplated in Canada
lor the pur])ose in question, and 1 doubted if Canadian capitalists could be induced to
suljscribe to it to any large extent, I obtained from Sir Francis Ilincks the names of the
persons who had been comnuuiicating with the Government, and immediately placed
myself in correspondence with them, lor the purpose of endeavouring to form a Pacific
Company, in advance oi the measures which were expected to be taken by the Govern-
ment at the tliOii ensuing Session of Parliament.

That, accordingly, after a certain amount of negotiation, I visited Ottawa in company
with some of these gentlemen, and w(! had an interview with the Government, rciV'-rcil
to by Sir John, on or about the 5th October, 1871. Sir John's account of that in* rvicw
accords perfectly with my recollection of what took place. On the 23rd Decembti "^71,
I entered into an agreement with certain American capitalists. T now produce a c ^/y of
that agreement, omitting only the names of the other signers, which I conceive 1 have
no right unnecessarily to drag before the public.

The witness here reads the agreement, a copy of which is produced and fyled
marked " P."

There was also a sup])lcmentary contract made at a future day. I had no recollection
of this contract until within the last few days, and if I had been asked, would^have said I
had never seen it. There is no question but that the contract was entered into and tiiat
[ was one of tlu; signt.'rs.

Witness here reads supplementary contract, a copy of which is produced and fyled,
marked " Q."

Neitlier the Government as a whole, or any member of the Government, ever saw
that agreement or liad any kiu)wledge of its existence, as far as I know, until very
r(!cently.

On looking at the deed of agreement it will be seen that it was stipulated that the
Road should Ije built i)y the route and on the terms prescribi-d in the Act to be passed
respecfing it, and it was further understood that in addition to the route north of Lake
Sujx'rior, a Ijranch was to be constructi-d from Lake Nipissing to Saiilt Ste. Marie, with
a branch to Georgian Ray near the mouth of French River. At Sault Ste. Marie the
river was to be bridged aiul the line carried along the south shore of Lake Superior to
Duluth where it would join the North Pacific from which line another branch would
lead to Fort Garry.

I'rom I'ort Garry westward to the Pacific it was intended the Road should proceed
on till" route afterwards determined by the surveys, and it was regarded as a possibility
that the Northern Pacific, when it got as far West as the Missouri River, miglit l)o

(JANADIAN PACIFIC RAILWAY.

199

itions for the

(lolbctcd so as to join the Canadian Pacific, get the advantage ol' our easier pass through
the mouatiiins, and run on its track to some point Mcst of the mountains*, Avheri- they
would again se])arate; the Nortliern Pacific ])assing south to New AV'estniinster, and the
Canadian Pacillc seeking the sliore of tlic Pacific Ocean at such point as determined
by the surveys.

I favoured this scheme, hecause it not only gave us such a Pacific Railroad as W(!
might desire, but also the advantage ol" a direct connection willi the States of Northern
Michigan, Wisconsin, Minnesota^ and Dakotah, the traffic and ])r()(Uice of which would
naturally find its way to and from tlie seaboard through Canada, as l)eing much the
shortest, and consequei\tly the eheajjcst route, even lor the traflic of New York and
Boston.

Thus, in place of, as lias been alleged, sacrificing the interests of Canada to the United
States, these phuis, if carried out, avouIiI have Incn a greater benefit to Clanada than any
other scheme oi communication that could be desired, and would have given a double
communication with I'ort CJarry. And with regard to this agreement I most distinctly
and explicitly declare that neither in the agreement itseli', nor in Jiny conver: :ition or
negotiation connccti.'d with it, was there any bti])ulation, statement, or exjjre.ssed plan,
which had for its ol)ject any retardation of the work, or any other jjurpose, than itsi'om-
pletion throughout, at as early a day as would he consistent with reasonaljle economy in
building it. And more particularly 1 declare that there was no intention ex[)resse(l or
implied, either in the agreement or in the negotiations which accompanied it, oi' placing
it in the power of the Northern Pacific Railway, or ary other Company, or body oi'
men, to obstruct the enterprise in any manner or way whatever.

1 am bound to say here that these New York gentlemen behaved throughout all my
negotiations with them in the most honourable and consistent manner.

Although the organization at Ih'st gave them a majority of Directors, when it was
thought that this might give rise to objection, they at once agreed that tlie majority
bliould be Rritish sul)jects, residing in Canada; and they consented to abide by all the
regulations and conditions that the Parliament or Gov(;rnment of Canada miglit impose
uj)on them. They never proposed to make the Road subservient to tlie Northern J'acilic,
nor to use it in any way otherwise tluu; for the best interests of Canada.

It ".as arranged that tlie Americans would advance money I'or necessary pre-
liminary exiJonses, and they jiaid in S4( >,()(}() American currency for this purposi-.

A large portion of this was spent to their jjerfect satisfaction, but owing to tlu! subse-
(juent changes in the aspect of allairs 1 thought it better, without any apjilication I'rom
them, to return to them the entire amount, and I did so. 'i'htre was no other money
contributed by the Americans in any form or lor anj' jiurpose to which I was a party.

Soon after my return i'rom New York I wrote to 'loronto with the view of enlisting
gentlemen in the scheme, and tlie lirst person I ai)plied to was the Hon. 1). L. Mac-
]ilierson, to whom I explained the whole scheme, and asked him to join the organization.
This he declined to do on the plea of its connection with the Americans.

I found the general feeling of the people in Toronto rather cool towai'ds tlie Pacific
Railroad, because their city did not lie on the direct line of the j)roi)csed Road, though
they could not deny the great merits of the scheme in a public point of view.

They feared that tlu' western traflic wcnild, by the proposed road, be carried past them
to Lowcjr Canada.

No further steps of imporlance were taken by m\self or associates up to the tim(; of
the opening of lb;- Session of Parliament at Ottawa in resjii'ct of the lU'ojected Com[iany,
except that I placed myself in communication with the Government, oU'ering to organize
a Company which would undertake the construction of the Road, and discussing the
question of the facilities and aid which the (jlovernment would probably recommend to
he furnished by the country, and in the course of these discussions and negotiations I
endeavoured, as far as possible, to secure for myself the position of President of the
])rojected Company, which was the position my associates were willing to allow me; and
to which 1 thought mysi^lf entitled from the activt; part which I took in the great
national enterprise to which the agreement and negotiations in t(uestion had reference.
And as to this point I had • nsou to believe from the first that the Government was
prepared to admit my claim.

That when the time for the Session of the Canadian Parliament approached, I ajiplicd
to Mr. Abbott to prepare the requisite legislation ; and shortly after Parliament had
opened, I proceeded to Ottawa for the purpose ol' ascertaining how matters were pro-
gressing, and what pros^jcct there was of a successful prosecution of the undertaking Ijy
mjself, and the persons who were then associated with me. 'i'hat previous to tliis time,
however, I had communicated w ith a large number of jicrsons in Can;;da on the subject

-2 V 2

C.\.VAIU.

200

correspondencp: relative to the

Itt-X:

Cajiada.

of the projiosed Comimny, refiuMiiig their oo-oporation and assistance, and endeavourin<^
to iudueo tliem to sul)seribe lor stock to such an extent as 1 thought lair, considering
liieir jjosition and means.

And tliougli 1 did not meet witli any great measure ol" succcbs in procuring oubscrip-
tions of stock, yet it was quite as great as 1 had antici])ated when making my arrange-
ments with the American cai)italists. In my negotiations witli tliem, therefore, I
provided for the distribution of tlie stock whieli those gentlemen were willing to
subscribe, or which I believed they would eventually be willing to subscril)e upon the
formation of the Company, as mentioned in my letter of the 28th February, 1872,
already referred to.

\Vhen I visited Ottawa, as stated in the last paragrapli, I ascertained by personal
ol)servatiou and communication with the members of the House that a strong prejudice
had arisen against any connection with American capitalists in the formation of the
l)roi)osed Comjiany, the I'ear expressed with regard to that subject being that such
ca])italists would fnid it for their interest, rather to obstruct the Canadian Pacific, and
I'urther tlie construction of the Nortlun-u Pacific, than to act in tlie interests of Canada,
l)y pressing forward the Canadian Road. And though I did not share this fear, and
always believed, and still believe, that the persons who proposed to be associated with
me would have gone on with the enterprise in good I'aith, to the best of their al)ility,
yet I Ibund the feeling for the moment so strong that I judged it expedient and pro])er
to yield to it, and therefore consented that the legislation to be presented to the House
should exclude foreigner!* from the (Jom2)any, and that the Directors should be
exclusively Canadian.

A Bill incorporating the Canada Pacific Company was then introduced into the House
Ijy Dr. Grant, who had lieen a ])rominent advocate of the Canadian Pacific scheme, and
had introduced in the last i)revious Session a similar measure jit the instance of tiie late
Mr. VVaddington and others, who were then interesting themselves in the i)roject.

Notwithstanding that the Bill which was so intioduced, contemplated by its terms the
exclusion of foreign(;rs, I did not feel by any means convinced that the Government
would insist upon any such condition, believing as I did, and do, that such a proposition
was impolitic and unnecessary. I did not, therefore, feel justified in entirely breaking oil'
my connection with my American associates, altliough I acquainted them with the
difficulty which might arise if the (roverumcnt took the same position which the
majority of the ])eoi)le with whom I conversed at Ottawa appeared to do. I was aware
that by th.e terms of the Bill introduced by the Government, they would have a con-
trolling power as to the terms of the contract, and I was willing to abide by their
decision as to the extent of intercut, if any, which foreigners might be permitted to hold.

And until tliat decision was communicated to me, I felt in honour bound by the
agreement I had made to leave the door open for the entrance of my American associates
into the Company, unless the contingency arrived of a distinct prohibition by the
Government against admitting them. And in inlbrming them of the progress of the
afiair in Canada, as I did on certain occasions as an individual and without implicating
the Company, of which I was a member, I consider that I was only acting fairly by
them. .And I did not intend thereby to bind, and, as I conceive, did not in any Avay bind
or com])romise, to my views, the other members of tin Canada Pacific Railway Com-
pany, with whom I did iu)t think it necessary to communicate at all on the subject of my
occasional correspondence with my former American associates, the more especially as
that corresi)ondence was entirely private and confidential, and, moreover, was written
with such inattention as to accuracy of expression as might Ijo expected in corres-
pondence intended only to be seen by those to whom it was addressed. During my stay
at Ottawa I had some communication of an informal character with members of the
Government, and 1 found that tliey were still dis})osed to recognize the value of my
services in endeavouring to organize a Comjjany, but in view of the rivalry which
appeared to exist in resjjcct to the Pacific scheme, and the strong array of Canadian
names which had been obtained by the Interoceanic Company as associates in its project,
nothing definite leading me to expect any preference for myself or for the Company
which I was endeavouring to organize, or indeed anything definite relating to the project,
was said by the members of t!:e Government with whom I then communicated. It
appeared to me that while their intentions and opinions had been freely expressed to rac
when no Company other than that which I was proposing to organize was likely to be
formed the presence of competition amongst Canadians for the contract had decided
them -J allow matters to take their own course until they should have been enabled to
decide after the formation of the Canadian Companies what line of conduct would be
most conducive to the interests of the country. And there was, therefore, very little

CANADIAN PACIFIC IJAJLWAY.

201

said or done during the Session wliidi gt-vve me any clue to the views of tlie Government
witli r('S]ie(t. to tlie course ol' action which they would proljuhly ultimately adopt.

In order to make my narrative intelligible, it is necessary I should recall to mind the
Lcijislation ol'the Session of 1872, as regards the Pacific Railroad. During that Session
two Coinpanicjs were incorporated with jn-ecisely similar powers. Tiie Interoccanic
C'ompany, of which Mr. Macpherson was a leading memi)er, and the Canafiii Pacific
Company, in which I took a ])romincnt jnirt. The Acts ol' Incor])oration oi' these ("om-
panies conferred on them no grant or right to the contract. A third Act was passed, a
Government measure which empowered the Government to grant .')(),000,000 aires of
laiul, and $;50,()0(),()00 in aid of the construction of the Railway, and to contract for its
construction and running, either first with any Company incorporated for the i)urposc
during that Session, or second witli •\ny two or more Companies amalgamated for
tlio purpose, or third, with any Company which the Government might create by letters
jiatent for the ])urpose.

After !l)(^ Session, the Canada Pacific Railway Company, of which I was a member,
]m)cee(led to oi'ganize and notified the Government that they were prepared to take the
contract for i)uil(ling and ruiuiing the Pacific Railway on the terms and conditions men-
tioned in the Government Act. They caused stock books to be opened in various parts
of tlie Dominion, in conformity with tlie Act, and took such initiatory steps and such other
proceedings as were necessarv to enable them to act as an orgfinized corportite body.
Tliat it soon after became evident to me that the Government would be best pleased to
see an amalgamation of the two Companies incorj)orated by Parliament, in order that
united action might be secin-cd and the greatest strength obtained in the formation of a
Canadian Comi)any. I therefore opened negotiations with the Interoceanic Company,
for the jiurpose of endeavouring to eflect such an amalgamation, and at the same time the
Canada Pacific Company placed itself in communication with the Government with
relation to the same sul)ject. It was thereupon intimated that the Government were also
desirous that th(! amalgamation should take place. That thereupon, Mr. Abbott, a
moniber of the CJanada Pacific Railway Company, j)roceeded to Toronto to meet Senator
Macpherson, and if possible to arrange terms of amalgamation that would be satisfactory
to l)oth Companies. And after a discussion of the matter during two or three days, in
Toronto, l)etween him and Mr. Macpherson, he reported to the Canada Company that
there did not a])pear to be any material difficulty in the way of our amalgamation,
except that the claim which I made to be President of the amalgamated Company, and
to have the nomination of an equal number of the members in the new Board to that
nominnted by .Mr. Macpherson, could net be acceded to. Mr. !Macpherson's proposal
was, that h(>, as representing the Interoceanic Company, should have the nomination of
a larger numi)er of members in the amalgamated Company, than I, and that the ((uestiou
of the Presidency should be left to the Board of Directors. With regard to the
Presidency, Mr. Abbott informed the Company that Sir John Macdonald expressed
liiniself as being favourable to my election as President, and that any influence the
Ciov(!rnment might possess among the members of the amalgamated Company, would be
exercised for the purpose of aiding in my election to that ol>'ce, and that probably the
difficulty as to the nomination of members to the new Board between myself and Mr.
Macpherson might be obviated in some way. In other res])ects he reported that he
could find no divergence of opinion as to the amalgamation of the two Companies
Irctween myself and Mr. Hacphersori.

After receiving Mr. Abbott's rejiort of the negotiations at Toronto, I felt satisfied that
110 difficulty would occur in bringii'g them to a successful termination. And as tin; late
Sir (ieorge Cartier happened to be in Montreal shortly afterwards, and I was taking con-
Hiderable interest in his re-election, I met him and had an unofficial conversation with
liim on the suliject of the Charter, on several occasions urging that the influence of the
Government should be used to procure the amalgamation upon such terms as I considered
would be just to myself and the Company over which I presided.

On tlie 2nth July, 1872, I received a message from Sir George Cartier asking me to
see him the next day. I requi>sted INIr. Abbott to accompany me, and I discussed the
whole question with Sir Cieorge, who stated his views fully.

He communicated to me a telegram he had received from Sir John A. Macdonald, of
which the following is a copy: —

Canada.

"Sir G omiK tl\RTrEi{, Montreal. "July 20, 1872.

" Have seen Macpherson. He has no personal ambition, but cannot in justice to
Ontario concede any preference to Quebec in the matter of the Presidency, or in any
other particular. lie tays the question about the Presidency should be left to the

202

CORRESPONDENCE RELATIVE TO THE

SfU"

Canada. Board. Under tliese circumstances I authorize you to assure Allan that the influence oi'
the: Government will be exercised to secure him the jjosition ol' President. The other
terms to he as af^reed on lietween iMiici)lu:rson and Aljhott. The whole matter to he
kept quiet until after tlie elections. Then the two gentlemen to meet the Privy
Council at Ottawa and settle the terms ol' a provisional agreement. This is the only
practical solution oi" the difliculty, and should be iieceptod at once by Allan. Answer.

(Signed) 'MOIIN A. MACDONALD."

And Sir George Cartier on that occasion gave me the assurance which he was by that
telegram authorized by the Premier to convey to me.

Tiiat on further discussion with Sir (jeorge Cartier as to the course which the Goveni-
ment would probably take with regard to the amalgamation and the contract to be
granted, 1 urged upon him certain modifications ol' the terms of the above telegram
from Sir John Alacdonald, and finally Sir (ieorge came to entertain the opinion that I
Avas entitled to have certain of those modifications conceded to me, and expressed his
willingness to recommejid it to his coUeagueif. Being desirous of having as definite an
expression of opinion from Sir George, as he felt himself justified in giving, I requested
that he would jjut what he sUited verbally to me in writing, and accordingly on the 30th
July, 1872, he wrote me the following letter:

" Dkau Sir Hugu, " Montreal, July :J(), 1872.

"I inclose you copies of telegrams received from Sir John A. Macdonald ; and
with reference to their contents 1 woula say that in my opinion the Uovernor in Council
will approve of the amalgamation of your Company with the Interoceanic Company,
under the name of the Canadian Pacific Railway Company ; the Provisional IJoard of tlu;
amalgamated Company to be composed of sevent^-en members, of whom four shall be
named from the Province of (Juebi-c, by the Canada Pacific Railway Company, four
from the Province of Oiitaric, by the Interoceanic Railway Com])any, and the remainder
by the (jroverumcnt ; tlie amiilgamated Company to have the power specified in the lOtli
section of the Act incorjiorating tlie Canada Pacific Railway Conijiaiiy, and the agree-
ment of amalgamation to be executeil between the Companies williiu two months from
this date.

"The Canada Pacific Company might take the initiative in procuring the amalga-
matiiiii, and if the Interoceanic Company should not execute an agreement of ai'.'ulga-
ination upon such terms, and within such limited time, I think the contemplated
arrangement should Ikj made with the Canada Pacific Company iinder its Charter.

" Upon the subscription and payment on account of stock being made, as required by
the Act of last Session, respecting the Canadian I'acific Railway Comjiany, 1 have no
doubt but that the Governor in Council will agiuse with the Company for the construction
and working of the Canadian Pacific Jiail way , with such branches as sliall be agreed upon,
and will grant to tlie Comjicuiy all sucli subsidies and assistance; as they are em[)owcred
to do by the Government Act. I believe all the advantages which the Government Act
emjiowers the Government to confer iqion any Comi)any, will be required to enable the
works contemiilated to be successfully carried through, and I am convinced that they will
be accorded to the Company to be formed by amalgamation, or to the Canada Pacific
Company, as the case may be.

" 1 would aild, that as I ai)prove ofllie measures to which I have referred in this letter,
1 shall use my best endeavours to have them carried into effect.

" Very truly yours,
(Signed) "GEO. E. CARTIER."

I observe that it has been stated that there was a postscrijit to the I'oregoing letter. I
declare positively that there was no such thing, and I now exhibit the original letter to
the Commis-sion, in support of wliat [ say, but I do not dispossess myself of it. An
authentic copy of which, liowever, is herewith jirodueed and fyled, marked "R."

I positively declared that up to the date of tliis hotter I had not any understanding of
any kind or descrijition with the Government, either directly or through any other person,
than that contained in Sir John Macdonald's telegram of the 2Gth of July, which is given
above; and that telegram and the above letter from Sir George Cartier contained every-
thing that was ever stated or agreed to ijctween any member of the Government and
myself, on the subject of a Pacific Railway jiroject, up to that date.

On the same day that I received the above letter from Sir George Cartier, I informed
Sir John A. iMacdonald of the substance of it, and asked for his sanction to the views
which it contained. But he declined to concur in the terms of Sir George's letter, tele-

CANADIAN PACIFIC UAILWAY.

203

le was by tliat

1 in this letter,

CARTIEK."

grapliing to liim (Sir (loorpic ("articr)thiit he would not agree to them, ami that he would
come down to Montreal and confer with hiui respecting them.

Hereupon I immediately informed Sir (JeorgeCartier that I sliould consider the letter
addressed to me as ])eing withdrawn, and to my knowledge Sir George telegraphed to
Sir John that he had seen me, and that as he (Sir John) objected to Sir George's letter,
it had been withdrawn. I also telegraphed to Sir John on the same day (July lilst) to
tlie effect that I had seen Sir George Cartier, and that he (Sir John) might return my
letter or regard it as waste ])aper, and that 1 was satisfied witli the telegram of tlu; IKith,
as expressive of the views of the Government.

These two telegrams are, I understand, produced by Sir John A. Macdonald with his
affidavit.

1 positively and explicitly declare, that exccjjting so far as an understanding between
the Government and myself is expressed in the foregoing correspondence, I had no agree-
ment of any kind or descrir/iion either verbally or in writing, l)y myself or through any
other jierson, in respect of the contract lor the Pacific Railway or of any advantage to
be conferred upon me in respect of it.

In one of my letters in the published correspondence dated fith August, 1872, 1 ajipear
to have said, " Yesterday we entered into an agreement. " The word " yesterday " was
used inadvertently for " recently," or " some days ago."

That this was merely a slip of the pen will appear from the letter following in the
publisliud correspondence, and Avhich is dated tlie day after, /th August, in which,
referring to the same agreement, I again used the word " yesterday."

There never had been anything tliat could be called an agreement, except that ar'sing
out of Sir Jolni Macdonald's telegram of the 2(ith July which remained untouched, Siv
fieorg(;'s letter of the 'Jdth July, which I have just exhibited, and my oAvn to Sir Jolni
A. Macdonald being considered withdrawn.

As we were leaving >Sir George said to me, in his usual abrupt manner, " Are you not
" going to assist in our elections?" or words to that effect.

I replied tbat as on former occasions I would no doubt do so to some extent, but I
wajited to know how much he required. He said it was impossil)le to tell, but from tlu;
opposition raised to the Pacific Railroad project, it might amount to ife 100,000.

I thought this was a large sum, but I felt that the interests involved in the issue of
the approaching general elections were most important in a national point of view. It
seemed to me to be a question whether the policy of the Administration with reference
to railroads, canals, harbours, light-bouses, and emigration was to be approved of or
not; that policy I thouglit then, and still think, deserving of the support of all those who
would really care for the development of the resources of the country. In addition to
these public reasons ior giving pecuniary assistance to the Government in the late
general elections, I had personal reasons, Avhich will be readily appreciated even by
those who cannot iniderstand any higher motives. As a person largely interested in the
carrying trade, I could not fail to desire the success of every scheme which would increase
the communications with the interior of the continent.

In addition to this, my feelings were aroused by the attacks on myself personally, as
well as on the Government, the ground of attack on the latter being m.ainly on its Pacific
Railway policy, and as I approved of that policy, I therefore determined to give; the
Grovernment all the assistance in my power, and in answer to George's request, 1 asked
him to state to me in writing what he wanted mo to do.

In the afternoon we again waited on Sir George, and he gave mc a letter of which the
following is a copy : —

{Private and Confidential.)
" Di:au Sill High, " Montreal, July .30, 1872.

" The friends of the Government will expect to l)e assisted with funds in the
pending elections, and any amount which you or your Company shall advance for that
l)iirpose shall be recouped to you.

" A memorandum of immediate requirements is b(;low.

" Yory truly yours,
(Signed) " (GEO. E. CARTIER.

NOW WANTED.

" Sir John A. Macdonald $25,000

Hon. Mr. Langevin iri.OOO

SirG. E. C. 20,000

Sir J. A. (add'l) 10,000

H(.n. Mr. Langevin 10,000

Sir (}. E. C. (add'l) ;i(),000

Canada.

«
u

20/1

CORRESPONDENCE RELATIVE TO THE

Canada. Q, — Havp you tjol that letter in your iJOSScsHiou ?

A. — I Imve, aiiil I hcreliy prodiue it lielore the Commission, hut do not wish to (Us-

possess myself ol it; an aullieiitie eopy is herewitli prodiacd and I'yh'd.and marked "S."

As the letter now a])|)ears, the menioranduni is lor Sl lO.OOO, Imt at the tinu; il was
written the (irst three items amouiitin;j,' to s^dO.OOd only were mentioned, Sir (ie(ir};c
said, however, that they eoidd talk ol" that al'leruards. A(Tordin!j;ly I imid over the
thre( iirst sums oi' money to the j;ciitlemen indicated. Afterwards Sir (leorj^e rj'ciuesled
me to send a further amount lo Sir .lidin A. Maedoiiald ol' ^l(»,()(H), and ^1(),0()() lo
Mr. Lan,u;evin, and !i«;iO,()(l() to the Central Connnittee of I'Mi'ctions; and the three sums
hist mentioneil in the memorandum appended to the letter wer(; then added to it hy Sir
Geori;c. I aee(U'dini;ly remitted sid.OOO to Sir John Macdonald, i^.'iO.OOO to the Central
Committee, and left slO.OOO with .Mr. Abbott for Mr. liangovin, to be paid upon n'ettiii^,'
from that j^entleman a receipt for it. In Sir George Clartier's letter of the .'{Otli July,
namely, the one to which I have secondly alluded, there is an undertaking on the part
of Sir (Jeorge that my advances would be paid back to me. 1 did not see well from
what source this money could he repaid, but Sir (Jeorge held out some hope that liis
political friends would eontributi- to make it uj). Beyond this there was nothing tliat
I can recall as to the maimer of ri'payment. On leaving Sir Gi-orge I said to Mr. Al)h()tt,
that I saw no possibility of my ever being repaid tlu!se contributions. Neither then nor
on any other occasion had I any correspondence with Sir George as to the repayment of
these sums.

I loft Montreal for Newfoundland I think early in August, and only returned at the
end of the month, and e.xcept by infrequent telegrams I had no communication witii
Montreal during tliat time. Among the.se ti'legrams I had two from Mr. Abbott, inlbrm-
ing me that Sir George wanted s2(l,00() more for the General Committee, and ii!l(),()()(l
for Sir John. I authorized Mr. Abbott to pay over thesi' sums, and placed the money at
his dis})osal.

I think I also received telegrams from Mr. Abhott telling me that ^Ir. Langeviii would
sign no receipt, and asking my authority to hand him tlu! money without any reeei])t.

This last telegram did not reach me in time to be acted upon, and I have since learned
from Mr. Abbott that ^ir. Langtivin gave no receipt.

1 heard of Sir George's defeat Avliile in Nova Scotia on my way back. In this way on
my return I found that the limits of payments which I had first agreed to had been
exceeded, and with subsequent advances they finally stood as follows:

To Sir George E. Cartier's Committee

$85,000

To Hon. Sir John A. Macdonald towards election expenses in

Ontario - - 45,000

To Hon. H. L. Langevin towards electoral expenses in Quebec - 32,600

$162,000

I also paid for the assistance of other friends of my own in connection with the
elections between $IG,000 and $17,000.

These sums, with the preliminary expenses on the Pacific and various railroads in
which I was engaged, more or less directly connected with the Pacific enterprise, made
up the amount of my advances to about $350,000.

After the elections I made another attempt to amalgamate the two Companies with
the assistance of the Government, by addressing the following letter to the Hon. D. L.
Macpherson : —

"Dear Sir, " Montreal, September 5, 1872.

"I received, some time ago, a communication from the Government, informing
me that it was deemed advisable that our two Companies should unite and form one
Company, for the construction of the Canadian Pacific Railroad, and expressing a hope
that the suggestion would meet Avith the apjiroval of the two Comi)anies. No doubt you
also received a similar communication.

" In conformity with the wish of the Government, the Canada Pacific Railroad
Company, of which I am President, is prepared to amalgamate with your Interoceanic
Company, and I consider it is for both our interests that the amalgamation should take
place as soon as possible.

'' I have therefore directed a meeting of the Provisional I'oard of my Company to be
called for the purpose of authorizing the execution of a deed of amalgamation being-
agreed upon.

CANADIAN I'ACirit; HAIIAVAV.

205

"I understood that tho (jloveriuneiit would approve of such an amaluiamation upon tlie
following conditions : —

" 1st. That cither of the Charters should he the Charter of tlu; aniali^aniated (Company.

"2nd. That the Provisional Directors of the amalganiated Company should he
seventeen in numl)er, of whom four should he namcil by you, four hy uu\ and the
remainder by the (iovernmeut.

" ;h'd. That the Board thus constituted should elect the Provisional Chairman or
President.

"As the Canada Pacific Company has opened stock hooks in conlbrmity with the Act,
and has retained them at the dilferent points recjuired by tin; Act since they were so
opened, I would suggest that the proposed subscrij)tions should be inserted in those
hooks, subject to allotment l)y the Provisional Moard, to be constituted under the deed
of amalgamation. And the books could then remain open at such ])oints as may be
ordered by the I'rovisional Board for further sul)scrii)tion, either in this country or in
Kiiglaud. By thus availing ourselves of the proceedings of the ( 'anada Pacific Company,
(lie time within which theC'ompany can he regularly organized will be greatly shortened,
and the amalgamated Company will be in a position, at an early date, to proceed with
the financial arrangements re([uisite for commencing the work next spring.

"I shall be haj)i)y to hear from you as early as jjossible on the sul)ject of these sugges-
tions, with any others which you may feel disposed to make, should you entertain tiie
idea of au amalgamation; and in that event you might consider it desirable to call your
Hoard together, in order to act in concert with our Board in carrying out the amalga-
mation as soon as possible.

" Arrangements should also be made, and powers obtained, to enalde us to negotiate
and execute a contract with the Government.

" For this purpose a meeting at Ottawa of au Executive from each Company may be
necessary, and I will be prepared to meet 3 ou there when required.

" Your obedient servant,

(Signed) - llUCill ALLAN.
'■ Hon. D. L. Macplierson, Toronto, Ont."

This offer was again rejected, and on grounds similar to those formerly given, and I
made no further attempt at amalgamation, but the Government coiitiiuied in their
endeavours to induce the Literoceanic Company to amalgamate, till towards the end of
the month of November.

A little before this time, however, a Memorandum was communicated to me, which
had been received by the Government from the Interoeeanic C()m))any, which apjjcared
to destroy the jn-ospect of amalgamation, and although the Canada Company endeavoured
to remove the objections made by the Interoeeanic Company, they failed in doing so, and
the idea of amalgamation was shortly afterwards finally abandoned.

Thereupon the Government informed me that it was decided that the contract should
not be given to either of the Companies alone, but that the Government would incor-
porate a new Company of the prominent members of the two incori)orated Companies,
iiiid any leading Canadians who might he disjiosed to join them and able to give assist-
ance, and could he induced to subscribe the stock in the jiroportions which the Govern-
ment had decided upon, which proportions are those embodied in the Charter. And from
that time the efforts of all parties interested in the project were directed towards pro-
curing the association together of the mo?t prominent men of both Companies in the
new Company to be incorporated under the terms of the Government Act of the previous
Session. And it was, as the result of these efibrts, that the present Company was formed,
composed, in a majority of instances, of gentlemen with w horn I had no communication
whatever, and not in any respect as the consequence of any understanding between
myself and the Government. From that time also communication between myself and
my former associates ceased, having finally been broken off by myseli', as soon as I
ascertained the desire of the Government. And I state further, positively, that no money
derived from any fund, or from any of my former American associates, was expended in
assisting my friends, or the friends of the Government, at the recent general elections.

That with regard to the construction which appears to be intendecl to be placed upon
the statements in the letter referred to as to the preliminary expenses connected with the
Chai'ter, I state most positively and explicitly that I never made any agreement or came
to any understanding of any kind or discription with the Government, or any of its
members, as to the payment of any sum of money to anyone;, or in any way whatever, in
consideration of receiving the contract for the Canadian Pacific. I declare, that I did
expend considerable sums of money in various ways which ai)peared to me to be advan-

2 D

Canada.

206

COHUESPONDKNCK UKI.ATlVi: TO 'I'lir:

IM'

Canada, tn^cous to tlic (!onii)iiiiy I liad ormaiiizcd, and nilculatctl fo strciif^thcn my ImndH in

unilt'iivoiirinu; fi> olitiiiii tlu' coiitriicl lorfliat ('(iiniiaiiy. Imt, tliat I did not on any occasion

or in any way jiay or a^rir to ])ay anyti\in^' wlmtcvcr to any nicnihrr ol' tin; (iovcrnnicnt,
or to iinyoni' on ludiaii', or at flic instance ol' the (Government, i'or any eonsideration wlmt-
cver, in eonneetion with the Cliarter or contract. As may iu- !j;atliere(l from the h-tfcis
in (Hiestion, I considered it, to lie my policy to stren;;then my jjosition as far as I jiossibjy
could with my own iViends and I'ellow-citizens in fii(! Province ol' (^uel)eo, and nKni'
L'sijccially in so far as related to tiie Montreal Nortliern Cloliini/ation Railway, which 1
conceived would at some day ho the nutlet I'rom the Canadian racifie to the Port ol
Montri'al. And a consideraI)le portion of the money referred to in those letters was
expended I)y me in i'urtherance ol'that project in many ways, and it was with those views
In addition to those already stated, I contrihiitcd tlie money already rel'errod to, hut with-
out any imderstan<lin;» or condition with the person reeeivinj; it.

I have already said that my suhscription and loans to assist in the elections could not
have lieen a consideration i'or my y:ettin;4 the Pacific contract as it is alleged in ^fr. IIuii-
tinu;t()n's motion, I'or on the HOth July nothinj:; was settled. The plan then contemplated,
and I'or months afterwards, was that of an amalj^amation of tlie Pacilic and the Interoceaiiic
Companies ; the plan linally adopted was the y;rantiny; of a Charter to an altofj;ethor new
Company of which it is true I was a Director, hut in which I had little or no choice ol'
my co-directors and no more influence than that conferred on me hy the stock which I
mi;j;ht hold. In jioint of fact some of the Directors were scarcely known to me, and to
the a]ipointmpnt of some I was opposed.

So in fact the Canada Pacific iiicm-porated h\i the Act of the Session of 1872 never fjot
the contract and never had anythin;;' a])j)roachinK to a promise of it. The contract was
given to a hody totally dillerent and includini!; for the most part persons who had noting
to do with that Cominmy.

The terms of the Charter, the composition of the Company, the ))rivileges which were
to l)e granted to it, the pro])ortions in which the stock was to he distriliutod having hecii
matters for ni'gotiation and si-ttlenii'iit up to the last moment, and were only closetl and
decided upon while the Charter ^^as heing ])repared in the carlv part of the present year.
And the persons who linally comjtosed the Coniiiaiiy were on' iecided upon within a few
days of the issue of tlie Charter; [, myself, heing permitted 1 ihscrihe a similar amount
of stock to that suhscril)e(l hy other prominent meml)ers of th. Company.

AVilh reference to certain ])rivate and confidential letters puhlished in the Montreal
' Herald.' and to certain statements in those letters which may appear to conflict in sonii'
degree with the foregoing, I must in justice to myself ofVer certain explanations. I desire
to state with regard to these h-ttcrs tliat they were written in the confidence of private
interconrse in the midst of many matters engrossing my attention, and prohahly with ''n^
care and circumsiiection than might have hccn hestowcd upon them had they hecii
intended I'or jmhlication. At the same time while in some respects those letters arc not
strictly accurate 1 conceive that the circumstances to a great extent justified or excused
the language used in them. With regard to the reference rei)eatedly made in tho-e
letters to the American interest in the stock of the C'ompany, as I hav(! already stated, I
had made an agreement with the parties to whom those letters M-ere addressed, associatiim
myself with them in a Comi)anY proj(Tted for the construction of the Pacific Railway.

It was a very delicate and unpleasant thing for me hluntly to tell them that I would
not carry out the arrangement; hesidcs, although I came gradually to know how strongly
opposed the Government was to the introduction of American capital and influence, and
that this feeling had taken possession, to a considerable extent, of the public miiiil,
still I had never been formerly notified by the Government that it was their intention
positively to exclude foreigners and their capital in the organization of the Pacilio
Company,

And in consenting to the h?gislation introduced into the House, I thought I was only
deferring to a prejudice which I myself considered without foundation. I did not hesitate
to intimate that if a suitable opportunity offered, they should be permitted to assume a
position in the Company as nearly like that which they and I had agreed upon as circum-
stances would permit. And as I entirely disbelieved the statements that were made as to
their disposition to obstruct the Canadian Pacific, and considered that they might be of
great use in furthering its construction, especially in the event of a failure of the negotia-
tions in England, I had no hesitation in placing myself individually, iu the ])osition of
favouring their .admission into the Company, if circumstances should jiermit of it. It was
in that spirit that what is said in my private ' tters, now published, was written to tlio
gentlemen to whom they were addressed, and if matters had taken such a turn as to per-
mit with propriety, of those intentions being carried out, I should have felt myself bound
to adhere to them. But in point of fact, when the discussions as to the mode in which

CANADIAN I'ACiriC HAILWAV.

207

llif Company should \>c lormcil wrro ciitirrd upon with fhi' (lovciiimi'ul late in the
iUitumn, I canu'to un<h'rstan(l (hrisivcly, tliat they couhl not he adniittitl, and I notilii-d
tlu'in ol' tho I'act and that the iu'u;otiations must cca'-i' h(l\V('('n us, liy a litter w hiih has
not Ik'cii pul>lisliL'(l in the ' lli-iiihl,' Init which was in the I'ollowing terms:

"Mv DKAii Mil. MrMir.i.KX, "Montfonl, Oetoher 2t. 1872.

"No aetion lias yet (as far as 1 know) Iuhmi taken liy tin- (Jov<'r!iiiieiit in tlio
matter of the Paeilie Railroad. Tlie opposition ol'the Ontario jiarty will, I think, have
tlie ellect oi' shutting out our Amoiiean friends I'rom any partiei])alion in the road, and I
ajipreliend all that negotiation is at an end. It is still uncertain how it will lie L;iven
/the contract), hut in any case the (iovermni'iit seem inclined to exact a declaration that
no loreigners will have directly or indirectly any mtirest in it. \\i\t everything is in a
state ol' uncertainty, and 1 think it is unnecessary l'<>r you to visit New York on this husi-
ni'ss at jiresent, or at all, till you hear what the result is likely to he.

"Public sentiment seems to be decided that the road shall be built by Canadians
oidy.

*' Yours trulv,
(Signed) "HUGH AFJ.AN."

I desire also to state I'urther with regard to the envelo])e, and the paj)ers which it con-
tains which wen- placed in the hands of the Hon. Mr. Stariies shortly before my dei)ar-
tui'c for Kngland with the delegation of the Pacific I{aihvay, that upon being inl'ormcd
by nie that all negotiations between my fornu'r American associates and myself on the
suliject of the Canadian Pacific Hallway must cease, large demands were made upon me
liy iMr. MciNIullen, based ))artly upon alleged exjienditure by him, and partly upon a
claim by him lor comiiensation for his loss of tiiui' and service in the promotion of the
enterprise, so long as lie and bis Irieiids rtmained cuiiiie ted with it. These demands at
first were of so extensive a character 1 declined altogether to entertain them. 1 was dis-
posed to return to my American associates any money which they might have expended
in the matter, and I was ready to compensate Mr. McI\Ii,llen for the loss of his time and
liis exjienses ; but it ai)])eare(l to me that tlie sum whicb iie demanded was much greater
in ainount than all such disbursements and exiieiis( s could possibly have reached. I J'c.lt
naturally that by trusting to the honour of my correspondents, and writing to them ina
manner somewhat incoiisiderate, I had placed it in their power to annoy me by the jiub-
liiation of those letters, and 1 feared that the outcry which might follow their pul)lica-
tion in the columns of certain jiajiers which have manifested unceasing hostility to the
Canadian Pacific Railway might injure the prospects of the dilegation in England. 1
therefore authorized an arrangement to be made w itli Mr. McMuUen. by which a sum
very much less than his original demands should be paid to him, the greater portion at
once, hut the remaining, and a considerable, j)ortion on the delivery of the letters to me,
iifter the present Session of Parliament, should they not be ])ublished in the interval.
This was accordingly done. Mr. McMuUen received the greater part of the sum agreed
to with him, namely, !^2(),00(), and the remainder, namely, !?17,''J<H), was placed in one of
those envelopes in the I'orm of a cheque, the other envelope containing, to the best of my
belief, the same letters which have been publislied in the Montreal ' Herald' together
vith one or two others whidi do not appear there, but which would have established the
rupture of all negotiations between the Americans and myself. And this arrangement
was made on my behalf with Mr. McMuUen. without the concurrence or knowledge of
any member of the Government, none of wlu)m were aware that the papers had been
deposited in the hands of Mr. Starncs.

Q. — With regard to some of these letters which arc in the parcel which you have
proved, I see -a that of the 28th February, 1872, you name a number of gentlemen to
wliom the stock was to be distributed. Had you obtained the consent of these gentlemen
to receive that stock ?

A.— I had not. I did not say that I had in any letter 1 have written. The mention
was that $4,500,000 of the stock that was to be given to myself, Mr. McMullen, and Mr.
Smith, Avas to he distributed amongst such parties in Canada as we thought would be
beneficial to the Company ; but the intention was that they should pay for their stock
the same as anyone else. It was never contemplated that it should be given without
payment.

Q. — Was this letter intended to convey the idea, or did it convey the idea, that these
gentlemen had accepted the stock ?

A. — I had no such intention. 1 merely stated that these would probably be the amounts
We would have to contribute from our several stocks. I did not intend to convey the
idea that these gentlemen liad consented to accept, or had accepted, it m any form.

Q. — Did any of those whose names apjiear here accept the stock ?

2 D 2

r.\NADA.

208

CORRESPONDENCE RELATIVE TO THE

Canada. A. — None of them, unless they became Directors of the Canadian Pacific Railway.

Q- — Not at that time ?

A. — No, not at that time.

Q. — I see in your letter cf June 12th, 1872, this expression : — "I believe I have got
" the whole arranged through my Frcndi friends, by means you are aware of, and we
" have now a pledge of Sir George that we will have a majority, and other things satisfac-
" tory. I liave told you all along that this was tlie true basis of operations, and anything
" else was powder and sliot tlirown away, and I think so still ? "

j4.— These were merely matters of conversation, and never amounted to anything like
a pledge of any kind. I had been communicating with a vast number of people on the
subject, and they generally received what I had to say to them favourably, and I thought
I had succeeded in securing the good will of all parties regarding it.

(2 — There is a letter of tlic 1st July, directed to Mr. Cass, in which you give a very
full account of your jiroceedings, and a detailed history of the course which you followed
for the purpose of obtaining tlio influence which you desired in Parliament. Will you
explain tlie expressions which you made use of there with respect to the means of securing
Sir George CiTtier and the majority in Parliament?

A. — Tliere never was any means used to obtain Sir George Cartier or anyone else,
except those I have already alluded to. In conversation with all tlie gentlemen, and in
my intercourse with them from time to time, I was constantly talking to tliom on tliis
subject, urging tliem to use all the means in their power, and I generally got their
jiromise to tiiat eflect ; but I did not use any improper means to acquire anything of that
kind at all.

(2. — The impression that would be conveyed by this would be that you used some
objcctioiial)le means for the purpose of purchasing tlie support of these men ?

A. — I did not ; indeed I did not.

Q. — You state " that Sir George then proceeded to give me the contract as required,
" in a way that there would be seventeen provisional Directors, of which Ontario would
" have eigli : and we nine, thereby giving us the control. \Ve at once proceeded to organize
"a Company, and they named me President," and so on. What Company was that to
which you referred ?

A. — The original Canada Pacific ; but we never got any contract. It was the opposite
way. In the provisional Company I was made President. It was only a provisional
Company, and was entirely abandoned.

(2. — Am I to understand that there was such a proj^^cted Company which subsequently
resulted in nothing ?

A. — There was, undoubtedly; but it resulted in nothing. There were only two
Provisional Companies.

Q. — That was the Company you announced in your letter to Mr. Cass?

.4— Yes.

Q.— In the letters of the uth and 7th August you state that an agreement had been
entered into?

A. — That referred to the letter on the 30th July, and to Sir John A. Macdonald's
telegram of the 2rith July.

(I. — That, you state, I think, was an inadvertent statement ?

A. — Yes, it alluded to the letter of the IlOth July, and to Sir John A. Macdonald's
telegram of the 2t)th July, which was the only agreement ever made.

Q. — Sir John's telegram ?

A. — Sir George's letter of the 30th July, founded on Sir John's telegram, but it was
subsequently objected to by Sir John and withdrawn.

Q— Then you state ir. a letter of the Kith July, that Sir George Cartier announced to
you that he did not iiitenc? to give the contra' t to your ('ompany, and that he never had
intended to do sn. Is that the iirst distinct announcement you had?

A. — Yes ; that was the first distinct announcement.

(I. — There are several allegations made ; you !:ave no doulit seen the published letters
of Mr. McMullen?

A. — Some of them ; but I don't think I have seen the whole of them.

Q. — There is one published on the 16th July, in the Montreal 'Herald,' and it
contains an allegation with respect to the payment of several sums of money which ho
stater? you alleged to have paid. We will o;o over these sums in order that you may
have an o]ij)ortunity of stating what you liave to say with respect to them. He says
that lie (meaning you) at one time announced that the $8,r)00 of which he speaks had
been lent to Sir John Macdonald and Sir Francis Ilincks, in sums of $4,000 and $4,500
respectively ; with a very good knowledge tliat they were never to be repaid ?

CANADIAN PACIFIC RAILWAY.

20!)

A. Macdonald's

•am, but it was

)ublished letters

A. — No such transactions ever took place.

Q. — Did you ever maivc such a statement to Mr. McMullcn?

A. — Not to my remembrance.

Q. — There is a reference to another sum of $r)0,()00 about which you said you had
some conversation witli Sir Francis Ilincks, and he said that at his time of life he should
preferan absolute pcment ol' $")(), 000 to a ])ercentagc of tlie ultimate i)roiits?

A. — No such conversation took place. 1 never sjwke to Sir Francis Ilincks on the
subject of money in my life, in any form, in this connection.

Q. — Are you able to state whether you made that statement to Mr. McMullcn or not?

A. — I do not recollect any such conversation.

Q. — As to the conversation with Sir Francis Hincks, as to securing for his son the position
of Secretary to the Company at a salary of !?2,000?

A. — That is an entire mistake which Mr. McMullcn has made. Sir Francis Ilincks
applied to me to get his son an appointment in the Warehousing Company at Montreal.
I don't know how Mr. McMullcn came to know anything about it, but Sir Francis Ilincks
never applied for his son to l)e em])loyed on the Pacific Railway. He was looking for
employment for liis son, and I v;as President of tlic Warehousing Company, and without
any reference to the railway or the contract, he happened to ask me if I knew of any-
thing that M'ould suit his son, and tliis quite casually. He asked me something about
whether there was anything in the Warehousing Company likely to suit him. I said I
did not know, and he never got any appointment.

Q. — As to the allegation that several sums had been paid for dificrent newspapers and
!iG,O00 to Attorney-General Ouimet ?

A. — I never paid any sum of any kind to Attorney-General Ouimet.

Q. — What about tlie newspapers?

A. — As to the newspapers, 1 discounted a note for the proprieters of ' Tiie Minerve,'
which they agreed to pay in advertising. I think that was the only transaction I had
witii any newspaper.

Q. — What amount was it ?

A.— I tliink it was $4,000.

Q. — Then there was an indefinite loan of $10,000 to Sir Francis Ilincks?

A. — I never loaned any money to Sir Francis Hincks.

Q. — In addition to the payments s])okeu ol', Mr. Abbott was authorized to promise
Mr. Langevin $25,000 to aid in the elections about Quebec on condition of his friends'
assistance ?

A. — I never heard of that before I saw it in the newspapers. He was not authorized
by me.

Q. — And Mr. Abbott reported that he had done so ?

A. — He never reported so to me.

Q. — Then there is another portion of this letter to which I wish to call your attention,
it is as follows : — " After having Sir George sign the agreement as stated in the letter of
" the 6th August, he commenced paying money, but as be told me, having Cartier's onler
"in each case, and taking his receipt therefor. \Vhen making the agreement lie liad
" no idea tliat the amount of money would be excessively large : and when it had run up
" to l)etween $150,000 and $200,000, he became alarmed, and told Carticr that he must
" stop paying the drafts which were coming in so rapidly unless the whole Government
" would sanction the bargain. He then stated tliat Sir George sent to Ottawa and
" received a telegram from Sir John Macdonald confirming his action. After tliis Allan
'■ said lie proceeded paying until he had advanced $358,000 in addition to tlu; s40,(IOO
" drawn from New York. I promised to submit his statement to my friends in New
" York, and leave the matter for them to decide"?

A- -I wasalisent from the Province during the whole of that time, therefore the whole
of that is impossible.

Q. — I'rom what date ?

A. — I leit on the 13th of August, and did not return till the 3rd September, and the
elections were going on during that time. A large amount of money was paid during my
al)sence and before I went, and there was no money paid that I did not know of before 1
loft, or did not sanction when I was away, therel'ore I could not possii)ly have made such
a statement.

Q. — Did you at any time tell Sir George Cartier that you must stop paying tlie drafts
which were coming in so rapidly, unless the Avhole Government would sanction tlie
bargain ?

A. — No, I never had any intervi^'W or conversation with Sir George Cartier on that
subject.

Canada.

17,'.' :< 4 ■*

[:• '^ I'

210

CORRESPONDENCE RELATIVE TO THE

Canada. Q — Xhc entire conversation you had with him was that ahcadj' stated ?
^.— Yes.

Q. — Do you know if Sir George sent any telegram to Ottawa on this sulijcct, or
received any ?

A. — I never saw or lieard of any.

Q. — You stated that the first intimation you received unfavourahle to the admission of
your American associates in the enterprise, was that letter of Sir George Cartier's of tlie
16th July?

^.— Yes, of the 16th July, 1872.

Q. — Had you at any time any stock in your name .as a cover for the American capi-
talists, either in tlie Canada Pacific Company or in tlie i)resent cliartcred Company?

A. — Never. No Americans tliat I am aware of have the slightest interest in the Cana-
dian Pacific, either direct or indirect. I never had any stock in my name any time tliat
represented Americans.

Q. — Can you state particularly the conversation \vhich passed between you and Sir
Francis llincks at the first interview, when it was suggested to you to apply to American
capitalists for assistance ?

A. — At this distance of time I could not give any definite statement of tlie conversation,
but I can give the general terms. Sir Francis Hincks came to my office in Montreal, and
pointed out to me the I'act that owing to the union with British Columbia, a railroad of that
kind would have to be built ; and that the Government had begun to inquire as to the means
by which it could be built, and he himself was very anxious about it. Tliey were not
prepared to do anything, and had not made up tlieir minds respecting it ; but he wislied
to make inquiry in order to sec in what way it could be carried out Avheu the time came.
He then stated that he felt very anxious that some of our own people should take it
up and not leave il; entirely in the hands of the Americans. He had no olyection to
American connections, but lie thouglit the principal ])arties in it ought to be Canadians.
Ht> told me of an interview he had had with Mr. Waddington, Mr. Smith, and Mr.
McMuUen. He strongly recommended mo to talvc up the enterprise, as being one whidi
must redound greatly to any person who carried it out. He urged that it was a great
enterprise ; if the promoters succeeded they would be conferring a great lienefit on tlio
country. I was very relucta:it to go into it at all. I lelt that it was too large a matter,
and too important, for a man with so much business on his hands as myself to engage in:
but he was very urgent, and finally he persuaded me to agree to enter into it. At the
same time I was very reluctant to do so. He then said tliat the best thing to do was to
put myself in communication with those jjarties Avho have applied to us; you can make
your own arrangement with them. You will find those gentlemen at New York, and you
will find them more likely to take it up than the people in England, because they have
already constructed two railways across the Continent, and arc about commencing a third.
They are much more likely to undertake it than our own people, who do not know any-
thing about it, and who would be afraid of so large a sum.

Q. — Were you induced by that conversation to enter into communication with your
American r'-sociates ?

A. — I was.

Q. — Then I suppose you attached yourself rather strongly to the idea of building the
Railway hy these means ?

A. — I did. I became, I may say, passionately enamoured of it, and determined that if
it rf>uld be carried through by any means, even by a large expenditure of my own money,
I would carry it through.

Q. — Except from Sir Francis Hincks did you receive any encouragement from the
Government to enter into communication with your American associates ?

A. — No, never.

Q. — From no other members of the Government ?

A. — No. They were very reticent on the subject. After two or three months liad
elapsed when it appeared tliat the West had taken up o])position to it, the Government
began to indicate that they were also opposed to it.

(2.— Did you ever receive any encouragement from any member of the Government
except from Sir Francis Hincks?

yl. — Never,

Q. — You ''It a good deal disappointed at the result ?

A, — I di' (ideed ; very much disappointed.

Q. — With M'hom originated the idea of a new Company or tlie amalgamation ol the two
Companies ?

A. — I think it was witli Sir John Macdonald the whole of these things originated.

CANADIAN PACIFIC RAILWAY.

211

o not know any-
ation with your

of building the

jment from tlie

le Government

Q. — That was against your opinion and wish ?

A. — It was. I was satisfied that the first arrangement would have bee nmost
successl'ul.

Q. — Do you knoAV when the Government became first acquainted with tlie agreement
between you and your American associates of December, 1871 ? They were not aware
of it at that time ?

A. — No, not for long after.

Q.—Not at the time of the legislation of 1872 ?

A. — They were aware that negotiations were going on and had gone on, but they had
never seen the agreement.

Q. — Did you consider the telegram of Sir John A. Macdonald of the 2Gth July, as the
basis of an agreement to be made ?

A. — Undoubtedly that was the basis, and the only basis, we had to go upon.

Q. — Has that basis been adlicred to or departed I'rom?

A. — As iar as it could be it has been adhered to. It suggested an amalgamation, and
at the meeting at Ottawa after the elections I acquiesced in all the proposals, and wrote
to jNIr. INIacphersoii, and requested him to meet me in Ottawa, tj carry out Sir John's
telegram of the 2Gth July.

Q- — By whom was Sir John's disapproval of the letter of the 30th July communi-
cated to you?

A. — Sir George Cavtier communicated it to me on the .31st July I think; but I think
it was not direct to me, but to Mr. Abbott, and through him to me.

Q. — I mean the telegrams which Ibllowed the letter from Sir George Cartier of the
m.h July?

A, — I sent a telegram upon the 3lst, and I think Sir John telegraphed down imme-
diately to Sir George Cartier his objection.

Q. — You stated that yon were a very large subscriber of money for the support of the
elections. That money Mas subscribed about what jieriod ; can you state the time ?

yl.— On the 30th July, I agreed to that anKuint of $(!(),00O or 875,000 I think, as stated
in Sir George Cartier's letter. He mentioned the amount he required on that date. I
agreed to that, and subsequently within a day or two before I left I'or Newfoundhuid he
stated that he wanted a further sum, and I sent him over the letter to put down what
lie wanted, and he did put it down. I agreed to that also. That Avas the last I heard
of the matter until I had gone to Newfoundland, and when I was in Newfoundland,
I received two telegrams, I think from Mv. Abbott, on the subject of money. Tiiese
telegrams I agreed to. He telegrai)hed me also with regard to the reeeijit from
I\Ir. Langevin, but I did not get the telegram and did not kno'v of it at the time.

Q. — The letter of Sir Geoge Cartier of the 24th August, cT which a copy is i)ublished,
is in these terms: — "In the al)senee of Sir Hugh Allan, I shall be obliged by your sup-
" plying the Central Committee with a further sum of ^20,000 upon the same conditions
" as the amount written by me at the foot of my letter to Sir Hugh Allan, on the
" 30th ultimo.

(Signed) "GEORGE E. CARTIER.

"P.S. — Please also send Sir .Tohn Macdonald !? 10,000 more on the same terms."

What was meant l)y these expressions, " the same conditions" and "the same terms?"

A. — It is difficult to say what Sir George meant by those words. He was not a man
with whom you could talk very much, because^ in rll the interviews with him he
jrcncrally did most of the talking himself, and you could with difliculty say anything.
1 never understood exactly what he meant on any of these points. I was quite satisfied
that he jirobalily felt that he did not like to be under such very heavy obligations, and
Avould endeavour at some future time, to make it up by subscription or otherwise. I did
not think that he had any very definite idea, and I did not think it would be done.

Q, — He says, "as written bv ir.o at the foot of my letter to Sir Hugh Allan, of the
oOth ultimo"'?

A. — That IS liie recouping, 1 sujjpose.

Q. — Did you ever receive any other letter from Sir George Cartieron the snbjcct ?

A. — Never.

Q. — "The friends of the Government will expect to i)e assisted with funds in the
"pending elections, and any amount which you or your Company shall advaiue for that
"purpose shall be recouped to you." This is the letter to which he refei', in the
letter of the 24th August ?

J.— Yes.

Q. — This was all the communication in writing between you?

A. — That was all the communication I ever had from Sir George on the subject.

Canada.

I }•>/■

212

CORRESPONDENCE RELATIVE TO THE

Q. — And you had no further conversation with him than what you have mentioned
which toolv place on tlie oOth July ?

A. — I think I only saw him once or twice after the 30th July, previous to my leaving
for Newfoundland. I was very much occupied, and during that time we had no further
conveiaution on tlie subject of tlie money. lie did not require any more then.

Q, — Had you any understanding with Sir George or any other member of tlie
(rovernment, or derived from any quarter that you were to receive certain advantages
for the subscriptions which you gave — certain favours from tlie Government for the
subscription whicli you gave — towards the elections ?

A. — Certainly not.

Q. — Had you any expectation of receiving any such favours?

A. — No, I had not the slightest.

Q. — Have you received any favours from the Goverument ?

A. — I have not.

Q. — What is your position in the Canadian Pacific Railway Company ?

A. — I am President of the Compuny.

Q. — Have you any other advantage than that?

A. — None whatever, except the paying out of money.

Q. — Were you elected President through the influence of the Government?

A. — Not to my knowledge. I am not aware that the Government exercised any
influence over anyone. I was elected unanimously, and many of the persons I had never
seen before, and did not know.

Q.- — What was your motive in subscribing so largely ? I will ask you a preliminary
([uestion, Had you ever subscribed so much in any previous election?

.1. — Never anything like it, and on this occasion I was actuated by a variety of
motives. They did not all come into operation at the same time, but from time to time.
I was very desirous to support the present Government in its commercial views. The
policy that it had inaugurated was entirely according to my feelings and wishes, as being
right and proper for the development of the country and for the advantage of the
Dominion. They had undertaken a very large emigration scheme and very large canal
expenditure, so as to make our internal communications superior to any other country,
and to bring down all the produce from the West in this direction, which I was very
much interested in tb.eir doing. Tliey had undertaken to enlarge tiie harbour of
Montreal to a very great extent. They had undertaken and built a vast number
of lighthouses all through the Dominion, and their commercial policy was of the
most enlightened character, and such as I entirely approved of; and I thought it was
my duty therefore to sustain that policy, and I was to a large extent influenced by
that motive, partly of course in consequence of my own interest in it, and partly in
consequence of the great development of the country which it was sure to bring about.
Then again I was interested in the Northern Colonization Road. I had expended a
large sum ol' money in bringing it to the point it had then reached. Its prospects were
not BO brilliant at that time as they are to-day, and there was some doubt whether it
would go on or not, but I saw at once that if the Pacific Railway was built the
Northern Colonization Railway would become a necessity. Montreal especially could
not do without it; could not do without a direct connection with the Pacific. That road
would have carried all the trade which the Pacific Road might bring across the Continent
for shijiping by sea. I had a further interest, inasmuch as the members of the present
Government were among my own friends and acquaintances ; I had known them for
many years, and although I am no politician myself, and never voted at a Parliamentary
election in my life except once, yet the members of the Ciovernment were persons with
whom I was always in contact, and I wished to assist them in every way possible, I
Avas also interested as being largely engaged in the carrying trade, and I saw that my
interest was to support the j)resent Government in their position,

(J.. — You had a very large sum of money invested in your steamships and other
enterprises in the country?

A. — A very large sum.

Q. — This sum which you gave amounted to nearly $400,000 ; was that not sufficient
to cramp you or distress you very much in your monetary afliiirs ?

A. — Not at all ; I gave it entirely from my own funds. I never borrowed any or
asked any from anyone. I never encroached on the moneys of the firm. I did not
even speak to my brother on the subject, and never drew a shilling from the firm for the
purjjose. It Mas entirely out of my own pocket.

Q.— Do you know how this money was distributed ; how it was spent?

A. — I know nothing about it.

%:, <:■

CANADIAN PACIFIC RAILWAY,

213

lave mentioned

)u a preliminary

at not sufficient

jOth July mentioned about your being
What did you understand by that ; by

Q. — Sir George Cartier's interview with you was on the 30th July. When he asked
you to subscribe, was any allusion made to the contract for the Pacific Railway ?

A. — No, not more than the fact that the letter was written that morning.

Q. — He did not say " You have helped us, we will help you ? "

.1.— No.

Q. — Did he intimate anything of that kind ?

A. — He did not.

Q. — Sir George Cartier in his letter of the
repaid, or recouped I think is the word he used,
wliom were you to be recouped ?

A. — That is one of the points on which Sir George did not give any explanation. He
talked in his usual abrupt manner about money, and he said he would get up a
subscrii)tion among the l)arty to pay mo back, or at least a portion of it. He did not
suppose that he would be able to realize the whole of it, but he talked about getting up
a subscrij)tion to pay back a portion of it. I myself did not believe that anything of the
kind could be done, therelbro I placed no confidence in the statement.

(2. — Was there anything to justify you in supposing that it would be repaid out of
moneys to be devoted to tlie construction of the Pacific Railway?

A. — It was impossible, and it could not have Ijeen done if he had.

Q. — Do you know the Hon. Mr. Foster, Senat'-'*?

yl.— I do.

Q. — Was Mr. Foster present at any interviews you had with Mr. !MciIullen ?

A.—l could not say in reality, I am not certain.

(2.— Have you ever had any conversation on the subject of these matters witli him,
MJiich are stated in Mr. McMullen's letter ?

A. — I never had any conversation with him on the subject of the Pacific Railway at
all, except tliat he was very anxious to become a Director, and I was very anxious to
liave him one. That is the only point on which I had any conversation with him. He
never spoke to me about any of the other matters referred to, so far as I remember.

Q. — Can you not say whether he was presen*^ or not at any interview you had with
Mr. McMulleu?

A. — No, I cannot say.

(J,. — Did you ever speak to him on any of the subjects respecting those payments of
money, or tlie other allegations made by ]\Ir. McMuUen?

A. — Not tliat I remember. I think I never did. I may have had a conversation, but
in a very slight and indirect manner, with Mr. Foster on this subject ; but I don't
remember ever speaking to him about it.

Q. — You say that you were absent from the 13th of August to the 3rd of September?

A. — I think those were the dates.

Q. — Have you with you any memorandum from your books showing when the
difl'erent payments were made, and to whom they were made ?

A. — I have not.

Q. — Can Mr. Abbott state when these payments were made ?

A. — I cannot say. He would be more likely to be able to state them than 1 would.
These difl'erent payments were made, I think, as stated in the letter published. I think
on the 14th of August a furtiier payment was made in my absence.

(2- — Then all the sums except that amount paid on the l-lth of August would, I
understand, probably have been i)aid before you left?

A. — Not the whole of them; probably more than one was paid after I left. I think
Mr. Abbott paid three sums after the 13th August.

(I — Would you have the goodness to look at that letter from Sir George Cartier, of
the 30th July. ' I observe that the body of the letter is not in his handwriting, but the
signature is his. In whose handwriting is the body of the letter?

A. — I think it is Mr. Abbott's writing.

Q. — Mr. Abbott stood in confidential relations to you apparently. What were they ?
What was the position in which he stood towards you ? Was it as a professional adviser
or otherwise ?

A. — Scarcely as a professional adviser, and yet, to some extent, it was so. He was
deei)ly engaged with me in all these railway schemes, and as such we had become
closely allied in all matters of this kind. He was w ith me at all the interviews I had
witli Sir George Cartier, and I did nothing on any point without consulting him.

Q. — Then he was present at the time Sir George Cartier made this appeal to you to
subscribe for the assistance of the Government at the elections ?

.1. — He was, but his recollection of what took place differs a little from mine. AVhile

2 E

Canada.

21t

CORRESPONDENCE RELATIVE TO THE

Canada.

r,'f

I think he mentioned $100,000, Mr. Abbott thinks Sir George did not mention any sum,
but only spoke of a large sum.

Q. — Was he present at the interview from the first to the last ?

A. — He was.

Q. — And had the means of knowing all that passed on the occasion?

^.— lie had.

Q. — Did he, or did you, or did Sir George suggest a letter of request to be put in
written i'orm ?

A.— I did.

Q. — Were the terms of the letter settled at that time ?

A. — They were settled by Si' George himself, I think, without consulting us. He
dictated the letter, I think, to Mr. Abbott, without allowing any interference.

Q. — Then this letter was Mritten at the time ?

A. — I am not sure whether it was written at the time or during the interval between
the morning and afternoon.

Q. — You saw him again in the afternoon ?

A. — Yes.

(2.— Was IMr. Abbctt present then ?

-4.— Yes.

Q. — Was it then that the letter was signed ?

^.— Yes.

Q. — Had you any conference in the meantime with Mr. Abbott as to the terms of
that letter ?

A. — I had not. We did not know what Sir George wanted, or how he proposed to
state it at all. We were not going to dictate to him what he should say.

Q. — I should like to hear again if you remember the way in which Sir George
approached the subject of a money subscription ?

A. — It was in a very abrujjt manner. As we were going out at the door after
arranging tlie first letter of the 30th July, he turned about and said : " Will you
" help us at our elections"? or "Are you going to help us"? or something to that
cflect.

Q. — Did you make a reply ?

A.—1 did.

Q.— What was it?

A. — I said that I had been always in the habit of giving something to the elections,
and no doubt I would do so on this occasion.

Q. — Who spoke next — what Avas next said ?

A. — I am not sure; but 1 think it is possible that I said to him, "To what extent will
you require assistance?" or, "What do you want?" and I also suggested that he should
put in writing what he wanted.

Q. — Your recollection is that he said ,$100,000 would be wanted?

A. — Yes. 'Sh. Abl)ott thinks he did not mention any definite amount.

(2. — After he named that sum, what did you ask him to do?

A. — To i)Ut the request in writing.

Q. — Wliy did you wish the request in writing?

A. — I wislied to have some authority for payment, and to know what I was doing.

(i.— What purpose did you tiiink that would serve?

^'l. — Nothing beyond being more satisfactory to myself. Men of business generally
require things to be done in that way.

Q. — I understood you that, notwithstanding what Sir George Cartier had said about
making a subscription among his friends, and raising some portion of the same, you
yourself had little hope of being recouped?

A. — Very little hope indeed.

Q. — Why did you think it necessary to have this letter written ?

A. — Simply because, as I thought, as a man of business, I should have an authority
for the large sums of money I was going to pay.

Q. — This, then, is the only document that you have which relates to any agreement or
arrangement in respect of that money between you and any member of the Government,
or the only one that was ever executed?

A. — The only one that I know of

(}, — And no understanding or condition was made, though not expressed in writing,
as to the receipt of that money, or as to the mode in which it was to be recouped, or as
to some advantage which was to be given to you ? ; , .

A. — None whatever.

CANADIAN PACIFIC RAILWAY.

215

mtioii any sum,

st to be put in

nterval between

to the terms of

V he proposed to

lich Sir George

to the elections,

an authority

Q. — I observe in the letter of the 7th August you speak very definitely. Have you a Canada.
cojjy of that letter with you ?

A. — I have not.

Q. — Tlie words used are these : — " It is unnecessary to detail the various phases
'• through which it passed, but the result is that we yesterday signed an agrccmeiil by
" whicli, on certain monetary conditions, they agree to form a Company, of which I am
" to be President to suit my views, to give me and my friends a majority of the stock,
" and to give the Company so formed the contract lor building the road on the terms of
"the Act of Parliament." You explain that in using the word "yesterday' in your
letters of the 5th and (5th of August, written to General Cass and Mr. McMullen, you
merely meant to convey the idea that it was recently, the letters having been written in
a hurried manner, you never supposing they would be published, and in botli you refer
to this document, and this only ?

A. — I referred to both letters.

(2. — And this letter goes no further than what is contained in both documents?

A. — No I'urther.

(2. — You say " signed an agreement." You were aware that any document which Sir
George Cartier signed would not bind the Cabinet ?

A. — Yes, I was aware of that.

(2. — Then why did you use the expression, " signed an agreement " ?

A. — It was tlie expression used in the hurry of the moment ; undoubtedly the agree-
ment was just so made.

Q. — Was it upon any opinion you had expressed in a letter of the 1st in which you
say : — " On a calm view of the situation, I am satisfied myself that the decision of the
" question must ultimately be in the hands of one man, and that man is Sir George
" Cartier, the leader and chief of the French party, who lias held the balance of power
" between tlie other factions, and has sustained and kept in office and existence the entire
" Government for the last five years." Did you take what Sir George Cartier did as
according to your view of the situation equivalent to an agreement with the whole
Government ?

A. — No, I cannot say that I did. I looked upon it simply as an agreement that he
would promote our views when the time came, in the Cabinet, and until the telegram
was made known to me that Sir John Macdonald declined to accede to it, I looked upon
it as a kind of agreement.

Q. — You arc still more definite in your letter to Mr. McMullen of the Gth, wherein
you say, "He yesterday signed an agreement by which on certain monetary conditions
"they agreed to form a Company, of which I am to be President " ?

A. — These were merely expressions made use of in consequence of the communication
with Sir George Cartier. I had no communication with the Government at all.

Q. — And the only documents embodying Avhat you have called an agreement

are

George

Cartier, and one other

the longer

contained in this letter of the 30th July, by Sir
letter?

A. — The only ones.

Q. — ^This letter of the .30th July, will you have the goodness to look at it^
letter of the 30th July. In whose handwriting is that letter, the body of it ?

A. — There are two writings in it, and I do not know either of them.

Q. — When was that signed ?

A. — It was signed, I should think, between twelve and one o'clock on the 30th July.

(2. — On the occasion of the first interview ?

^.— Yes.

Q. — On the first interview you say the money was sp*" iien of?

A. — Yes, at close of it.

It was immediately alter that interview that that letter was signed, and immediately
afterwards the money was spoken of.

Q. — Was anything said about money before the longer letter of the .'50th of July was
signed.

A. — Nothing whatever.

Q.. — Was Mr. Abbott present on that occasion also ?

^.— Yes.

(2.— I do not desire to press the question which I am about to put, but I should like
you to answer it if you have no objection. It seems a very large sum lor anyone to give
towards such a purpose, and as I only know by report your means and the extent of the
capital employed in the various undertakings in which you are engaged in connection
with railway and otlier great enterprises, if you have no objection, I should like you

2 E 2

mm'

V. c.

216

CORRESPONDENCE RELATIVE TO THE

Canada.

Ls'lS

to give a general statement of the amount of capital you have in these undertakings. Of
course it is a question I do not jircss if you do not choose to answer?

A. — I have no objection to answer. I consider that my property, invested in various
ways connected with the country, in business of all kinds, amounts to about $0,000,000.

Q. — Then all the interest that you speak of in connection with your investments in
this wpy would be promoted by the policy of the Government?

A. — It was with that intention that I supported them.

Q. — Was there any discussion as to the exact terms of this longer letter before it was
signed ?

A. — I think there must have been.
. Q. — Do you remember what it was ?

A- I am not quite certain what it was, but I think I probably wished to have a larger
amour..; of influence in the Company than the Government were willing to give me, and
I think it was probable that that was the point that we discussed together. I think it
was entirely the organization of the Pacific Railway, and I think it only referred to the
amount of influence I would have in it, and nothing else.

Q. — Claims made by you for more favourable terms and not conceded by Sir George?

^.— Yes.

Q. — Are you aware that Sir George at one time, according to tiie evidence before us,
had an opinion entirely unfavourable to the introduction, not merely of American control,
but of American capital in this enterprise ?

A. — I am aware that he had, up to the very last moment, when the ultimate contract
was signed, and on that day when I had the interview with him in regard to this matter,
one of the conditions was that no American capital or control was to be introduced into it.

Q. — Did you at any time consider him hostile to the interests you were desirous ol
promoting ?

A.— I did.

Q. — Up to what period did you consider him decidedly hostile to the interests you
thought it desirable to promote ?

A. — Up to the time that a Committee of his constituents came up to Ottawa and
visited him, for the purpose of influencing him on the subject. There was a large
meeting held of his principal supporters in Montreal, and they, entertaining the opinion
generally held in Montreal, as to his hostility to the organization we had formed,
appointed a Committee to come to Ottawa and assure him that if he continued that
hostility, he would not be re-elected for Montreal. I understood from them afterwards,
that Sir George had agreed to abate his hostility and forward the views expressed by his
constituents as far as possible, but I have no doubt it was that hostility which caused tlio
loss of his election in Montreal.

Q. — AVhen was that deputation ?
^ A. — I think it was during the St^ion of Parliament.

Q. — That is the one Mr. Leblanc speaks of?

A. — The same.

Q. — You used all the influence you possessed in endeavouring to mould public opinion
in unison with your own views; were you in any way inst -omental in stimulating the
feeling that prevailed in favour of views which Sir George did not approve of?

A. — I was no doubt very influential in raising public opinion in Montreal in favour oi'
the scheme, and there is no doubt that meetings were held and means were used to
diffuse information, which had a great effect in causing a feeling to arise against Sir George
Cartier.

Q. — Did you know anything of this deputation waiting on Sir (jeorge Cartier during
the Session ; did you know anything of it before it was formed, or of the intention to
form it before it was formed, or when did you first become aware of the appointment of
the Committee?

A. — I first heard of it iu Montreal. There was an intention of sending up a Committee
for the ])urpose. I was aware that they had held a meeting and appointed a deputation,
but I did not know anything about what the instructions to that Committee were, or
what the action of the Committee was.

Q. — When did you first discover that there was a change in Sir George Cartier's views,
or that yielding to the pressure of opinion he was disposed to change them ?

A. — Immediately after the deputation called on him. I was at Ottawa within a few
days of or at the time the deputation was here. I happened to meet Sir George, and I
thought I observed some change in respect to his views.

Q. — Can you fix the date of that ?

A. — I cannot.

Q. — Was Parliament in Session at the time you met Sir George ? ['

CANADIAN PACIFIC RAILWAY.

217

uiidertakinsrs. 01'

itter before it was

d by Sir George?

the interests you

Id public opinion

A. — I think it was. I tliink it was within a day or two after that deputation was up Canada.
hci-e. —

Q. — You were with a deputation that waited on tlic Government at Ottawa ?

A— Yes.

Q. — What is your recollection of wliat occurred on tliat occasion. What gentlemen
were with you representing the interests you were desirous to promote ?

A. — Mr. Smith, Mr. McMullcn, and mysell", I think, were the only ones to represent that
interest. There was, perhaps, anotlier, but I think there were only three. I think the
members of the Government luimbered altogetlier nine or ten, and the discussion was
participated in by Sir Francis Ilincks and the deputation. Sir George Cartier never
spoke during the whole time. Very lew of the other members spoke at all. No opinion
was expressed by the Government on the subject.

Q. — Do you remember what was said ?

A. — I remember that I explained to them the route by which it was proposed to take
the railway, the advantages it would give to the Provinces, the means by which it could
be built, and the results that would i)robably arise from it, I don't think anything was
said by any member of the Government except merely asking explanations on points
which they did not quite understand,

Q. — Was that the interview at which you were asked to make some proposal '!

A. — It was.

Q. — What did you say ?

A. — I said " Are you prepared to accept a proposal if I make one? " Sir John replied,
" We arf> not prepared to accept any proposition ;" then I said " I am not prepared to
" make one."

Q. — Returning to the money question once more, I understand you to say that you
had no hope or expectation of receiving that money back again ?

A. — Not the slightest.

Q. — You say you got this paper as a sort of business matter. Did you make any entry
in your books as to the disbursement of that large sum of money ?

A.— In my own private books.

(2. — What was the I'orm of the entry ?

^1. — I don't keep it in regular style and make entries in it.

Q.— Is there any entry made which would indicate any source from which you
expected to have those large sums repaid to you ?

A. — A considerable portion of the money was expended in the Northern Colonization
Road. I do expect to get back some portion of that money because it was legitimately
expended for railway purposes. There was a large amount of money expended on the
PaciKc Railway, I having paid all the preliminary expenses connected with it. I do not
expect to get that back. In all probability I will not. There was a large sum expended
on the Ottawa and Toronto Railway. I think when that comes to be organized I will
get that back. I have paid for surveys, and paid tiie conimissionere for getting bonuses
from the municipalities, altogether quite a large sum of money, and I expect to get that
back. The portion of money paid to assist in the elections directly I don't expect to be
repaid.

Q. — That is the money you disbursed to Sir George Cartier, Mr. Langevin, and Sir
John ?

^.— Yes.

Q. — And the subsequent moneys, paid through Mr. Abbott ?

.4.— Yes, amounting in all to $162,000.

Q.— Did you make any entry in your books about those particular sums. Did you
separate them ?

A. — No, I don't think I did. I imagine that my books contain merely a memorandum
of the payments.

Q. — And you have no claim in any way lor their repayment ?

.4.— No, not in the slightest.

To Sir Jolui A. Macdonald, through the Chairman :

Q. — As I understand it, then/.the agreement between you and the Government, or
any member of the Government, may be considered to be confined to my telegram of the
26th July ?

A, — I think so.

Q. — At the time that that telegram was sent to Sir George, on the 26th duly, there had
been no conversation with him or anyone about helping to contribute to the elections.

A. — No, not at all ; it was after that.

Q. — It Avas after that, so that as far as that agreement was concerned there was no
connection between your subscription to the elections and that telegram ?

Wfi*»*»JiW< ,1

'Sl^»W.'"'F"

218

CORRESPONDENCE RELATIVE TO THE

J!^

Canada. yl.— None at all.

Q. — When Sir (Jeorgo niul yourself oiiterod into this ngroemont of the 30th July,
varying the terms of my telegram, its terms were settled before there was any diseussiou
about money matters ?

A. — Yes, immediately after those terms were settled the discussion about money
matters came up.

Q. — Then liis letter, my telegram to liim of the 2nth, and his letter of the .'JOth July,
were all iiefore the conversation took place about the money matter. Then on receiving
my telegram, or after having ascertained that 1 objecti-d to the agreement of the .'JOth
July, you replied to me next day that 1 might treat your letter as waste pa])cr ?

A. — I am not sure what day it was, but it was a day or two afterwards, at all events.

Q. — You authorized Sir (ieorge, also, to telegra])h me that your letter might be
regarded as waste paper, and that the agreement was my telegram of the 'idtli July?

yl.— I did.

Q, — Therefore, any sums you may have advanced to aid in the elections, must have
been after your were aware that I had rejected that letter of the 3()th July of Sir (Jeorge ?

A. — I cainiot say when the actual ])ayments were made.

Q. — The agreements were made on the afternoon of the ."JOth July, and on the 3Ist
you rejjlied that your letter was waste pajjcr?

A. — I am not sure when the i)ayments were made, but I regarded them, at all events,
as having Ijeen j)aid without reference to that matter.

Q. — Yon say that you considered it to be to your interest to support the Government
and its policy in tlie various subjects you have mentioned '!

A.— I did.

Q. — And tliat there was a danger that that policy might be discontinued or reversed
in case of a change of Government ?

A. — I ajiprelicnded it might be so. I did not know that there would be, but I appre-
hended that there might be.

(2. — Now in that communication in that pa])er, respecting the recouping, he (Sn
George) says, " You or your (.'omi)any." AVhat Company does it refer to ?

A, — I am not able to exi)lain what Company was meant. I can only judge from
analogy. Sir George had said before that the Americans were to have nothing to do
with it, therefore he could not have meant th(!m. The Canadian Pacific Railway Com-
pany was not formed, except provisionally, and had no fund. The only other (.company
that he could have possibly meant, was my own firm, and that never paid any of tlie money.

Q. — Sir George did not know of tlie agreements between you and the Americans, and
could not have any reference to them ?

A. — No ; he did not know anything a})Out it.

Q. — You never showed him that agreement, or made any communication to him on
that matter?

A. — I did not, nor to any member of the Government.

Q. — And you kej)t that away even, I take it, from the other gentlemen connected
with the Canada Pacific Railway ?

A. — Except talking about it in general terms to Mr. Macpherson and the other gentle-
men in Toronto, there was no knowledge of it whatever.

Q. — Sir George did not know of it; you never told him?

A. — No, he did not know of it; at least, not from me.

Q. — 1 need not ask you about the loan to me of $4,000 ?

A. — I have clearly stated that.

Q. — Not a word of truth in it ?

A. — None.

Q. — Not only no $4,000, but no dollars at all nor cents?

A. — None.

Q. — You liave stated that you did not give authority to Mr. Abbott to make arrange-
ments with Mr. Langevin as spoken of in Mr. McMulIen's letter?

A. — I do not remember speaking to Mr. Abbott at all on the subject.

Q. — I remark that you state that you gave a discount to 'La Minerva' newspaper.
Was that a business transaction?

A. — A business transaction entirely.

Q. — Had it any reference at all to the Government or to the Pacific Railway?

A. — Not the slightest.

Q. — As a matter of fact, was that arrangement between the proprietors of * La
Minerve,' or with the individuals composing the firm ?

A. — It was not with the proprietors of * La Minerve.' It was with an individual and
not with the Company.

CANADFAN PACIFIC RAILWAY.

!in

n about momv

lued or reversed
be, but I apprc-
ouping, he (Su

ition to him on

;men connected

ve newspaper,

Q. — You made tlieni a discount at your Hank?

A. - I don't renicniber wlietlier it was tlimuf^h the Bank or through myself. It waa
lor a small amount; a mere business trantiac'tion.

(2 — Tbi'n there was no agreement ?

A.~ None.

Q. — Was there any telegram I'rom me to you approving of or confirming the pro-
ceedings of Sir (ieorge Carticr, as stated by Mr. McMullen?

vl." You did not telegraph me at all that I know ol'.

(2. Your received no telegram Irom me approving of Sir George Cartier's arrange-
ment, and the only ac(|uaintance you have of any telegrams from me was one disapprov-
ing of it?

A. — Exactly.

Q. — I see that Mr. McMullen speaks in tliis interview about your being a large
gainer, and that you would be recouped by the (Jovernment deposits, to a large extent,
in the Mercliants' Bank?

A. — The Merchants' Bank has tlie smallest amount of Government deposits of any
Bank of the same class, so that was quite imjjossible. The Merchants' Bank collects at
various points lor the Government, where its other agents have no branches, so there is
a very small amount there, much smaller tlian is usual in other Banks.

Q. — Do you happen to remember the amount ?

A. — It varies every day.

Q. — Can you state the average ?

A.— I think it is from $200,000 to !i<30l),()UO.

Q. — Any profits tliat miglit l)e niadi; on these deposits, to whom would they go?

A. — To the shareholders of the Bank, of course.

Q. — And not to Sir Hugh Allan personally?

A. — By no means.

Q. — You get your jjortion ?

A. — Yes, my sliare of the dividend, that is all.

(^.-Mr. McMullen states tluit you ])rei)ared a memorandum, setting forth all the
telegrams, correspondence, and everything coimected with the Pacific Railway, and
threatened the Government to publish it, and that then they came to your terms. Is
there any truth in that?

A.- — None whatever. ,

Q. — Did you ever make any communication approaching to it?

A. — None whatever.

Q.— It is altogether a falsehood ?

A. — pjutirely.

Question by the Commission.

Had you any communication i'rom the Goveruracnt respecting the suppression of these
letters ?

A. — None whatever.

Q. — Or from Sir John, Sir George, or any other member of the Government?

A. — None whatever.

Question by Sir John Macdonald.

There is a statement by Mr. McMullen that I sent you a telegram stating that you had
"a big tiling," and "must shell out." Did you ever get such a telegram?

A. — I never got such a telegram.

Q. — Or anything like it?

j4.— No, nor anything like it.

Q. — When in one of your letters, Mhicli has been referred to, to Mr. Mc^IuUen, or
Mr. Cass, I forgot which, you say " by tiie means you know of," did you refer to
pecuniary means, or political exertions by yourself, or how ?

A. — I don't know.

Q. — What did you mean when you said in your letter of the 1st July, 1872, that
means must be used to iniluence public opinion ?

A. — It meant simply by newspaper articles and means of that kind. «

Q. — W^orking up the jiublic excitement and so on ?

A. — Yes, the usual way in which such things are done.

And further for the pre:^ent deponent saith not.

And on this 2jth day of September the said witness re-appeared and made the follow-
ing addition to his foregoing deposition :

In answering the question " Was anything said about the money before the longer
" letter of the 30th July was signed ? " I wish to say that nothing was said about money

( 'anada.

220

( OHKKSi'ONDENCE RELATIVE TO THE

C'AifADA.

previous to the terms of it beinj* agreed upon, but reference was made to it iu a later
period ol'lbc! day.

And i'lirtber deponent saitb not, and tliis bis deposition bavin^ been read to bim, ht!
declares tliat it contains tiie trutb, persists tbercin, and batb signed.
Sworn and taken on fbe ninefeentb day of I

September, 1S7;;, and acknowledged [ (Signed) HUGH ALLAN,

on 2r)tb day of said montbaiid year. |

(Signed) "CHAHLKS DEWEY DAY, Cliairman.
A. POLETTE,
JAMES ROBERT GOWAN, Commissioners.

PnOVINCK ni' OSTAIMO,

City of Ottau-n.

IN THE MATTER OF TIIE COMMISSION

Appointing (;M.\Kr,r;s Di:wi;y Day, Axtoi.vm Pomiiti:, and Jami:s RoiiicnT (Jowax, Com-
missioners to in(iuiru into and report upon tbe several matters stated in a certain
liesolution moved by tbe Hon. Mr. IIi;.NTi\(iT0N' in tbe House of (^onmunis on tlie
iiecond day of April, a.u. 187.'!, relating to tbe Canadian raeifie Railway.

Present; 'I'm; CoMMi.s.';i().\i,ns.

On tbis nineteentb day of Sejjtember, in tbe year of our Lord one tliousand eight
bundred and seventy-tbree, i)ersonally came and aj)peared before us, tbe aljove-nameJ
Coinmissioners,

Tbe Honourable .JOHN J. V. ABP.OTT, of tbe City of Montreal, Advocate, who being
sworn, deposetli and saitli :

Q, — You reside in Montreal?

yl.-Ves.

Q. — You are an advocate ?

yl.-Yes.

Q. — And a member of tbe House of Commons?
■ ^.— Yes.

Q. — Do you know Sir Ilugb Allan?

A.—\ do.
' Q. — Have you been connected witb liim of late years in railroad operations?

A, — I bave been associated witb bim in two or tbrec railroad enterprises during tlu;
last year or two.

(^.— Do you know Mr. G. W. McMuUen ?

A.—\ do.

(2. — You are aware of tbe cbarges relating to tbe construction of tbe Pacific Railroad,
and tbe fiirnisbing of money for tbe elections, recited in tbe Commission. Will you have
tbe kindness to state in detail what you know of these matters ?

A. — My first interview with Sir Ilugb Allan on the subject of tbe Pacific Railway was
very shortly after tbe Session of 1871. Then I suggested to him that this enterprise
would be a fit ol)jcct for gentleman of bis position and wealth. To that be replied,
"AVell, ])ut (town your ideas in writing," but this I did not do for reasons Avbich it is
unnecessary to mention now. I did not take any iurtber steps then. Tiie next I beard
«f tbe Pacific Railroad from Sir liugb was when be called on me in ^lonfreal, I think in
tin; month of March, 1872, and :uiked me if I would assist bim, as he was going to take
up tbe t-nterprise. I agreed to do so. and shortly alterwards I met Mr. McIVIiillen at bis
bouse in the evening, at a dinne; j/ivty or something of that sort. He (Sir Hugh) then
told me that be bad made an aiiangenu'nt witb certain American capitalists to foi'ni a
Company to build tbis road; that he bad been in communication witb the Govern-
ment about it, and that be thought they could organize a Company tliat would build
it, and that they would get the contract. As far as I recollect, ho did not show
me either tbe contract or the sup[)lementary contract on that occasion. In fact
I did not see either the one or tbe other mitil within tbe last few days, except the
contract which I saw for a moment at Montreal in the early part of this year, at a meet-
ing I fiad with Mr. McMullen and two of bis friends, and I bave not yet read them care-
fully. He said that tbe Americans bad sketclied a Bill for the incorporation of tlie
Company ; that they thought the best mode of getting tbe road built was by a cor})ora-
tion, and he gave me these two Bills as a sort of basis for the preparation of the legisla-
tion that was required for the incorporation of the Company. I took them, and that was
about all that passed on that occasion. I was not told \^\\o the people were, and I think
did not know until a very considerable time afterwards, except that one of them was Mr.
J. Gregory Smith. I did not know that there had been any formal agreement executed

CANADIAN PACIFIC RAILWAY.

221

it ill a later
cad to him, hu

LLAN.

I'liiaii.
mniissioners.

[ISSION

' Go\VA\, Coni-
x'd in u ceituiii
jiiimoiis on thu
ilway.

tlioiisaiid figlit
u above-iiameJ

ati", \vi;o belli;;

ions r

iscs during tho

acific Railroad,
Will you have

ic Railway was
tliis enterprise
lat lie ri'plied,

ans which it is

le next I heard
cal, I think in

IS goinj; to take
rSl alien at his
ir Hugh) then
ilists to iwin a
1 the Goverii-
it would build
did not show
ision. In fact
ays, except tlie
ear, at a meet-
read them caro-
loration of the
s by a corpora-
of the legisla-
m, and that was
ire, and I think
f them was Mr.
iment executed

at that time, or if I had heard that tliorewas, I did not know its nature. It amounted to
tills, lliat Sir IIu;.;b Allan, jirobabl; reeollectini; my suf^gostion to liin> of the iJi'cvious
year, and knowing that I was fre([iniitly engaged in my prolessional capacity, in the
orgaiii/atii)nH of corporations, ajiplied to me to prepare the necessary Legislation lor tiie
Comjiaiiy to build the road.

1 undertook to do that, and shortly altenvards Parliamiiit met.

I don't know tliat I had any fuvllur iurerview or conversation, cither with Sir Hugh
Allan or Mr. McMullen, uulil utter I'liriianu-nt met. I cainc! up {o Ottawa alioiil the
first w«'ek of the Session, and I found that there was a very considerable feeling in the
House aijainst the admission of .Vmcrican infUunice into the Pacific Railway. In fact I
suggested to Sir Hugh Allan and .Mr. McMullen tliat tlu\\' ])robal)ly would be such a
feeling, and that if they attempted to give to it the character of an .Vniericaii Company, they
might not succeed in passing their Rill. When I readud Ottawa, liowevi r, I louiid this
feeling much stronger than 1 had anticipated, and I louiid then for the lirst time that a
Company had been ])artially organized in Ujiper Canada. A iiiiiuber ofnauu" had been
got which were understood to be jiledged to the formation of a Company to exclude
American capital and American control. I conferred with a noml ni my of the
members, and with some of the Ministers in a general way about this, and I saw plainly
that no CMiarter to incorporate a ('ompaiiy to build tin- road with ^\ merle ai capital, or
leaving the control of it in the hands of Americans, would be sanctioned by either the
Jlouse or ilie Government. A sliort time alter this Sir Hugh Allan cuue himself to
Ottawa ; I think I asked him to come, and 1 told him what I thought was the position
of all'alrs, and that unless he set himself to work to organize a Canadian Company,
and abandon his American project, he could not succeed in what he wished to do.

(2. —About what time was this ?

A, — About three weeks after the opening of the Session. It must have; been about
the end of April, I should supj)ose. I had two or three conversations with Sir Hugh
Allan on thi« point, and Mr. iSlcMuUeii himself had been here before that, and 1 Iiad
expressed tlie same opinion to him. I told Sir Hugh this in the jjresence of Mr.
McMullen, and after some consideration Sir Hugh authorized me to j)roceed with the
jireparation of a Rill for the incorfioration of a ('omjiany that would entirely exclude
American influence and American cai)ital. I should not say American capital, we could
not exclude that if people chose to put it in, but entirely to exclude American indiience,
and 1 understood from that moment that any agreement that had been made with
American cajjitalists was at an end. Subsequently I told Sir John Macdonald our con-
versation ; and I also apjiroached Mr. Mac})herson, and suggested to him, that as Sir
Hugh Allan and his friends were willing to go into a C^omi)any compo.sed entirely of
Canadians, and entirely under the influence and control of Canadians, it would be bi'tter
if lu; and his party, which was strong, should join with Sir Hugh Allan and his party,
which was also strong, in forming one Company for the purpose of taking uj) this enter-
prise — that is one Canadian Company. Mr. Macpherson was not convinced that the
connection between Sir Hugh Allan and his American friends had ceased, nor that the
influence of those people had ceased in the Company ; and this was one of the reasons,
tliough not the only reason for his not yielding to my suggestion to form but one strong
Comi)aiiy — the strongest Company the l3ominion could raise, to proired with the building
of the road. Consequently I th.en in-epared a Charter for the Canada Pacific Railway
Com})any, which was the name given to the Com])any of which Sir Hugh Allan was the
prominent man, and the Charter of the Interoceanic Company was subsequently prepared
and jirinted in nearly the same language.

(2- — They were incorporated by Statute ?

A. — Yes, but the incor|X)ration did not take place for a considerable time after that. I
think the Canada Pacific Bill was printed first, and the Interoceanic Bill afterwards, con-
taining the clauses of the Canada Pacific Bill, and a few more, and the matter remained
in that position until about the beginning of June. The j.'olicy of the Government as I
understood, during that interval, was not settled with regard to these Comi)anies ; that is
to say, they seemed to be unwilling that the incorporation of private Com[)anies should
proceed until their own measure, laying down the principles u])on which they were
prepared to act in carrying out the enterprise, should have either passed the House, or
made such progress before the House, as would enable everyone to know what the
project was really to he.

After this took place, the Bills were allowed to go before the Standing Committee on
Railways.

Q. — The policy of the Government then to exclude American influence was known
before these Acts of Incorporation were jiassed ?

A. — It was known in this way, that everyone knew that there was a strong feeling on

2 F

CiiNADA.

wtm

\p.

000

C'OltUESPONDENCE RELATIVE TO THE

> 1

Canada (In. pmt t)f the Government against American influence. No one knew, as far as I am
aware, that there hafl been any distinct decision by the Government, but yet everyone in
ilie House distinctly understood, tliat either the Government, or the greater number of
the jicntlemen composing the Government, were opposed to American influence being
introdiici'd into the Company, and more especially was Sir George Cartier known to be
opjiosi'd to it. I know myself that on several occasions he expressed himself strongly
against tlie admission of American influence, and apjjcared to show rather a liostile feeling
towards the Allan Company ; and to have the idea that they did intend to take the
Americans into their organization. For some time he apjieared to liave tliat feeling.
About the first week in June, I think, the Bills were allowed to go to the Committee.

The Government Bill having been introduced, and its terms made known, the other
two 15ills were allowed to go to the Committee, and they were passed in exactly the
same language. I do not think that there was any diflerence in them from one end to
the oilier, except in the names of the corporators. The Canada Pacific Company's Bill
had lieen framed with a clause, excluding absolutely all foreigners from being members
of its Board, but the Interoceanic Company's Bill, as prepared, provided only for t'le
exclusion of a majority of foreigners from its Board, and permitted a minority of the
Company on the Board. Before the Committee, the form of the clause adopted by the
Interoceanic Company was inserted in the other Bill, and I believe that both stoor , and
for that matter stand to this daj', allowing a minority of foreign Directors ; but up to
that time there was this difference, that the Canada Pacific Company had provided for
the exclusion of all foreign Directors.

(3.— That is, the draft Bill that you prepared for the Canada Pacific Conpany
expressly excluded Americans?

A. — ^Yes, it excluded all foreigners.

Q. — The other Bill was in the terms you state, providing for a majority ol
Canadians?

A. — Yes. The Bills were read a first and second time and referred to the Committee
on Railways, and in that Committee their terms were assimilated to each other iu the
form adopted in the Interoceanic Company's Bill.

Q. — With the approbation of the promoters?

A. — -Yes; at least I cannot say that the question was ever submitted to the promoters
of the Canada Company's Bill. I was re])resenting them before the Commit 'ce, r.nd as
the (Jovernment were desirous of having the Bills in the same terms, and Mr,
Macpherson's Company were unwilling to put in a clause excluding foreigners, I yielded
to the suggestion that it would be better not to exclude them absolutely, and to make
the Canada Company's Bill the same as theirs. Immediately after the Session there was
a sort of provisional organization of the Canada Company. They appointed a President
and Vice-President, and caused books to be oi^cncd throughout the Dominion. The
books were oi)ened iu the principal towns in every Province in the Dominion, and notices
were inserted calling for subscrii)tions of stock. Tlie greatest possible publicity was
given to these notices, and there was no restriction as to the amount which might be
suiiscrilied. The Company were anxious, so far as I knew, to get all the subscriptions
they possibly could. The matter remained in that condition.

Q. — About what time were those books open for subscription ?
■ A. — 1 think early in July, but I am not quite certain as to the date. Immediately
alter this provisional organization took place, the Company communicated to the Govern-
ment the fact that they had so provisionally organized themselves, and applied to be
granted tlu; contract. They got no immediate answer to that, but shortly afterwards
were informed, I think by a letter from the Government, that the Government desired
that an effort should be made lor an amalgamation between the two Companies.

<f^.— Did you say that they applied for the Charter?

A. — They apjilied for the contract, stating their readiness to conslnict and run the
road in accordance with the Government Act. Shortly after this th^y received ai.
intimation from the fiovenmient that they would like to see an amalgamatio'i of the
two Comjianies, and they immediately communicated with Mr. Macpherson's Company
urging such an amalgamation and expressing their readiness to make it on such terms as
might be agreed upon ; and also communicated to the Government their readiness to do
this. Nothing came of it at that time. The elections then came on, and about the
ccmnnencemeiit of them, I think, I was sent by the Canada Company to Toronto to press
upon Mr. Macpherson the amalgamation. I saw him in Toronto, and I also saw Sir
John Macdonald there on one or two occasions. Tlie substance of what passed between
Mr. Macpherson and myself is detailed with sufficient accuracy in his own printed and
sworn statement. The result was that there were only two points upon which there was

CANADIAN PACIFIC RAILWAY

223

3 far as I am
;t everyone in
iv number of
fluence being
known to be
iself strongly
hostile feeling
id to take the
: that feeling,
committee.
\vn, the other
in exactly the
)m one end to
ompany's Bill
eing members
I only for tlie
linority of the
dopted by the
oth stoor . and
jrs ; but up to
d provided for

nfic Conpany

a majority Oi

the Committee
•h other in the

tlie promoters

mit'ce, r.nd as

rms, and Mr.

ners, I yielded

and to make

ssion there was

:ed a President

)minion. The

on, and notices

publicity was

lich might be

e subscriptions

Immediately
to the Govern-
applied to be
tly afterwards
•nment desired
panies.

and run the
ly received ai»
imatio'; of the
ion's Company
such terms as
•eadiness to do
,nd al)out the
routo to press
also saw Sir
lassed between
n printed and
ich there was

any difficulty ; one was that Mr. Macplierson could not agree to Sir Ilugli Allan being
President of the Company ; the other was that Sir Hugh Allan would not agree to Mr.
Mac])herson's naming a preponderance of the Directors of the proposed amalgamated
Company. These were the two points. Tliis was communicated to Sir John A.
Macdonald, and he at this time endeavoured to assist me in bringing aljout an agreement
with Mr. Macpherson. I think he had one or two interviews with him; and when I
left Toronto his impression was, as stated to me, that these little difficulties could Ijc got
over, and that we would succeed in tjiis amalgamation. That .■•Iso was my opinion.
About the end of July, I think it was on tlie 2nth of July, Sir Hugh Allan called upon
me at my office, and asked me to accompanv him on the following day, at 11 o'clock,
to Sir Ceorge Cartier's house. He said that he liad an ai)j)oiiitnu>nt with him at that
hour. To the best of my recollection Sir Hugh is mistaken in saying that I had been
with him at |)revious interviews with Sir (ieorge Cartier. I do not think that 1 was
witli liim except on the occasion ol' which I have just s]K)ken, iiamel}', the ai)i)ointed
meeting of the 30th July. Sir Hugh called upon me, and we went to Sir George's
rooms and saw him there. Sir George and Sir llugli liad quite a lengthy discussion,
whicii ap|.;'ared to me to flow to some extent irom previous intei\ lews about the jKJsilion
of tliese Companies, about their amalgamation, about the jjrosi'.ects of the amalgamated
Company in connc tion with the Kaihvay ; in I'act, on the whole subject ; and tl.i;y came
to agree in certain views about the malter, wl-.ich were stated l)y Sir (ieorge and Sir
Hugli plainly enough. The basis of their conversation was the telegram which Sir John
A. Macdonald had sent Sir George on the '2(5th July, and Sir Hugh urged certain addi-
tional conditions beyond those mentioned by Sir John A. Macdonald. In point of fact,
the telegram of the 2Gth July appeared n^ally to settle nothing excejit wliat had been
perfectly understood from the first, so far as 1 know, tliatSir Hugh Allan was tiie fittest
person to be President of the Company. That the Government considered him so, and
considering him ao would use their influence to obtain for liim that jjosition; l)ut every-
thing else connected with t!ie railway and tlie enteri)rise was to be postponed until the
elections were over. This position of affairs did not exactly setth; one of the obji-cts for
wliich I understood Sir George and Sir Hugh liad met. The people of Montreal, and a
very large portion of the iieojile of Lower Canada, were extremely anxious to know
sometliing about this railway and its prospects. They thought that the preponderance
of the I'jiper Canada Company meant that the tratlie of the Pacific Railway " oiild be
brought down to Toronto, and over tlie Grand Trunk to Montreal and tlii' il^oard ;
while the preponderance of the liOwer Canada Company would ensure a direct com-
munication to Montreal with the Pacific Railway, by means of the Montreal Northern
Coloni/ation Railway, which the jieojile were also very mucli interested in. In the
interests of Sir George Cartier's election, as well as for other reasons. Sir Hugh ai)])eared
(Irsirious of having something more definite settled than was contained in Sir John's
tel(>gram. The result was that they appeared to agree ujion certain jioints in which Sir
George was disposed to liivour Sir Ilugh's views. Sir Hugh then said to Sir (ieorge —
"Now if you can put these jioints in writing for me, as you state tliem, I think they will
"satisfy our friends." Sir (ieorge was extremely busy, and \\as not a very leady pen-
man at any time, and he said — '' Mr. Abbott has lieard our conversation, let him put
" down what he nnderstands has passed between us, and come back this afternoon and
" we will close it 'p." VVe then rose to leave, and were leaving the room when Sir
George addressed Sir Hugh on the subject of money in the manner which Sir Hugh has
described. He said in an ofl'-liand kind of way, " Are you not going to help us with our
" elections?" Sir Hugh said he woulu, or words to that efl'ect, and said, " How much
" do you want," oi ' How much do you require ?" or sometliing like that. I understood
Sir George to say that there would be a considerable sum required, as there was so much
opposition on various grounds. Sir Hugh said, as far as 1 can recollect, " \Vell, write
" down what you want." Sir (ieorge said very rapidly, " You know you won't lose .t
" all. Our party will make up the greater part of what you give, but we want it now,"
or something like tliat. My memory is very imperfect as to the exact phrases used, as
1 never end(;avoured to recollect them until lately, when the matter became the subject
of conversation. Sir George then said, " Very well ; come back this afternoon. Let
"Mr. Abliott write a note requesting you to advance this money, and telling you that I
"will see that you are repaidjand come back this afternoon at such an hour and we will
"close tlie whole matter up." W'c left upon that; I went to my oHice, sketched a
letter about the railway afl'air, either by di(\atioa or otherwise, I don't remember now
corrected it, and had it copi'^d.

Q.— l would call your attention to these two letters now ?

A.-^l sketched those two letters.

2 F 2

CAWADit

mw^

224

CORRESPONDENCE RELATIVE TO THE

Canada. Q. — You saw them, I suppose ?
^~~^ A. — I sketched them ; I drew them. I sketched those two letters roughly, knowing,

I thought, what to say with regard to the first — the railway affair — hut knowing very
little about the other. Sir Hugh called upon me, and I took these two letters I had
sketched to Sir George Cartier's office with Sir Hugh Allan. The first letter, referring
to the railway. Sir George was satisfied with as to tlie first two jjages of it, but not Avith
the third, 'rii'! letter was written u])on three leaves. He was satisfied with the first
two leaves, hut the conclusion of the letter did not exactly please him. He said " leave
"that off, and I will dictate to you what conclusion to put to it." He then dictated the
four or five Hues which constitute the last sentence of the letter as published, signed it,
and handed it to Sir Hugh Allan. The other lelter witli respect to the money he did
not approve of, and struck his ])en through the most of it, I think, if not the whole of it ;
wrote a lew words upon the draft, and requested me to write it over for him, which I
did. either from his dictatiou or the draft so altered by him. These are the two letters
which Sir Hugh has ])roduccd this morning. I find that my recollection differs a little,
hut not materially, from that of Sir Hugh. I think that the terms of the first letter
referring to the railwiiy were agreed to, but that it was not written or signed at the first
interview ; that is, we were leaving, and after the terms had been agreed to. Sir George
spoke to him about the money in the manner in which Sir Hugh Allan has indicai,ed,
and that in tl e afternoon the two letters were signed. That is my recollection of the
circumstances connected with that. Subsequently, in fact I think some time after this,
the question oi the amalgamation of the two Companies was revived. We received an
informal intimi tion from the Governmeut, or some member of the Government, that it
would be well to have a meeting at Ottawa, I think in the latter end of the month of
September, with the Interoceanic Comjiany, or with leading men from tha*^ C' mpany,
carrying out ))recisely as I understood it the telegram of Sir John A. M, ?do r 'i ol t!ie
2Gth July. Several members of the Canada Company came to Ottawa ifvi '■ iv i : ■ and
some gentlemen, I think connected with the Interoceanic Company, al^ rail,:-, out of
this I am not quite sure. At all events, on our arrival here, or shortly after, we were
informed that the Interoceanic Company had sent in a Memorandum giving reasons for
declining the amalgamation.

Q. — Is that the Memorandum publislied in the Blue Book?

A. — Yes. the first one. We saw several members of the Government about it, and
requested to have a cojjy of that paper, that we might have an opportunity of answering
it. They urged u])on us to endeavour to answer it in sur-h a manner as to remove the
objections of the Interoceanic Comjjany if jiossible, rather than get into an altercation
with them, and so increase the difficulties of amalgamation. The paper was not com-
municated to us at Ottawa, but a copy was sent to us at Montreal. The answer was
drawn u}" as we thought in a very '-onciliatory spirit ; urging the amalgamation strongly,
and endeavouring to dispose of the grounds of objection raised by the Interoceanic Com-
pany, and doing all that we could to endeavour to bring about an amalgamation. This
answer was communicated to the Interoceanic Company, and they replied to it I think.

Q. — Was that the document of the 12th of October, signed by Sir Hugh Allan, your-
self, and Mr. Beaubien ?

A. — Yes ; but I cannot remember the date. We were the provisional Committee. \u
answer was sent to that, which, I think, is also printed. On seeing that answer t
thought that the attempt to amalgamate would i)rove imsuccessful, and I do not think
the Canada Conijjany took any lurther steps to bring about an amalgamation : !,ui we
were informed that the Government had taken up the matter and were making an
effijrt, and of Sir John A. Macdonald's visit to Toronto to see Mr. Macpherson ; and the
probability at first of his succeeding and afterwards of his failure. These efforts were
commenced before the elections, suspended to some extent during the elections, and re-
commenced towards the end of September and carried on until the end of November,
with every desire, I think, on the jiart of the Canada Company to have been successful.
After this, I think cither at the end of November or the beginning of December, lale in
the autum, at all events. Sir Ilugli Allan was 'nformed, and I myself I think verljnlly,
also, that the Government intended to form a Comjjany under the power given tln'iu v
their Act ; that they did not think that it would be i)roper to give the contract to !(■ er
Company ineorjMjrated ; that these Comjjanies were to a very considerable extent section'
and that the Company which should get the contract must be one that would iairiy
represent the whole Dominion. The Govtn'ument then stated that they ^vere endeavour-
ing to get togotlier a Company comiKised of such men as w oald f; :iv' v -epresent the who'e
Dominion, and would command confidence here and u> /"i.gland, where it was supposed
the funds were to be obtained for building the road, Sh» rtly after '\,i.- a few of the gentle-

CANADIAN PACIFIC RAILWAY.

225

ravn whom the Government liad been consulting about the Company, met in Ottawa, and
perhaps every week or so tbey met again, their numl)crs being increased eacli time ljy
persons who were tliought lit to come, and who were encouraged to come in. 1 tliink
that in January the number iiad been j)retty nearly filled u}), and the framing ol' the
Charter was proceeded with. At the meetings here I liad always taken an active part,
and given a good deal of attention to the whole subject, and I came gradually to be i)ut
forward without any formal a])pointmcnt to rejjresent those gentlemen in settling the
details of the Charter ; and tlie Goveriunent corresponded willi me on several occasions
in tlmt sense, and caused mi; to visit Ott<iwa to meet members of the Government for the
purpose of vorking up the (Charter. And in that way during tlie montii of January, and
I think uj) to the 5th of February, the clauses of the Charter were discussed and the
Charter framed, after a very great dual of discussion and attention on both sides. It was
framed as it now is, and was issued about the otb of February, of this year, in the I'orm
which it now assumes.

(<!.— What number of interviews had you with the Government?

-1.— We had several interviews with the whole Cabinet, but the details of the Charter
were settled chiefly witii Sir John A. Macdonald and the 1 Ion. Mr. Campbell.

I don't know whether any narrative I could give you could i)roceed liirther than that
I have given ; but any iurther questions which the Commission may choose to put me I
will be hap})y to answer.

Q. — Did you know oi' the corresj)ondence between Sir Hugh Allan and Mr. McMullen
and Mr. Smith, while it was going on ?

A. — Nothing whatever, I had no idea of it at all.

Q. — Have you any jiersonal knowledge about these telegrams of the IJOth and lilst of
July, to Sir George Cartier, respecting that letter of the 30th of July, embodying the new-
terms of agreement ?

^.— No. I had no knowledge of them until very recently. I was under the impression
until some time ago, that Sir John A. Macdonald concurred in Sir George Cartier's letter,
but I annot at this moment rememljer what caused that impression. It was witliout any
foundation whatever, 1 am satisfied now.

(I — Were you pv^seiit. at any of tlie meetings between Sir Hugh Allan and Mr.
McMullen, excejjt the one yen have mentioned ?

A. — I had an informal meeting on one occasion early in the Session, when I informed
them — Sir Hugh Allan and Mr. McMullen — that unless the American project was laid
aside, it would be useless to attempt to carry out their enterprise. I met them both
frequently afterwards.

Q. — You have seen Mr. McMullen's published letter of July?

yl.— Yes.

Q. — Do you remember the statements made with respect to the payments of, or
promises ol', sums of money ?

A.—l don't remember sufiiciently well what promise you refer to.

C<!.— The first is, tlmt Sir Hugh Allan announced to Mr. Smith and Mr. McMullen tliat
$8,500 had been lent to Sir Joiin A. Macdonald and Sir Francis Hincks ?

A. — I know nothing whatever of that.

Q — It also speaks of !?r)l»,0()0 which Sir Hugh Allan said it was necessary to pay to
Sir Francis Hincks?

A. — I never heard of that except in the newsj)apers.

Q. — Did you ever hear Sir Hugh Allan mention either of these sums, or tliat 'liey
were expected by the parties to whom they were given?

A. — No, never.

Q. — Then the letter says : ** In addition to the payments sjjoken of, Mr. Abbott was
'• authorized to promise Mr. Langevin .'5>2"),000 to aid in the elections about Quebec, on
" condition of his friendly assistance, and Mr. Abljott re|)orted that he had done so .'"

A. — As regards that I think it is necessary to make a statement. In the first i)lacc, tlie
statement in tliat form is entirely untrue, but it ii; quite true that I had a conversiitioiv
early in the Session with Mr. Langevin about the expenses incurred in the elections at
Quebec. Mr. Langevin mentioned to me that at the i)revious general elections he had
been obliged to exjiend a very considerable sum of money, not very large in itself, but
large comparatively, and he said he did not think it fair that the burden of those elec-
tions should rest entirely on him. He said he thought he ought to have a share of any
funds subscribed in Montreal i'or election jiurposes to assist in Quebec, which he had not
had in previous elections, and that they could not exiKict much of a subscription from
Quebec to help the Government. I agreed with him in thinking that it was unfair that
iie should bear the burden of the Quebec elections, and I told him that in so far as I

Canada.

22C

CORRESPONDENCE RELATIVE TO THE

0am ADA.

t ^

Mft H

coiilil liiivo any influence in the m.attcr I would try tliat he should have a portion of any
fund which might he got up in Montreal for general election purposes. Talking over
matters — and I think it is this that Mr. IMcMullen speaks of — it came out in conversation
that i)robably the elections would cost in the district of Quebec, irrespective of his own,
a sum of $25,000 or $30,000. I told him that as liir as I could influence the matter I
would endeavour to get something like tluit amount allotted to the district of Quebec.
That is what took place between Mr. Langevinand myself. 1 did not at that time make
any allusion to tiie position of the Canada I'aciflc and ito Charter. I knew Mr. Langevin
was a strong Lower Canadian, and I thouglit tliat h'.-i friends were all in favour of arrang-
ing the Pacific matter in sucli a way that tlicre sliould be direct communication with the
seaboard at Quebec and Montreal, and I assumen that in any matter in which he could
support tlie views of the Lower Canadians he would do so, and we did not wish anything
more. I never said anything more ; I never reported that I liad made any arrangement
witii Mr. Langevin, though, no doubt, I did mention it to Sir Hugh Allan, that if we got
up a I'und Mr. Langevin should have a part of it to the extent of $25,000,

Q. — Did you communicate this to Mr. McMullen ?

A. — It is not likely that I would do so ; though Mr. McMullen appears to have become
aware of it. But there lias been so much spying and betrayal of private documents and
abstraction of private letters in the course of this all'air, that it is impossible to say how
Mr. McMullen became possessed of it.

Q. — I do not understand you ?

A. — 1 mean that nearly if not all the pajjcrs publisjied in the press relating to this
Pacific afl'a \ . ave been obtained by illegal if not criminal means. For instance, the four
papers whii ublished at the end of Mr. McMuUen's second letter, must have been

obtained l)y n, hich I think I may call criminal.

Q. — What i)aj' lo you refer to ?

A. — I refer to the two telegrams and the receipts, the one from Sir John Macdonald
to me, the one from me to Sir John Macdonald, the letter of Sir George Cartier to me,
and. the receipt of the Montreal Committee to me.

Q. — In whose possession were they ?

A. — These papers were in my possession during the absence of Sir Hugh Allan in
Ncvlbundland.

Q. — Have you them yet ?

A. — No, I gave them to Sir Hugh Allan when he returned from Newfoundland, and
it is (piite obvious, at all events I am convinced of the I'act, that those jiapers were either
stolen from the ]n'ivate drawer in which they were kept while in my possession, or from
the place in which Sir Hugh Allan put them.

Q. — You say Sir Hugh Allan has them now?

A. — I don'u say he lias them ; I say I gave them to him on his return in Sej)tembcr,
18V2. I don't su])pose these gentlemen had tlie originals in their possession, but they must
have obtained them by bribing a confidential clerk or secretary wiio had access to them to
copy them. For tiiese reasons I say I don't know how Mr. McMullen got his informa-
tion. It is barely possible that he could have heard it from Sir Hugh Allan or myself

(2- — You were acting as confidential agent to Sir Hugh Allan with respect to tlie
money ?

A. — No, I don't think I was. Sir Hugh Allan asked me to assist him in this affair. I
think the preponderance of his motive was that my professional practice liad led me in the
direction of tliis kind of business — the organization of Companies. I also took an interest
as a i)ublic man in this particular railway, but I considered I was acting more as the
solicitor of Sir Hugh than in any other capacity 1 can describe. I never was in any sense
his agent.

Q. — I think you were made the medium through which the moneys were paid for
election jnirposcs ?

A. — Only while Sir Hugh was in Newfoundland. I never had anything further to do
with the moneys than this. I was present when those letters which I have described
were talked about ami signed, and when Sir Hugh Allan left for Newfoundland I was
mi;de the medium of communication witii him with respect to three or four transactions.

Q. — Did any other sums come into your possession other than those subscribed by Sir
Hugh 'I

^.— None whatever. I had nothing whatever to do with the distributionof the money
subscriljed for the elections.

Q. — What was the amount paid through you by Sir Hugh Allan for the elections? ,

^.— The first amount was $10,000.

Q.~At what date ?

A. — I think it must have been about the 8th or 10th of August. It was $10,000 which

CANADIAN PACIFIC RAILW '.Y.

227

IIusli Allan iu

s wore paid for

is i)( 1 0,000 wliicl

ho left in my hands to be given to Mr. Langevin. He wrote to Mr. Langevin, I think,
iiiJbrniing him that the money was in my possession, and that on his giving me a receipt
for it I would pay it. The first I heard of Mr. Langevin's action was his telegraphing
me to meet him on the Quebec boat, which I did, on his way down to Quebec. He said
h'? had received a letter from Sir Hugh Allan saying that on giving a receipt I would
give him the money. He said lie could not understand wliy such a receipt was asked
from him. I told him I did not see that there was any reason for it either, and I did not
think that there was any particular reason. He then said that he would have notliing to
do with it; that he could not give me any receipt. He did not know what Sir Hugh
Allan's reason was for asking it, and at all events he would not give any receipt whatever.
It looked to him as if it might be said that it was not a free subscription to the elections at
Quet)cc which Sir George Cartier iiad promised him, and unless it was, he would not take
it at all ; and moreover, he would on his arrival at Quebec return the $15,000 which Sir
Goor<;i! Cartier had previously caused to be sent him. He appeared to me to be a little
excited aljout the matter. I left him upon his expressing his determination not only to
rcluso that money but to send back the $1.5,000 which was the sum first paid. I tele-
giai)lied Sir Hugh Allan saying that Mr. Langevin did not leel disposed to give any
receipt, and asking his authority to give Mr. Langevin the money M'ithout a receipt. I
ditl not get an answer within two or three days, and knowing that the elections were
going on, and that the money would probably be wanted, I took the responsibility of
sending the money to Mr. Langevin by exjiress, and wrote liim at the same time telling
him tliat I had done so.

The second sun , namely, $20,000, was paid to the Montreal Central Committee, I
getting Sir Hugh Allan's autliority to pay it, l)y telegraph. The third sum was $10,000,
respecting which Sir John Macdonald telegraphed me. That I also inlormed Sir Hugh
oi'. and obtained by telegraph his authority to i>ny it. I think tiiese were all the sums of
money I had anything to do with. I kept these vouchers, these letters and telegrams,
ill 111) i)rivate drawer in my office until Sir Hugh Allan returned from Newl'oundland,
ami then I gave them to him.

Q. — Were they out of your possession at all ?

A. — Not that I know of.

(2 — I'be $20,000 was given upon this letter of Sir George Cartier's to you of
August 24th?

^.— Yes.

Q. — You are familiar, of course, with the terms of it, namely :— " On the same condi-
" tions as the amount written by me at the foot of the letter to Sir Hugh Allan of the
" .30th ultimo. Please send Sir John Macdonald $10,000 more on the same terms."
What did you understand by those expressions in Sir George's letter to you?

A. — I understood him to refer to the letter of the 30th July, in which he informed
Sir Hugh Allan that any advances he made would be recouped.

Q- — Tliere were two letters of that date, both drafted by you in the first instance, then
jiortions of them rejected, and tlio whole modified by Sir George. Do you remember the
terms of your draft of your letter?

A. — No; I do not. My im})ression is that the third sheet of the longer letter vva«
rejected because the conclusion did not please him, and my idea was that the objection
was hypercritical, as it only referred to the phraseology.

Q.— Not to the matter, but only to the form of expression ?

A. — Yes; you will perceive that the conclusion of the letter is a sort of statement that
these being his views he would urge them uj)on his colleagues. The form in which the
draft concluded was a little different from that, but not materially. He preferred liis
form, and he dictated it to me, and I wrote it as you see it.

Q. — What was your draft relating to the money ?

A, — I think it was about the same length as the one produced, but I cannot say posi-
tively. I had a great difficulty, I remember, in saying anything about the details, because
I did not understand how it could be recouped, and did not believe that Sir George could
raise such a sum of money as he described from his party.

Q. — Were there in the draft any special terms or conditions upon which the money
was to be advanced ?

A. — I think not.

Q. — Do you think it corresponded in general meaning with the letter that is produced ?

A. — I think so. I think it made some mention of the money being repaid out of such
money or fund as could properly be appropriated to the })urpose. It was a perfectly
harmless letter, and one perhaps less open to misconstruction than the one which has
been produced.

Q. — There was no difference as to the substance ?

Canada.

www

228

COHllESPONDENCP: RELATIVE TO THE

Canada. ^. — "J^at that I recollect. Sir Hugh Allan informed me that he did not attach the
slightest importance to the promise ol" repayment.

1 think, if the Commission will allow me to refer to it, I remember a statement which
appears in a Chicago paper, said to have been made by Mr. McMuUen to some newsi)aper
editor there, respecting an agreement which lie says was executed subsequently to the
.'JOth .hily, and he mentions a circumstance wiiich lie appears to think confirms his posi-
tion ill connection with the agreement. He says it was written by three clerks in my
oflice, so that none of them might know its contents. No such agreement was ever pre-
])arc(l or written, but as a matter of fact the first letter wliich has appeared before your
Honours was written by three clerks in my office. The first two pages were written by
two different clerks, and the third leaf was written by a tliird clerk, and that is the
jmper of which some person, I have not the slightest doubt, who has been willing to
lK;tray confidence, has given him an inaccurate description, and caused Mr, McMullen to
suj)])ose that it was a different paper from that jiroduced.

Q. — Why was it written by three clerks ?

A. — Simply because the space of time between the interviews was so short, I had to
write it out or dictate it, get it extended, corrected and recopied, and so I placed one
sheet in the hands of each clerk to save time. If I had supposed it possible that any one
of those clerks could have been bribed to disclose the contents of the paper I might have
been more anxious to prevent their knowing Avhat it contained, but I had no such idea
and no sucli motive.

Q. — Were you present at any other interview, or do you know of any communication
between Sir Hugh Allan and any members of the Government in relation to the sul)-
scription of money for the elections ?

A .■ — No, I never heard of any other.

Q. — Do you know how these moneys were spent at all?

A. — I cannot say that I do. I Iiave a general knowledge that they were expended in
furthering the elections in different jjarts of tiie Province.

(2 --!^ir George Cartier's election?

A . — Yes, and other elections. I do not know many of the details ; I have personal
knowledge of scarcely any of tliem. I was not a member of liis Committee, and did not
take part in his election, as I had enough to do in attending to my own.

Q. — Did you ever hear from Sir Hugh Allan an exjjression of expectation of receiving
any advantage from the Government ?

A. — He certainly had the expectation of receiving advantage. He expected to retain
in ])ower the Government whose policy he approved of, but as to the Pacific Charier,
beyond sustaining in power the Government which was disposed to carry out the build-
ing of the Pacific liailway, I most unhesitatingly say that I never heard a word from him,

Q. — You were in very intimhte relations with him on this subject?

A. — Yes. I did not see him very often, but he seemed to speak to me without any
reserve.

Q. — ^Do you know Mr. Foster ?

.4.— Yes.

Q. — Was he present at any of your interviews with Mr. McMullen?

A. — 1 think he was present at interviews witli Mr. McMullen during the Session. He
was one of the Directors of the Canada Pacific Railway Company, and. we desired to
get 111 in on the Board of the Canadian Pacific. He is a man of considerable railway
exjierieiice, and I believe of capital. He was entirely in tlie confidence of the Company,
and during the Session of 1872 assisted, to some extent, in getting the Bill through. And
I have no doubt that Mr. Foster, Mr. McMullen, and myself frequently met during that
Session.

Q. — Did you ever liave any conversation in Mr. Foster's presence in relation to any
sums of money to be jjaid to tlie (iovernment or any member of it ?

A. — To th(! l)est of my recollection, no. Nothing of tliat sort was ever contemplated
at all to my knowledge;, either during the Session or afterwards. The election fund, to
which Sir Ilugii Allan alterwards contributed, was not, I think, spoken of at all during
the Session, except as I had ))reviously stated. After the Session I saw very little of Mr.
Foster, and nothing at all of Mr. McMullen for a considerable time.

Q, — Sir Hugh Allan mentioned that he had never given anything so large at any
l)revious elections. Did it occur to you that this was a very large sum for him to give
on this occasion ?

A. — I know nothing of what Jie had given on previous occasions, but I certainly
thought that this was a very large sum for him to give. At the same time it must be
observed that he did not agree deliberately to subscribe the whole of this sum at once.

CANADIAN PACIFIC RAILWAY.

220

jt attach the
ement which

)n of receiving

c without any

elation to any

lie contributed from time to time as tlu; elections went on and as tlic money was needed.
Probably lie mij^ht liavi; besitated at subscriliiii<j; so large a sum at once, but tlu' I'eelings
and interests wbieli lie himself biis descril)ed probably led him, as the money was
needed, to continue his contributions to a larger sum than he originally intended.

Q. — Do you know of any other facts which will throw light on his motives in giving
this large sum ?

A. — No, most certainly not. To my own mind Sir Hugh Allan's motives as described
by liim are perfectly clear. He is interested in the carrying trade to an enormous extent.
About s.'?,000,00() of jiis fortune is invested in tlu- carrying trade alone. I mean in sea-
going steamers alone, lie has also a large amount of money invested in the Inland
carrying trade. He was forced, as he imagined, and not unwillingly, perliaps, to enter
into an organization for an extensive scries of railways i)roviding for a second communi-
cation between the seaboard and the interior of the country. He had taken up witli a
vast deal of energy and enthusiasm this Pacific Railway scheme. He had been himself a
member of the Canal Commission, if not the Chairman of it, and had taken great interest
ill that. On every one of these subjects the Government had a policy whicli was lavour-
able to his views, and in my opinion three times the sum would have been well spent if
it had been necessary to keep a Government in power, which had, according to his views,
and my own too, the improvement of the country so deeply at heart as this Government
api)eared to have.

(2. — Did he think so at that time ?

A. — Yes, certainly.

(2. — Did it not strike you as strange that ho should contribute so largely?

A. — Not at all strange considering his position and his objects.

Q. — You say that you had several intervicnvs with the Government, and more particu-
larly with Sir John INIacdonald and Hon. INIr. Campbell, discussing the terms of the
Cliarter before it was finally settled. Did vou propose any modifications in the original
(Iralt ?

A. — Yes. The work whicli was done during, I think, about a fortnight of very close
apjdication to the Charter was of two kinds. One was a very critical examination of the
phrases and language of the Charter, and that took up a good deal of time. The other
did not take up so mucii time, namely, the discussions of certain modifications which
wore suggested on both sides to the original draft. I made several suggestions, some of
whicli were ajiproved, and some of which were rejected.

Q. — What was the general nature of the modifications you suggested?

A. — I suggested, I r<micmber as one thing of im]iortaiice, that there should be power
granted to tbeCimipany to issue a further amount of stock, and Sir Hugh Allan had that
very deeply at heart indeed, because he I'eared that an application to English cajiitalists
to obtain money might be unsuccessful if tliese capitalists were not to have any share in
the ])rospective advantages of the Road. That was discussed at considerable length with
tlie Government, and finally the inattei" was submitted to the Government itself, and Sir
Hugh Allan's vii'ws in this subject, ami my own were overruled. There were several
other points on which I desired to have modifications, for instance, the amount of bonds
per mile. I thought that it was too small.

(^.^Did your views prevail"'

A. — They did not prevail in that respect. I remember another subject which was
considerably discussed, namely, as to the mode and in what proportions the money and
lands were to be paid to the Company for the construction of the Road. The original
design was that they should i)e paid on the certificate of the Government engineer. My
idea was that there might be a difference ol' opinion between the Government Engineer
and the Company, and I was anxious that there mighty be some indejiendent tribunal to
which the quest' n should be referred, and finally a very guarded clause was introduced
which jirovided a referee or referees for that }nirpose.

Q. — Did you propose any modification in the original draft having reference to the
admission of American capital or American control ?

A. — No ; quite the contrary. From the moment I prepared the Bill for the House of
Commons, I considered that the design of introducing American infiueiice and control
into the Road was abandoned. I did not regard it as inniossible that it might Ijo revived ;
that might dejiend upon the policy of the Government; but as I'ar as I know the idea of
carrying out the Road by American infiuence and capital was abandoned. My impres-
sion was that Sir Hugh Allan, while he authorized the organization being proceeded
with on that ground, still appeared to entertain in his own mind the idea that some time
or otlier we might be obliged to have recourse to American capital. Tliat is the way in
which I iiccount for iiis having continued in private correspondence with the Americans.

2 G

Canada.

230

C'Ol^RESPONDKNCE RELATIVE TO Till':

Canada. So far as T ami tlu> Cnnipany were concerned, tliere was nut the sli^Iitest idea of the
introduction of Ann^rican inlUienee and cai'ital. Aly elforts were directed to framiu"
the Cliarter, or assisting the Government to frame tlie Charter, so as to exclude tlie
l)ossil)iIit\' of it.

U. — Were you present in Ottawa at the time the names of the genth;men Avho appear
in the Charter were settled on?

A. — ^Thi-y were not all settled on at once. It was a work of some time to collect
togetlier the Directors of the C^ompany. I am aware that several gentlemen were spoken
to, others were corresponded with, several came to Ottawa and saw the Government ;
and one hy one fit people were selected from one part of the Dominion or another, until
the lull complement of thirteen was decided upon. I think the last one was not entirely
settled niion until within two or three days of the signing of the (Jharter. I refer to I\lr.
Hall. lie was not linally selected until two or three days before the Charter was signed,
partly because Sir Hugh Allan and myself had urged the a])pointment of some one sug-
gested by Mr. Foster, and partly because Mr. Foster himself was desirous of being rejjre-
sented on the Board, and jjartly, 1 believe, because Sir (ieorge Cartier had expressed a
wish that Mr. Foster should be on tlie Board or represented on it.

Q. — Did you come to Ottawa instructed by the Company, or prepared to submit any
names as Directors to the Government?

^.— No.

Q. — Did you submit any names?

A. — No, I never did. The only name on the Board that was submitted by any
member of the Comi)any ?

Q. — Do you mean the Canada Company?

A, — No. The Canada Company ceased to have any existence, T may say, for the
])urpose of this Railway, when the design of amalgamating it with the Interoceanic
Company was abandoned.

Q. — Still to some extent the interests of the Canada Company were represented ?

A. — No, not in the slightest degree. When the project of amalgamation was aban-
doned, several gentlemen independent of any Company were asked to come to Ottawa to
meet, with the view of discussing the details connected with a Company. I have not a
very precise idea of the way tliey Miire got together at first, but I know that five or six
gentlemen who desired to be interested in the formation of a new Company, met at
Ottawa, and the Canada Company had no more to do with it than any imaginable com-
pany out of tlie realm.

Q. — Do you know if Sir Hugh Allan suggested any names to the Government?

A. — Yes, 1 know he suggested the name of Mr. Beaudry.

Q.— Any others?

A. — No others that were accepted. The only one I Ijelieve that Sir Hugh Allan was
the means of introducing into the Company was Mr. Beaudry.

To Sir John A. Macdonald through the Chairman:

Q. — Siieakingof the terms ■which uere granted to the Canadian Pacific Railway Com-
pany by the Charter; and supposing that Sir Hugh Allan had had no connection in anv
way with the Company, from what you know of tlie policy of the Government, and from
the communications between members of the Government and yourself and the Boaril,
would not the same terms have been granted ?

A. — I have not the least doubt they would. I think the terms of the contract and
Charter were settled without the remotest reference to Sir Hugh Allan any more than to
any other member of the Board. I never knew a suggestion of his, however much it
might l)c pressed, if it appeared unreasonable that was not rejected without ceremony.
I don't know of any favour or concession ever having been made to him.

Q. — Then you are satisfied that if the construction of the Road had been confided to
the Interoceanic Company, tliey would have got the same terms ?

A. — I am quite satisfied of it.

Q. — Then these subscriptions for election purposes had no effect on the Charter?

A. — No ; so far as I knew, and I believe I was in a position to know as much as any
one, the subscriptions for the elections had no influence whatever upon the negotiations.
I never heard them referred to.

Q. — AVas it not the case that every effort made by Sir Hugh Allan to get any prepon-
derance to his sectional influence was overruled ?

A. — I don't know that he made any special effort to give a preponderance to his
sectional interests in the Canadian Pacific Company, but in the Canadian Pacific Com-
pany, the efforts that he made were overruled ; for instance, I know that he made some
suggestions in respect to the amalgamation, and that they were overruled.

CANADIAN PACIFK; RAILWAY.

231

■st idea of the
led to framiuj^
to exclude tlie

len who appear

time to collect
icn were sj)oken
c Govcn.meiit ;
r another, until
vas not entirely
I refer to Mr.
rtcr was signed,
f some one sug-
1 of being repre-
lad expressed a

1 to submit any

jmitted by any

lay say, for the
the Interoeeauic

^presented ?
lation was abnn-
mc to Ottawa to
y. I have not a
V that five or six
'omi)any, met at
imaginable eom-

.>rnment ?

lugh Allan was

Railway Com-
onnection in anv
nmcnt, and from

and the Board,

the contract and
my more than to
owever much it
thout ceremony.

been confided to

he Charter ?
as much as any
the negotiations.

get any prepon-

onderance to his
an Pacific Com-
it he made some

Q. — There is a (luotation made in one of i\Ir. MclSIullen's letters. A series of para-
graphs from tlie pajier, eominunicate<l by the Canada Pacific Coni])any to the (govern-
ment, stating distinctly that so far as that Company was concerned, they had no
comiection with American caj)italisls?

.4.— Yes.

Q. — That truly expressed the action of the Canada Pacific Company?

A. — Most decidedly.

Q. — Of which you M'cre a member?

^.— Yes.

U- — You were not aware of this correspondence with Sir Hugh Allan ?

A. — I was not aware of it.

(2— So that these communications ])etween Sir Hugh Allan, Mr. McMullen and others,
were matters personal to Sir Hugh Allan liimsell', lor which the Canada Company were
in no way responsible, and which they repudiated when they were known'

A. — I'jntireiy so. Exce])t as to the repudiation they did not become known until after
tin; Canada Company had ceased to take any action in the Pacific matter?

Q. — Mr. McMullen in the discussion of the ])articiilar question refers to a trifiing
matter to which I migiit as well reler. Mr. McMullen said in eilect, that at an interview
which he liad with Sir Jolni A. Macdonald lie gave him copies of documents, Sir Hugh
Allan's drafts for the !r-IO,000, and the receijits of Mr. Todd for the Private Bills
expenses of the Canada Improvement and Canada Pacific Railway Companies paid by
him ?

A. — In that communication of Mr. McMullen he professes to slight or disparage the
statement of the Canada Pacific Cenipany, that tlioy had nothing to do with the
Americans, and he quotes in support of his pretension that they had, tlie fact that he had
paid the House fees on the ]>ills which uere introduced in the first instance in the House
for the Canada Comjjany. In point of fact, that fact is true, though the inlerence is
not correct. I believe he did pay the House for the two Bills and some other trifling
expenses.

Q. — What would they amount to?

A. — The House fees were i?2 t.j.00 for whicii I got receii)ts. There were some other
trifiing expenses, prol)ably amounting to slOO or SlaO more.

The receijjts ibr the House lees aw herewith produced and fyled marked "S." and " T."
In fact Mr. McMullen did keep uj) a certain amount of connection with the promotion of
the Pacific Bill, alter he was perl'ectly aware that all coniu'ction with thi' Americans
must cease. He was a 'Canadian hinistdl', and Mas very anxious to keep himself
connected with the scheme so far as he could, in hopes of something turning up in the
end. He met Sir Hugh Allan occasionally. The Bills were called u]) in the Committee
hurriedly, and it was necessary to have the ices paid on them before they could be passed
through the Conmiittee, and to the best of my recollection I said "I wish Sir Hugh
'■ would send the money," or " I wish 1 had the money to pay the fees," or something of
that kind. He said he had money for such ])urposes, and he jiaid the fees. The matter
had entirely slij)i)ed from my memory, as I supposed he had settled it with Sir Hugh
Allan. However, when negotiating for giving up Sir Hugh Allan's correspondence last
Jiuuiary, he told me that he had these receipts fi)r the House fees, and the other small
expenses I have mentioned. I told him to bring them to my office and I would give
him a cheque for the amount unless Sir Hugh Allan settled with him. Sir Hugh Allan
did settle with him, and Mr. IMcMuUen gave up those receipts to me.

Q. — Are you aware what sum Sir Hugh paid him in relation to giving up the corre-
spondence ?

^.— The sum of $20,000.

Q. — Are you aware of what money he refunded of what he received from the United
States cai)italists ?

A. — He told me that he had refunded it all.

Q, — Do you know anything about the sealed packet of letters left with Mr. Starnes ?

A. — Yes. It was I who arranged lor their deposit with Mr. Starnes. About the
latter end of the year Mr. McMullen himself, I think, told me that he had a number of
letters.

Q. — Letters of what year ?

A.~Oi' 1871 and 1872, I think. He (Mr. McMullen) made an application to Sir
Hugh Allan, claimhig that his people had the right to command the services of Sir Hugh
Allan in connection with the Pacific contract, and stated that Sir Hugh had not used
them well, and that he ought to pay whatever advances they had made, and also for their
loss of time and other claims. The demand made by Mr. McMullen amounted to a con-

2 G 2

Oahasa.

232

rollHESPONDKNCE HELATIVE TO THE

'i^Mi-

Canada, sidcnil)!*' s\im. I fliiiik over ?r'2()(),(tl»(), if not .'i2r)(),0(in, in tlic first jilace, Itiif tliis
incliuk'(l tlu! !?I(),()(I0 Sir Hugh Imd received. Al'tcrwiirds there was some liltiu
nei^otiiitioii about it, and lie reduced his claim somewliat, and liually he came to
IVIontreal with Mr. Smith and Mr. Hurllnirt. He read me passaf^es irom tlie correspou-
deuce, and showed it to mc; stated to me Ins position, and adiU-d that lie had heen ill
used, and spoke of'liis claim I'or a considerable sum of money. He also showed me the
contract with his friends, which 1 j;lanced over to verily a statement he made as to its
contents. 1 wrote him, with Sir Hu<;;h Allan's authority, that so I'ar as tlie disbursements
went, Sir Hugh Allan was ready to pay tliem, md with regard to their services, he was
ready to pay them a reasonable sum, but that t lie demand lie was maUing was me which
did not ai)|iear to me to be based on either ol those principles, but was in fact such a
demand as that Sir Hugh could not listen to at all. He cani«> to Montreal, as I hjive
stated, with Mr. Smith and Mr. Hurlburt, of Chicago, 1 had an interview with tliose
gentlemen, and I then, for the first time, saw those letters. I think this was in January.
I did not read them all, but I read, or heard read, extracts from some of them, which
showed me their character. I saw at once that the jiublieation of these letters whidi
Mr. McMuUen had threatened to publish, would jn-oduce a deal of outcry, and would
probably interfere with the prospects of the deputation going to England to raise money
for the Koad. I thought it was best for Sir Hugh Allan to make any arrangement ia
reason, or out of reason, in order to get through with his mission to England
before there was any row made about them. I therefore arranged with Mr. McMulleii
to accept !:rlO,()0() in American currency. He assured me that he had spent above
$20,000, and tiic remainder he claimed as remuneration for loss of time of himself
and his friends. Ihit this arrangement did not include the $40,000 received by Sir
Hugh Allan.

I thought it would he a prudent precaution to prevent the publication of these letters,
and therefore to make the payment of part of the money dependent ujjon their not
heing published for a reasonable length of time. The jiaper read by Sir Hugh Allan,
which was al'terwanls given to Mr. Ptarnes along with the sealed packet, was prepared
by myself, ll was submitted to Sir Hugh Allan and signed by him, and afterwards also
signed l)y Mr. Mc.MuUen. The package was made up on the spot, and Mr, McMulleu
and I gave it into the hands of Mr. Starnes.

I also})aid ^Ir. ^le]\Iulleii l?20,0()0. The chetiue for the remainder was to be delivered
to him some time after the rising of the Session in the event of these papers not being
published. He declared to nu; that there were no copies of them in existence, except tliu
one which he had given to Sir ,101111 A. ^lacdoiiald, which is the copy referred to in the
paper. He undertook also to procure the sanction of ^lessrs. Smith and Hurlburt to this
arrangement, and he wrote a letter to Sir Hugh Allan, discharging him from all claims
of every kind and description. I think Sir Hugh Allan has this letter which ^Ir,
McMuUen wrote to him. I also produce and fyle the letter which Mr. McMullen wrote
to me marked " U."

Q. — Uo you know Mr. McMuUen's handwriting ?

A. — 1 think I saw him write this letter.

Q, — Was that concession or payment made by Sir Hugh Allan at once or after con-
sultation with you '!

A. — It was made after the negotiation had spread over a couple of weeks, I should
think, and after several notes and interviews had passed between Sir Hugh Allan and
myself.

Q. — You were negotiating with ^fr. McMullen ?

,1. — 1 was negotiating with him on behalf of Sir Hugh Allan as his Solicitor in the
matter.

(2.— What did you say was the motive that induced Sir Hugh Allan to give a sum
beyond the actual disbursements which were alleged to be $20,000.

J.— Ill the first i)lace, I think, Sir Hugh recognized the fact that Mr. McMullen and
his friends had really spent a good deal of time about their scheme, and that they had
given themselves a good deal oi' trouble .ibout it. I think he recognized also, that they
should have some remuneration for that. I think he considered that the sum demandetl
for that was very large, indeed cxorljitant, but he thought it was better to settle the
matter than to have a great outcry and scandal, while he and the delegation to England
were endeavouring to raise money for the Pacific Railway. I imagine that he saw
that if these letters were jiublished an immense deal more would be made out of them
than their importance warranted, by any parties who were opposing the Pacific scheme,
and he desired that their publication, if it were to take place, might not be until after
his return.

CANADIAN PACIFIC 15AIIAVAY.

23.-!

llllU'C, l)llt tliis
■as some littli-
ly 111" c'l'um" to
1 till' coni'spoii-
lu! Imd lu'cii ill
showed nu' the
; inadu as to its
e dishurscmi'iils
services, hv was
r was 'lie which
s ill laet such a
treal, as I have
•vic'V with tlioM'
was in .laimary.
ol' them, which
se letters which
tery, ami wouKl
I to raise money
arrangement in
on to Enfi;laiul

I Mr. MeiMulleu

lad spent ahove

time of himseli

received by .Sir

II ol' these letters,
; upon their not
Sir Hugh Allan,
et, was ])reparc(l
d afterwards also
I Mr. McMuUeu

is to he delivered
papers not being
tence, except tlie
I'erred to in the
lurlburt to tliis
from all claims
etter which Mr.
McMuUen wrote

mce or alter con-

' weeks, I should
Hugh Allan and

Solicitor in the

11 to give a Slim

McMullen and
d that they luid
d also, that they
e sum demandeil
ter to settle the
ation to England
iue that he saw
ade out ol' them
Pacific scheme,
ot be until alter

111

Q. — When dill you, Mr. ^IcMulleii, and Sir Hugh come to an understanding'.'

A. — It is mentioned in the pajier which was lyied this iinu'iiing.

Q. — As soon as you came to an agreement it was committed to writing ?

yl.— Yes.

(i. — Was it at your suggestion that a portion ol' the money was withheld '?

.'!.— Yes.

Q, — You were acting as Solicitor lor Sir Hugh Allan '{

yl.— Yes.

Q. — And thought it a reasonable and ])roper i>recaution to fake ?

A. — Yes. I thought it jiossible that there might be copies ol' these letters extant, and
tliat no sooner would the money be paid than copies might apjiear in the newspapers. I
thought that the retention ol' a portion ol' the money would operate as a check against
anything of this sort.

Q. — " Within ten days after the end of the coming Session of Parliament, Mr. Starnes
" is requested," and so on : why was that time fixed upon '!

A. — .lust for the same re.ison as any other time might have been fixed upon in order
to give sufiieient time to enable the delegation to go to England and return. The
iniblication then would lie better than during the Session of Parliament, as it would
create less noise and scandal than during the .Session.

(I — The date is the '2(ltli of February. AVheii did Sir Hugh Allan leave for
l']ngland ?

.1.— I think on the first of March.

U. — For what jjurpose'.'

A. — As one of the delegation to try to raise funds for the Pacific Railway.

Q. — When did copies ol' these pajxTS appear in the newspapers'/

A. — The first timi; that copies ai)peared was on .Inly 4tli, in the ' Montreal Herald,' but
the charge! Mr. Huntington made in the House was supposed to be based on some copy
which he had of these j)apers. I understood that he proposed to read paj)ers Mhich bori'
a resemblance to tlu!se documents.

(I. — You say that it was a])preheiided that the publication of these papers might all'ect
the mission upon which Sir I lugh Allan went home to raise money. Do you know if it did?

A. — I am perfectly certain that it did. I was cm- of the delegation of four — comiiosed
of Sir Hugh Allan, (Governor Archibald, Major Walker, and myself — and the chief
ditliculty we met with in England, was the feeling caused by the violence of the pul)-
lications in this country, the extravagant charge made against the Company, causing the
belief in the minds of English capitalists that the success or failure of the Company
dejieiided upon the success or failure of one of the great political jiarties in tliis country.
Peojile became convinced, as far as I could judge, when these charges were made and
reiterated to such an extent, that if the Government maintained themselves in jiower, the
Contract would likely be carried out and the Cimijjany go on ; while on the other hand,
if the Ciovernment were ejected from power, the Contract and the Charter would I'all to
the ground, and the road would not be built. They felt then that they were not only
imperilling their money on the chance of the success of an enterprise sullicicntly difficult
in itself, but on the chance of one or the other of the political parties remain.'iiL; in power.
There was more hesitation from that notion, that any successful result wo.' Id depend
upon the success of one party or the other, rather than in view of tlie diflii iiit;. <;! ^lie
undertaking itself. This it was that prevented capitalists in England from siibscribing;
in fact that was the reason given by one large firm of cajjitalists, with whom the
delegation made the greatest progress in negotiating for the money.

Referring to the deposition of Mr. ^Vhite, I wish to state that the draft P>ill which he
sui)posed I bad pre])ared, and caused to be printed on behalf ■•, I'e projected Ami'iican
Company, was, to the best of my recollection, the dnift i- ■ 'a print, which 1 have
already sfcited. Sir Hugh Allan gave to me when he requested me to jireiJare the
legislation for the Session of 1872.

And further deponent saith not, and this his deposition having been read to hini, he
declares that it contains the truth, persists therein, and hath signed.

Sworn and taken on the nineteenth day of "i

Sei)tember, 1873, and acknowledged .o- n t i << AuurvPT

.1 .4 4.U 1 1- • 1 (Signed) J. J. < . AlJJiUil.

on tlie twenty-seventh day ol said ^ <= >'

month and year. j

(Signed) CHARLES DEWEY DAY, Chairman.

A. POLETTE,

JAMES ROBERT GOWAN, Commissioners.

Oan.vda.

CORHKSl'ONDENCE RELATIVE TO THE

Oan/u)a. Provivck ok Oxtaiuo,
Cit;/ of Ottmm.

IN THE MA'rrEH OF THE ( OMMISSION

iii

Appointing Ciiaki.ks 1)i:\vi:v Dav, Anioink Poi.kttk, and .Ia.\ii:s Kohkrt Gowax, Com-
niissionurs to in([uirt' into and report npon the several jnatters stated in a certain
Resolution moved liy the Hon, Mr. IlrMiSdTo.v in the House ol' Commons on tin;
seeond day oi' April, A.n. i.ST.'J, relatiiif; to the Canadian Pacific Railway.

Present : TnK Comsiia-uonkuh.

(.>n this twentieth day of September, in the year of our Lord one thousand eij^lit
hundred and seveuty-tiirce, personally came and ajjpeared belbre us, the ahove-named
Commissioners,

WILLIAM EDWARD ULUMHART, of the Clity ol' Quebec, who being duly s\w)rii,
deposeth and saith:

I reside in (Quebec, but this summer I have resided temjiorarily in New nrunswicl<.
My occupation is general agent of a company for building railways. I am not an
engineer, l)ut attend to the business portion of the agency.

Q. — Were you residing in Quebec during the years of 1871 and 1872?

A. — Yes. ^

Q. — Do you know Sir Hugh Allan ?

A. — I don't. t

Q. — Do you Icnnw Mr. Geoige W. McMuUen ?

A. — No, I do not.

Q. — Do you know anything of an agreement made between those gentlemen relating to
the building of the Pacific liaihvay ?

A. — I do not.

Q. — ^Vere you in a position to know anything of that matter ?

^.— No.

Q. — You are tlien utti'rly witliout knowledge relating to that subject?

A. — Yes. I have no knowledge whatever, excej)t what I have seen in the public
prints.

Q. — Did you take any part in the ginieral elections of 1872 ?

^.— Idid.

■ Q. — Were you on any of tlie committees?

A. — I was on several committees, but not the General Committee.

Q. — Were you on any committees Avhich were organized, as it was supposed, in favour
of the promotion of the election of the Government candidates?

yl.— Yes.

Q.-—Do you know anything about the subscription of money for promoting the
elections ?

A. — I know that money was subscriljcd.

Q. — Do you know by whom ?

A. — Several persons subscril)ed. I saw no names, nor any list of names of subscribers.
J know there were subscrijjtions made. I do not know to what amount.

Q. — Do you know whether Sir Hugh Allan was one of the s'abscribers ?

A. — I do not.

Q. — Do you know through whose liands any money came which was used by the
Central Committee, or by any other committee ?

A. — I do not.

Q. — How do you know that money Avas subscribed ?

A. — I know that one gentleman told me that he had subscribed.

Q.— Was that Sir Hugh Allan ?

A. — No. A gentleman from Quebec — a tradesman.

Q. — A tradesman in Quebec ?

^.— Yes.

Q. — Do you know the names of any of the gentlemen who 'vere on the Central Com-
mittee in Quebec?

^.— Yes.

Q. — Will you mention them?

A. — I know Mr. Beaudct.

Q. — His Christian name ?

A. — Elisie.

Q.— Do you know the Hon. Mr. Langevin ?

A.— I do.

CANADIAN PACIFIC RAILWAY.

235

issiON ^*:.:.,.,

T GowAN, Com-
ited ill a certain
CumnioiiH on tliu
Liiilway.

thousand fi;j;lit
lie al)ove-nami'd

'inf; duly sx^oiid

New Brunswit k.
i. I am not an

Icmcn relating to

en in the puhlic

pposed, in favour
promoting the

les of subscrihcrs.

was used by the

he Central Com-

(2. — T)o you know wlietlior any noncy was vcrcived througli him by the Central Com- Canada.
mitfee or l)y any person for tlie elections i*

A. — I do not; I ni'ver was on tiiat Committee at aU.

Q, — Had you aiiythin;j; to do with the distribution of the moneys which were sub-
scril)ed for tlie elections?

A. — All tlie nuiiic)- I had anything to do with was what we subscribed ourselves and
spent ourselves.

(i. — Had you any conversation at any time with Mr. Laiigevin about election expenses?

A.— No.

Q. — Had you any such conversation with any other of the ministers ?

yl.-No.

(2. — Do you know anything; about any understandinj; between the Government and
Sir Hugh Allan and Mr. Abbott in relation to subscriptions for elections?

^1.— No.

Q. — Have you any knowledge whatever in relation to the subject matter of this
iiKpiiry ?

A. — Nothing but what has appeared.

Q. — Do you know why your name was put down upon the list of witnesses ?

A. — 1 have no idea at all.

Q. — Have you ever said anything to give reason to believe that you had some know-
ledge concerning this matter ?

A. — No, I always on the contrary, since I saw my name on Mr. Huntington's list
of witiu'ss(!s, said I had no idea why my name was put down, as I knew nothing about
the matter.

Q.— For whose election were you on a committee?

A. — For the countii's of Kiniouski, Ri'llechasse, and iNIontmagny.

Q. — Who was the candidate for Kiniousl ■ ?

yl.— Mr. Sylvain.

(2.— Who for B<-llechasse ?

A. — Mr. Caron.

(2. — And lor Montmagny ?

A. — The Honourable Mr. lieaubien.

Q. — These were all Government candidates?

yl.— Yes.

Q. — Were they elected ?

A. — No, they were all defeated. They had not money enough.

Q. — Do you know whether any money was sent down from Montreal for the support
ol' tliese elections ?

A. — I do not.

^2. — Do you live in the City of Quebec ?

yl.— Yes.

Q. — Do you know anything of the elections in the City of Montreal or the Montreal
district ?

A. — No, my exertions were confined entirely to the Counties l)efore mentioned.

Q. — Were you on the Kainouraska Committee?

.4.— No.

Q. — AVho represents Kamouraska now ?

^.— Mr. Pelletier, 1 think.

Q. — ^\Vho rejjresents Bellechasse?

yl.— Mr. Fournier.

Q. — AVere you on the Election Committee for the Centre Division of the City of
Quebec ?

A. — No, I was absent from the city. The elections in those three Counties, where I
have mentioned I was engaged, took place on the same day.

Q. — Had you ever any conversation with Air. Huntington on the subject of this inquiry ?

yl. — No, nev(,'r ; I do not know Mr. Huntington.

And further deponent saith not, and this his deposition liaving been read to him, he
declares that it contains the truth, persists therein, and hath signed.
Sttoru, taken, and acknowledged on the 1

day, month, and year fii-st above \ (Signed) WM. E. BLUMHART.

written, before us. J

(Signed) CHARLES DEWEY DAY, Chairman.
A POLETTE
JAMES ROBERT GOWAN, Commissioners.

wwmr

Canaka.

23C

CORRESPONDENCE RELATIVE TO THE

IN THE MATTER OF THE COMMISSION

Pkovinti-: ok Ontakio.
Cifi/ cf Ottawa.

Apjioiiitiiiii; CiiAiuj'H Dkwky Day, Antoixk Polkttk, and Jamkh Rouert Goavax,
Comniissioiicrs to inquire into and report upon tlu; several matters stated in a
eerfuiii Resolution, moved by tlie Hon. ISIr. IlLNTiNcroN in tlie House of Clonimoiis
on the seeond day ol' April, A.n. 1S73, relating to tlii> C'anadian Paeific Railway.

Present: Thk Commissioxkrs.

On this twenty-lourth day of Sejitember, in the year of our Lord one thousand eip;lit
hundred and seventy-three, personally eame and appeared before us, the above-named
Commissioners,

I'REDEIHCK CALVIN MARTIN, of the Town of Woodstock, in the Province of
Ontario, wlm Ix'inp; duly sworn, deposeth and saiti :

(>. — I will read over the terms of the charge which it is the duty of tl'.e Commission
to inquire into, that you may kriow precisely what they are, and then proceed to put you
questions.

Haviuij; heard the eliarge read, 1 will now ask you first as to tlu; part of the charge
relating to the agreement between Sir Hugh Allan and Mr. G. W. McMullen. Do you
know .Sir Hugh Allan .^

A. — I do not. k

(3.-1)0 J on know Mr. G. W. McMullen? ^

A. — I do. He is a second cousin of mine.

Q. — Do you know anything of an agreement between Sir Hugh Allan and Mr. G. W.
McMullen, acting for certain United States capit;'.lists, v;herel)y Mr. McMullen agreed
to furnish i'unds lor the construction of the Pacific Itailway?

A. 1 know that Mr. G. "\V. INhvMullen, with several other capitalists, were forming au
a'j;recnient with Sir Hugh Allan to obtain the contract for building the Canadian Pacific
Railway.

Q. — When did you become accjuainted witli that fact?

A. — First through friends or ri'lations of Mr. McMullen's.

Q. — About what time?

A.~\ tliink it was in 1S71, the latter part of 1871.

Q. — Have you any knowledge whether any agreement took place between Sir Hugli
Allan and Mr. McMullen and his friends, tending, or with a view, to tlie construction of
the Pacifu' Railwa\ ?

A. — 1 have no knowledge I'rom Mr. MelMullen himself, except this: — Had a conver-
sation with him; I think it was in April, 1872, at my father's house. I spoke to him
on that occasion on the subject of the Pacific Railway. The first (juestion I asked liim
was al)()ut the route that would be taken; whetiier the Road would not be obstructed
liy snow, and as to how they would overcome that dilTu-uUy. He said that he thought
that the Itoad would go too far north for that; or north of the sn(nv limit, I think, lie
expressed it. I asked him if the ' Globe' newspaper would not be strongly opposed to
the building of the Canadian Pacific Railway, it being a Government measure. He said
no, not to any extent.

(I-

A. — I do not.

Q. — Von had no other conversation with him?

J.— Not at that time?

In July, 1S72, I left for Chicago, in order to visit him. I arrived on the 28th July,
1872, and s\Mini a week there, and then went on out to the prairies. I eame back to
Chicago, and I think it was on my return I stayed there about a week .»nd a half.

One day Mr. McMullen came into the room and said he had received a letter.
Holding it in his hand, he said, "This is from Sir Hugh Allan." He read me a part of
the letter, and he said, "Sir llugli Al'-n is a tricky fellow and not to be dependccl upon,
but I think we have got him so tightly bound by these letters that he dare not go back
on us."

Q. — Is that the whole of the conversation ?

/I.— ^'es.

(^.— AV as any allusion made to the part which the (Jovernment were taking, or that
the Government had taken any part in that agreement?

.1. — No, there was not.

(I, — \Vas any allusion made to any members of the Government ?

.l.~Tliere was not. There was something said about the elections, but nothing
affecting tlu' Government.

-Do you know anvthing about the terms of this agreement \

j;i

CANADIAN PACIFIC RAILWAY.

237

ISSION

lOUKRT GOWAV,

ttors stated iu a
use ol' Clomnions
'acifie Railway.

• thousand eight
,he above-named

the Province of

' tl:c Commission
oceed to put j on

irt ol" the charge
ylullen. Do you

m and ISTr. G. W.
dcMuUcn agreed

, were forming an
■ Canadian Pacific

)et\veen Sir Ilugli
le construction ol'

— Had a convcr-
I si)ol<e to him
ion I asked him
ot be olistructcd
that he thought
iniit, I think, he
'ongly opposed tn
neasure. lie said

on tlie 2Sth July,
I came hack to
.ind a half,
•eceived a letter.
:t;ad me a part of
e depended upon,
dare not go back

re taking, or that

ons, but uolhing

Q. — Have you had any communication with Mr. G. W. McMullen since that on this
subject — since the publication of these letters?

A.— I have not. I have had a conversation with his brother, Harvard C McMullen.

(2. — You have seen those letters of Mr. G. W. McMullen's which have been
published ?

A. — I liave.

Q. — You had no conversation with him on the subject of those letters ?

A. — Not with him; only with his brother.

(2.— Do you know anything about tlie subsequent portion of the charge, as to Sir
Hugh Allan's advancing money for the purpose of the elections?

A.— I do not.

Q. — Did you take any interest in the elections in your own part of the country ?

yl.— I did.

Q. — Have you any k'nowledge of any money being supplied from Montreal for these
elections ?

A. — I have not.

(l — Of the elections in Ijower Canada, I take it you know nothing?

A. — Nothing except what I have got from tlie newsjiapers.

(.1. — \Vhere do you reside?

A. — At Woodstock.

Q. — What is your occupation ?

,1. — I am a lawyer.

it — Do you know anything more about the subject matter of tlie charge which you
have heard read ?

A. — 1 do not.

ll. — Have you ever had any communication with Sir Hugli Allan?

A. — No. I do not know Sir Hugh Allan.

(i. — Or with any member of the Government on this subject ?

.4.— No.

Q. — And this conversation which took place with Mr. G. W. McMullen is all that you
know about the matter?

A. — It is, exce])t what I heard from his brotlier. Notliing more than that.

(I. — ^Vllere was Mr. G. \V. McMullen going when you had this conversation with him
in April?

A. — He was at home then in C'hicago. It was in Chicago it occurred.

Tlie first conversation occurred at my father's housi; iu Beechville, .ibout five miles
west of Woodstock. I think he Mas on his way tlien to Ottawa, but I am not certain.

(I. — I believe you mentioned the dates at wliicli these conversations took place respec-
tively ?

A. — Yes. One was in April, and tlie other conversation was in July, I think.

(I. — Have you mentioned the vear?

yl.-It wasin 1872.

(I. — What time in July ?

.1.- — It was in August the second conversation took place.

(I. — What time in July was the first convei-sation ?

.4. — The first conversation was in April.

Q. — What time in April?

A. — I cannot say. I am not certain that it was in April, liut I tliink so.

(>. — What time in August was the s(>coiul conversation?

A. — About the middle of the month. I remaiii'd in Chicago at that time a week, and
from Monday till Saturday I was out on the jivairies, and then I returned to Chicago,
;ind left there on the 21st August.

Q. — Did Mr. McMullen show you any ])ai)ers?

A. — Nothing Init this letter, and he did not hand it to me, but only read me a ])or-
tion of it.

Q. — Do you remember the contents of it ?

A. — I do not know that I do. I did not pay any particular attention to it at tliat
time.

It was a letter tliat he receivcnl in August when 1 was there, from Sir Hugh Allan.

it — Was any person present besides Nir. McMullen and yo.irself?

A. — There wai not. 'J'here were otiicr persons in the liouse, but we were alone in tiie
drawing-room at the time. It was at his brother's house.

Q. — Where did he take the ])aper from ?

A. — I think lie had it in his hand when ho came in.

2 II

Canada.

238

CORRESPONDENCE RELATIVE TO THE

Canada. Q. — Was there anybody witli liim when lie came in ?

A. — No; he was alone. He had it open in his hand.

Q. — Was he apparently reading it ?

A. — Yes. I was in the room when he came in. He then made the remark to me
that I have mentioned.

And further deponent saith lot, and this his deposition having been read to him, he
declares that it contains the truth, persists therein, and hath signed.

Sworn and taken on the twenty-lburtli day
of September, 1S73, and acknowledged
on the twenty-fifth day of said month
and year.

(Signed)

(Signed) FRED. C. INIARTIN.

CHARLES DEWEY DAY,

Chairman.
A POLETTE,
JAMES ROBERT GOWAN,

Commissioners.

IN THE MATTER OF THE COMMISSION

Provivce op On'TARIO,
Citi/ of Ottawa.

Appointing Chahi.L'S Dewky Da'x, Axtoi.vk Polktti:, and James Robert CrOWA\, Com-
missioners to inquire into and report upon the several matters stated in a certain
Resolution moved by the Hon. Mr. HuNTiNnrox in the House of Commons on the
second day of April, a.d. 1873, relating to the Canadian Pacific Railway.

Present: The CoMaissioxEus.

On this twenty-sixth day of September, in the year of our Lord One thousand eigh
hundred and seventy-three, personally came and appeared bel'ore us, the above-named
Commissioners,

THOMAS WHITE, junior, of the city of Montreal, who being duly sworiiv deposeth
and saith :

I am a resident of Montreal.

Q. — What is your i)rofession ?

A. — PuMisluT.

Q.— Pul)lisIuT of what?

A. —The ' Montreal Gazette.'

(2. — Do you know tlie charges which are recited in the Commission ; are you familiar
with them, or shall I read them to you?

A. — I know them.

Q. — Do you know Sir Ihigli Allan?

A— I do.

(I— Do you know :Mr. G. W. McMullen?

A.-l do.

Q. — Have you any knowledge concerning any agreement between Sir Hugh Allan on
one side and Mr. G. W. McMullen on the other, representing certain United States
capitalists, relating to the construction of llie Canada Pacific Railway?

A. — I have no knowledge of any formal agreement. 1 am awar<! that during the
session of 1872 Mr. McMullen was in Ottawa representing certain American capitalist-;,
as he stated, and was interesting himself in the construction of the Pacific Railway.
During the earlier part of the session he was in very frequent communication with
gentlemen in the House who were interesting themselves with Sir Hugh Allan in this
enterprise, and I saw him ficcjuently at that time, and had conversations with him. 1 am
also aware that towards the close of the si'ssien Mr. Abbott, with whom I had lre<[uent
convirsations, looked ujion American cennection as al)andoned. I am aAvare too that Sir
George Cartier, with whom I had lre(jiient conversations during that session, was very
much ojiposerl to the American connection lor the construction of the Railway, and was
anxious to ])romote the interests of Mr. Mac])herson's Com])any as an offset to it. I had
one conversation with Sir George Cartier especially, in whicli, while ])rofessing a desire to
see Sir Hugh Allan connected with the (,'ompany, he expressed his determination to have
the Company so formed as to exclude the jwssibility of American connectiou.

Q. — Do you recollect the date?

A. — It was whilst the Bills were before the House. The conversation occurred before
the close of the Session. It was at his own house and lasted two or three hours. The
Northtrn Colonization Railway at that time was a prominent question in Montreal, and

remark to me
ead to him, lie

J. MARTIN.

i^ DAY,

Chiiirman.

GOWAN,

ommissioners.

ISSION

/r Go-\vAX, Com-
i\to(l in a certain
Commons on the
lailway.

e thousand eigh
;hc above-named

sworn, deposctli

are you familiar

ITno-h Allan on
lin Ignited b^tates

that during the

. rican rapitalists,

Pacifu- Railway.

inumication with

ivr\\ Allan in this

with him. 1 am
iin I had lre(iuent
lAvare too that Sir

si'ssion, was very
Railway, and was
ifikttoit. I had
J'essinu; ii desire to
rmination to have
•ction.

m occurred before
hrce hours. The
in Montreal, and

CANADIAN PACIFIC EAILWAY.

230

I was giving it support through the newspaper, and it was in connection with that, that
fears were entertained by some of the promoters of that scheme, that Sir George was
opi)Osed to it, and that this conversation arose.

Q. — When did your conversations take place with Mr. McMullen?

A. — Ii. the early part of the Session. I had known Mr. McMullen for some fifteen
years.

Q. — Do you know whether the Government gave him any encouragement in this
scheme ?

A. — I cannot say.

Q. Had you any conversation vith any other member of the Government than
Sir George Cartier on the subject ?

^.— No.

Q. — H<ad you any conversation with Sir Hugh Allan on the subject?

A. — I had conversations with him on general Railway matters. I understood liis
policy was to unite all the schemes with which he was identified as the easiest way to
secure the construction ol those in the Provinces of Ontario and Quebec.

Q. — Were \ou aware tliat he was associating himself with, or that negotiations were
going on between him and those Americans ?

.1. — I inlirrcd from the conversations I had with Mr. McMullen and Mr. Abbott that
such was tlie case, but I had no direct knowledge of any formal agreement.

Q. — ^Vas Mr. McMullen or any other person present at this conversation you had with
Sir George Cartier?

^.— No.

Q. — Do you know anything more in reference to this branch of the subject?

A. — Nothing more.

(2. — Dill you take any interest in the elections in Montreal in 1872?

A.— I (lid.

Q. — Were you on any of the Committees in Mojitreal ?

.1. — I was on the Committee for West Montreal l)Ut not on the Central Committee.
I was rreii'.iently at the meetings of the Central Committee, but not a member of it.

Q. — Did you take any part in the election of Sir Geoi-ge Cartier?

A. — No direct part.

Q. — Were you on liis Committee?

A. — I was not on his Committee.

Q. — Do you know whether any money was subscribed for the purpose of promoting
the Montreal elections ?

A. — I am aware that there was a fund as there always is at elections.

Q. — Do you K:;ow the amount of it?

A. — No, I have no knowledge of the an :iit of it.

Q. — Do you know whether Sir Hugh Allan was a subscriber to that fund ?

A. — I have no personal knowledge that he was a subscriber.

Q. — In whose hand was the fund ?

A. — Mr. Retournay, now Judge Betournay, was Chairman of the d uimittee, aud I
think any cheques that were drawn were drawn by him.

(}. — Cheques upon whom ?

A. — Cli'Miucs upon the Metropolitan Bank.

Q. — Did you understand that the; funds were deposited there?

A. — I understood that the funds of the Central Committee w< lo deposited in the
Metropolitan Bank.

Q. — Who drew those cheques?

A. — Mr. Betournay usually, 1 think. I saw him draw a good many cheques.

Q. — Do you know anything of the amount ?

.4.— No, I do not. I think the largest amount paid out was i'uv i.invassers. This
system o<" i ;'ivassing has always prevailed in Montreal. The canv.issers got their pay
every Saturday.

Q. — Do you know of any understanding between Sir Hugh Allan and the Government,
i-.r any member of the («overnment or their supporters, for raising money for the
elections ?

A. — I do not.

Q. — Is there anything more that you have to state in relation to this matter?

A. — Nothing in relation to those charges.

To Sir John A. Macdonald, throui>;h the Chairman.

Q — You say tliat you know »liat Sir George Cartier, in order to counteract any
aMpnhendcd American iulluence, attempted to strengthen the Iiiteroccauic Company ?

2 H 2

Canada.

240

CORRESPONDENCE RELATIVE TO THE

Cahaba, j_ — I am aware of it.

Q. — Do you know that Sir George favoured the introduction as corporators in that
Company, of some leading Lower Canadians for that purpose?

A. — I am aware of it.

Q. — Can you mention their names ?

A. — The names mentioned at the time were Mr. Tourangeau and Mr. Simard.

Mr. Tourangeau was one of the members of the House I'or Quebec East at that time,
and Mr. Simard was the member for Quebec Centre.

Q. — They were corporators in Mr. Macpherson's Company ?

.4.— Yes. »

Q. — You know pretty well all the names of the corporators in that Company, and in
the Canada I'acific C()mi)aiiy ?

A. — Yes. I have looked at them frequently.

Q. — Are there any American names mentioned in either of those Companies ?

A. — I think not.

Q. — Do you remember anything about an original draft of the Canada Pacific
Railroad Charter?

A. — I tliiiik tliat Mr. Abbott caused tlie original draft of that Charter to be printed
before tlic Session.

Q. — Before the Session of 1872 there was a draft of the Act of Incorporation of the
Canada Pacific Railway Company; there were Americans included in that?

A. — There were.

Q. — Mr. McMullen's name was in it ?

A. — I think so, and Mr. Smith's of Chicago.

Q. — That draft was atjaiuloned ?

-1. — Yes. I tliink it was never introduced at all into Parliament.

(2- — How do you account for its being abandoned ; was it because of Sir Hugh Allan's
connection witli Americans, and consequently tliat such an Act would not be acceptable
to Parliament?

A. — That was, I understood, the reason for its non-presentation.

Q. — You tlien understood from Mr. Abbott, who svas i)romoting the Bill wliich is
now on the Statute Book, that all connection with the Americans had been abandoned ?

A. — Yes, and towards the close of the Session that was the general impression in regard
to the Canachi Pacific Comjiany.

(2. —Mr. McMuUen must have known tliat at the time?

-1. — He must have known it, but I have no knowledge that he did know it.

Q. — You say, with respect to the expenditure of money for the elections in Montreal,
vou were on the Committee for tlie \Vestern Division?

^.— Yes.

Q. — You don't know personally what was the expenditure in Montreal East ?

A. — I do not. I think it was very large.

Q. — You s!iy the largest item in the expenditure was the payment of canvassers ?

A. — Yes, the payment of paid canvassers. That was a plan which was adopted by
both sides.

Q. — Hotli jiarties had paid canvassers?

^.— Yes.

(2.— Was there a very large expenditure for that purjwse, besides other expenses, in
Sir George Cartier's election ?

A. — There must have been from the number of paid canvassers. I cannot form any
estimate of the amount, but it was several tliousand dollars, judging from the whole
expenditure that took place.

(I — Do you know anything about a sum of $25,000 being raised by the supporters of
Mr. Jettc! for his election?

A. — Nothing but the rejxjrt prevailing at the time. There was a very large sum
raised, and I understood it was $25,000.

Q. — To assist Mr. Jette in defeating Sir George Cartier?

^.— Yes.

(I — Do you not know that by Hom\; mysterious process a good deal of Sir George
Cartier's money went to the other side ?

A. — That was the impression at the time. There is no doul)t of our being sold. Men
who had i)een working with us were found on the day of the election to be working lor
the other party. That was the case in both tlir Eastern and AVestern Divisions, i do
not know whether we were outbid or not, but these men were found working on the day
of the election on the other side.

CANADIAN PACIFIC RAILWAY.

241

lorators in that

jinpany, and in

lev oxpenscH, \n

of Sir George

Q. — You liavc read Mr. McMnllen's letters, in which he makes charges of corruption
against the Government, and in fact everybody else?

A. — I have.

Q.—l think he has included you?

A.— He has.

Q. — Would you be kind enough, with the permission of the Commission, to state
exactly your relations with Sir Hugh Allan, and also what were his relations with your
nc\vspa])er '!

A. — The copyright of ihe 'Gazette' was purchased from Sir Hugh Allan and Mr.
Brydgcs by T. and R. Wliite (our firm) in 1870. The plant of the office was leased to
us — leased ui-o:" the understanding, or upon the condition, that after a certain expen-
diture in the way of salaries the profits siiould be divided, and that we should have the
riglit to j)ui'chase within ton years for $1)0,000. Tlie papers were made out, at Mr.
Brydges' request, in the name of Sir Hugh Allan; hence our relations in the first
instance with Sir Hugh Allan rather than with Mr. Brydges. Alter some time we
became anxious to comi)l<!te the jjurcliase upon the terms agreed upon, and applied to
Mr. Abbott, by whom the pajjcrs had been drawn in the first instance, or rcther revised
after being drawn by a notary, — we applied to him to arrange with Sir Hugh Allan for
tlie purchase. Sir Hugh Allan was quite willing; but he thought he should be paid in
cash, which was not convenient for us to do then. While these negotiations were going
on througli Mr. Abljott, the Montreal Northern Colonization Railway was tlie promi-
nent subject of discussion at the time. Mr. Abbott sent for me one day, and told me
that he tliought lie could have the matter arranged, and that in view of the support
which the ' Gazette ' had given to the Northern Colonization Railway, in which Sir Hugh
Allan was deeply interested, he thouglit tiiat there sliould be some consideration allowed
for that, and tiiat the Company would lie disposed to agree to it. He therefore suggested
that the i)a])ers be drawn up lor $20,000 instead of $30,000. That was in January or
Fei)ruary, 1872. We declined the arrangement, and said that we only wanted the
purchase comiileted at the $30,000.

Therefore the first charge made by Mr. McMuUen is entirely untrue. In the second
letter of Mr. McMnllen's there is a charge made that we threatened Sir Ilugli AUnn
with exposure unless he consented to an arrangement before leaving ibr England.

Having now Jieard read the portion of Mr. McMuUen's second letter, which refers to
tills matter, and on being asked if that statement is true, I say that the statement is true
as a matter of fact. Matters were " fixed up." The statement is strictly true in that
rcsjiect; but in regard to the impression which it conveys it is entirely false.

The efforts made to get the paper into our own hands were prompted by two motivi's :
first, the business promise<l to be a profitable one. In the next place. Sir Hugh Allan's
connection with jiublic enterprises in difl'erent parts of the country rendered it necessary
that Sir Hugh Allan's connection with the paper should cease, so that no person could be
able to say that the ' Gazette ' liad any connection or was under the influence of Sir
Hugh Allan.

We wanted the arrangement to be carried out, if possilde, before Sir Hugh Allan Icit
for England, and the i)aper transferred entirely over to us. Alter the jiapers had been
drawn up — some four or five days bel'ore Sir Hugh left for England — he thought that he
should have a larger interesr upon the unpaid sums, and the papers had all to be made
over again at a larger rate of interest. They were then signed belbre he left for England,
the amount mentioned in tlu;m bv>ing that named in the first lease when we first purchased
the good-will of the paper.

Question by the Commission :

Q. — With whom did you see the printed Bill, prepared by Mr. Abbott, that you
speak of?

^1.— With Mr. Abbott.

Q. — In what form was it?

A.- -It was in the usual form,

Q. — Where was it printed ?

A.— I am not very sure ; I think it was printed in our office. I saw it first in Mr.
Abbott's possession.

Q. — Did lie give you a copy of it?

A. — No he did not,

Q. — Do you kno*v of any one having got a copy of it ?

A. — I do not.

Q. — You have no knowledge as to whether he exhibited it to any one else ?

A. — I have not.

Oakaoa.

■■'. ?

242

OORllESPONDENCE RELATIVE TO THE

Cakada. ]\ir. McMiiUeii, I siii)pose, knew of it.

I knew such a Bill was printed, and that tliere were American names in it.

Q. — For wliat purpose did Mr. Abbott sliow you the Bill ?

A. — Because we were in constant communication with regard to railway matters.

Q. — Fen' wliat purpose did you say that he sliowcd it to you ?

A. — In tlie ordinary course of conversation; not for any specific purpose. I think I
knew almost everything that was going on in connection with railway matters at that
time.

Q. — The names of the American capitalists were Mr. McMnlIen and Mr. Smith.
Were there any other names?

A. — No; I don't know of any others.

And further deponent saith not, and this his deposition having been i*ead to him he
declares tliat it contains the truth, persists therein, and hath signed.

Sworn, taken, and acknowledged on this 1
twentv-sixth day of September, 1873. j

(Signed)

(Signed) TIIOS. WHITE, JuN.

CHAIILE;:: DEWEY DAY,

Chairman.
A. POLE'TE,
JAMES liOBERT GOWAN,

Commissioners.

IN THE MATTER OF THE COMMISSION

Provixce of O.vtario,!
Cit>/ of Ottawa. )

Appointing Charles Dkwey Day, Axtoine Polette, and James Rouert Gowan, Com-
missionei-s to inquire into and report upon the several matters stated in a certain
Ri'Kolution moved by the Hon. Mr. Huntix«ton', in the House of Commons, on
the second day of April, a.d. 1873, relating to the Canadian Pacific Railway.

Present: The Commissioners.

On this twenty-sixth day of September, in the year of our Lord, one thousand eight
hundred and seventy-three, personally came and appeared before us, the alcove-named
Commissioners,

Tlie Honourable HECTOR L. LANGEVIN, of the City of Ottawa, being recalled on
the application of Sir John A. Macdonald, Avas by permission of the Commission,
the second time examined, who being duly sworn, deposeth and saith :

Q. — I think you stated in your previous examination that you had taken part in the
elections on the Ministerial side in the District of Quebec?

.1.-1 did.

(t — And that you had raised funds for that purpose ?

.1.— Yes.

(2— How much did you say you had raised; how much did Sir George Cartier
send you ?

J.— $32,000 I think.

Q. — Have you been a good deal connected with elections in your part of the couutry
for many years ?

A, — Yes.

(2. — D<» you consider that that subscription or tliat expenditure was excessive in your
part of the country, as compared with previous expenditures ?

.1. — I consider tliat the expenditure at the last elections was greater than at the
previous elections, speaking of the expenditure in the elections around.

Q. — The expenditure on liotli sides was much larger in 1S72 than in 18{)7?

.1. — Yes, much larger.

Q. — Which was the most expensive election in your part of the country ?

A. — I think it was Quebec Centre.

Q. — Who were the candidates?

A. — The candidates were Mr. Cauchon and Mr. J. G. Ross, merchant.

Q. — Can you form any idea as to the expenditure in that single election ?

A. — I uncierstand that the exjienditure was — in fact I know that one of tlie candidates
I'XiKMided nearly $l.'"),Of)(), and I understand that on the other side the friends of the
otiicr candidate expended nearly !j!30,000.

(i. — You say that one of che candidates expended $15,000 ; wl n was that candidate ?

. 1 . — Mr. Cauchon.

(I. *

"?;

CANADIAN PACIFIC RAILWAY.

243

iiid Mr. Smith.

read to him he

V'lIITE, JuN.

G corse Car tier

t of the country

(I — IIow (lid you know tliat he expended that amount ?

A, — I knew it from liimself,

Q. — IIow do you know the expenditure on the other side ?

A. — I do not know it from Mr. Ross, but I know it from some of his friends, and it
is a matter of public notoriety in Quebec that the expenditure on that side was nearly
dou'yie that on Mr. Cauchon's side.

Q. — There was a good deal of riot in that election ?

A, — Yes, and loss of life also. One man was killed. Perhaps I might be allowed on
that point to state this also, thiit none of the money that was entrusted to me for the
elections was expended in this election of Quebec Centre. I make this statement
specially because it has been stated outside, of course by my ojjponents, that they were
not surprised now to find that there had been so much rioting and loss of life in that
election of Quebec Centre ; and, of course, I wish it to be well understood that I had no
part in that election.

Q. — You stood aloof from the election, did you not ?

A. — Yes. The fact is, Mr. Cauchon gave me to understand that he was friendly to
the administration, and so did the friends of Mr. Ross, on the other side, give me to
understand that Mr. Ross was also friendly to us ; and finding therefore that our friends
in Quebec Centre were divided, some supporting Mr. Cauchon and others Mr. Ross, I
stated to Mr. Cauchon and to Mr. Ross's friends that under the circumstances the
Government would take no part in that election, but that they would leave their friends
to fight the battle out themselves, and elect what candidate they thought right under the
circumstances.

Q. — Are you aware of the election contest in the Missisquoi ?

A. — Nothing special.

Q. — That is not in your district ?

A. — It is not in the region I was looking after.

Q. — You know nothing of the expenditure there?

A. — No, only by hearsay.

Q. — Do you know anything ofth(! expenditure in Kamouraska?

A. — Not personally, but 1 understand it was very large.

Q. — Who were the candidates?

A. — The candidates were Mr. Pelletier on the Opposition side, and Mr. Routhier (now
Judge Routhier) on the other side.

(},. — The expenditure was very large in that County?

A. — It was very large.

'2. — IIav(! you any moans of judging approximately of the expenditure there ?

A. — If I could judge from public rumours, I should suppose that it was between
$10,000 and $18,000.

Q. — On bo A sides ?

^.— No ; about $8,000 or $0,000 on each side.

Q. — Whicli is Mr. Fournier's County ?

A. — Bellechasse.

Q.—Do you know anything about the expenditure there ?

^1.— No; but I understood it was large on botli sides.

The fact is that in all ihe elections the expenditure was very large; much larger than
usual. My political friends from the ditt'erent portions of the eastern part of Lower
Canada all state that tb.c expenditure against them was such that they could not stand it.
This accomits to a very great extent for the loss of some of the Counties there.

And further deponent saith not, and this his deposition having been read to mm, lu'
lu "lares it contains the truth, persists therein, and hath signed.

ISwcni, taken, and acknowledged'

(Signed) HECTOR L. LANGEVIN.

Canada.

on this twenty-sixth
of September, 1873

Igea »
day V

(Signed)

CHARLES DEWEY DAY, Chairman.

A. POLETTE,

JAMES ROBERT GOWAN, Commissioners.

244

CORRESPONDENCE RELATIVE TO THE

Canada.

PjtovixcK OK Ontario,)
Citi/ of Ottawa. j

IN THE MATTER OF THE COMMISSION

Appointing CitAiirx-* Dkwky Day, ANTOiNf; Poleitk, and Jamks Riihert (iOwax, Oini-
missiontTs to inquire into and report njwn the several matters stated in a certain
Resolution moved by the Hon. Mr. HrNTiNOTOX, in the House of Commons, on
the second day of April, a.o. 1873, relating to the Canadian Pacific Railway.

Present: Tiir; Commipsio.vkrs.

On this thirtieth day of September, in the year of our Lord one thousand eiglit
hundred and seventy-three, personally came and appeared before us, the above-named
Commissioners,

The Hon. GEDEON OUIMET, of the City of Quebec, Provincial Secretary and Member
of Public Instruction for the Province of Quebec, who being duly sworn, deposeth
and saith :

Having heard read that portion of the charge contained in the Royal Commission,
which reads as follows :

" That in anticii)ation of the Legislation of last session, as to the Pacific Railway, an
agreement was made between Sir Hugh Allan, acting for himself and certain other
Canadian Promoters, and G. VV. McMulIen, acting for certain United States caj)italists,
whereby the latter agreed to furnish all tlie funds necessary for the construction of the
contem])lated Haihvay, and to give tiie i'ormer a certain per centage of interest, in consi-
deration ol' their interest and position, the scheme agreed upon l)eing ostensibly that of a
Canadian Company, with Sir Hugh Allan at its head."

I have no knowledge of such an arrangement, and I would add that, from communi-
cation with Sir (ieorge Etienne Cartier, Sir Hugli Allan, and some of the Directors of the
Northern Colonization Railway, I was induced to think the contrary. ,

I do not know (i. W. McMullen.

I do know Sir II. Allan.

I have never had any knowledge touching this arrangement, or any other of the kind.

I have no knowledge that the (ifovernment entertained the idea of entering into an
arrangement of this kind. I say this l)ecause of frequent communications with the late
lamented Sir George Cartier, who certainly entertained altogether contrary opinions.

I don't know that the Government, or any member of tlie Government, entertained the
idea of entering into arrangements witli Americans, or of forming any Company for the
purpose of constructing the Pacific Railway in which American capitalists were to be
included.

Q. — What was the nature of your relations?

A. — As a member of the CJovernnient of the Province of Quebec, I took an active part
in the policy inaugurated l)y that Government in favour of the construction of railways
^vitllin the limits of our Province, among others the Montreal Northern Colonization
llailway. After the formation of tliat Company, the Government of Quebec did me the
lioiiour to select me as one of the directors to represent that Government in this Company.
Iji'vond my interest as a member of tiie Government, I was much interested in the con-
struction of tiiat Railway, as being a proprietor in the City of Montreal, and also as a
member in the Local Legislature for tlie County of Two Mountains, through which tlie
contemplated Railway was to pass. I also took an active part with my friends in
endeavouring to induce tlie citizens of Montreal to subscriiie the million of dollars which
was asked for that great enterprise. The question of a depot within or near the limits of
tlie City of Montreal was considered one of vital importance for the town as well as for
the province of Quebec. With a view to securing the success of the Railway, we addressed
ourselves to Sir Hugh Allan in his capacity as a great financier and as an eminent man
in our province, in the hope to secure a more easy and certain result. It was thus, when
♦ he Pacific Railway came up as an important political question in the Confederation, that
1 made efforts with my friends with a view to have this gretit Railway united with the
Northern Colonization Railway, that it might pass through the Province of Quebec and
V:.,y. iin depot within or near the City of Montreal; and it was then that I worked to
favour the Pacific Railway, the object being to secure the success of the Northern Colo-
nization Railway. My communications with Sir Hugh Allan were to this effect, and it
was equally with the same olvjects in view that my name appeared as one of the provi-
sional Directors in the Canada Pacific Railways Act of 1872 ; and concerning the apjiear-
ance of my name in the Act of Incorjioration, I may say that I only knew of its being
there after the Bill had passed through the committee, and, as I said IjHjfore, I was suffi-
ciently favourable to the enterprise not to make any objection, and I made none. This

CANADIAN PACIFIC RAILWAY.

346

IISSION

IT Go\7A>r, Com-
ated ill a oiTtaiii
ol' Commons, on
[ic Uailway.

tlioiisaiul fight
;he above-named

ary and Member
sworn, deposeth

yal Commission,

cific Railway, an
lid certain other
States cajjitalists,
nstruction ol'tlie
interest, in eonsi-
tensibly that ol' a

from communi-
; Directors ol' the

ther of the kind,
entering into an
^ns witli the late
ary opinions.
, entertained the
Jompany for the
ilists were to Ijo

ok an active part
:tion of railways
ern Colonization
lebec did me the
in this Company,
ested in the eon-
1, and also as a
rough which the
1 my friends in
of dollars which
lear the limits of
n as well as for
ray, we addressed
an eminent man
t was thus, when
infederation, that

united with the
c of Quebec and
that I worked to

Northern Colo-
his effect, and it
ne of the provi-
ning the appear-
new of its being
ifore, I was sufl'i-
lade none. This

Bill, which is .^'ith Vict., chap. 73, was discussed, I think, in tlie month of May, 1872, Canada.
and I was then in Ottawa, not only in the interests of the Montreal Northern Coloniza-
tion Coinpany, but for the purpose of meeting my colleagues in the Quebec Government,
the Honourable Messre. Chauveau, Beaubien, Archanibault, and Irvine. We had at the
time several meetings of the Executive of Quebec, at Hull. This, then, was the interest
which I had in this question of the Pacific Railway, an interest altogether relative to tlu;
Northern Colonization Railway. In a conversation which I had with Sir Hugh Allan in
April or May, 1872, that gentleman asked me to neglect nothing in the interests oi the
Northern Colonization Railway. lie also spoke to me in the interests of the Cor.serva-
tive party, to which he attributed his commercial prosperity in a great measure, and did
not hide from me the fact that that i)arty had already made efforts to maintain his Steam-
ship Company, and that he was convinced the party had ruade sacrifices in his favour, or
words to that effect. I did not fail to tell him that I was doubly interested myself in the
success of the Northern Colonization Railway, of which he was Pres'ueiit, as well Irom
being a member of the Government of Quebec, as Irom being mehiber of the County of
Two Mountains, and that I should make efforts to have this line traverse the county that
I represented.

The aid which I gave to Sir Hugh Allan relative to the construction of the Pacific
Railway at Ottawa or elsewhere was of a friendly character as a citizen who was inter-
ested in this great enterprise, and interested more directly, as I have already explained,
in the construction of the Northern Colonization Railway. Sir Hugh Allan, nor anyone
else, ever engaged my service as advocate, nor in my character as Attorney-General of
the Province of Quebec (a charge which I have already denied) in the interests of the
Pacific Railway.

I procured the aid which I have already spoken of to Sir Hugh Allan because I wa i
in communication with Sir Hugh Allan as a Director of the Northern Colonization Rail-
way. I may add that Sir Hugh Allan ai)peared to honour me with his confidence.

I endeavoured to induce my friends from the Province of Quebec who were members
of the House of Commons not to lose sight of the interests of our Province, and to favour
the Northern Colonization Railway, and if that influence was favourable to the Pacific
Railway, with a view to its union with the Northern Colonization Railway, I induced
them to give it, but I did not, properly speaking, give any aid to the Pacific Railway as a
question apart from the Northern Colonization Railway. I desire also to say that if I
had not been interested in the Northern Colonization Railway I would have liad nothing
to do with the Pacific, because I was not a member of the House of Commons. For the
rest, I cannot see what influence I could have outside of that which I have just
mentioned.

Having had communication of letter which has been published in the newspapers, over
the name of G. W. McMuUen, and in which the following appears : " ^6,0U0 to Attorney-
" (reneral Quimet for aid rendered at Ottawa," as having been paid by Sir Hugh Allan,
and being asked for any ex])lanations on this point, I say in reply: — Having never been
asked by the Company, nor by any i)erson whatever in its interest, nor by any person for
for my services as a lawyer or otherAvise, and it being impossible that I should be engaged
by the Company in any quality as Attorney-General, my services as such being of no
assistance either in the obtaining of the Charter or the contract, having acted only as a
friend to the enterprise, as a citizen desiring it to come to a good end, I affirm that I
never received the sum of $6,000 in question, nor any sum whatever. I affirm, moreover,
that I never had, either directly or indirectly, either from the Company or from any
friends of the enterprise, any promise of money, or of anything else.

I never received any sum of money from Sir II. Allan, nor from anyone else, either
directly or indirectly, as I have already said. I was largely interested myself in the
Northern Colonization Railway Company and road. I have in its interest disbursed
considerable sums, and undergone much fatigue, but, God be thanked, without recom-
pense, or hope of recompense, hoping only that to the Province of Quebec may accrue the
benefits which will flow from the construction of the Northern Colonization JJailway.

I do not know if Sir Hugh Allan paid $4,090 to the ' Minerve,' nor of the other sums
mentioned by McMullen in his letter as having been paid by Sir Hugh Allan. 1 do not
believe a word of them or of the other charges made by him.

I do not know whether the Government or any member of the Government had any
knowledge of the negotiations spoken of before between Sir H. Allan and Mr. McMullen,
nor do I know if Sir Hugh Allan had any negotiations with Mr. McMullen.

The second part of the charges contained in the Royal Commission is as follows;
" That subsequently an understanding was come to between the Government, Sir Hugh
" Allan, and Mr. Abbott, one of the members of the Honourable House of Commons oi"

2 I

2-10

("OnRESPONDEXCE RELATIVE TO THE

Oanada.

'■ Caiiadn, that Sir Muf^li Allan and liis IViciids slioiild advaiue a lar^c sum of money for
" the puipost- of aidini; the eh'ctioiis of Ministers and their suj)]K)rters at the en^uin^
" {general elections, and that he and his friends should receive the contract for the ron-
" struct ion of tlie Kaihvay."

1 declare that I know nothinu: of it. I could say, however, that I had some conversa-
tion with Sir (ieor^e ('artier in June, July, and August, 1H72, in which lie spoke to me of
Sir IIuji;h Allan, the Allan Company, the I'acilic Railway, and the Northern Colonization
Uailway. Sir Ceori^e rehutted the idea of any connection of American capitalists with
the Pacilic Railway, and said that he never would consent to such a thinj;, and that lie
thouj^ht that the roads should be constructed without the aid of American capitalists.
While expressing his appreciation of tlic merits of Sir Hugh Allan, Sir (jfoorge Cartier
did not appear to me to be on very I'riendly terms with liim — tliat is to say, on terms of
personal friendsliip. Nevertheless, he thought that Sir Hugh Allan, from liis jKJsition,
would he of great assistance to the Pacific Railway. He told me that he wished to see
the amalgamation of the Macplierson and Allan Companies, and that he liad been unjnsty
reproached with opposition to the Northern Colonization Railway in favour of the Grand
Trunk Railway. I remarked to him that I ri'garded it as unfortunate that his Govern-
ment had not settled this (piestion of the contract of the Pacific Railway before the
elections, because, I added, that this question would militate against him in the Province
of Qnebi'c, and particularly in Montreal East. 1 said to him also that Sir Hugh Allan
had to'd m»' that he owed his commercial jjrosperity in a great measure to the Con-
servative ])arty, and that I thought that Sir Hugh or his Company would aid him by
influence or otherwise in his election. Sir (ieorge thereupon said that lie could not
entertain much hope that Sir Hugh Allan or his Company, meaning the Montreal Ocean
Steamship Company, would come to his assistance, but as for himself (Sir George) he had
several times ])ut his portfolio in danger to malniiJn or obtain the subsidy for the Allan
('omj)any. Sir George told me this in that energetic language which lie ordinarily used,
and which is well known to those who were familiar with him. I had the honour to
occupy myself in the election of Sir George at the last elections, and, notwithstanding that
liis friends urged him to let us make his election on the basis of the railway policy, and
particularly the Pacific, he would not consent, saying that he would conduct his election
on his own jiersonal merits.

I have not any knowledge that Sir Hugh Allan advanced a sum of moiujy to aid in
the I'lection of Ministers and their sujjporters. 1 wei>', a few times to Sir George's Central
Election Committee, but 1 know nothing of the distribution of the money. Of course I
know fi'om peisinial experience that it was necessary to spend money on that as on other
elections.

No memhers of the Government ever told me that Sir H, Allan had advanced money
for the elections, nor did Sir H. Allan ever tell me.

This conversation with Sir George Ca"tier. in reference to the road that I have men-
tioned, took place at several intervals, aud I tiiiiik that the last conversation 1 had with
him was two or three days liefore the polling in the Eastern Division of Montreal, iu
which Sir (ieorge was a candidate.

Q. — Do yon know the date on which the polling took place?

A. — Late in the month of August.

lieing asked if I can give any ex])lanation, or if I have any idea why my nanii! is men-
tionetl in McMullen's letter, as having received ^(i,OOU, I declare that I have no idea how
my name came to be mentioned. The charge is wholly false.

And further deponent saith not, and this his deposition having been read to him, he
declares that it contains the truth, persists therein, and hath signed.

Sworn and taken and acknowledged on the | gj ^^^^j. GEDEON OUIMET.
thirtieth day oi September, 1873. J v » /

(Signed) CHARLES DEWEY DAY, Chairman.
A. POLETTE,
JAMES ROBERT GOWAN, Commissioners.

CANADIAN PACIFIC RAILWAY.

247

aJvancisd money

LIST OF EXHIBITS.

A. " Sealed Packet " addressed " Hon. Henry Starnes," and subbcribed ''Sir Hugh Allan,"

"G. W. McMullcn."
A 1. Letter IVom Sir Hugh Allan to Hon. J. J. (). Abbott, consenting to the opening of
the sealiHl packet, dated Montreal, Septeml)er 2, IH73.

B. Letter I'rom James lieatty, jun., to Sir F. Hincks, dated July 17, 1S71.

C. Reply of Sir Francis Hincks, datod July 20, 1871.

D. Letter from James Beatty, jun., to Sir F. Hincks, dated July 24, 1871.

E. Reply of Sir F. Hincks. dated July 26, 1871.

F. Letter of Hon. D. L. Macpherson to 'Mail,' dated July 8, 1873, containing his reply

to Sir Hugh Allan.

G. Telegram from Sir J. A. Macdonald to Sir G. E. Cartier, dated July 20, 1872.
II. Telegram from Sir G. E. Cartier to Sir J. A. Macdonald, dated July ,'{1, 1872.
I. Telegram from Sir Hugh Allan to Sir J. A. Macdonald, dated July 31, 1872.

J. Cojiies of a portion of correspondence between Sir II. Allan and C. M. Smith,

G. VV. McMullen, and George VV. Cass.
K, Copy of " First Contract " between Sir Hugh Allan and his American associates,

dated December 23, 1871.
L. Copy of "Supplemental Contract" between same parties, dated March 2S, 1872.
M. Copy of acknowledgment, dated April 1, ls7'2, from Jay Cooke and Co., to

G. W. McMullen, of his draft on various parties, to amoiuit of !3;.')0,00(), setting

out drafts numbered 1 and 2, &c. ; also of receipt by G. VV. McMullen, of fees for

Legislation.
N. Cheque by Sir Hugh Allan, on Merchants' Bank, for $17,500, in favour of

Hon. Henry Starnes, dated February 20, 1873, contained in "Envelope No. 2,"

portion of contents of A, or " Sealed Packet."
0. Memo, between G. W. McMullen and Sir Hugh Allan, February 2(5, 1873, contained

in small envelope addressed " Hon. Henry Starnes," portion of contents of A, or

" Sealed Packet."
P. Same as "K."

Q. Certified copy of Letter from Sir G. E. Cartier to Sir Hugh Allan, July 30, 1872.
U. Certified copy of Letter from Sir G. E. Cartier to Sir Hugh Allan, July .'JO, 1872.
S. Receipt for House Fees re Incorporation of Canada Improvement Company,

June 1, 1872.
T. Receipt for House Fees ?c Incorporation of Canada Pacific Railway Company,

June 1, 1872.
U. Letter from G. W. McMullen to Hon. J. J. C. Abbott, dated February 2.j, 1873.

Canada.

read to him, he

EXHIBITS.

COPIES OF LETTERS AND TELEGRAMS ENCLOSED IN ENVELOPE No. 1.

No. 1 Telegram.

Montreal, December 8, 1871.
I have seen Sir Francis to-day. He says they have determined to advertise, and that
it is of no use to visit Ottawa at present. I write you l)y mail.

(Signed) HUGH ALLAN.
C. M. Smith, Banker.

Letter No. 2.

Sir HroH Allan to Mr. Smith, dated London, 4th November, 1871, will be found
at jKige 52.

Telegram No. 3.

Sir HuQU Allan to Mr. Smith, dated Montreal, December 7, 1871, printed at
page 52. •> -■. .,( •

2 12

l-'E

S-i-

It'

248

Canada.

CORRESPONDENCE RELATIVE TO THE

Telegram No. 4.

Montreal, Derembcr 0, 1871.
I arrived here this morning and will be glad 'o sec you as soon as convenient.

(Signed) HUGH ALLAN.
C. Mather Smith, Banker.

Letter No. 5.

Sir Hion Allan to Mr. Smith, dated Montreal, December 8, 1871, printed at
page f).'}.

No. 6 Letter.

Sir Hugh Allan to Mr. McMullen, dated Montreal, December 29, 1871, printed iit
page 53.

No, 7 Letter.

Sir Iluan Allan to Mr. McMullen, dated Montreal, January 1, 1872, printed at
page 53.

No. 7. Letter A.
Deak Sir, Montreal, October 6, 1871.

I enclose copy of the communication sent to Sir John. Everything looks favour-
able at present at Ottawa.
I sail Irom Quebec to-morrow.

Yours truly,
(Signed) HUGH ALLAN.
C. M. Smith, Esq., of Chicago, Metropolitan Hotel, New York.

No. 7. Telegram (b), dated Father Point, October 8, 1871, printed on page 52.

Letter No. 8.

Sir Hugh Allan to Messrs. Smith and McMullen, dated Montreal, January 24, 1872,
printed on page 53.

Letter No. 9.

Sir Hugh Allan to Mr. McMullen, dated Montreal, IVb. 5, 1872, printed at
page 54,

No. 9 Telegram (a).

Montreal, Feb. 16, 1872.
Why is it that McMullen does not answer my letter ? I will be in Detroit on Wednes-
day evening, can I meet you there ?

(Signed) HUGH ALLAN.
Mather Smith.

Telegram No. 9 (b).

Montreal, Feb. 19, 1872.
! I think it is the Douglas Hotel, at Detroit. Don't fail to come.

(Signed) HUGH ALLAN.
C.M.Smith.

(•ANADTAN PACIFIO RAILWAY.

240

Letter No. 10. Canada

Sir Hioii Allan to Mr. Smith, elated Toronto, Feb. 23, 1872, printed at pogo 51.

871, printed at

1871, printed ut

1872, printed at

No. 11 Letter.
Sir Iluon Arj.AN to Mr. Smith, dated Toronto, Feb. 24, 1872, printed at page r)4.

No. 12 Letter.
Sir ITiGn Allan to Mr. Smith, dated Montreal, Feb. 28, 1872, printed at page 54.

iVo 13. Letter.

Sir Hran Allan to Mr. McMullen, dated Montreal, 4th March, 1872, printed at
jKige .'')4.

No. 13. Letter (a).
Dear Mr. McMullen, Montreal, April 1.'), 1872.

TIu; enclosed telegram from Mr. Cass reached me this morning. He wishes you
to go to New York, hut I wish to see you before you go. I leave here on ^Vednt>sday
morning, and will see you on Thursday morning. You will be able to leave for New
York on Thursday evening if you desire to do so.

Yours truly,
(Signed) HUGH ALLAN.

anuary 24, 1872,

872, printed at

No. 13. Letter (A).
Sir Iluon Allan to Mr. McMullen, dated Montreal, April 16, 1872, printed at

page 55.

No. 14. Letter.

Sir Hugh Allan to Mr. McMullen, dated Montreal, June 12, 1872, printed at
page 55.

Letter No. 15.

Sir HioH Allan to Mr. McMullen, dated Montreal, 10th July, 1872, printed at
page 55.

Letter No. 16.

Sir Hugh Allan to Mr. McMullen, dated Montreal, 6th August, 1872, printed at
page 58.

IGH ALLAN.

■' ' No. 17 Letter.

Sir Hugh Allan to Mr. McMullen, dated Montreal, IGth September, 1872, printed
at page 58.

No. 1 8 Letter.

Sir Hugh Allan to Mr. McMullen, dated Montreal, 24th October, 1872,' printed at
page 63.

Canada.

250

CORRESPONDENCE ET^LATIVE TO THE

Letter No. 19.

Dkar Mu. McMullk.v, Montreal, Uth November, 1872.

You really know as much about the Pacific Railroad contract as 1 do, and that
is Hot much.

I am assured that the Government have resolved to form a new C/ompany, but under
what conditions or who the parties will be I am ignorant. It is said that the whole
matter will be arranged by the end of the month, and if so, we will soon know it.
I have not changed my views of what it ought to be.

Yours truly,
G.VV. McMullen., Ebti., Pictou, Ont. (Signed) IIUGII ALLAN.

Note.— For residue of « Sealed Packet " see " N " and " O."

A 1.

Letter from Sir Hugh Allan to Hon. J. J. C. Abbott.

Dear Sik, Montreal, 2nd September, 1873.

Referring to the parcel of pai)ers deposited with Jlr. Starni>s, and which will no
doubt be produced bel'ore the Royal Commission, I authorize you on my behalf, to con-
sent that it shall be opened by the Commissioners. Rut I olyect to any of the papers in
it being used or published unless they are found to contain evidence which can be legally
or judicially used in the case.

Yours truly,
Hon. J. J. C. Ablwtt. (Signed) IIUGU ALLAN.

Letter from James Bcatty, jun., to Sir F. Ilincks, dated 17th July, 1871. (For this
letter see deposition of Sir F. Ilincks, page 100.)

Reply of Sir F. Ilincks, dated July 20, 1871. (For this letter sec de^wsition of Sir F.
Hincks, pa:' iOl.)

Letter from James Beatty, jun., to Sir Francis Ilincks, dated July 21, 1871. (For this
letter see deposition of Sir F. Hincks, page 101.)

Reply of Sir Francis Ilincks, dated 2Gth July, 1871. (For this letter see deposition
of Sir F. Hincks, page 102.)

Letter of Hon. D. L. Macpherson to ' Mail,' dated 8tli July, 1873, containing his reply
to Sir Hugh Allan. (For this letter see deposition of Hon. D. L. Maci)herson, page 111.)

[;:^s

Tdeijram from Sir John A. Micdonald to Sir Geonje E. Cartier.

(Private.) July 26th, 1872.

Have seen Macpherson. He has no personal ambition, but cannot, in justice to Ontario,
concede any preference to Quebec in the matter of the P., or in any other particular. He

GH ALLAN.

CANADIAN PACIFIC RAILWAY.

251

says the question about the P. sliould be left to the Board. Under these circumstances I
authorize you to assure Allan that tlie power of tlie Ciovernnieut will he exercised to
secure him the jiosition of P. The other teinis to be as agreed on between Macpherson
and Abbott. The whole matter to be k''})t quiet until after the elections; then t'le two
[gentlemen to meet the Privy Council at Ottawa, and settle the terms of a provisional
agreement. This is tl\e only practicable solution of the dilTiculty, and should be accepted
at once by Allan. Answer.

(Signed) JOHN A. MACDONALD.
Sir George Cartier, Ottawa.

Canad,\.

JGU ALLAN.

1871. (For this

i)osition of Sir V,

TcJecjram from Sir G. F. Cartier to Sir John A. Macdonald.

Kingston, 31st July, 1872.
(By Telegraph from Montreal.)

Rave seen Sir Hugh. lie withdraws letter written you since you make ol:jcction to it,
.ind iellcs ^or basis of arrangement on your telegram to me, of wliich I gave liim cojiy.

Alatters go on well here. Hope they are same with you. Don't think it is necessary
lor you to come down here Saturday. I want to be out of town on Sunday, but will
remain liere if you specially desire to see mc. Answer.

(Signed) G. E. CARTIER.
To Sir John A. Macdonald.

Tele(jram from Sir Hwih Allan to Sir J. A. }[aciloHnld.

Kingston, July ?,\, 1872.
(By Telegrapli I'rom Montreal.)

I have seen Sir George Cartier to-day, you may return my letter or regard it as waste
jiapor, it was not inti-nded as anytliing odicial. Your telegram to Sir George is tlie basis
or our agreement, whicli I have no doulit you will approve of. lie juirposcs to go out of
town on Saturday afternoon, and I am persuaded his liealth will be benefited thereby,

(Signed) HUGH ALLAN.
To Sir John A. Macdonald.

1871. (For this

,er see deposition

Copies of a portion of Correspondence hctwcen Sir Ihnjh Allan and Charles M. Sr.iith,
lleorge W. McMidkn, and George W. Caf<s, relative to the construction of the Canadian
Pacific Itailtray.

No' 1 Telegraph.

Father Point, October 8th. 1871.
Send to me, care of Allan Bros., & Co., Liverpool, the names of tlu parties engaged
with us in the Railroad enterprise.

(Signed) ll ALLAN.
C. M. Smith (of Chieago),»Metropolitan Hotel, N. Y.

No. 2 Letter.

Sir Hron Ai.I-a\ to Mr. Smith, 17, Graceehurch Street, London, November 4, 18/1,
printed at page 52.

No. .'}. Telegraph
Sir Huon Allan to Mr. Smith, dated Montreal, December 7, 1S71, printed at page 52.

Canada.

•252 CORRESPONDENCE RELATIVE TO THE

No. 4 Tele//raj)?:.

Montreal, Dcccmljcr 8, 1871.
I have seen Sir Francis to-day. He says they have determined to advertise, and that
is of no use to visit Ottawa at present. I write you by mail.
C. M. Smith. (Signed) HUGFI ALT.AN.

No. 5 Letter.
Sir High Ai.L.w to Mr. Smitif, dated Montreal, December 8, 1871, printed at page 52.

iVo. (') Letter.

Sir Hugh Allax to Mr. McMl"ij.i;.v, dated Montreal, December 2!>, 1871, printed at
page 53.

No. 7 Letter.

Sir Hugh Au.AN' to Mr. McMilmo.v, dated Montreal, January 1, 18":?, printed at
page 53.

jYo. 8 Letter.

Sir Hugh Allan to Messrs. Smith and ISIcMri.ijiN', dated Montreal, January 21, 1872,
printed at page 53.

No. Letter.

Sir Iluon Ai.i.ax to Mr. McMui.len, dated Montreal, Feljnnry 5, 1871, printed at
page 54.

No. 10 Letter.
Di'AU Sir Toronto, February 21, 1S72.

' "^Sinco writing to you yesterday I have seen Mr. D. L. Macphcrson, ol Toronto, who
is member of the Dominion Senate, and ratiier an important person to gain over to our
side He has been applied to by our opi)onents, and uses tliat as a lever by which to
obtain better terms from us. He insists on getting !?25(),00(» of stock, and threatens
opposition if he does not get it. You will remenilier he is one of those 1 proposed us a

1\viTl do the best 1 can, but I think that IMcMulleii,you an<I myself, will have to give
up some of our stock to conciliate these parties.

^ Yours truly,

C. M. Smith, Esq., Chicago, Ills. , (Signed) HUGH ALLAN.

No. 11 Letter.
Sir Huoii Allan to Mr. Sunn, dated Montreal, February 28, 1872, printed at page 51.

No. 12 Letter.
Sir Ilcaii Allan to Mf.McMullen, dated Montreal, June 12, 1«72, printed at page 55.

Letter No. 13.
My pkai! Silt, Montreal, July 1, 1872.

The negotiations regarding the Canadian Pacific Railroad are now apiiroaching a
termination, and I have no reaw)n to donlit they will be favoural)le to us. I have been
given to unfh'islaiKl bv Mr. McMullen tliat he lias regularly kept you mformed ol the

CANADIAN PACrFIC RAILWAY.

253

nherS, 1871,
LTtise, and tlmt

iH ALLAN.

iutcdat pagoJ

1871, printed i\t

1872, printed at

luuiavy 21, 1872,

1871, printed at

nary 21, 1872.

ol Torontii, who

gain over to tiiir

ver by which to

i, a\ul threatens

se i proposed as a

will have to give

Kill ALLAN.

print c'd at page .')1.

printed at page .').').

il, July 1, lH7->.
low api>roaching a
J us. I have been
ju iufornied «>1 the

progrcs.s and jjosition of affairs, Lence I have not communieatcd with you on the subject {!.vnai)a.

as often as I otherwise would have done. No doubt he inibrmed yon that, thinking as I

liad tixkcn uj) the project, there must he something very good in it — a very ibrmidable
opposition was organized in Toronto, which, lor want of better, took as their cry, " No
foreign influence'" — "No Yankee dictation" — "No Northern Pacific to choke of!' our
Canadian Pacific," and others equally sensil^le.

So much effect, however, was ))roduced b>th in and out of Parliament by these cries
and the agitation consequent on them, that after consulting Mr. McMuUen I was forced
unwillingly to droj) ostensibly from our organization every American name and to put in
reliable p<'ople on this side in place of them. It will be ai)parent to you tiiat at this point
Mr. McMullen and I differed a little as to the means to be adopted to influence tht^
Government itself. Two opposinj^ Companies desiring to build the Railroad were
formed, the one from Ontario having tlie greatest number of names, while that from
Quebec had the greatest political power.

Mr. McMullen was desirous of securing the inferior members of the Government, and
entered into engagements of which 1 did not ai)prove, as I thought it only a waste of
powder and shot. On a calm review of the situation 1 satisfied myself that the whole
decision o!" the question must ultimately be in the iiands of one man, and that man was
Sir George K. Cartier, the leader and chief of tin; I'Veiieh party. This ])arty lias ludd the
balance of power between the other factions. It has sustained and kept in offu-e and
existence the entire Government for the last five years. It consists of forty-fivi; men who
have followed Cartier, and voted in a solid phalanx for all his measures. The (iovern-
ment majority in Parliament being generally less than forty-five, it follows that the
dofcc'ion of one-half or two-thirds would at any time put the (iovernment out of offu-e.
Jt was therefore evident that some means must be adopted to bring the influence ot this
compact body of members to bear in our favour, and as I soon made up my mind what
was the best course to pursue, I did not lose a moment in following it uj).

A l^ailroad from Montreal to Ottawa through the I'reneh country, north of the Ottawa
river, has long been desired by the rrench inhabitants, but Cartier, who is the salaritd
solicitor to the Grand Trunk Railroad, to which this would be an opposition, lias always
interposed difficulties, and i)y his influence prevented it being built. The same reason
made liitn desirous of giving the contract for the Canadian Pijcific into the hands of
parlies connected with tht; Grand Trunk Railroad, and to this end he fanned the fiame of
opposition to us Mut 1 saw in this Firiwh Railroad .scheme, and in the near approach
of the general election, when Cartier as well as others had to go to their constituents for
re-election, a sure means of attaining my object, especially as 1 purposed to carry it
through to the terminus of the Pacific. The plans 1 propose are in themselves the Ix'st
for the iiitercsts of the Dominion, and in urging them on the jjublic 1 am really doing
a most patriotic acdon. Rut even in that view, means must be used to influence the
public, and 1 emjdoyed several young French lawyers to write it up for their own news-
papers. I suljscril)ed a controlling influence in the stock, and proceeded to sul)sidi/e the
newspapers themselves, both editors and projirietors. I went to the country through
which the road would pass, and called on many of tlie inhabitants. I visited the jniests
and made friends of them, and I employed agents to go amongst the princiiial people and
talk it up.

I then began to hold public meetings, and attended to them inyself, making frequent
speeches in rrench to them, showing thi;m where their true interests lay. The scheme
at once became popular, and I formed ii committee to influence the members of the
Legislature.

This suceertled so well thot in a short time I had 27 out of the 4') oil wliom I could
rely, and the electors of the ward in this city which (!artier himself represents, notified
him that unless the contract for the Pacific Railroad was given in the interests of Lowit
Canada he need not present himself '"or re-election. He did not believe this, but when
he came here and met his constituents he found to his surprise that their determination
was unchangi'able.

lie then agreed to give the contract as required in this way, that there would be 17
Provisional Directors, of which Ontario wouhl \m\c. H and "■.•> i) tlierel)y giving us the
control. We at once proceeded to organize the Comjmny (our Swtion), and they
named me the President. 1). Mclnnes of llamilton. Vice-Prtsident; K. L. de Bidlefeuille,
Secretary ; and the Honourable J. ,1. C. .\bbott, Legal AdvLser.

We liave advertised that the books Ibr subscription of stock will be opened IStli .luly
at the different j)laee9 nnnunl in the Act, and we have iiotifie<l the Government that we
are willing to take the contriici lor building the t'aimdian Pacific Railroad on the terms
nud conditions i)re8cribed in the Act. The next thing to Ik' done is to subscribe the stock,

2 K

-.'it'

Canada.

254

CORRESPONDENCE RELATIVE TO THE

■vvliic'h must he done l)y British suhjccts only, and 10 per cent, of the snhsciiptions must
he paid in cash at the time of sul)sc^il)in^^ VV^e have the right of subscribing nints
seventeenths (^-17) at present, and of taking uj) whatever the other party may not sub-
scribe at the eiul of one month. I have arninged in the meantime that if you will send
a certificate of the equivalent of !?(l,()()0,fM)0 gold having been placed by Jay Cooke and
Co. to the credit of the Merchants' Bank of Canada, Montreal, in their own Bank in New
York, it will accept the cheques for tlie subscription, but no money will pass till tlie
contract is entered into, and then 1 per cent, on the amount of stock awarded us will
have to he paid in to the Receiver-General. Be pleased, therefore, to send me, as early
as possible, powers of attorney to subscribe the stock and Jay Cooke and Co.'s certificate
above mentioned. 1 have had several letters from England offering to take the whole
thing up if we desire to part with it, but it looks to me to be too good to part with
readily. If you desire any further information I will go to New York next week, if you
desire it, and commimicate with you i)ersonaliy. Please telegra])h if you wish to see me,
and the day. As you may suppose, the matter has not reached this point without great
cxi)ense, a large portion of it only payable when the contract is obtained, but I think it
will reach not much short of $300,000.

Yours faithfully,
(Signed) HUGH ALLAN.

I presume you desire that unless we can obtaiti and secure a majority of the stock you
could not take any, but on this point I wish to be instructed.

H. A.
(r. W. Cass, Esq., Liberty Street, New York.

No 15 Letlh".

Sir Hi^Gn Allax to Mr. McMtT.r :;v: dated Montreal. August 6, 1872, printed at
page 58.

No 16 Letter.
From Sir Hugh AiJ,AN, dated Montreal, 7th August, 1872, printed on page 57.

No. 17 Letter.

Sir Hiiou Allan to Mr. McMcllkx, dated Montreal, September 10, 1872, printed at
page 58.

Letter No. 18.
Sir IlKJii Alla.n to Mr. McMullen, dated Montreal, Oct. 24, 1872, printed at

[MgC (iJ,

Letter No. 19.
Mv DKAU Sill HuoH, Pictou, Nov. U, 1872.

Since the receipt of your letter, the contents of which surprised me cousideraijly,
iiiliowing so soon after our conversiition at Montreal, and in view of the fact that the
GovernnieMt seem so mu'h at sixes and sevens about tiie whole matter, 1 huve of course
communicatetl the substance of it to ray friends. They are anxious to know whether
such u decision will be arrived at, afWr the various plcflges made, as will debar our Asso-
ciation from partici]>ation in the construction of the Railway. Whatever skirmishing
may be dune by way of talk, they can hardly have an idea thai y"u will prove recreant

No 14 Letter.

Sir Iluon Allan to Mr. McMvllen, dated Montreal, July 16, 1872, printed at
page 55,

CANADIAN PACIFIC RAILWAY.

255

)sciiiitioiis must
ubscribing niiif-
ty may not. sub-
if you Avill send
Jay Cooke and
m Bank in New
ill pass till tlio
awarded us will
nd me, as early
[ Co.'s certificate
) take the whole
lod to part with
ext week, if you
I wish to see me,
lit without great
d, but I think it

GH ALLAN.

of the stock you

H. A.

1872, printed at

m y.age 57.

1872, printed at

872, nriuted at

Nov. 6, 1872.
ne cousiderttl)ly,
he fact that the
I Imve of course
1 know whether
debar our Asso-
iver skirmishiuf;
I prove recreant

to your business associates in an arrangement mainly of their own suggestion (I mean the
Government who first requested you to write to Chicago). However much they may be
beset with political jn'oblems, I do noi, believe they could get, in any other way, so diffi-
cult a one on their hands as they could by taking such a course. Mr. Ogden and party
are now back from Puget Sound, and I shall take an early opportunity of meeting them.

I should like any possible positive information, and in case the affair goes so that our
Association either directly or through you, cannot handle it, it would be well to know it.
But as the Government could not exj)ect you to go into it and leave the others out
entirely, I should think you could have it arranged as we have several times talked,
i.e. the stock held by you subject to private arrangement witii the others. And what-
ever street rumour may say of public opinion, I should judge that this would do all that
is needed.

Please let me hear irom you.

Truly yours.
Sir Hugh Allan, Montreal. (Signed) G. W. MoMULLEN.

OAl'AOAk

Lbifer Xo. 20.

Sir IIuou Allan to Mr. McMullkn, dated Montreal, November 11, 1872, printed at
page 250.

Copi/ of l.st Contract between Sir lltujli Allan and his American Associates.

New York, Dec. 23, 1871.

The undersigned hercJjy agree to associate themselves together for the following pur-
|ios(«i, to wit ;

First. — To form the Canadian Pacific Railway ('ompany under a Charter substan-
tially aa agreed upon, and sulyect to such modifications or changes as shall be bereafti-r
mutually assented to, which (Jharter is to bo ])rocurod by Mcssre. Sir Hugh Allan, Charles
M. Smith and Geo. VV. McMullon from tlie Parliament of Canada at its approaching
Session.

Second. — Under and by authority oi' sfiid Charter the undersigned propose to construct
the said Railway.

For these purposes, we, the undersigned, each for himself and not for the others agree
to subscribe in all the sum of ten millions of dollars to the capital stock of the said
Canada Pacific Railroad Company as follows : —

The various names subscribed to this contract at the end of it except Allan, C. M.
Smith and McMulien, and such others as they may associate with them shall subscribe
five millions five hundred thousand dollars (!?r>,r»00,(i()0) and Sir Hugh Allan, Chas. M.
Smitii and George W. McMullen, and such others as they may associate with them, sha';
subscribe four millions five hundred thousand dollars (^4,500,000) and it is further agr»ed
that the above-named parties who shall subscribe five millions five hundred thou and
dollars, shall pay in the sum of ten per centum on the whole ten millions of dol'ars of
stock to be subscribed as aforesaid, into the Banking House of Jay Cooke and Co, mNew
Yorl< city, to the credit of th«; Canada Pacific Railway Com])any upon its orgai i/ation to
be used for the construction of the said railway and for such other j)urrjses as the
Directors of said Company hereafter to be elected shall determine, and it 'j also agreed
that on the or:;anization of said Railway Co., such a By-law shall be adojjt d as will pro-
hibit any further assessments on the stock beyond the ten jwr cent, paid a', before specified
unless ordered by a vote of at least nine-tentha (~) of all the outstar Jing stock of the
Company at some regular or special shareholders meeting.

It is further agreed by the parties hereto, that they shall associate tlemselves together
as the Canada Land aiui Improvement Co. which it is pro])osed shall be hereafter iucor-
l)orated by the Parliament of Canada, for the purpose of constructing the said Railway,
and for the purchase and sale of lands, arul lor other needed objects, and that their
interests in the said Land and Improvement V.q. shall be in the same proportions as their
usual subscriptions to the railway stock, aforesaid, bear to the whole ten millions of
dollars ($10,000,000) subscribed, and it is agreed that the contracts for building any or
all of the various Sections of the Canada Pacific Railway, when let, shall l)e let to the
saiu Canada Land and Improvement Co. at fair prices, and to the Canada Land and Imj)rove-
meiit Comjmny shall operate and be allowed the use of the said railway, during the iwriod

2 K 2

256

CORRESPONDENCE RELATIVE TO THE

|-f»

Oaxaoa. of its construction, without charge ♦ neri'lor, except tlic expense of keeping the same in
good order and repair at tlieir own rest, during sucli use and control of said railway.

It is also agreed that the first working capital of the said Canada Land and Improvement
Company, sliall be tlie aforessxid one million of dollars, to be paid in on the Railway
Stock before-named, less any amounts previously expended by order of the Board of
Directors, and shall also consist of such sums or profits as shall thereafter be received by
it, from time to time from said Railway Company for construction and for work done in
excess oi' the cost of such work, or so miuh thereof as may be necessary for th(! successful
prosecution of said work. And it is expressly agreed that the first prolits arising from the
contracts above referred to, shall l)e used to reimburse (parties subscribing for $5,500,000)
and their associates for the one inillion of dollars paid by them as a ten per cent, instal-
ment on tlie Railway Stock aforesaid, with interest thereon at the rate of seven per cent,
per annum.

And it is furthermore agreed that all, or at least a majority of all the stock or interest
ill both the (Canada Pacific Railway Company and the Canada Land and Improvement
Company, held by each of the undersigned, shall be placed iu the hands of a trustee (wiio
is to l)e selected by the undersigned), to i)e held by him during the time occupied in
building the said railway, or until two-thirds of the owners or representatives of said
stock, so held by said Trustees, shall elect to terminate said trust, and the said stock shall
be votetl on by the said Trustee or his successor, meanwhile, at all the meetings of stock-
Iioldcrs, iis he shall be directed to voU; by the owners of a majority thereof. It is hereby
agreed that after the one million of dollars heretofore mentioned, with the specified
iiiti'iest thereon, has been refunded to the parties advancing it, then all divisible profits
of both the Canada Pacific Railway Comjiany and the Canada Land and Improvement
Canipany, shall be divided among the stock-holders of each Company in proportion to
tin- shares they severally hold.

It is hereby understood that the names " Canada Pacific Railway Co." and " Canada Land
" and Improvement CIo." are used for the sake of convenience, and in case diilerent names
shall 1h; adopted by the Canadian Parliament, or in case they shall fail to authorize any
Kiicli I^iid and Imjirovement Co., then this agreement shall be understood to relate to
^ lull railway as shall be authorized to be constructed in accordance with the provisions
liereol aiross Rritish Territory to the Pacific Ocean, (jiulf ol' Georgia, or Straits of Fuca,
and to the Iiiiprovemcnt Company or Association jn-oposed to be organized to construct
ihc same, which may be organized under and in accordance with the laws of any of the
States comprising the United States, and its terms shall govern the parties hereto in
iil;ition to the same, in the same niaiiner as if the names above-mentioned had been used
in the said projiosed Charters for said projioscd organizations.

It is understood that no moneys in excess of one hundred thousand dollara shall be
drawn from the funds of the proposed Canada Pacific Haihvay Company until the actual
<;)nstructi()n of the road begins unless by consent of the owners of or subscribers to at
li;ist two-thirds of the ten millions of dollars of stock to be subscribed iu accordance
witli the terms of this contract.

The essential conditions of the Charter referred to are a subsidy of fifteen thousand
dollars (5;1"),()00) jier mile for each and every mile of Road constructed, payable on the
t'onipletion of secticns ol twenty miles, and a grant of lands ecjual to twenty thousand
acres ]ier mile from all the Road except for Fort (iarry East, on the North Shore of
Lake Superior to a junction with the section jirojiosed to be built from Lake Nipissing
to the SaultSte. Marie on which (he grant of laiuis is to be equal to twenty-five thousand
acres per mile. The only forl'eiture in case of failure to complete the entire road within
the time specified is to be the; right to finish the uncompleted portions, the payments
lieing absolute on the cmnpletion of each section of twenty miles.

The amounts pro})ose(l to i)e subscribed by the various jiartii-s to this contract are as
follows: J. Cooke and Co., )s;[,lH(0,00() ; 1>. McLaren, $')()0,000; Wm. 13. Ogden,
!i-(;:i7,rj(»(t; .1. Gregory Smith. $500,000; G. W . Cass, .*G;}7,r)()0 ; II. R. Pay son, $175,000;
Thus. A. Scott, $506,O0() ; F. E. Cauda, $175,000; C. .1 . Cauda, $150,000; R D. Rice,
\\ . (i. largo, Frederick liillings, Wm. Windowa, B. P. (.'Iieiiey, A. II. Harney and Thomas
11. ('.iwlield, or so many of them as become jiarties to this agreement, in all $1,225,000.

."^ir Hugh Allan, Charles M. Smith, and (jieorge W. McMuUen for themselves and
others, $4,500,000.

iSi^ned) .1. Cooke and Co., one million of dollars.

\\ Ml. R. Ogden, six hundred and thirty-seven thousand five hundred dollars,

(i. \V. Cass, six hundred and thirty-seven thousand five hundred dollars.

.i. Gregory Smith, five hundred thousand dollars.

I). .McLaren, five hundred thousand dollars.

ilK:-:

ir;

ng the same in
id railway,
li Improvement
Ml the Railway
r the Board of
• be received l)y
)r work done in
)r the successful
irising from the

for $r),r)Oo,()oo)

per cent, instal-
[■ seven per cent.

stock or interest
\ Improvement
f a trustee (wiio
me occupied in
ntatives of said
said stock shall
jetings of stock-
if. It is hereby
h the specified
divisible profits
d Improvement
in proportion to

1 " C!anada Land
dillerent names
to authorize any
aod to relate to
I) the provisions
Straits of Fuca,
!ed to construct
vs of any of the
)arties hereto in
I had been used

loUars shall be

until the actual

iubscribers to at

in accordance

(illcen thousand

payable on the

wonty thousand

Vorth Shore of

<ake Nipissing

y-five thousand

ire road within

the jiayments

contract are as
m. B. Ogden,
y son, $175,000;
)0() ; K D. Rice,
ey and Thomas
ill $1,225,000.
themselves and

liars.

CANADIAN PACIFIC RAILWAY.

257

Thos. A. Scott, five hundred thousand dollars.

II. H. Payson, one hundred and seventy-five thousand dollars.

F. E. Cauda, one hundred and seventy-five thousand dollars.

C. J. Cauda, one hundred and fifty thousand dollars.

H. D. Rice, two hundred and tliirty tiiousand dollars.

Frederick Billings, two hundred and thirty thousand dollars.

A. II. Barney, two hundred and thirty thousand dollars.

Wm. U. Fargo, for self and B. P. Cheney, two hundred and thirty thousand dollars.

Thomas II. Cawfield, Wm. Windowa, one hundred and eighty thousand dollars.

Samuel Wilkinson, seventy-five thousand dollars.

Walter Ilinchman, fifty thousand dollars.

$r),r)()o,ooo.

Hugh Allan, one million four hundred and fifty thousand dollars.
Charles Mather Smith, one million five hundred and twenty-five thousand dollars.
George W. McMullen, one million five hundred and twenty-five thousand dollars.

$4,500,000

Copy of Supplemental Contract between Sir IIikiIi Allan and his American Associates,

dated March -2Hth, 1h72.

Whereas it ai)pears that the Canadian Government prefer to give a gross sum of money
and a gross amount of lai'd for the construction of tl e Canada Pacific Railway and the
i)ranch thereof from Fort Garry to Pembina or St. Vincent or the international boundary
line in that vicinity, now therefore the undersigned agree to so alter tlieir contract or
agreement of December 2.'}rd, 1871, as to agree to take thirty-five millions of dollars
($35,00(»,000) in money (gold), and filty millions of acres of land in amount, to be
selected as projjosed, and the money to be paid pro rata per mile as constructed, each
mile to be counted as the one twenty-live hundredth {^ l)art of the whole line to be built,
and the land at the rate of twenty tiiousand acres for every mile of railway built, and in
case in the judgment of our associate. Sir Hugh Allan, it should be deemed exjjcdient by
him to sui)mit to the acceptance of tliirty-three millions of dollars in gold ($3.'> ,000,(100)
and fifty millions (50,000,000) acres of land as compensation for the construction of said
road, he is hereby authorized to do so ; and in case a iurtber reduction in \n'\cv is found
to be indis])ensal)le in order to secure the contract for the construction of the said Canada
Pacific Railway, then . I. (iregory Smith, Sir Hugh Allan, G. W. McMullen, Geo. W. Cass,
and Wm. B. Ogden are hereby constituted a committee with authority in them or a majority
of them to submit to such further reduction in the money i)riceto be paid in their discretion
or any sum not below thirty millions of dollars ($;U),000,000) as they shall think necessary
or advisable, and the said committee or a majority of tluin shall have power to inakeiuch
assessments irom time to time, for the general purposes of the Comi)any, not exceeding in
all one and one half per cent, of the amounts agreed to be suliscribed by us to the ^toek of
the Canada Pacific Railway Company as they shall deem expedient. The said assess-
ments are to be considered as jmrt oi the one million dollars agreed to be paid on the
stock contracted to he subscribed by us in the agreement of Deceiniier 2.3rd, l!^71, and to
1)0 subject to the same conditions of payment and refuiuling with interest as are therein
set forth.

And we hereby authorize the said Committee to take such other action lor us as they
may deem necessary in the premises consistent with the general terms of the contrad, ol
December 2;{, 1871, and as modified hereby. - ,

New York, March 28, 1872.

(Signed) Jay Cooke & Co., J. (iregory Smith, B. P. Cheney for self and W. .1. I ar;j,(),
R. D. Rice, Thos. II. Cawfield, A. H. Barney, G. W. Cass, Daniel McLaren, by .1. \V. i:ilis,
Frederick Billings, >\'m. Windowa, 11. R. Payson, F. K. Cauda, C. .1. Candii, Saniiiel
Wilkinson, W. B. Ogden, Walter Ilinchman, Hugli Allan, Charles Mather Smith, George
W. McMullen.

■' I ■'(''"'*..•'.;,( 1 fill '1' ' - ' ' .- ■ '' .'!''!

Canada.

' y. •'.

Oamaoa.

258

CORRESPONDENCE RELATIVE TO THE

Copy of acknowledgment from Jay Cooke (J* Co., to G. W. McMullen of his drafts on

various parties^ <.fc.

(Copy.)

G. W. McMullen, Esq., Secretary, Canada Pacific R. R. Ex. Committee.

Dear Sir, New York, April 1, 1872.

We have to-day received of you your drafts on various parties to the amount of
$50,000, which sum we credit to the Executive Committc of the Canada Pacific R. R.
Association, subject to the draft of Sir Hugh Allan.

Respectfully,
(Signed) JAY COOKE & CO.

No. 1.

Jay Cooke & Co., Bankers,

Corner Nassau and Wall Streets :

Pay to myself or order.

Fifteen Thousand Dollars.
115,000.

No. 2.

Jay Cooke & Co., Bankers,

Corner Nassau and Wall Streets :
Pay to myself or order,
Twenty-five Thousand Dollars.

$25,000.

New York, May 2, 1872.

(Signed) HUGH ALLAN.
New York, May 3, 1872.

(Signed) HUGH ALLAN.

I have also receipts for Fees on the Bills of the Canada Pacific R. R. Company, and the
Canada Imi)rovement Company, paid with other things to tlie Hon. J. J. C. Abbott, and
by him settled with Mr. Todd, whose receipt I hold. Also my cheque showing the
payment, returned me by Bank of Montreal, in due course.

G. W. McMULLEN.

{Enclosed in Envelope Number Two, being portion of contents of " jd " or " sealed packet."

$17,500.00. Merchants' Bank of Canada, February 26th, 1873.

Pay Hon. Henry Stames, or Order, seventeen thousand five hundred dollars cy.

(Signed) HUGH ALL/iN.
To the Cashier.

Endorsement on back of above Cheque.

Mr. Starnes will please endorse and collect this Cheque, and pay proceeds to Mr.
McMullen if he becomes entitled to it by the instructions.

(Sd.) H. A.

{Enclosed in small Envelope addressed " Hon. Henry Stames," being portions of contents

of "A." or ^'' sealed packet."

Montreal, February 26, 1873.
The Honourable Henry Starnes is requested to deliver over envelope No. One to Sir
Hugh Allan ; and envelope number Two to Mr. George W. McMullen, unless Sir Hugh
Allan claims that the contents of the letters contained in envelope Number One have
been divulged, or copies of them have been given to other than one person mentioned to
Mr. Abbott (which Mr. McMullen declares has not been and will not be done), in which
case Mr. Starnes will open envelope Number One and having heard the parties will
d«;tcrmine whether the contents of such letters have been divulged, copies granted other
than above, or not. If he decides that they have not, he shall hand over envelope
Number Two to Mr. McMullen and the letters to Sir Hugh Allan. If he decides other-

ii^V^

CANADIAN PACIFIC I^AILWAY.

259

of his drafts on

April 1, 1872.
,o the amount ol'
Ida Pacific R. R.

OOKE & CO.

, May 2, 1872.

GH ALLAN.
, May 3, 1872.

rCH ALLAN.

wise he is to hand over envelope Niim1)er Two to Sir ugh Allan, and the letters also,
unless Mr. McMullon ])ays him Twenty thousand dollars in gold, in which case he will
hand the letters to Mr. McMullen and envelope Number Tico to Pir Hugh Allan with
the twenty thousand dollars. And Mr. McMullen declares that the said envelope
Number One contains all of Sir Hugh Allan's letters in his possession or under his
control.

(Signed) G. W. McMULLEN.
HUGH ALLAN.

Oavaoa.

{Endorsement on envelope covering above).

If Mr. Starncs is not requested to decide any disputes in regard to the ownership of
papers herewith, he is to burn this envelope with its contents unopened, immediately on
settlement.
Hon. Henry Starncs.

Endorsement on larye inner envelope, contained in "A" or " sealed packet" and covering
envelopes Nos. 1 and 2, ana small envelope addressed " Hon. itenry Starnes!'

Montreal, February 26, 1873.
Within ten days after the end of the coming Session of Parliament, the Hon. Henry
Stames is requested to deliver envelope No. One' to Sir Hugh Allan, and envelope No. Two
to Mr. G. W. McMullen, unless objections be made by Sir Hugh Allan to his doing so ;
in which case he will open the envelope addressed to himself, and act as instructed
therein.

(Signed) HUGH ALLAN.

G. W. McMULLEN.

!ompany,and the
I. C. Abbott, and
que showing the

McMULLEN.

" sealed pockety

ry 26th, 1873.
ollars cy.
GH ALL/.N.

proceeds to Mr,
Sd.) H. A.

tions of contents

uary 26, 1873.
e No. One to Sir
unless Sir Hugh
umber One have
son mentioned to
done), in which
the parties will
ies granted other
d over envelope
le decides other-

Endorsement on " A," or ^'^ sealed packet."

May 17, 1873.
Papers produced by Mr. Starnes before Select Committee and returned to him subject
to be produced to this Committee on their order.

(Signed) J. HILLYARD CAMERON,

Chairman.
J. G. BLANCHET.
A. A. DORION.

Copy of first Contract between Sir Hugh Allan and his American Associates, dated
New York, December 23, 1871, printed at page 249.

Certified Copy of Letter frorn Sir Geo. E. Cartier to Sir Hugh Allan.

{Private and Confidential.)

Dkar Sir Hugh, Montreal, July 30, 1872.

The friends of the Government will expect to be assisted with funds in the
pending elections ; and any amount which you or your Company shall advance lor tliat
purjwse, shall be recouped to you.

A memorandum of immediate requirements is below.

Very truly yours,
Sir Hugh Allan. (Signed) GEO. E. CARTIEK.

NOW WANTKD.

" Sir John A. Macdonald -

" Hon. Mr. Langevin ...

" Sir G. E. C.

« Sir J. A. (add'l)

" Hon. Mr. Langevin (add'l)

« Sir G. E. C. - ■

$2r),o()o

1 5,000
20,000
10,000
10,000
30,000

260

CORRESPONDENCE RELATIVE TO THE

Oakaoa. xiic foregoing certified to be a true copy of the oripiiial letter produced hy Sir Ilugb
Allan belore the Uoyal Commission, re Canada I'acifie Uuiivvay, which original was at
his desire allowed to be retained l)y him.

(Signed) CHARLES DEWEV DAY,
September 10, 1873. Chairman.

Certified Copy of Letter from Sir G. E. Cartier to Sir Ilwjh Allan.

Dear Sir Iluon, Montreal, July .'loth, 1872.

I enclose you copies ol' telegrams received from Sir John Macdonald, and with
reference to their contents I would say that in my ojMnion the Governor in C!ouncil will
a])prove of the amalgamation of your Comi)any with the Interoceanic Company under
the name of the Canadian Pacific Railway Company, the Provincial Board of the
Amalgamated Company to be composed of seventeen meml)crs, of whom four shall be
named from the Province of Quebec by the Canada Pacific Railway Company, four from
the Province of Ontiirio by the Interoceanic Railway Company, and the remainder by
the Government: the Amalgamated Company to have the powers specified in the tcntli
section of the Act incorporating the Canada Pacific Company, and the agreement of
amalgamation to be exticuted between the Companies within two months from this date.
The Canada Pacific Company might take the initiative in procuring the amalgamation,
and if the Interoceanic Comjjany should not execute an agreement oJ' amalgamation ui)on
such terms and within such limited time, I think the contemplated arrangements should
be made with the Canada Pacific Company under its Charter.

Upon the subscription and payment on account of stock being made as required by the
Act of last Session respecting the Canadian Pacific Railway Company, I have no doubt
but that the Governor in Council will agree with the Company for the construction and
working of the Canadian Pacific Railway with such branches as shall be agreed upon, and
will grant to the Company all such subsidies and assistance as they are emj)owered to do
by the Government Act. I believe all the advantages which the Government Act
empowers the (government to confer ujwn any Company will be required to enable the
works contemplated to be successfully carried through, and I am convinced that they
will be accorded to the Company to be formed by amalgamation or to the Canada Pacific
C!ompany as the case may be.

I \\ould add that as I ajiprove of the measures to whicli I have referred in this letter,
I shall use my best endeavours to have them carried into eil'ect.

Very truly yours,
(Signed) GEO. E. CARTIER.

The foregoing certified to be a true copy of the original letter produced by Sir Hugh
Allan before the Royal Commission re Canada Pacific Railway, which original was at
Iiis desire allowed to be retained by him.

(Signed) CHARLES DEWEY DAY,

September 19, 1873. . Cliairman.

ife

Receipt for House Fees on Canada Improvement Company Bill.

PRIVATE BILL OFFICE.

House of Commons, Ottawa, June 1, 1873.
Fee and Charges on the Rill to Incorporate the Canada Improvement Company.

Fee payable under the 58th Rule $100.00

^, e . ,. ,,.,, f 500 English 2.25

ChargeforprmtuigBiUJ2,^PP^|^^^ .... 1.35

500 English 1.34

Charge for printing Act
Translation -

250 French

0.!)7
3.00

$108.91

Received imyment from Hon. J. J. C. Abbott, M.P. .

(Signed) ALFRED TODD,

Chief Clerk Private Bill Office.

CANADIAN PACIFIC RAILWAY.

261

■ed liy Sir IIurIi
J original was at

Y DAY,

Chairman.

Ulan.

ily ;i()tli, 1S7'2.
(lonald, and witli
r in Council will
■ Company undor
il Board ol" the
lom four shall be
npany, lour I'rom
lii; remainder by
ficd in the tenth
ihe agreement of
IS from this date,
le amalgamation,
nalgamation upon
mgements should

IS required by the
, I have no doubt
constrnetion and
agreed upon, and
empowered to do
(lovernment Act
ired to enable the
hvinced that they
he Canada Pacific

•red in this letter,

E. CARTIEK.

uced by Sir Hugh
1 original was at

:Y DAY,

Chairman.

Dill.

^, June 1, 1873.
ent Company.

$100.00
2.25
1.35
1.34
0.!)7
3.00

Canada.

$108.5)1

lieceipt for House Fees on Canada Pacific liaihray Company Bill.
PHIVATK BILL OFFICE.

House of Commons, Ottawa, June 1, 1872.
Fee and Charges on the Bill to Incoriwratu the Canada Pacific Railway Comjjany.

Fee jiayable under the oSth Rule $100-00

.'JOO English - - - - 9* 60
200 French - - - - 4-75
500 English - - - - 5 -30
250 French - - - - 3-:)8
14-00

Charge lor printing Bill

Charge for printing Act
Translation

$137-15

Received payment from lion. J. J. C. Abbott, IVI.P.

(Signed) ALFRED TODD,

Chief Clerk Private Bill Office.

Utter from G. W. McMullen to Hon. J. J. C. Abbott.

Dear Sir, Montreal, February 25, 1^73.

If before the expiry of ton days alter the termination of the coming Session of
Parliament I do not hand you Messrs. Smith and Ilulburt's confirmation of the arrange-
ment I have this day made; with Sir Hugh Allan, I authorize the Honourable Henry
Starncs to retain the enveloiie No. 2, delivered to him, coiitainhig Sir Hugh Allan's
cheque, until I do produce such letter.

I have, 5:c.,
Hon. J. J. C. Abbott. (Signed; GEO. W. McMULLEN.

APPENDIX.

ivate Bill Office.

To the Hon. Lucius Seth Huntington', of the City of Montreal, in the Province

of Quebec.
Sir, Ottawa, Au-ust 21, 1873.

I have the honour to enclose herewith a ])rinted cojjy of the Royal Commission
appointing Commissioners to inquire into and report ui)on tlie several mattei-s stated in
the Resolution moved by you in tlie House of Commons on tlie 2iid day of April last,
relating to the Canada Pacific Railway, and to inl'orm you that the Commissioners
therein named will meet in the City of Ottawa, in the Parliament House, on Thursday,
the 4th day of September next, at noon, for the purjjose of making iiupiiry and taking
evidence concerning the allegations contained in the Resolution and fully set fortli hi tlie
Commission. You are requested to lurnish to the Commission, with all convenient dili-
gence, a list of the witnesses whom you may wish to examine, in order that they may be
duly summoned to appear on the day and at the place above specified, and you are
requestetl then and there to proceed with your evidence in the premises.

I have, &c.,
(Signed) CHARLES D. DAY,
_____ . Chairman.

Sii?, Ottawa, August 21, 1873.

I have the honour to inform you, that the Commissioners appointed to inquire
into and report upon the several matters contained and stated in a certain Resolution
moved by the Hon. Mr. Huntington in the House of Commons on the 2nd April, 1873,
relating to the Canadian Pacific Railway, will meet in tlu- Parliament House, in the City
of Ottawa, on Thursday, the 4th day of September next, at noon, for the purpose of
making inquiry and taking evidence, under tin- authority of the Commission, concerning
the allegations and matters contained in that Resolution, and that notice iias been given
to the Hon. Mr. Huntington to appear and proceed with his evidence then and there.

I have, &e.,
(^^igned) CHARLES D DAY.

Chairman.

'J L

2G2

CORRESPONDKNCE UELATIVK TO THIO

hi >.

Canai>a. Sin, Montreal, Aii>;iist '2G, 1H7.1.

I have the honour to acknowledf;!; the receipt of your letter ol' thi; Ulstol' Aiij^ust
instiint, eiu'losiiig ii eojiy ol' the Hoyal C(»iiimisHioii, nppoiiitiii); Cominissioners lo im|uiru
into and report upon the heveral matters sliit«'(l in the Uesolution moved l)y me, in the
House of Commons, on the '2nd day of April last, and rcciuestin^ nu- to furnish to the
Commission a list of the witnesses 1 mij^ht wish to examine, in order that they may he
duly summoned to api)ear, and to proeeed with my evidenee.

I have to eall your attention to the fact, apparent on the face of the Commission, that
it was as a memher of the House of Commons, and from my place in Parliament, that
I pn^ferred these chart»es aj^ainst Ministers of the Crown, and memhers of that House,
which, on the 8th day of Ajiril hist, entertained the charges, determined lo investigate
them itself, and ajjpointed a Select tlommittce to inquire into it and report ujmju them ;
and to the further fact, apparent on the Journals of the House, that to the said Com-
mittee I fiM'nished a list of some of the principal witnesses, wliose evidence I l)e[ievi;
could estahlish my charges, and I have always heen ready to proceed to tlie i)roof thereof
lielore the trihunal constituted hy the House for the investigation.

'I'he determination of the Commons to investigate these charges remains unaltered,
and I deem it iiuonsistent with my duty as a member of Parliament, and a breach of
the undonbte<l privileges of__the House, to recognize any inferior or exceptioiial tril)unal,
created to inquire into charges still pending before the Commons, and so essentially
affecting the |)rivileges, dignity, and imlependeuce of Parliament.

I believe that it is a breach of those privileges, that u Royal I'ommission issut-d
witlutut the special sanction of the House, should take any cognizance ol', or should
assume to call on me to justify, words which I have sj^ken on the lloor of the Commons,
and lor which I am resiwnsible to them, and to them alone.

I feel that I should do no act whicli may be construed into an ac<iuicscence in the
attentjjt to remove from the C'ommons the conduct aiul control of the inquiry.

I believe that the creation of the Commission involves a breach of that fundamental
princijjle of the constitution, which preserves to the C-ommons the right and duty of
initiating and controlling iiKpiiries into high political offences ; that it involves also a
breach of tliat fundamental principh' of justice which prevents the accused from creating
the tribunal and controlling the procedure for their trial ; and that it is a Commission
without j)reeedent, unknown to the Common Law, unsanctioned by the Statute Law,
jiroviding by an exercise of the jirerogative for an inquiry out of llic ordinary course
ol' justice into misdemeanour cognizable by the Courts, and conse(puMitly illegal and
void.

Entertaining these views, you will not expect me to fict otherwise tlian in conformity
with them, and you will l)c satisiied that by my nou-.appearancc before the Commission 1
intend no disrespjrt to tlu' Commissioners, but am moved by the same sense of pul)li('
fluty which will constrain me at the earliest practicable moment to renew the efforts
which I ha\e Ix'en making since April last to bring to trial before Ine Commons of
Canada the men whom I have impeached as public criminals.

I have, &c.,
To the Hon. tlharles D. Day, Chairman, (Signt'd) L. S. HUNTINGTON.

Ottawa.

No. 11.

The Eaul ok KiMnERMCv to The Earl of Dufferin.

Mv LoKP, Downing Street, Novonibor l.l, 1873.

I itEi'ERRKD to the Law Officers of the Crown your Despatch of October 4,*
I'dpiesting instructions for your guidance in the event of an Act being passed by the
Dominion rarliameut, purporting to authorize the issue of a Commission of lni|niry into
the racilic Railway (piestion, and to give to such Ct^ramission the power of examining
witnesses on oath, and I have now to inform you that '.n their opinion that course would be
beyond the powers of the Parliameat of the Don>in,ica.

I have, &c.,
The Earl of Dufferin, (Signed) KIMRERLEY.

&c. &c. ite.

No. 9.

f '2 1st of Aiif;ust
ioncrs to iiuiuire
cd liy me, in thi;
lo riiniish to tlio
lat they may In;

'ommiHsion, that
Parliament, tliat
s of that House,
eel to iuvestigati!
port upon tiiem ;
o the said ("om-
vitleiiee 1 helievi;
the prod' tliereol'

>mains unaltered,
, and a l)reaeli ol'
•ptional tril)uual,
iiid so essentially

Dmmission issued
u-c of, or Hhould
ol" the Commons,

(piiescence in the
muiry.

that liindamcntal
right and duty of
it involves also a
sed from creating
t is a Commission
the ^^tatute Law,
e ordinary course
leiitly illegal and

lan in eonformity

the ('ommission 1

sense of puhlic

renew the ellbrts

:ne Commons of

lUNTlNGTON.

Muhcrin, 1873.

of ()ct()l)er l,'
ng passed l)y the
)u of Inipiiry into
)wcr of examining
it course would he

Szc
KIMRERLEY.

CANADIAN PACIFIC RAILWAY. 868

No. 12.

Tlie i'^AKL OP KiMnEui.KY to Tho Earl ok DrFFEuiv.

■My IjORO, Downing Street, Xoveinhcr 22, 1S7.1.

I iiAVR to acknowledge yonr Lordship's Despatch of the lird instant,* for-
warding copies of the evidence taken before the Koyal Conmiission af)pointed to inquire into
llie isauo of the Canadian Pacific Hallway Charter.

I am glad to learn that your Lordship is of opinion that the Commission discharged
•;Ls duty clfectively.

I have, iVc,
The hiirl of Duflerin, (Signed) KIMHERLRY.

(tc. <tc. (tc.

No. 13.

Tiio Kaul op Dukfertn to Tho Earl op Kimukrlet.

Mv Lord, Canada, November 7, 187.'{.

I iiAVK the honour to inform your Lor<iship that on Thursday, tlie 2;ird of October,
1 opened Parlinnent with a speech, of which I have already forwarded a copy in a
previous Despatch.

2. On returning to their chamber the House of Commons, at the instance of Sir .John
^lacdonald, adjourned until the following Monday, in order that members miglit iiave time
fo acfjuaint themselves with tho contents of tiie papers wliich had just been laid upon the
taltle o'' Uie House.

;>. These papers consisted of the Report of tho Royal Commission, and of the body of
evidence it had eolleeted, and of my Despatches to your liordship in relcreneo to tlio Pro-
rogation of Parliament on the llUh of August, and to the issue of tlie Commission, together
witii your iiOrdship's re|)ly thereto, of October the ntii.f in which you are gootl enough to
convey to me, on the part of Her Majesty's (lovernment, your approval of my conduct iu
reference to these two transactions.

4. I thought it desiral)lc that these three latter documents shoulil be connuunicatcd to
the House of Commons for two reastms. In the first place, they contained a statement of
certain facts whi<'li illustrated and supplemented the evidence Uikon before the Commission,
and which no one Imt myself was in a position to furnish; and in tlio next, tliev clearly
sliowed that whether exception could or could not bo justly taken to tho general course of
procethire adopted by my Ministers, no foundation existed ibr the impression which at one
time prcvailo(l, that the (Queen's Prerogative had been exercised uncimstitutioiially, or witli
partiality, or in the intention of interfering with the privileges of Parliament. It w;ls the
more desirable that this should be made patent, as it was currently reported — of course I
cannot say with what truth — that instead of raising the main and essential (juestion lus to
tlie culpability of the transactions between my Ministers and Sir Hugh Allan, some of the
oppoiu'iits of the ( iovermnent were inclining to tiiko a vote on a side-issue in reference to tho
I'rorogation of i'arliament on the l.'itli of August, and to the alleged breach of privilege it
involved, with a view of binding to their party those Ministerialists who hatl signed tho
^lemorial addressed to me on that occasion.

5. As the ])osition thus proposed to l»e occupied might incidentally commit the House of
Commons to an opinion on a Constitutional (luestion which could not l)e sustained, and sus it
^eelllcd of the last importance that the intention of Parliament should not be diverted from
what was tho real issue to a subordinate controversy, I thought it well to discourage tlie
adoption of this latter alternative — should it be in contemplation — by bringing to the,
knowledge of the House of Commons yonr Lordship's Despatch and my own lommunica-
tions to which it was a reply.

(i. The presentation of these documents to Parliament has licen complained of in some
quartei's as evincing a desire upon my part to aiVord imdue assistance to my Ministers.
Such an impression could only have been generated in the heal and confusion of a i)arty
condict. '1 lie major part of my Despatches consisted of a simple narrative of fa"ts. If

• No. 10.

t No. 6.

Canada.

:64

CORRESPONDENCE RELATIVE TO THE

CaNAIjA.

thcHC lacts wcro true — and their acciiracv cannot l»i! impugned — wliotlicr they told for or
agiunst my Ministoi-s, no just man could have wislied them to he withlield. As for any
incidental remarks or inl'erences intei'siH'rj'cd throngli the narration, such remarks anil
inferences referred to the aspect of atlaii-s as they existed on the IJUh of August, and not to
the totally distinct and nllered issues upon which Parliament was proceeding to adjudimte.

Y. On Monday, the 27th of October, the House of Commons met at three o'clock in th(;
afternoon, and proceeded at once to the consideration of the Speech from the Throne, the
debate commencing with an able and malerate speech from 5lr. Mackenzie, in which he
moved the siilijoined amendment as an addition to the second paragraph: —

"And we have to acipiaint His Excellency that by their course in reference to the
investigation of the charges preferred by Mr. Huntington, in his place in this House, and
under the facts disclosed in the evidence laid licfore us, His E.xcellency's Advisers have
merited tlie severe censure of this House."

8. This amendment raises a jicrfectly fair and direct issue, it goes to the root of the
matter, it founds itself upon the evidence taken by the Commission, and neither directly
nor indirectly does it im|)Ugn the act of Prorogation. Indeed, on perusing the Report of
the discussion which ensued, your Lordship will perceive that the objections which at one
time were so vehemently insisted upon in regard to this proceeding have been, so far as.
my actinn was concerned, almost entirely pretermitted, that Mr. Rlake stated he would not
even refer to them, and that most of the s[)eakers, with an instinctive appreciation of what
the exigencies of the case demanded, confnied themselves to the consideration of what are
the main substantive charges against my Ministers.

!). On the second night of the deliate .Mr. .lames .Macdonald, member for Pictou, an
eminent sup|M)rter of the (lovernment, moved a second amendment in the following
terms : —

"And we desire to tissuro His Excellency that after consideration of the statemeids
made in tlu; evidence before us, and while we regret the outlay of money l>y all political
parties at Parliamentary elections, and desire the most stringent measures to put an end to
the practice, we at the same time lieg leave to express our contin\ied coididence in His
Excellency's Advisers, and in their administration of public all'airs."

10. The discussion on the two Ibregoing amendments continued, with the exception of an
intervening Saturday and Sunday, for seven siu'cessive days, that is to say, from Monday,
the 27th of October, to \Vc(lnesday, the 'tth of November.

11. On the moniing of that day Sir .iohn .Macdonald asked for an interview, at which he
inibrmed me that although lie and his friends had had reason to expect a considcralilc
majority when Parliament met, some unexpected defections had .since occurred in the ranks
of his supi)orters, and that he had just received an intimation from one or two more, which
so compromised his pros])ects as to render it his duty to tender me his resignation as well
as that of his colleagues. He then repaired to the House of Commons, and brought a
debate of almost unprecedented h'ngth and interest to a clo.se l)y the announcement of his
surrender of the seals of ollice, and of my having called upon Mr. Alackenzie to form a
(lovei'iimcnt in su<'<ession to himself.

12. The discussion not having been brought to the test of a vote, it is impossible to state
with cerlainty what the result of a ilivision might have been. lM)r .some time before the
meeting <if Parliament, and at the outset of the J)ei)ate, the Ministerialist side were very
conrulent lA' » majority of from 1(1 tiv 2.'». I coiiless I always considered llies(! calculations
over wmguine. (hi the otlier hand,— even at the last moment, when their chance of success
seemed most assured, — the Opposition, 1 have rea.son to believe, did not calculate <m a vote
ol niore than H or 10 in their liivour, so that under any circumstam-es the division woulil
have been a narrow one.

1.'!. It may nut, lioivever, be inopportune to rennuk, that the fact of every single member
of the House but two, having been present in Ottawa and prepared lo vote on this
occasion, exemplilies in the most striking way liow mistaken I should have been on the
llfth tif August, had 1 taken the ninety-two signatories to remonstrance presente<l to uie, as
representing a " niiijority " of Parliament. If the House had gone to :i division on the day
on which Sir .Iohn .Mai donald resigned, it woulil have liecome appari'Ht that, — leaving out
of account the new members for Prince Edward Island, — ninety-two votes would have
represented a "minority" of linirtecn un the total number given.

II. Many of the speeches delivered ilnring the course of this remarkable discussion were
I'liiinirterizeii liy gi-cat abiliiy iiiiil power, several of them having lieeu of three and (i)Ui'
houf'^" duration. Sir .Iohn Maii!iin;dil did not address the House uiilil .Moiiilay evening the
sixth day of the debate, when lie spoke continuously for five hours. Mr. Uiake followed
him with a speech of eipial abililv and ini|iortaiice, and was succeedid liy other niendiers oi
weiiihl and emincMc. It i' iml iiveis-ar\ I should imlieale aii\ i/f these eloiinent ellbrts \\>i

they told for or
Id. ' As for any
•h reiimrks and
iigust, and not to
n^i; to adjiidicati'.
ce o'clock in t\w

the Throne, the
izie, in which he

reference to the

this House, and

s Advisers have

) the root of the
neither directly
inji the llejtort of
ions wliich at one
,e been, so far as.
ited he would not
)re(iution of what
iition of what are

iv for Pictou, an
in the following

of the statements
ey by all political
s'to put an end to
conluli.'nce in His

he exception of an
lay, from Monday,

•view, at which he
ct II considerable
urred in the ranks

two more, which
csignalion as well
IS, anil brought a
nouncement of his

kenzie to form a

iiii|ii»ssibie to state
H> time iM'ibre the
ist side were very
ilu'S(! calcidations
riiaiiic of success
Icnhitc on a vote
le division would

ry single member
io vote on thi>
uive iM'cn on tin-
vsi.'u(ed to nic, as
vision on (he day
llial,— leaving out
\oles v.ould liavi'

lie discussion were
)f lliree and four
oihIju' evrniiig tli>'
Ir. liiake iollowed
other members ol
.iloiiuenl elVorts f n

CANADIAN PACIFIC RAILWAY.

265

your Lordship's special notice, as from the report of the proceedings you will yourself be
able to judge of the various kind of merit displayed by each.

IT). Unfortunately the shorthand writer's notes have to be tslegraped to the principal
journals for publication, and as I have already stated to your Lordship W. v previous Dcsimtch,
errors and lacunar unavoidably occur during so complicated a process. Notwithstiinding
the imperfections arising from tliia source, your Lordship will not fail to perceive that when
called upon to deal with a subject of gnivity and moment, there are probably few asse jlics
in the world to which in eloquence, dignity, and aljiiity lor Debate, th< Parli'- A'lit of
Canada need yield the palm.

1<>. I cannot close this Despatch, which describes the concluding scene of the painful
drama of which I have been a spectator, witiiout calling your Lonlship's attention to the
fact that the result arrived at, — a residl not oidy hailed with satisfaction by the victors, —
but what is of as great sigiiiricance, ac(piie.s('e(l in by the vumpiished, has been reached by
a patient adherence to those constitutional princijjles which your Lord.ship has recommended
to my observance.

17. If instead of proroguing Parliament on the KUh of August, I had dismissed my
Ministers, or compelled them ag-ainsl their will, had that been possible, — into a line of
action which .should have evcntiuucfl in their premature overthrow, a cry far more loud and
genuinely indignant, than that evoked by prorogation, would have been raised thr<)ughout
the country ; and the action of the (Vewn in rashly discarding or ''liandoning untried ni"n
whom Parliament had P-comuii'iided U . - coiifidcnee, would have l)oen denounced with C(|ual
velicincnce anti far greater reason, as ,i higli-liaii(ifd ait of the Prerogative. Nothing so
disturbs the march of justice, so eonlksesan ii-sne, so rehal)ilitatea wrong-doing, as that any
irregularity of procedure, any nppearance of shari) practice should "itiate the action tjikeu
against the accused, and the destruction of my late Government under sueli circumstances
would always have been regarded by its adherents as having i)een brought about l)y
vioh-nt means, and through the uncalled for intervention of an imperial oflicer.

IS. If my Ministers have now fallen, they have fallen after thoy have had every oppor-
tunity of stating their ca.se to the country, and of pleading their cause before a full I'arlia-
nient. If the venlict has gone against them, it has done so under circumstances which
leave them no ground of complaint against the Representative of the Oown.

19. On the other hand it must be apparent to those who take an adverse view of the
conduct of the late Administration, that a result which they would prol)ably designate as
the vindication of the national credit and pulilic reputation of the Dominion, has been
brought about, not by an ill-considered and hasty exercise of Imperial authority, nor by the
application of premature })ressuro from witiiout, but iiy the free and spontaneous action of
the l{eprosentativcs of the Canadian people — a coiu'lusion wliich thoy will hail with a
satisfaction, proportionate to their power of a|ipreciating the privileges of self-government,
and to the importance they may attach to Canada being recorded in history as having
proved competent to the guardianship of her highest interests.

20. During the whole of this unfortunate business, I have never doubted but that a strict
application of the principles of Parliamentary Goverinnent wouhl be suflicient .to res)lve
every difficult^-., iml that a result would be eventually arrived at in harmony with tiie con-
victions and wi>i;es of the Canadian people. Had it proved otherwise, I still held in
reserve a Consiitutional power e.|ual to any cmergencj-, and in the last resort I should have
been (,;;ite jirepared to have exercised it in whatever way the circumstances of the case
might have justified.

I have, il'c, •
The I'iirl of Kimlwrley, (Signed) DUFFERIN.

&c. &c. &c.

No, 14.

The Earl ok Kimheulet to The Eakl op Duffehln.

My Loan, November 29, 1 873.

I HAVK received and laid before the Queen your Lordship's Despatch of the 7th
of November,* reporting the proceedings of the Dominion House of Cmimons on the
re-assembling of Parliament, on the subject of the charges brought by Mr. Huntington

O&KADA.

• No. 18.
2 M

■260

COUUESPONDENCE, ETC.

<\\;;ai)v, a<rainst your Ministers, and acquaintint: mc that, after a longlliened debate on an aineml-
meat moved l)y Mr. Mackenzie to the address in answer to yotir speech, Sir Joiin
Macdonald hud placed his re;-iii;nation and that of hi? cnlk'agues in your hands, and you had
tiiereupon called upon Mr. ^Mackenzie to funn a Ministry.

I agree with your Lordship in the satisfaction which you express that the result i:rrivod
at has been rearhed l)j' a strict application of constitutional principles, and by the re;;;ular
working of the machinery of a free J\irlianient, and i have much pleasure in <-onveyin';- t"
you Iler Mijesty's iiitire approval of tin manner in vvhich yon have acted in eiroumstan .'cs
of no ordiuarv diflicultv.

1 li&vc (fee.
The Earl of Duflerin, (Signed) ' KIMHEIU-EV,

(fee. &c. itc.

irmnoN

MUNTKD nr IVaLIAU tU>WKll ANIi UttSi, hTAMFOIUI irrRKKT AND (.'UARI.VM CR
»UU IIEK NAJIifll't '-TATIONKriV OIKICI.