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Hiotographic

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U^-.'/^/:^^'^ \

HISTORY

OF THh

J^ Iis/£ A LO- j^Is/I A-TIOIsT

Ol' lllK —

"NOVA SCOTIA MUTUAL"

AND

Royal Canadian Fire Insurance Co's.

WITH

A BRIEF ACCOUNT OF THE SPECIAL

JURY TRIAL.

EUDL-A-IR

7;.s'.

BOTAl CiADIAN fflSDMCE COMFM.

liKLlJ IN 111 I-;

8UPEHiOR COURT AT MONTREAL,

November 26th and 27th, 1878.

4f3r

^^•ii"iP»P

mmm^

Roj

HISTORY

OF THE —

-A.iwd:j^LC3-A.ii^jLTionsr

OF THE —

NOVA SCOTIA MUTUAL"

— AND —

Royal Canadian Fire Insurance Co's.

WITH —

A BRIEF ACCOUNT OF THE SPECIAL

JURY TRIAL,

vs.

ROffl CMADIM fflSiANCE COMMY.

HELD IN THE

SUPERIOR COURT AT MO^'TREAL,

November 26th and 27th, 1878.

'•• ■»«■

ROYAL CANADIAN INSURANCE COMPANY.^

» ♦ »

The JoUowing Telegram-t, LeHera, Agreemmh, te., d-c , d-c, ore copies a f those fy ltd in

tUia caae in the 6iipei iur Court, Montreal'

III the eununer of 1873, when tlie Hon.
John Young and otliei> were actively eti-
pas^eil ill e^'tablishiiiir the Coiiipaiiy, (Jet'en-
dant.) Mr. Young, induced the I'laintitt" to
virtit the Maritime Province.- to secure nulr
ficriptions to tlie capital .Stock of hi» Com-
pany, agreeing to pay the Plaintitt" a com-
iiiit-Hioii of one per cent upon sucii capital
as might Ite secured to liiHOompany through
the services of tlje I'iainliti'.

The Plaintitt" accordingly left Montreal
about the 8th of July, and' on his way to
the Maritime Provinces conceived the idea
that the quickest way to promote the rapid
extension of the Company's operations in
those distant parts of the Domini< n, would
be to confine his ettbrts to absorbing local
Insurance Companies, instead of inducin;.r
capitalists to put fresh capital into the
business ol (ire Insurance, to injure the
capital already invested in the business.
Before reaching Halifax, the Plaintitt' gained
a good deal of intbrmation about the local
Fire Insurance Companies of Halifax, and
poon after leaching that city he called upon
the President of the "Nova Scotia Mutual
Fire Insurance Company", Mr. James B
Durt'us, and made known to him the object
of his visit to Halifax, mentioning at the
same time, that he considered it would be
to the advantage of the shareholders of his
Company to retire from business, and trans-
fer their capital and risks over to the Ruyai
Canadian Insurance Company. The pro-
position w .8 a bohl one, but Irom the first
It was looked upon with favour by the Pre-
sident of the Nova Scotia Mutual.

Finally, the Plaintitt' decided to commu-
nicate with his principals at Montreal,
which he did as follows by telegraph :—

Halifax, July 12, 1873.
To the Hon. John Young.

Royal Canotiian Ins. Co.,
Montreal.

Favnurnble opportunity for amalsrnmnting the
Novii Scotia Mntu.'il Fire [nsuranceCompijny, pnid
capitiil hundred thousand dolliirs, at risk nearly
two millions of dollars. They want twenty-five per
cent bonus, what say you ?

(Signed,) S. PEDLAR.

The above telegram wap the first intima-
tion the Company had of the Plaintifrs
project, and as it indicated a ditt'ercnt line
of action from what was exi«'clid;, it must
have been an agreeable surprise. The fol-
lowing letter was also forwarded the same
day :—

Halifax Hotel, July 12, 1873.
To the Hon. John Young,

President Royal ( anadian

Insurance Company.

Sir.- The telegram just sent you. doubtleits will
convey the imprecsion to your mind as well «u« ihe
Dirovtori<, that llalitiix people have been made
aware of the obj«'Ct of my mission hither. I hiivo
now attained ;•• that stage that it is highly ncces-
SMry that 1 s'lould give a full dcscriptidii of the
matter up to his date. I found the city had sevoml
Fire Insurancu Compaiics. and the Foreign ones,
lowering their nites. The .^tna of llartford, in the
handii of a most excellent agei t. w.is not in the
tariff ci'mbination, thus roinoviiig the objections
which existed so favourably to our work iu Mon-
treal.

I decided to sound through Mr. Kinncar (of Kin-
near is. Jones . the Nova .*>colia Mutual Kire In-
surance t'«impiiny, a company of two years standing,
in a healthy state, with a good paid up capital of
one hundred ihcmsand dollnrs, to see if it could be
got to transfer its capital. I entered into this Mea,
believing it the best and quickest way to accom-
plish rapid w< rk in getting stock. I felt sure >ou
would not care how so(m I earned a handsome com-
mi-s.-iion, only that results were secured

Mr. Kinnear this n. m. told me he would go with
me totheolTiceof the Nova .'^cotia Mutual, and there
the President J. B. Diitfus, and tn\self could talk
over I he matter. Mr. Kinnear. Mr. Duffus. and one
or two other (lentlemen. thereupon expressed them-
selves tavourably uoon their transferring their
business, capital, and all. over to the Royal Cana-
dian, calling the one hundred thousand dollars cash
paid up to be the ■(• per cent call urux one million
dollars subscribed stock. In enbsequent co' versa-
tion with Mr. liuHiis. he stated that while th'e
stockholders as a body had not been consulted, the
principal ones felt there w< uld be consent of the
whole, providing a reasonable bonus, they stated
twentv five percent of the entire oai>it:il handed
over) were allowed for the goodwill of their
business, also, that no marine business be trans-
acted for thf present.

Their bu-iness is supposed to be healthy, for the
shareholders are themselves the heaviest insurers,
only one loss has taken pi ice si' ce commencing.
After pa>i"g a lihcral dividend ihcy show a hand-
some surplus, notwithstandii'ir the large risk of
over one and a half million ot dollars.

I have no doubt in my own mind about the rare
opportunity which presents itself through my effort!
in thia instance, lu one transaction the Koyal

_ 4 —

Cnnndinn »rnlr« not only n splendid oliiMof wenlthy
poli'i Kliiiri'lioldcni, but ii timiribln nvniliblo iim>cI,
bfKi<lcf<ii l)UM<'(>rF, II pliic! to do it in, :< oaimblc niiin-
iiirtMiitMit. iiiid b(-iii (if nil nil iiil(>rRi*i«'il, cn-opmliiifr,
iiiiluKntiiil, body of inminT'i, Kiviiifr ili« Ho.vitK'iiuii-
diiiii II holii iii>on the .Mnritiinc I'mviiict-x, tliiit to

c iiiLMico lit the bntlom could nut be iittiiiiiod W

over ill II niiiirU'r of ii ci'iiUiry.

How to hriiiir tlio Irniixlur Mboiit iR the r|iici<tion.
A bonus will be tl^l<ed, and I think it is worih u
boiiiip, but think ten |>cr eent iiciirer ibo vn'.uu thiiii
twenty-five i«er cent.

Wo sliould iiiuku the best poiiHiblo biirirnin. The
pontleiiicii referred to ki ow llio lincird Muckbol-
ders ill ii purely U.c.il t fflee riiii. iind nodoiibt be-
lieve in my cinttinent thiit it wmild be a fiiil'er
Fitii.'ition fir tbein to be holders of one niillion
dolliirs of Mibseribrd shnres in the Toyiil I iinndiiin,
thiiii bolder!' of tuo hiiiKlred thriismd doihirs in
the .\o\ii Veofiii Miitiiiil to !< ly iiotlii; k iiboiit bonii^,
oven, hence we iiiny tio iible to have a fair burKnin-
niid ,i d'ltly on iclu lo an arniinreino'it niiitii illy sa-
tisif ictory. I nil II iiwint further in^'trllcfionf.
Should you consider the fchcine a valiii<ble one, ii
proper competent person, or percops, sliould coire
on lieru fully authorized tu proceed further with
details.

I feel thut I have well earned my ooinmission in
opeiiinir up tic way in thislnrpo I andsoine (nins-
nctioi), but will stiiyherc ai'd rci'der any nssistanrt-
required 80 that tho Hoyal Ciiniidiaii 8)iall >ooii be
u nt-iii, nli'iil'lr, iiiiliirii)fi fact, ''lease deliiy a
reply no lonrcr than y< ii can help. 1 have not
called upon Tobin. nor Coi-hranc.
I remain very truly,

S. PEDLAR.

After inailinjr the nltnve letter, tlie I'ollow-
ing telegram was received : —

Montreal, July 14, 1873.

ToS. Pedlar. Esq..

Halifax.

"At present cannot act till new Board is elected.
Write mo fully on bubject.

(Signed.) JOHN YOUNG.

On receipt of tlii.*, the Plaintiff sent th(
Halifax, July 14, 1873.

following telegram

rny that T do not consider the price nnmed by me
''/-.IK at all excesHive, ooiisiilennti the pi-renl pn.
sitinii of the Nova >^eotiii .Mutual •'(>.,»« II. business
could be very much increased In.m October to
Jiiniiary, 1^74, if umalffainntcd with u Cumpuuy uf
liirKc capital.

Yours respectfully,

JAMES D. DIJFFU.'',

Proiiineiit N. S. M.

To the Hon. John Younp,

Montreal.

Have wriltco. I start early for Montreal to ex-
plain mutters.

(Signed,) S. PEDLAR.

Before leaving for Montreal, Mr. Duffus.
the I resident of the Nova Scotia Mutual,
hail addre^-sed the Plaintiff the killowiiij;
letter wliicli may be saiil to form the basi.-
of the negoc.ations which linally resulted
in uii agieement of amalgamation.

Halifax, July 14, 1873.
Mr. S Pedlar,

Halifax Hotel.
Dear Sir,

In refcronco to the communication with yon, res-
pcctini' tbe Koyal l.'anadian insurance Co., I coin-
municited the spirit of the suae to my Co- Direc-
tors. Tlioy would bo prepared to recommend the
accept inco of say s-iu .(«ki in stock in tho Royal
Ciinadian Co., to the Sharoholdors of the N'ovii
Sootia .lutual Firo Insurance Co.. provided they
cm sell to thM Koyal Caiiutiian Co., at a. fair price
the Kood-will of the Nova Scotiu Muiuul Co. I may

Montreal was reacdied iti due time, atid at
an interview with the Directors, the project
was considered to he (d'so much inijxirtance
that no time should he hi-t in having it ae-
(■om|ilished, and Mr Young, the Provision-
al I'resident of the ("omimnv, defendant,
was instructed to proceed witiiout delay to
Halifax with the Plaintiff to secure thifl
tnd.

Halifax was reached, and at a conference
of the Directors of the Nova Scotia Mutual
Fire Insurance Company, Mr. Young and
the Plaintiff, an agreement was duly entered
.iito as lollows : —

AOHEKMENT.

Memorandum of Agreement entered into between
the .Nova Scotia Mutual Fire Insurance < ompany
oil the one hand, and tho Koyal Canadian Insurance
' ompany of Montreal, on the other hand.

That IS to say, that in n conference held on the
twenty-fiflh day of .July, 187S. of the IHreetore of the
N'ova Scotia Mutual Kirc Insurance Company, and
the lliin. John ^ oiiiig. M. I .. the President of the
Koyal Canadian Insurance Company of Montreal,
it was agreed :

That it would be mutually advantageous thnt the
Vova Scotia Mutual Firo Insurance Company
«hould be merged into the Hoyal Canadian In-
ouranee Company of Montreal, on the following
conditions:

.St. That the risks now rem-iining of the Nova
'^cutia Mutual Fire Insurance Company, amounting
to tlio sum of about one million five hundred
thousand dollais. should bo assumed by the Roviil
<'anii(tiiin Icsurai ce Company, and that the Pro-
iniuins which have been received from these risks
listM of which both ot the risks and preiniuuiH to be
made out) should b" equally divided between both
comiianies. The amount received being $ll,5(J(i,
m.e naif to be kept by the Nova Sco'ia Mutual Fire
nsmaiice Company, and the other half being paid
'iver to the Ko>al Canadian Insurance Coinpiioy,
they take the risks for the fifty per cent of the Pre-
miums of eoveriiigall lossesfrom the Policies issued
lip to this time by the Nova Scotia Mutual.

2nd. The shareholders of the ^ ova Scotia Mutual
l''iro Insurance Compam*, agree to subscribe stock
in the Royal Canadian Insurance Company of Mon-
treal to the extent of five hundred thousand
dollars, with liberty to subscribe seven hundred
ind fifty thou.«and or one million dollars, and to
pay over ten per cent of the said stock to the Direc-
tors of the Royal Canadian, or in other words
S^t'.C) ) fifty thousand on the five hundred Ihou-
cand, and in proportion for a larger amount.

■' rd. For the uoodwili of the business surrendered
by the Nova Scotia Mutual, to the Hoynl Canadian,
It is agreed that at the end <if the twelve months,
from th»* date of the subscription of the stock, the

oyal Canadian Insurance Company agree to i>ny
over to the original shareholders of the Nova
'cotia Mutual Fire Insiirnnce Company, one per
Rent on all stock subscribe<i up to the extent of one
million dollms, but not for a less amount than five
iiiindred thousand dollars.

■tth. It is agreed that tho business of tho Nova
icotia Mutual Fire lusurunoe Company shall be

— 5 —

inl

|>ck
in-
Ind
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to

BC-

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pu-

ied

iny
Iva
Icr
|)e
|ve

rontiniie'1 an nt prrBont. (nftrr flic nrrnnjrcmpntf
nru coiiipluteil) in tliu ninnc <it tlii' Wo al < niiMlinii
liiKiiniiii'O ('()iii|>Miiy of Mui truiil, tint nil I'nlicic*
fhiill be i^'l'u^ il III ilH iiiitjif, liiHf llif l>Msiiifs« nt llii'
(oinimi'.v i" i^">ii >c<>li ' ►Iwill l>e poii'luctpil l)> lli«
i>rt'.«eiit rn'(<iilt'iil III (1 liifiM'tors iil the ov.i .-cdtiu
jiutiiiil hire liii>iiriii cc < iiiii|>iii y "liil Lvilm |iri'-
peiit Sft'i'Ptirv. midiT hih-Ii inctriii'linim jis iu:iy Iroin
time to liinu lie i».<iie(l by tli<> prcHt'iit ('oiniiiiny nt
Miiiiti'L'iil, t'lir tilt! Ki-iiiTiil iiiiiii.iiicu and uuiitluct ol
the busiiifss of the ''omtiaiiy.

r>th Th:it till! |irps«'iit Ipiiso of thn nffce on the
corncrof Prince Street iinil Drtll'onl How. with all
the riKhiH and |)ri^ ilexes of hire, arc hereby iiiven
by the Nova Sedtiit Mutual Kire L snranee Coiii-
ixiiiy to the KflViil I'aniidian Insiinnee t'ompaiiy, iit
the price paid by the ''mniviny for the I.c.ice, i;nd
that llie Furniture of llu' dflicp be aH^||llll(*'l by the
]<oyiil ('nniidiiiii insiuranco tunipaio at the cu.st ot
the same.

(Siptncd,) JOHN YOlXO.
Prenideiit Jioial Cdii'uliiin Inn. Co.,
Mo lit mil .

J. R. DUFFU.^,
Pretident Kovii iScotiii Miifiinl Fin
Jiiiuriince Coinitnny,

When the ahove ngreeineiit was enteroil
into, all |iartii.'s to it, cotisiilereil a hati^tac
tory anaiijrciiK'iit had Ikcii eiitt'icd into.
Mr Yonny and the Plaintill' in a ttw davf-
at'ter the cuinpletion ol the a^rreeineiit, re-
turned to Muiitreal, tu take jiart in the lirsi
meetitig ol the shareholders tiir the electiuii
of Directors. Tlie following paraj^iaph taken
frotii the •' Moiilrtiil JJciuld" is interesting
in showing the reference that was made at
this meeting to tliis project.

Extract from the " Montreal Herald."

12th AiiguHt, 1S73.

Mr. Young, the cliairnian, saiil : —

"At one of their meetinas, it h:ifl been deemed
advimible, and indeed necessary, to obtain ihe netive
cooperation of the Maritime I'rovinces". AccorJinK-
ly he went to Halifax with Mr. Hedlar. and after
negociation, succeeded in makiiiiran iigreemunt by
which the "Ni.vu Scotia Mutual " and the Hoyiil
Canadian Insurance Ctunpiinies .should merfro into
each other. 'J he Jiirectorii who for over two years
iiianaiccd that Comimny, a»!reed to take tive hundred
thousand dollars worth of the smck in our ('oinpaiiy,
and tfive over to us their business at the usual rate
of filty per cent-

Quite unexpectedly, liowover, Presidetit
Dutt'us of the "Nova Scotia Mutual," ol
Halifax, communiciited tha following day
the intelligence, that certain otie or two ot
the shareholders of his i onipany, were dis-
Hatistied witli the agreement entered into,
and the IMainlitf was directed to go to Ha-
lifax the third time, to remove, if possible,
tho.se ditHculties.

The Piaintirt' arrived in Halitax in time
to atten 1 a meetitig of the Halifax share-
holders at the request of Presi.ietit Diitfu-,
as representative of the company. Defen-
dant, liut before attending thi- meetin^j he
Icrwarded tlie following telegraph : —

Halifax, August 19, 1873.
To lion. John Younir,

MoiitrcnI.

" Meetinir fo-mmrow to confirm three hundred
thon-iiid .subscribed- Feeliui; nciiiiiKt nu>ro Shall
I accept ?

(SiKucd.) S. PKDLAR.

The f llowing is Mr. Youtig's reply : —

Montreal, August 19, 1873.
To S. Pcdhir.

Jas. U. DufTuR,

Halifax.

"Our Tlonrd think >ou Fhould ncocpt, nlfhouRh
we would have liked the whole- liutiiicss continue
to How iu.

tSigned,) JOHN YOUNtJ,

President.

The Plaintifl'attended the meeting referred
to, and unswend such (luestions a.s were
put to itim hy shaieholders of the Nova
.Scotia Mutual.

It will he seen hy the following resolution
that while not expre-sed in so many words
the Halifax people felt that they were husty,
in transit ring their capital and husiness
to thf Cotnpanj D' fendant before it had
more of its stock subscribed.

Jfe^ohiiion oj N. S. M. ShareJiolda's.

'* Moved by Mr PukIi, seconded by Mr- Dniill,
That when stock to the i<niount ol four iiiillious of
dollnrs is siib.veribed in the Itoyal Canndiaii In-
surance ( ouipaiiy of Montreiil, ii cUidinf; the
II mount sub-cribed bv the (-toekholders of tlie Nova
Scotia .Mutual, which shall iiot be le>s than three
hundred thonsund dollars, then t'lC Hoyal and the
Nova Scotia .Miitunl shall amult(iimiite iipoi) tho
terms previously ajrreed upon This proposition to
remain orien to first of January, eighteen hundred
and sevciity-ttiur. 'Carried.)

Imtnediately after the close of this meet-
ing, the Plaintiff decided to return to Mon-
treal, and before doing so, fent the follow-
ing telegram : —

Halifax, August 20, 1873.

To lion. John Young,

President,

JMontrcal,

"Successful merely in advancing another stage.
.Start for Montreal to-morrow.

(t^igued,) S. PEDLAR.

ThePlaintitl' Ciilled at the office of the
Company, Defendant, when lie rfached
Montreal, and verbally reported in substance
what the difficulties were at Halifax— and
fnrn shed a cojiy of the resolution passed at
the meeting referred to. This closed the ne-
gociation which was originated and suc-
cessfully oomph ted through the exertions
and labours of the Plaintiff

It is presumed corresiiondonce continued
between thf UtficM-s of the two ('ompanie!»,
but as the l'laiiititf'.« -ervices elo<-ed when
he returned from Halifax the third time, he
had no part in it.

6 —

Plaintiff" arksi for Compensation*.

Some nix wpck-* tln'P-nftt'r.wliilc in Ti-roii-
to vii-iliii;j; iViciuls iiimI il« \otiiij; |in>oiiiil
attcnliuti ii< lii^ iiwii privutf liti-inch.-, tli<
I'laiiitilt' tilt tliut till- {. uiii|iui<y, !)• rcinlaiit.
wus flow III KiiuNvin^i; II priipor a|ipiTuialiuii
ol'tlif valiuiliU- MTv.ci'M whicli lit' liuii nil-
(Icri'd in the llaliliX nc^(itiittHin>> wliicli in-
volvftl tlif I'xp' ii'C III' inicf runnd tnp.>« tt.
Ilulitiix, to fay iKitliin^'ul tlic caic, anxu ty,
ami tiiiK' f^ivi'ii (Inrin;^ tliif lni;itliy ncjriMi .-
tiiiiiH. >«> aulin;! upon tlu> liclict' lliat tinin^li
tlie Company did not move in tlic way indi-
cated till' I'lainlitr Icit that lit' wai- t'lilitlt-.i
to fonu' conipt'ii^ution, licnou the lullowin^
curre»puudence took place: —

Quoon'8 Hotel,
Toronto, October 5, 1873.
John Yountr, E»q.,

PrcHident,

Royal Canadiau Ins. Co.
Donr Pir,

As a Dimple act of justice to myself. I boR to nsk
of the l)ireetor.s of >our L'oaipany ii ju>t mid proper
coiii|icii8iitiun for tiine mid cxpciisfs incurred iti [lie
ncgociiitions wiili flio .Nova Scotia Mutual liig>ir
nance Conipimy. Aly oiish outluy, iis expenses, i«
nearly two hundred dolliirs, liaviiiK niiide ihreu
trips in ill I tu Hiilifax. tlieretore yon ciiii form sonic
idea what would bo a laircuinpensutiuu for the pait
1 have taken in the matter.

My iiddri'ss al present is the "iEtna Life "Office,
Toronto. Trusting you will give this matter due
attention,

I remain.

Yours truly.

S. PEDLAR.

Montreal, October 11, 1873.
S- Pedlar. Esq.,

" Queen's Hotel,"
Toronto.

Dear Sir,

I am in receipt of your letter of the (^th instant.
askiiiK the Company I repre^ent. forcompeiiwitioii
for your time and expenses in going to lialilax in

its interest. . ..... ....

I have had no opportunity of submitting your
letter to the Directors, but you must be aware ihiit
on the belief th.it you would be successful in the
nejcociations you allude to at llalifax. it wiw under-
stood and aiirx'l that you on your part were to bear
lid thiit you ran the risk ol
the

„..^^^„„ „. ^_ _ iig

proved a failure, it does not seem to me you have
any claim on the t'ouipaiiy. , -n u • .i

If however you think otherwise, I will bring the
matter before the Directors for their decision, an I
if I under-Hand your letter, you will under the cir-
cumstances be willing to receive ,i>ii , (two hundred
dollars) in compensation for your expense and
labour. 0/ couihc ii"u mv Hwmv th<it tvn if iinu hail
iwri-edvi'l, your HUnLeHH irniild hnvo been turgelu
owing to my Utt<.r» tofriendi in Huli/iix.
Yours very truly,

JOHN YOUNa.
President Royal Canadian.

your own eNpenses, and thiit you ran the risk ol
beiiii? paid out of the commission resulting fnan tht
success of jour mission. Your negociation havins

Queen's Hotel.

„ . Toronto, Uoiubor ii*, 1873.

To Hon. John Young,

rrciidoi t.

Royal Cunndian Ins. Co.,

Montreal.

Dear f'ir,

Your fivor of the Hthoaine duly to hind. With
the kiiiiliie.st iueliiU<< of resp ol f<ir yo:i pur.<onaliy,
1 must iiisiftt, ili.it bec.iiiHu your t'onipa^iy hIIows
iiKieeiiiuiits to bu ri'pudiatud, my ri"!!!* are not tu
vulter in coi seiinenoi'.

I hu iigreeniuiii in the po'ises.iio i ol'yonr Company
is the bert possible pruoi tli:ii thitru wis no liing
wanting in the ne/oeiitioii 'in the couirurr tliey
lire >iuitc credit ible to tliore t.ikioK purt in tliciii in
buliiili ol the K<i.val Oimidian, anil the failure is
owing, ill fact, to yo ir CouiP iiiy, nut insisting U|u>u
the iigreeineiit iieiiigo rriedout.

You wish to know if two hundred doll'irs. the sum
d.sbiiriied by me, wou.d be deemed sutlieieiit eom-
ponsatioii In reply would iiiorel.v say. i,on >nt a

ri,iiiiiflt-it txtdi/ to ifiriiti nh'lt iriiulil Itr o jiloffr
'■iiiiitH-iiHiitioii irithoiit iiniiidivi- to mu riuhtu, aliouhi
lite " i\ova Heottii MutuiH " yet carry out iti agi-vt-

menl.

Very truly,

t. PEDLAR.

A few dftVfi after mailing the last letter,
the Pluintitr returned to Montreal, and call-
ed ut the otlice of the Company, Uefendant,
so a.<^ to further jjit'HH his claim for«om-
pensalion. Mr. lounjj beinjr ottt of town,
the Plaintilf conversed with the Mun-
uirer, and learned from him that there
wus no prospect whatever of Ihe final carry-
ing out of an Agieeinent with the Sliure-
iiolders of the " Nova Scotia Mutual," and
us this was a pretty general belief with
everyone at the time, the Plaintitf had
no other cour.'-e hut to full in with the name
view. The I'laintitt' called at the olhce
several times after this, and finally the
Directors of the Company, Defendaiit, in
view of the time and expense given to the
matter by the . intill", instructed the Se-
cretary to |my him the sum of two hundred
dollars, barely half of what the I'laiiititf
had paid out of his own pocket. However
the Plaintiff accepted the $200, and gave

the following

.•S2f0.

RECEIPT.

Montreal, 2nd December, 1873.

Received from the Roval Canadian Insurance
Compnny. the sum of two hundred dollars (.•^JiO),
being in full compensiition for nil services in con-
nection with my mission to Halil'nx. in behnlf of
the said Company or elsowhere, and tor all services
up to date.

(Signed,) S. PEDLAR.

When the above receipt was given, the
Plaintiff remarked to tlie Secretary who
drew it out, "that lie, the Piniitliff, would
look to the Company, Jfef'endant, for full
conipeimatioH should the I^ova IScotia Mutual
nhare/iolders riltiniately carry out an Agree-
ment to retire from Ituainesx and trunsfer
their c ip-tul and business over to the lioyal
Canadian"

— 7 —

itee-
sfer
oyal

Tho Plnlntlir'g rrojoot h revived, but 1hi>
Company llereiidniit iiio<«t UiN((rnrefiill.v
and dlNlioiiorabl}' rcpudlaten iiU rigliU
In it.

A few iiiotiiliH artcr j^ivitig tlie olxivo re-
ceipt, tlu> PlaiiititC iioticcii n parii^riipli in
the *• Monlreul Ilerafil," to the i-Hl-ct tliat
tlie *'.V«Prt >coti(i Mutiiiil the Innuranrt
CoiiipaHy" liati cenvi-il tu do IxiHinesH, ami
that it!4 capital ami hii-'*ie8f, ainoiiiitin^'
to nearly two niillioiiMOi ..«.i«arn, were trans-
t'ercii to the Uuyal Canadian in»i.M-atici
Company.

Tlie Plaintiff" soon al'ter seeing the ahov(

faragraph ealled at tiie olHce of tin
!onipan> , Defendant, to cee the Pre.xjdenl,
but aM he was not in the oflice, he met
the Manager, to whom the Plaintitt
offered Iih hearty cungratiihitions ove
tlie final amala^'amation of the two Com-
panies, and followed that up hy asking
for the commiH!»ioii which helelt he was en
titled to, and which the Company » Defen-
dant, coiili' atlurd to pay. The Manage!
answex . that hir Company hud already
paid the Plaintiff' i:i full for his ser■•l«:e^,
II, connection with those Halifax negocia-
tionfland heM a receipt t • that effect, hesidef
the final Agreement entered into hetween
the two Companion had no connection what-
ever with the Plaintiff's negotiations and
therefore he was not entitled to further pay '
Notwithht^nding this view of the >iana-
ger, the Plaintiff' called again at the olhce
of the Company, and naw the i resident.
who positively refn-ed to consider the
Plaintiff's claim. The Plaintiff' answered
the President, hy telling him that he wa-
astonished at his course, nnd immediutely
left the idKce of the Company.

Notwithstanding ttie obstacles thus set
in \\i'* way, t le Pluintitrwas determined to
defend his riglit«, and as a first step ad-
dressed tlie Secretary the following letter:

Montreal, September ICth, 1874.
A. Oagnon, Esq..

Sec. Uoyal Canadinn Ins. Co.

Den r. 'Sir,

Now thif tho n ilifax people hive nt Inst onst in
their int with tho * Hovnl Cmi dim," I consido if
my duty m ruceivo full coiniionsttiioii for my sorvico
diiriiiK the RiiiiiinLT of << .'{.

If -i y ."lock sec^ired to the Royil Canjidiir- 'an
afford I" be If .i cuiDiiiisH on of m e per cent, iti.o (!,■.>
Il'li i\\ Mock. f(ir it is the •tily ^ltock .\ei iibi.iiiivd. I
boiieve, wh ch ir;iii!<cd a ri-tiroiii»iu of vomijiti.i

In it' t '■'< •I'll ,<'•"/ f I II iirr

I h ivc "'ily recei^'C't thi' s im nf ■^2')'. for snr>'i<'r!'
th't c mSL'd mu rn mike tliri't' irips t" llnlifix, noi
H ifTimo ' I" re- iiib IIS.- iiif f>r trivelli'i,' cxpfiises
nl'iiu', 'I his sum, "111 ill '^^ it w 1.". I , cei-teil, bi'-iiiisi-
nt III till i w s '•iii>p<>!'cd lh>' ||:il tk.v pi 0|il' would
not jiMM tlic " Hi.yil ('I'lM.li m." Vr. I'liffn.s. ..f
lliilif X. wrote me •' fi-w d^ivs pri'vioiis HiippnrtiMc
thin .«nppt.»iiioii, i nt i o\v nfter the hi| si- of .-i few
moiifh«i lie soin'ine is to .'ill intfuts iii i| piirposiii
e <rried mit, o iiccouiiivf which 1 biso luy chum fur
fuUuumpeu8ii*iou.

Ilnvinir cverr eonfldonec that the Dlrectnri will
do wh'tt is riffht and just in the otne.you will
Kiciitly iibliKe by plHcinit iliis letter belure them at
your eurlieit coiivonieiico

I rouiain.

Very truly,

l!$. PEDLAR.

Mootroal, Sentember 22nd, 1874.
."S Pedlar, Eiq.
Dear Sir.

" Your letter of the K'th inst , preferrin* a claim
nsaiiist the Company for services rendered at Hali-
fax has been HiibiiiittiMl to the " Hmnil of ItirfO'
lorn," and ill reply I am directed to say that the re-
<iur8t therein contiiined is not icraiiled. it having
nocitnnection with 8iibsc>iuent neKociiitions tu the
settlement made with you for '*/ul( rmniitnfiiiin
'lor nil nriri i* i/i rnnifition irit/i i/our miitninn
"to Ilnlifiur in biliiil/ of thin CoiniHt v, or rUr-
'' H'/itrrt, and /or all »»•; pir. » to Utile of mltlrmi'ilt."

(Signed,) A. GAtJ.VOX,
Secretary.
tary's replv it will be seen
s on record the design of the

The St
■<t|uarely p

I'onipaii., (h-fendant, to repudiate the
rigli'r of' the J*lainti«'.

1 :. ■ Plaintiff' i'< \i that the Directors were
iieiiig inffuciici-d by the President and Man-
ager, ami ii..'refore before taking further
-K'p, (i>ci(l (i to ask lor a hearing before
llie ••Hoiiul of Directors,"* accordingly he
addressed tLc following letter to the Secre-
tary :

Montreul, .supt- 30, 1874.
A. Gagnon, Esq.,

Storetary,
Dear Sir.

" Your favor of the 2?nd inst., came duly to hard.
This letter I regret commits the Board of Dirco ors
in such a milliner ii> vould nut ha\ e been if tho
whole of the facts wer« better known

I ftel it lo be addiiiK insult to injury, for my rights
to be tlirusr )u<ide in such a manner I am s::tisfiod
that if the lioiird willgrint ine perinis'ion to appear
III person to defend myself in o'leii session, thatn
more just and siitislnutory conclusion will bo ar-
rived at I iheretbre ask of iho Directors for an
oiirly opiiortuiiity ot appenring before them My
tnifisioii to llalifix occupied six weeks of close ap-
plication to one idea, for the interest of your Cum-
piny, caused mo to in iko three consecutive trips to
llalifii.v, tlu'reiore rucli wurk is not like a mero
summer excursion I'lease present this letter for
the consideration and action of tu-duy's Board
Meeting.

■Very truly.

(Signed,) S- PEDLAR.

The Company, Deteinlant, after weeks of
lete rinir. reluctantly grunted the Plaintiff
a hearing. 'J'lie Pre.^idii't in the <liair,
Kay, 0-telI, Mnllafkey, Wilsin and I I '-
liiupicun, were the Directors present Tlit
I'laintilf conlined his reniarKs to a n ere
ncital )i' the fads of the history of his
p!(ijei:t.!ind lii« liilior in connectii'ii with it.

I he rre-ilcnt only nii the part of the
l)ir('ctors uHeied any retni'ri..«. He said, nd-
• Irc-sing the i'la.n't fi', " Yuii w II admit,
will yoM nut, that yoii wei'e aided in your
labor at lliilifax by ii y letter of intiddiic-
tiuii 1 gu.e you?' To which the Plaintiff"
Huid, ''oeitainly."

- 8 —

The Directors promised the Plaintiff that
the claim would be duly considered, and
this ended the inteI•^'ie\v, but this they did
not do, hence the I' iaintitt' ad dressed tiie se-
cretary another, and a rinal letter.

Montreal, Nov. 18. 1874.
Arthur Ga~non. Esq ,
Secretiiry,

lloyul Canadian Ins. Co.

Dear Sir,

'* I herewith request that the commission due mc
upon certain Stock cecured to your Coiupiiii.\
through the mnaUiunation of the Nova Scotia AIu-
tuii I Insurance Coinpniiy ot'Hnlifiix, be pliiced to my
credit in paying up in full, siocif in jour Coinp:iii.>
subscribed by me in the summer of 1873. The
balance I will accept in cush.
Very truly,

^Signed,) S. PEDLAR.

Not r(C3iving any reph' to this commu-
nication, and learning that anytiung bni
harmony prevailed at board meetings, ii<
at once instructed his legal adviserj^,
Messrs. Abbott, Tait, . W'otlierspoon and
Abbott, to commence proceedings against
the Company

T. lAL 2Gth NOVEMBKR, 1875.

The case came to trial before Mr. Justice
McKay, and a special Jury in tiie Superioi
Court," the 2Gtli of November, 187o TIk
Jury was exceptionally the most intiuential
and intelligent that had tried a case for ii
number of years. The following are the
names of tlie Jury: —

Edward Murphy,

(of Frutliiiigham & Workman,)
Robert Kerr,

(t'ommission Merchant,)
Robert Mitchell,

(of U Mitchell & Son.)
Duncan Hell,

(C(jmmission Merchant,)
Robert J. lirowii,

(of iirown & Claggett,)
James Mills,

(ot Mills & Hutchison,)
John McLea,

(of J. & R. McLea,)
David Grant,

(Ghissware and Crockery,)
William Muir,

(of Muir & Ewan,)
Herbert F. t'ounes,

((irain Merchant,)
Edmund H. liottereii,

(of John Henderson & Co.,)
Edward Cope and,)

(of Cuijelaiul k McLaren.)

The Trial occupied the whole of two days,
and resulted in tne follow n<:

VERniCT roK Plaintiff.

Ist. Did the Company, defendant, employ the
pl'iiiiliff. in July, ciirhfeen liundred mid seventy-
throe, to ubtuiu sub;icrii)tiou3 to its uapiial stucl; 7

A. Yen.

2nd. Did not the snid Compnny ncting in the pre-
mi>es by the lioiiornblc .John Vountr, ;>gree to piiv
(lie pliiintitf one percent. u|inii all of itn Htock which
lie sliould get lukea up or liubscribed for ?

A Vos.

;ird. Did the plaintiff enter into negociafions with
the Nova .""Cotia iVlutual Insurance Company, in
irderto effect iin amnlgiiiniition of the Company de-
I'endant, with that Comp.iny, m d whs a plan of
■ tnalgaiiiatioii between these Companies nrrmired
md almost completed, pr.ncipuily through pluiu-
titf 's exertions V

A. Yes.

■Ith. Did the said plaintiff receive any and what
isi'istaiice from the Honorable .John Young. Alfred
I'err.v. and Mr. Duffus mentioned in the pleadings
III tnis cause ?

A. Yes ; .such assistance »s principals are suppo-
sed to render an agent in carrying out such a truns-
iction.

5tli. Were snid negociations drojiped and nt an
end in December, one thousand eight hundred and
-eveiity-tlirce ?

A. Were dropped for the time being, but the
Honorable .John Youi g continued urging the matter
upon Mr. Dutfus' attention.

lith. I>id the said Uoinp my, deCsndant, pay to the
lilaintitfon the seco d of December, eighteen hun-
Ired and seventy- three, the snai of two hundred
dollar.'' mentioned in the receipt fyled in this c:iuse
oy defendant, as Exhibit niiinber One, for the
causes and reasons in said receipt stated, and is
said receipt sigiifd by plaintifl'?

A. Yes, and signed the receipt under the reser-
vation i»roduced in evidence.

'ith Was the receipt produced by the Company,
defendant, given on the talse representations
of the s.'iid Company, defendant, that no amalgama-
tion would be etfected between that Company and
the said Nova .Scotia Mutu il Iiisur.ince Company ?

A. The receipt was given under the impression at
the time held b.\ both parties that no amalgamation
would take place.

Htli. Was any ai'd what kind of nmalgamition
formed between the said Cuinp'iny, delenda t, and
the Nova Scotia Mutual Fire IiiSurance ( ompuny,
and when was .-iich am ilgimatioii etlfcteil. and on
what precise b;isis and terms ; and by whom was
such amaiffamation etfected, and did tli<- said jilnin-
titl' take any and what part in effecting the snmc ?

A. There was iimalKamation on the basis and
terms contained in the indenture dated Juno ;'2nd,
1ST4. marked "h" in tlie exhibit thereof, the plain-
tiff t iking no pirt in it, except us it was the result
of previous negociations.

iith. iJy what e.*tent w^is the capital stock of the
C< mpany, defendant, increased by reason of the
said amalgainitioii ?

A. Inere.ised by >W>',4n\

V th. Was the s lid am ilgnmntion in any way due
to the coi eeptioii, labor, cvertions or negociations
of the idaiiiiiff, and if so, what would be a fair re-
muneration tor such labor, exertion and uegocia-
tion ')

A. 'i'es. entitled to one per cent, upon the $38i\-
4011. as per afrrcenu'iit, less ,>i!' i' paid by tliein.

All the above answers unanimous, except the
last ; one dissenting.

The bu.*ii:ess community prett}' gene-
rally approved of the verdict, while the facts
iironght out in the trial placed the » om-
pany m an unfavourable light. Many ex-
pressed surprise at the t ompa y going
into court with a case so inanife tly in lavor
ot the Plaiiititf.

Notwith-'tanding this verdict, the Com-
pany curried the < ase to the " Cav t of Re-
view" which result'd in another trial bein^
orlered,oii the ground of some technical
delect of tlie jury trial.