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i-iiTi.-vni-B~ i*fi«aji«iai>iaiaii 
 
 
 GEAND TRUNK EAILWTAY OF CANADA. 
 
 B 
 
 The Ordinaby Half-yearly General Meeting of the Grand 
 Trunk Eailway Company of Canada, was held at the 
 London Tavern, Bishopsgate Street, London, on Thursday 
 the 2nd of April, 1863, at One o'clock, " for the purpose of 
 receiving a Eeport from the Directors, and for the transaction 
 of the other business of the Company." The Chair was 
 occupied by the President of the Company, Mr. Edward 
 W. Watkin. 
 
 The Secretary having read the advertisement convening the 
 Meeting, published in the " Canada, Gazette" and in the English 
 Papers, 
 
 * The Chairman said — It is now my duty, assuming as I 
 suppose you will permit me to assume, that the Report and State- 
 ment of Accounts are taken as read (hear, hear), to move " that 
 the report and accounts be approved and adopted." In doing 
 so, I must express a hope that the Shareholders and Bondholders 
 present, who, like ourselves, must have wished that the result of 
 the half-year's working had shown a larger increase of profit, will 
 bear in mind the facts of the past in discussing the present, and 
 will recollect the position of the concern little more than two years 
 ago ; because, although it may be that all we expected has not 
 been realized during the past half-year, still we must test what 
 has been done by the difficulties we have had to surmount if wo 
 would arrive at a fair comparison, and a fair understanding of our 
 present position. You will all recollect that less than two years 
 ago our credit appeared to be utterly destroyed ; the wages and 
 
2 
 
 salaries of our officers and servants were in arrear; we were 
 encumbered with a debt, as to which there appeared to be no 
 resource for its liquidation, but a seizure of the whole property of 
 the concern; and, as might have been expected, there was an 
 amount of difference of opinion, of absolute discordance, amongst 
 the holders of the various classes of securities which, while damaging 
 always, must have been as disagreeable to gentlemen on that side 
 as to the Directors on this side of the table. It was reported, also, 
 that the line was on the point of stoppage from want of repair 
 and deficiency of plant. (Hear, hear.) Since that time we have 
 succeeded in a very great degree in restoring the position of our 
 credit. (Hear, Y 3ar.) Our wages and salaries, and the materials 
 we consume are periodically and regularly paid for ; and we are 
 now able to buy in the cheapest market, because we can offer cash 
 for everything we want to be supplied with In addition to that, 
 our traffic, in spite of many adverse circiunstauces, to which I shall 
 have occasion to allude, has shown a reasonable amount of increase ; 
 and f.lthough our expenses have been in this half-year augmented 
 by a very large amount of renewals, notwithstanding that fact, the 
 increase of expenses, however to be regretted, has not been, under 
 the speci?'. circumstances, very excessive. But above all, we have 
 learned to unite instead of to quarrel amongst ourselves ; and all 
 classes of bond and shareholders are now ready to give our altered 
 management a calm and patient trial. There is much more to be 
 done, and many anxieties and difficulties still remain, ' c the 
 worst is happily over. (Hear, hear.) Gentlemen, in turning 
 to the accounts, I would first call attention to the capital 
 account. There you will see that we have transferred from what 
 were called "General balances" a number of large items, which 
 ought, as it seemed to me, to have been from the beginning placed 
 to the capital account ; and we have also endeavoured to bring 
 in every liability, which we admit in whole or in part, with a 
 view, if possible, to know the final, or at all events, the present, 
 outside amount of the capital liabilities of the concern. The 
 Bum of £15,440,000, which appears in the accounts, includes 
 
 *•«- 
 
3 
 
 4 
 
 
 all the claims settled or unsettled that, so far as we kno,., 
 can be brought against the undertaking, and we hope that with 
 regard to some of these accounts a reduction may be made by 
 negotiation on settlement. I am aware that we are now carrying 
 into account debts before you have paid for them, and some 
 explanation,- even though it may have been given before, ought 
 to be aiforded in reference to the position of those debts, as 
 affecting the Bond and Shareholding interests of the concern. 
 By the Act of last Session the creditors of the Company in 
 Canada and in England were to have legal recourse, after the 
 adoption of the Act by you, which was on the 8th August last, 
 against the postal and military revenue derived from the working 
 of the undertaking, the balance of the debts being paid in fourth 
 preference stock. By that Act, hard as it appeared to press, in the 
 opinion of soine of them, upon the creditors, all right of action and 
 all right of seizure of the Company's property was taken away from 
 creditors of the Company, whose debts made a total, if I recollect 
 rightly, but very little short of two millions and a half sterling ; but 
 the assent of a majority of the creditors in Canada and England 
 was required, and that assent was most handsomely, and under the 
 circumstances, raagnanimoualy given by a majority. Therefore 
 our position is a peculiar one, for we have debts which we have 
 not paid, but yet our property cannot now be seized for those 
 debts of your creditors in Canada and England. The creditors 
 in the United States were in a different position, but we were 
 to a great extent protected. But a vital question remains, 
 that of our pledged securities — upon that much of the future 
 success of the concern hinges. I will state hereafter the arrange- 
 ment that we have proposed as to these securities, and upon 
 what that arrangement seems to be contingent. Our position 
 is this, so far as the accounts go, that we have brought into the 
 accounts every claito, settled or unsettled, that we believe can 
 be brought against us, and though by that process, the increase 
 of the capital account appears to be £3,400.000, it is a merely 
 nominal increase; the whole real increase charged to capital 
 
 *-«- 
 
being, in reality, only about £8,000 in addition to what has 
 been paid out of revenue. I will now say a word about the 
 revenue account ; and I think if you will follow this account 
 in that which I have always considered, in reference to Canadian 
 Railways, as its most important side — I mean the working 
 expenses— I think you will find that although there is much that 
 we hope to change, and which we would have preferred not to see 
 there, still it does present some considerable signs of improvement, 
 nnd I think we may hope that the working expenses will be cut 
 down to as low an amount as is consistent with the exceptional cost 
 of the working of such Railways in Canada, and to the efficient 
 maintenance of the property. (Hear, hear.) But in order fairly 
 to see what our position at the present day really is, we must 
 look for a moment at the past. I find thnt in the half-year 
 ending the 31st December, 1859, the balance of net profits, stated 
 in your accounts, after deducting the working expenses from the 
 revenue, was £52,000. I find that in the half-year ending 31 st 
 December, 1860, the net profit, after deducting the working 
 expenses, was £62,000. For the half-year ending 31st Decem- 
 ber, 1861, the net profit was £95,000, and for the half- 
 year, which is included in the account now before you, the net 
 profit amounts to £106,000. (Hear, hear). Taking it again 
 as a question of average on the year, I find that in the year 
 1859, the total net profit amounted to £73,000; in 1860, to 
 £108,000 ; whereas in 1862, it amounted to £170,000. (Hear, hear). 
 I am quite aware that it may be said, that, although that does shew 
 a very large and gratifying increase of profit — in fact, of from 
 £73,000 in the year 1859, to £170,000 in the year 1862— yet 
 that that is still very far short of the requirements of the concern, 
 to pay the interest on the various classes of bonds. That we must 
 all with very considerable regret admit, but our duty now is not 
 uselessly to complain with regard to the past, where it is needless 
 and useless — our duty is, by united action, persevering industry, 
 and common sense, to restore the concern steadily, if gradually, for 
 the benefit of those who have invested their money in these great 
 
works. (Cheers). That is what we, on tliis side the table, have at 
 heart, and that is the practice and the policy we shall pursue, should 
 it be your pleasure that we continue as your Directors — that is the 
 course we shall adopt with a view to promote the interest of the 
 Company, without turning to the right hand or to the left. (Hear, 
 hear). The report calls attention to the very large excess in the 
 item of renewals. In paragraph 2 of the report it is stated that, 
 whereas in the half-year now under consideration, the expenses 
 of renewal have been £70,25G, in the corresponding half-year of 
 1861, they amounted to only £35,878, shewing an excess of 
 £34,378. In the report I presented to you in the fall of last 
 year, I called your attention to the importance of improving 
 your road-way, as far as practicable, and out of current revenue. 
 I must state, however, that since that time, gentlemen who are in- 
 terested in the property of the Company, Bondholders and others, 
 have said to me that it is not quite fair that that which is, to a con- 
 siderable extent, a permanent improvement, should be paid out of 
 current profit, and I admit that there is a great deal to be said in 
 favour of that view, but both efficiency and safety demand these 
 items of expense. But we have been in this position : we have had 
 to extend our works without capital, and sometimes to meet our 
 debts without revenue. (Laughter). That exceptional state of 
 things, I hope, is about to be removed, and, if so, I think it is a 
 fair subject of discussion, whether the view I enunciated in that 
 report is one that ought or ought not to be finally adopted. I have 
 always, in considering the question of Railways in America, con- 
 sidered that the question of iron— especially in reference to northern 
 latitudes, in the making and repairing of the lines was, physically 
 speaking, the main and most important matter in connexion with 
 the undertakings. With regard to the Grand Trunk Line, you 
 originally laid down the kind of rail commonly adopted in the 
 United States of America, and which is called the hollow, or " U " 
 rail. But we find that the severe alternations of the temperature 
 at the beginning and end of winter — having a spring day, perhaps, 
 on a Wednesday, and on Thursday a fall to 20 or 30 degrees below 
 
6 
 
 zero— have such an effect in lifting and disturbing the road bed, 
 and, in consequence, upon the rails, that they become strained and 
 twisted in a remarkable and singular degree. Having tried several 
 kinds of rail, we have come to the conclusion that the solid rail, 
 fished at the joints, is the best adapted for our work, and for that 
 variable climate, and we have not forgotten that our line is at 
 present more of a heavy freight than a passenger line. (Hear, hear). 
 We have therefore adopted that kind of rail in the renewals— 
 although each new mile laid down costs perhaps 30 per cent, more 
 than the old mile taken up, and, in efBciency, is worth 50 per cent, 
 more. Then comes another question, affecting not only the Grand 
 Trunk line, but also every railway company in Canada and North 
 America. We find that iron of every kind, whether connected 
 with the railway or the wlieels and tyres of the cars and engines, or 
 the axles, is liable to fracture in winter, and that the degree of 
 breakage bears some proportion to the reduction of temperature 
 below zero, but what that proportion is we cannot say, except 
 that we find that an excessively low temperature brings at 
 once augmented breakage. We find, in fact, that iron breaks 
 in Canada on a large scale, in the same way, that during the 
 severe winter of 18 GO, in this country, it was found to break 
 upon our railways in a manner which alarmed us here, though 
 it was upon a small scale as compared with the results in 
 America. It is, therefore, a question of very serious consideration, 
 and we have often discussed it at the Board, within the last month 
 or two, as to how these difficulties may be finally and fully met, 
 and the improvements lately made and proposed in the manufacture 
 of steel seem to open the way. (Hear, hear.) If these improve- 
 ments be elaborated and cheapened to the extent which many 
 practical scientific men are sanguine enough to believe ; and if steel, 
 good enough for common purposes, can be reduced to a price within 
 £2 or £3 per ton of the cost of good iron rails, future renewals 
 ought, as it seemed to us, to be made of steel instead of iron, as 
 steel rails would last longer than iron. If this could be done, an 
 ultimate and very large economy in adopting steel instead of iron, 
 
 I ' 
 
which is i)iuvL'd Lo be uot thoroughly ctticieni, coiiUl ho inado. Tliat 
 is a question which is very important to he considered hy a company 
 that has 1,090 miles of railway, and it shall have our best attention. 
 We shall watch the progress of the new manufacture of steel with 
 the greatest interest, and shall make such recommendations in 
 future to you in reference to it as we think best for the future 
 efficiency of the concern. Having called your attention to the 
 Keport, however generally and briefly, I will now endeavour to 
 give you the latest inibrmation with re<;fird to the working of 
 the railway. Having before mo an account of the income and 
 expenses of the first four w(;eks of this year, which is subsequent lo 
 the half-yearly Report before you, I find that the gross traffic of the 
 four weeks was ^59,072 in 1862, as against £64,114 this year, aiid 
 that the expenses were £41,357 in 1862, as against £38,453 this 
 year, showing a very gratifying improvement in the working of the 
 line not only in the increase of receii)ls. but in the decrease of 
 expenditure. (Cheers). A subject has been before you on forn)er 
 occasions to which I must now advert— I allude to your relations 
 with the Government of Canada. 1 believe I have been accused of 
 saying some hard things in this room with regard to the Govern- 
 ment'^of Canada; but I knew the infinite damage your interests 
 bad sustained, and which damage brouglit good to no one. I lliiiik, 
 however, that disagreeable as it may be, it is heller to let the Share 
 and Bondiiolders on this side of the Atlantic, who hold property 
 3000 or 4000 miles away, know everything, even at the risk of 
 ulfending parties abroad -I see no ultimate harm, but great 
 good in laying bare the whole truth always. (Cheers.) Our great 
 subject of complaint, in refeience to the present Government of 
 Canada, was that the previous Government having agreed to sub- 
 mit the disputed question of postal remuneration to arbitration, the 
 present Government, without any reason, as we believed, and having 
 themselves to a great extent acted upon that agreement, withdrew 
 from that arbitration, and refused to permit it to proceed, although 
 it formed the basis of our re-arrangement of capital, and of the 
 prior settlement with our creditors, whose legal rights were taken 
 
8 
 
 away. This unexpected concluct really relieved our crediiors from 
 their obligations. They might, as assent to the Act of 1862 was 
 necessary, have seized our property and stopped the working of the 
 line. This risk was thus forced upon us. Some of our creditors in 
 the 'states put immediate pressure upon us. Creditors here sold 
 Bccurities to our loss. But the majority of the creditors stood by 
 their word, though they were really, by the action of the Government, 
 released from it, and they have enabled us to avoid the danger of 
 a seizure of your property by giving us— in proper time and on the 
 faith of our beat exertions in their behalf, and of the renewed 
 promises of the Government — their assent and co-operation. 
 (Cheers.) I am happy to tell you now, that by a telegram received 
 two dayri ago by way of Halifax, we have the information that the 
 Government has introduced a Bill into the Canadian Parliament for 
 authorizing and legalizing the settlement by arbitration of the postal 
 claims, and wo have every reason to hoi)e that the justice of the 
 Parliament of Canada will lead to the early passing of that measure, 
 through which we hope to get a fair and just and honest settlement of 
 that question, and we want nothing more, at no distantday. (Cheers), 
 By the Act of 1838, in force in England, any Railway Company 
 aggrieved by the conduct of the Post-office, as regards the amount 
 of payment made to it by the Post-office, may appeal to arbitration 
 under this Act, and then the Post-office appoint one person, the 
 Railway Company another, and the two appoint an umpire, and 
 the amounts of almost all the postal payments made to Railway 
 Companies in Great Britain and Ireland have been settled to the 
 satisfaction of all parties and without a complaint, under that very 
 simple, just, and efficient machinery. (Cheers). I hope, by the 
 passing of this proposed measure in Canada, that the existmg 
 differences which have arisen between the Government of Canada 
 and ourselves will be ended; and I congratulate the present 
 Government of Canada, who energetically assisted us to pass our 
 Arrangements Act of 1862, and to whom our thanks for that service 
 are cordially due, upon the taking of a step which, if faithfully 
 carried out, will do so much, I hope finally, to remove the soreness 
 
 01 
 
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 of reeling and want of confidence which have prevailed with regard 
 to the way the unfor. nate persons who invested their money iu 
 Kailways in Canada have been treated. Of this, I feel assured, 
 and all dispassionate opinion in Canada will concur in the remark, 
 I have no doubt, that nothing which the Ocvomment could do 
 fairly to assist ihe holders of Canadian Railway property would 
 bo out of place, considering the enormous sacrifices they have 
 made to cover the smiling surface of Canada with these 
 useful, these essential undertakings. (Cheers). In the mean- 
 time, wc thank the Government for introducing this Bill. (Loud 
 checis). But, pending the settlement of the postal question, there 
 has been a very important arrangement which I now come to 
 discuss with our creditors. I have already informed you of the 
 Icgil position we stand in with respect to them generally, a position 
 which, I hope no quirk of law, which we should resist to the bst, 
 can disturb. Several of these creditors, however, hold securities 
 belonging to you, which were to have been given up, to the nominal 
 amount of nearly £700,000 sterling, but of the market value, of 
 possibly £250,000 or £300,000, and we want these securities to 
 provide for these improvements of road and extensions of works, 
 which efficiency and safety require. One of these creditors, upon 
 the news of the reversal of the Postal Arbitration, thought fit to 
 dispose of £153,100 of the 2nd preference bonds at the market 
 price of the day, which I think was as low as £53 lOs. Of course 
 you are benefited by the reduction of the debt, to some extent, but 
 you lose, on the other hand, the valuable security which would have 
 been given up absolutely, if the Canadian Government had carried 
 out the previous promises made to you. With respect to the other 
 Creditors, they have acted, as I said before, upon the expectation 
 that justice would at last be done, and now they rely that the Postal 
 Arbitration Act will be carried, and that a just payment will be 
 made for the postal service, and whatever the amount, less or more, 
 they will accept whatever a fair arbitration shall decide. They will 
 at once give up securities of the nominal value of nearly £600,000, 
 under the pioi)osals which have passed between us, if this Act passes. 
 
10 
 
 Thus we must wait the decision of the Parliament with great anxiety. 
 But as these securities could not be dealt with for the purposes of the 
 Company, without a vote of the Proprietors, I shall, at the close of our 
 proceedings to-day, propose that the Meeting do adjourn until the 
 11th of June, in order that we may then report as to the Arbitration 
 Act, and if thereby enabled to do so, take your insiructions in 
 reference to the whole matter. (Hear, hear). It has often been 
 a matter of complaint, that on the working of the Grand Trunk 
 Line, we have had very little employment for our car stock in 
 summer. In the summer yoa will perceive that we are competing 
 with one of the finest water communications in the world. Whereas 
 in the "VirintGr, we have a monopoly of the carriage of traffic from one 
 end of Canada to the other. We have recently made an arrangement 
 for the runniag of steain propellers from Chicago, and other ports on 
 Jjake Michigan to Sarnia, and wa hope, under that arrangement, 
 that greatly increased employment will be found for our stock in the 
 carrying of grain from Sarnia to Toronto, in summer, when ine 
 cars want employment. But it may b said, that " having Sarnia 
 at the one end of the peninsula, and Toronto at the other, why cUd 
 you not do that long ago ?" The ansv/er is simple :— Because 
 whereas you had an excellent elevator at Sarnia, at Toronto, not- 
 withstanding your large outlay, there was no means of sliipment for 
 grain in bulk at all. We have, however, recently had an eleva- 
 tor erected at Toronto, by arrangement with private parties, which 
 will be opened the moment the navigation permits ships to run 
 to Sarniu. Having now, therefore, complete means of shipment, 
 with Lake Ontario at the one end and Lake Huron at the other, 
 we hope to do a large business, and to find profitable employment 
 for ^,uch of our eiock, which has been lying idle in summer. 
 (Hear, hear.) I know it in contended by some, that it is quite 
 useless to carry heavy articles along the whole length of the 
 Grand Trunk in the summer, because the carriage by water is 
 cheaper , but the matter will be differciit when it comes to be a 
 question of carrying such articles not over the whole, but over tlie 
 short cut of 170 miles, only across the peninsula, and of improving 
 
 

 
 11 
 
 the condition of the grain in passing it iwice through the elevator. 
 If we do not get a profit over the whole, we shall have a profitable 
 traffic over the 170 miles, where we have the means of carrying 
 large quantities, and by wholesale. vHear, hear.) I wish here to 
 say a word as to the extent of trade that may be more or 
 less affected by arrangements of this kind. We have all 
 heard with wonder and astonishment of the progress of the lake 
 cities of the United States, the markets and depots where the great 
 grain traffic and food traffic of the western states is carried on. 
 The moBt remarkable is the city of Chicago, which, thirty or forty 
 years ago did not exist, but which is now a centre of the greatest 
 importance, and perhaps doing the largest inland grain traffic in the 
 world. I find by papers that have been sent to me that the receipts 
 of grain and fiour into Chicago in 1859 were equivalent to twenty 
 millions of bushels, while in 1862 it was fifty-eight millions. I 
 find that the total shipments from Chicago in 1859 amounted to 
 16 million bushels; and in 1862, to 55 millions. The total 
 receipts of hogs, live and dressed, from 1st of October to 2l8t of 
 February, for three years, was — 1860-61, 324,000; 1861-62, 
 720,000 ; 1862-63, 1,200,000. These are figures which we are not 
 accustomed to see with regard to articles of food in this country, 
 and show that there exists an amount of traffic exhibiting a 
 wonderful law of increase, our share of which, if carried on with 
 profit, which we can now do, but could not hitherto compete for, 
 ought at length to yield a large return. And when I say " compete 
 for," I do not mean to go out of our way to take it from any existing 
 railway, but that in co-operation with the water navigation we 
 can give it that more rapid and economical flow to the market 
 which its necessities demand. In turning from Chicago I 
 ought to mention the rapid progress and position of the city 
 of Montreal, the centre of your system. Although the in-^rease 
 of Chicago has been great, there are features with regard to 
 IMontreal which will show that, although the comparative figures 
 we besfin with mav be less, the ratio of increase is most 
 remarkable. The population of Montreal in the year 1851 
 
12 
 
 amounted to only 55,000. In 1862 it was estimated at 120,000, 
 showing an increase in eleven years of no less than 125 per cent 
 The statistics of the trade of Montreal also show very gratifying 
 resulta The returns of receipts of flour and grain, are, for 
 1862, 18,000,000 bushels, as compared with 16,500,000 in 1861, 
 showing an increase on the year of 1,500,000 bushels, or nearly 
 10 per cent., in face of a bad Canadian harvest. Then with 
 regard to the shipping trade entering the port of Montreal, in 1854 
 when your Kailway was opened, there were 258 ships, with a total 
 tonnage of 78,000 tons, whereas in 1862 the returns show 571 
 ships, and the tonnage was 265,000 tons (Cheers) ; and let me 
 say, that by a proper spirit of co-operation between the Grand 
 Trunk and the important commercial interests of Montreal, which 
 we shall labour on all occasions to cultivate, our revenue may be 
 largely augmented, and the progress of the commerce and enterprise 
 of the city may be assisted and stimulated. (Hear, hear.) I do not 
 give you these figures to renew that which it has been too much the 
 habit to adopt, namely, to raise hopes by a florid statement as to 
 future prospects, when the hopes so raised might be disappointed, 
 but to show that there are elements of improvement, progress, and 
 success with regard to the trade and commerce of Canada, and also 
 with regard to the Western States, which must in the end materially 
 affect you. It is usual at the meetings of English Railway Companies 
 to talk of proceedings in Parliament (laughter) — I am happy to say 
 we have no proceedings in Parliament to report, except as to one Bill 
 of a clause or two to remedy an error of date which crept into the 
 Act of 1862 in one or two of the clauses, and perhaps for some other 
 useful details. SCi^ie of you may have observed that a particular 
 date is given in some places in the Act as 30th of June, and in 
 other places 31st of December. To make the Act consistent we 
 were obliged to introduce a short Bill, and should any other 
 matter strike our colleagues it can be applied for in this Bill. 
 In addition to that there is a Bill, I cannot say promoted by 
 our Company, but certainly by parties so far in our interest, 
 that they desire to connect this Grand Trunk Railway with the 
 
 i 
 
13 
 
 wonderful Oil Springs of Upper Canada, by a branch of a few 
 miles. We heard the other day that the flowing wells near Ennis- 
 Idllen had ceased to spout up the oil. Last year, when I was there, 
 it was a country dotted over, in fact, with oil fountains. The same 
 subsidence has now taken place which was found in the older oil 
 region of Pensylvania ; and, I believe it is because of the gradual 
 evaporation of the gases, which are confined below, that the oil has 
 ceased to be forced, or spouted up from the ground. It has now 
 to be pumped, instead of pumping itself, I believe ; and if any 
 gentleman is alarmed, and believes that the supply will cease, let 
 him take comfort from the fact that the phenomena which now 
 appear in Upper Canada have previously exhibited themselves in 
 the oil regions of Pensylvania, and that there the oil still exists in 
 the ground, and has, as I have said, only to be pumped up. I 
 would not say much with regard to one important item, namely, 
 the traffic caused by emigration, if it were not that we were some- 
 what sanguine, as we were given to understand that a greater 
 number of emigrants would find there way to Canada last summer 
 and autumn, than had been the case before, and that this season 
 would show even better still. We find, however, that notwith- 
 standing all the turmoil that prevails in the United States, there is 
 still a large amount of emigration there, which recently was 
 strangely increased, consisting, to a very considerable extent, of 
 able-bodied young men, without families. Some of our agents 
 state that there seems to be a sudden and great demand for young 
 men, without families, in the United States, and they suspect that 
 there has been a process of persuasion going on to induce young- 
 men, principally from the south of Ireland, to emigrate, not 
 altogether for commercial, but probably for military purposes 
 (hear, hear) ; and we have some reason to suspect that a 
 large part of this tide of emigration will re-appear on the 
 other side of the Atlantic in the shape of Federal soldiers, as a 
 proof of British " neutrality" in the affairs of the north (laughter) 
 I have only in conclusion, to allude to two projects which have 
 been frequently discussed at your meetings — one, the inter-colonial 
 
 i 
 
14 
 
 railway, from the eastern extremity of your Railway to Halifax, 
 and the other, the proposed telegraphic and postal routes between 
 the extreme western boundary of Canada and the Pacific Ocean. 
 "With regard to the latter, I am happy to say that I have been 
 informed that the Canadian Government have proposed, by a 
 Minute in Council, very wisely, and as statesmen, as I think, to 
 submit to the Canadian Parliament, a proposition for giving an 
 aniiual subsidy of 50,000 dollars, to assist any matured plan for 
 telegraphic and postal communication with British Columbia, 
 Vancouver's Island, and the Pacific. This will enable immediate 
 negotiation with British Columbia, and with the Government of 
 this country of a practical character, following up the mission of 
 MM. Sicotte and Howland. I think that important question, 
 so largely affecting the best political and commercial interests of 
 Canada, in the present as well as in the, I trust, great future, 
 may be regarded, therefore, as making rapid and favourable pro- 
 gress, and that we may hope that the project will be perfectly 
 realized without any,"seriou j loss of time, considering the importance 
 of the undertaking. Then, with respect to the inter-colonial 
 railway, the legislatures of Nova Scotia and of New Brunswick, 
 have before them at this moment, I believe, bills authorizing them^ 
 to make appropriations for their share of the guarantee on the 
 capital necessary to construct the portions of railway required 
 to complete the connection between Halifax and River du Loup, 
 and these bills are expected to pass. With regard to Canada, I am 
 sorry to say there is a difference of opinion upon a proposition 
 of Mr. Gladstone, our excellent Chancellor of the Exchequer, 
 who has annexed to the proposal for the loan, a condition as to 
 creating a sinking fund. It was proposed that the Imperiul 
 Government should, upon the guarantee of the three provinces, raise 
 the sum of money necessary to com[)lete the railway, and that the 
 first repayment should be made at the end of ten years, the whole 
 to be repaid by the end of fifty years. ]\Ir. Gladstone considered, 
 however, that in addition there should be a sinking fund, but he 
 would have allowed it to be invested in Colonial securities whi h would 
 
15 
 
 I 
 
 Lave yielded nearly double the accruing interest which an investment 
 of the fund in consols would have given. That has,nevertheles8,given 
 rise to a question which is still being discussed, and is unsettled, be- 
 tween the Government of Canada and the Imperial Government, in 
 reference to that detail. At the same time I may say, that the discus- 
 sion of this question also has made considerable progress, and it is, I 
 trust, now admitted both in the mother country and in the provinces, 
 that the project is as essential for the commercial and industrial com- 
 munications of the country as for its military defence ; and all those 
 who wish to preserve the connection between Canada and the crown 
 of England, should desire that the day may not be far distant when 
 access to Canada for purposes of friendly commerce or for mutual 
 defence, may be made possible all the year round through British 
 territory. The report of the Eoyal Commission upon the defences 
 of Canada, which was made to the Governor- General last Septem- 
 ber, corroborates this necessity ; after noticing the existing means 
 of communication between Canada and England during the season 
 when the navigation is closed, and pronouncing the present lines 
 of communication to be " not available during hostilities," the 
 Commissioners conclude by expressing their hope " that some ar- 
 " rangcment will soon be come to, through which an undertaking 
 " so important to the British North American Provinces (as the 
 "Quebec and Halifax Railway) may be carried out." 
 
 But pending these discussions, unfortunate so far as they delay 
 the completion of the works, there is a serious, and I may say a 
 momentous subject, almost forced upon our consideration. I mean 
 that of intercourse with the great Western States of America. The 
 great food producing, or Western, States of America desire, and 
 apparently have determined, to render the means of access between 
 their vast producing districts and the food markets of Europe more 
 commodious and more economical. Naturally, the chain of lakes and 
 the basin of the St.Lawrerce form their shortest, easiest,and cheapest, 
 route to the Atlantic, uii ". to Europe. But political associations, 
 which often turn, or seek to turn, the current of the plain promptings 
 of nature, have transferred to the Erie canal and the port of New 
 
16 
 
 York a traffic which otherwise fairly belonged to the route which 
 nature herself laid out upon the subsidence of the great waters 
 which once covered the west. The farmers of the west complain that 
 the existing means of transit do not keep pace with their production 
 of food, so that now, they say, it takes seven bushels of grain out 
 of eight to take the eight to England or Europe. Recently, viz., 
 on tlie 24th February, there has been a meeting of the Chambers 
 of Commerce and other public bodies at Chicago, including impor- 
 tant and influential delegations from the States of Wisconsin, 
 Illinois and Iowa, and a resolution was passed which I shall now 
 read to the meeting : — 
 
 " Resolved— That we give a cordial and emphatic endorsement to 
 " the recent action of the Legislature of Illinois in empowering the 
 " government thereof to appoint a committee to visit the Provincial 
 " G-overnment and Parliament of Canada, and the Government of 
 " Great Britain, if deemed advisable, and to respectfully urge upon 
 " those bodies the importance of opening new or enlarged channels 
 " of communication between the great lakes and the Atlantic, for 
 " the outlet of western products, believing that the establishment of 
 " close commercial relations would be the surest guarantee of an 
 " enduring peace." 
 
 Now, I look upon this as a message of peace between the 
 western states of America and the people of this country, involving 
 far more than we can at present predict, or which can now appear, 
 involving very largely increased commercial intercourse, perhaps a 
 happier political connection between the two countries, for the 
 west is a country and a great one ; and if it should be carried out 
 effectually, either by widening the Welland Canal, which connects 
 Lake Erie with Lake Ontario, or by cutting a canal across the 
 peninsula from Lake Huron, or by connecting the lakes south of 
 Georgian Bay with lake Ontario, or by adopting the Ottawa route, 
 so as to secure the principal summer communication for large ships 
 all the way by water from Chicago or Milwaukee right thi-ough to 
 Europe; and also by a communication for the winter and for 
 passengers by railway to Halifax, the interests of Canada will be 
 
 

 17 
 
 served, and the Grand Trunk main line must secure a large increase 
 of useful and profitable business. This, I believe, would result. 
 Such highways, made permanent through Canada, and open to all 
 the world, would lead to a settlement of commercial relations of a 
 larger character ; for, in fact, the business interests of the whole of 
 the North American provinces, and the business interests of the 
 Western States, would be thus linked together, the railway which, 
 by your sacrifices, has been constructed through the Canadian 
 provinces forming no small or unimportant element in so great 
 a work of peace and progress. (Cheers.) 
 
 Mr. T. Baring, M.P., seconded the motion. 
 Mr. Mercer said, that when he attended last year, the President 
 did not then occupy the chair ; but he believed that the proprietors 
 in putting the chairman in his present position had done that which 
 would very much promote the interest of the Grand Trunk of 
 Canada (hear, hear). He had great pleasure in saying that having 
 gone through the whole accounts very carefully he was exceedingly 
 pleased with them, and he had examined them, having had very great 
 experience in railway matters. He looked upon the accounts as 
 being most satisfactory. There was one item as to which he desired 
 to have a word of explanation. It was stated that they had earned 
 a sum of £106,000. Of course they could not expect to get blood 
 out of stones, but he thought that the expenses for renewal which 
 were charged to revenue ought to have been paid from a reserve 
 fund or by loan. He observed that nothing had been stated in the 
 report as to the interest now due on the 1st of this month to the 
 preference Stockholders. He did not suppose that the Company 
 intended to pay it at once, but he thought that that ought to have 
 been stated. There was another question which he wished to put, and 
 it had reference to the securities held by the creditors. If he under- 
 stood the matter rightly when the postal arrangement was intended 
 to be carried out, these securities amounted to a larger sum, but 
 that a considerable portion had since been sold, which was much to 
 be deplored. He wished to know how much still remained unissued, 
 and in the control of the directors. He felt bound in conclusion to 
 
18 
 
 repeat, that he was very much pleased with the accounts that had 
 been placed before them. The Company had great difficulties to 
 contend with, but he thought that the directors had done all that 
 could have been done for the interests of the concern. He believed 
 that they would continue to do so, but they should give them time. 
 In appointing Mr. Watkin chairman, they had certainly put the 
 right man in the right place (cheers). 
 
 Mr. CouLSON said, he quite concured in what had just fallen 
 from the hon. proprietor. It gave him great pleasure to hear a 
 gentleman of such experience express such an opinion in reference to 
 the report. For himself he was also perfectly satisfied with it, and 
 lie thought that they should hold up their heads as their prospects 
 were brightening, and they would have better times hereafter. He 
 was much pleased too, that they now paid in cash for the materials 
 which they required, and he threw out as a suggestion for the 
 consideration of the board, that he understood the East India 
 Kailway Company had entered into large contracts for supplies, 
 and that they bought in this market. 
 
 Mr. CoNYBEARE said, he wished he could take as couleur de rose 
 a view of the aiFairs of the company as had been taken in the speech 
 just heard. He quite concurred with what the hon. proprietor had 
 stated, that in putting the chairman in the position he occupied 
 they have put the right man in tl e right place. The speech which 
 the chairman had addressed to them was one of the most talented 
 that he had ever heard, particularly when they remembered the 
 circumstances by which they were that day surrounded. For his 
 part, however, he should say, that he looked upon the report with 
 feelings of very considerable disappointment. He did not think that 
 the roseate hues which had been thrown over the future by the chair- 
 man, were at all borne out by the circumstances in which the company 
 were placed. There was one thing he found upon the face of it 
 which was so manifestly incorrect, that it ought not to have 
 emanated from the distinguished individuals who composed the 
 board of directors. The report stated that the net balance 
 amounted to £106,000, but when he looked into it he found that 
 
 I 
 
 + 
 
19 
 
 + 
 
 £106,000 wa8 not the net balance at all, and that before it came 
 profit they had to deduct a sum of £14,000 or thereabouts, and 
 which sum ought to have been included amongst the losses. 
 Deducting that sum the fact was, that the profit for the last six 
 months was smaller than it was for the corresponding period of last 
 year. If they had made a greater loss on the difference of 
 exchange, that oughf to have been deducted before the balance of 
 profits was ascertained, when he looked forward to the future and 
 considered the enormous expenditure to the great increase to the 
 capital amount, and remembered that half-year by half-year fresh 
 accumulations were getting up, he very much feared that a very 
 long period would elapse before the shareholders could get sixpence. 
 It seemed to him that the prospect before thera was anything but 
 promising, and that instead of overlaking the accumulations of 
 capital, they were gradually seeing themselves pushed further and 
 furthpr from any participation in the profits ; but that was a question 
 for the shareholders themselves, and which he sunposed that those 
 who are more interested in the shares than he was (hear, hear), and 
 who had therefore more right to speak upon the subject would 
 express their opinions, but it seemed to him that the shareholders 
 must be disappointed with a great deal that had been said that day. 
 These were all serious questions which showed him that that 
 report ought not to be received and adopted that day, as it seemed 
 to be determined that the meeting should be adjourned for a 
 future day owing to the arrangements with the postal subsidy not 
 being completed, he had to suggest that the report be laid upon 
 the table until the next day of meeting. They would then have 
 an opportunity of getting information as to the main points which 
 had not been explained in the very talented speech of the chairman, 
 and which required elucidation. The meeting should consider, that 
 in adopting the report, they made themselves parties to every 
 statement it contained. They adopted those statements, if they 
 were deceptive they unwillingly and unconsciously became par- 
 ties to deceiving others. (Cries of " order "). Many parties, he 
 was sorry to say, had been deceived by reports emanating from the 
 
20 
 
 other Bido of the table. He did not say that the directors had 
 knowingly and wittingly deceived them, but this he did say, that 
 they must have deceived the shareholders through their own care- 
 lessness. If that had not been so, the Detroit and Sarnia lines 
 would never have been adopted, and many other things of the same 
 sort would never have taken place. The printed circular, for 
 instance, which he held in his hand would never have been put 
 forward, if the persons who got it out had informed themselves as to 
 the transactions with respect to which they spoke. Under these 
 circumstances he proposed as an amendment, that instead of the 
 report being adopted it should lie on the table until the next day 
 of meeting. '' 
 
 The Chairman— Does anybody second the amendment ? (cries 
 of no no, and a pause.) Mr. Conybeare, I have no wish to see your 
 amendment not put, have you a seconder ? (Mr. Conybeare shook 
 his head.) Well, as there is no seconder, I have only to put the 
 original resolution. Before doing so, I beg in reply to Mr. Mercer's 
 observation to call his attention to clause 18 of the Grand Trunk 
 Arrangement Act. In order to save Mr. Mercer's time and the time 
 of the meeting, the Secretary, after it is concluded, shall explain the 
 clause to him, and I am sure he wiU be satisfied that he is labour- 
 mg under a slight misconception. With regard to the other question 
 which IS one of considerable importance, namely, the quantity of 2nd 
 preference stock held by the company, you will remember that I 
 stated the total amount, and as regards the 2nd preference, it 
 amounted to about £280.000. One of the creditors, however, sold 
 2nd preference bonds to the amount of £1.53,100 upon the repu- 
 diation of the postal subsidy, and therefore all the 2nd preference 
 bonds that the Company have still control over amount to 
 £122,866. With respect to these they are mainly held by secured 
 creditors. I mentioned that arrangements were in progress which 
 I trust will be carried to a successful result, the Arbitration Bill 
 being passed for the release of these securities. If they are, then 
 all these securities and their value will be available for the perma- 
 nent capital purposes of this company, and it will be for you to 
 
 ' \ 
 
 4 
 
21 
 
 4- 
 
 say at tho adjouraed moeting how far those securities are to be 
 used for those purposes. 
 
 The resolution was then put and carried unanimously. 
 The Chairman then moved tho re-appointment of Mr. Taylor 
 and Mr. Morland, Auditors, resident in Canada, also the appoint- 
 ment as Auditor of Mr. Newniarch, resident in England. He said 
 in reference to this resolution, I wish to state that although only 
 one of the Auditors resident in Canada should go out of office on 
 this occasion, they both wished to submit themselves to you for 
 re-election, or for the substitution of other persons in their places. 
 With regard to the appointment of an English Auditor, we have 
 with some difficulty persuaded Mr, Newmarch to act in that 
 capacity. He was good enough to take charge of a most difficult 
 matter of audit which had to be provided for before this meeting 
 was called. I thought as we were caUing in, for the conversion 
 or registry, the Bonds of the Company, the opportunity was an 
 excellent one to have a thorough audit of that portion of the Capital 
 Stock, and Mr. Newmarch has superintended it. We have, I am 
 happy to say, prevailed on Mr. Newmarch to act as auditor, and 
 we are greatly indebted to him for the labour which he has devoted 
 to the complicated duty which he undertook (hear, hear). 
 Mr. Baring, M.P., seconded the resolution 
 Mr. Walker said, before the resolution was put, there was a 
 matter wliich he wished to submit to the attention of the Chairman 
 and to the meeting. He saw by the account that a sum of £70,000 
 had been paid for renewals of the railway during the last half-year, 
 and that that sum had been charged to revenue. He wished to 
 inquire whether there was a probability of similar expenditure in 
 future half-years being charged to the same account, as it was a 
 matter on which considerable difference of opinion prevailed, and 
 his own opinion was that it ought not. He also saw a very lar^e 
 amount transferred to the capital account under the head of interest 
 paid to the aist December, or accruing and to be capitalized. It 
 might be considered a delicate question, but he desired to know 
 
22 
 
 what was tho rato of interest paid upon theao debts, and whether it 
 was above 5 per cent. ? 
 
 The CiiAiiiMAN— I can assure thehon. proprietor that there is 
 no question too delicate to bo answered at a ineutinj; of sharehoUlers 
 — there are no secrets in a joint stock concern tliat do not belong:; to 
 tho proprietors. (Hear, hear.) With regard to the interest that ho 
 has spoken of, tlie rate charged on the debts due in Canada has 
 been tho Canadian rate of fi [)cr cent., and ou tlioso in England the 
 ordinary rato of 5 per cunt. Now, with respect to the subject of 
 renewals, 1 have already admitted that it was a grave question 
 whether tho expenses ought to be charged to current revenue, but 
 the road must, as far as our means go, be kept in order. I 
 am aware that there is considerable difference of opinion on the 
 subject, but at the time tho expense was incurred, tho Company was 
 in the position of having no capital to go to. If I have no cash but 
 that which is derived from the revenue, how can I carry out works 
 except out of revenue ? and if these works must be done, of course 
 the revenue must pay for them. But I may say that we look 
 forward to providing funds to be realized by those securities whicii 
 are held by our secured creditors. The giving of them up depends 
 upon the Postal Arbitration Bill, and upon arrangements now, I 
 repeat, in progress, and which, it is to be hoped, will be carried to 
 a successful termination. I purpose to call you together on the 11th 
 June to consider the whole question, and if you think that it is 
 better those expenses should be borne, not out of revenue, as I 
 recommended, but partially, at least, out of the realized securities, 
 or a reserved fund, this question shall be laid before yon, and it 
 will be for you to decide. (Hear, hear.) 
 
 Mr. Adams inquired whether the particulars of two liirgo items 
 in the balance sheet, namely, the names of the creditors for loans 
 on security and other loans £1,556,000, and outstanding liabilities 
 in Canada £688,000; would be laid before the adjourned meeting. 
 The Railway haa been finished for two years, and he did not 
 think there cewk sje any objection to lay before the proprietors 
 the names of those large creditors. 
 
 •• 
 
The CuAiRMAN—FoUowing the principle I before laiil down, 
 I have no objection to answering tlie qucHtion, eitlinr now or then. 
 It will be perhapH more regular then, and it shall bo then fully 
 answered, but I will answer now if it be denired. 
 
 Mr. Adams— Will the particulars be published before the 
 meeting ? 
 
 The Chairman — We do not thiidc it neccHsary to publish a 
 list of creditors, which mybonafiJe holder may see when lic likes, 
 as we have nothing to conceal, ]\lr. Adams will be perfectly 
 satifified. 
 
 Mr Packer— Since you do not object to answer delicate 
 questions, but, on the contrary, say that there is no question too 
 delicate to be answered at a meeting like this, may I inquire 
 whether you will be able to pay the first preference bond-holders 
 in July H— (laughter^. 
 
 The Chairman— The Hon. Proprietor is right ; there is no 
 question too delicate to be answered at a meeting like this ; but 
 the same observation does not extend to a prophecy. I can only 
 tell him that we shall use our best exertions to increase the net 
 profits as much as possible, and if we fail we shall have a good 
 I'cason to give. 
 
 The resolution for the appoiitment of the auditors was then 
 put .and carried unanimously. 
 
 A Proprietor said, that the debt due by the Company, and 
 which amounted to a million and a half, lay like an incubus U[)on 
 it. He was a first preference bondholder from the beginning, and 
 he was willing to give his quota towards getting rid of that incubus 
 as soon as possible. He therefore moved, the appointment of 
 a committee to confer with the priuci[)al creditors and bond-share- 
 holders, with a view to propose to them a payment of 10s. in the 
 pound in cash, charged on the best security the Com})any could 
 offer 
 
 The Chairman said, he supposed the Hon. Proprietor put that 
 question owing to a very silly letter which had appeared in a morn- 
 ing paper. The Hon. Proprietor was a million and a half better 
 
24 
 
 off than he seemed to imagine. He appeared to think that it was 
 necessary, besides devoting the postal payments to the creditors, 
 also to pay a million and a half in cash before any interest could 
 be paid on the preference bonds. This was not so. He had to 
 inform him, however, that that large sum was provided for out of 
 the postal revenue which had been set aside to pay it— (hear, hear) 
 —and he feared no difficulty of the kind, unless it affected the 
 small amount of debt still due in the United States, 
 
 The Proprietor said, that the postal subsidy would be a long 
 time getting rid of the debt. 
 
 The Chairman — There were many things connected with that 
 subject, which, pending the arrangement now in course of nego- 
 tiation, it was not necessary to discuss. On the 11th June, 
 however, the matter would be fully gone into. The Hon. Proprietor 
 was not in the difficult position he seemed to think. This he desired 
 particularly to mention. It had been said by one of the speakers, 
 that the shareholders had little interest in the settlement of the 
 postal subsidy. When they met again, he would show that the 
 shareholders had. and would continue to have, a most vital and 
 enduring interest in the postal subsidy. He now declared the 
 meeting to be special for the election of directors. The directors 
 who retire by rotation were— Mr. Chapman, Mr. Ferrier, Mr. Potter, 
 and himself (the Chairman), and he had to propose their re-election 
 accordingly. A notice had been given by Preference Bondholders 
 of their desire to have Mr. A. W. Young and Mr. James Caird, 
 M.P., appointed. The directors would be most happy if there were 
 vacancies to have these gentlemen amongst them, as they were both 
 men of very high standing and position. 
 
 Mr. Salisbury thought that the directors must be proposed 
 separately. 
 
 The Chairman having consulted Mr. Swift, the Company's 
 Solicitor, who ruled with Mr. Salisbury, assented. 
 
 Mr. Salisbury then proposed that Mr. Watkin be elected a 
 Director of the Company. (Cheers.) 
 
 Mr. Morris seconded the resolution, which was carried by 
 acclamation. 
 
 I I 
 
 i 
 
f 
 
 'I 
 
 I I 
 
 A 
 
 35 
 
 The Chairman— I am much c'jliged for this token of your 
 confidence. The position in which you have placed me is one 
 I did not originally seek, or would now seek, for it is one of great 
 responsibility and anxiety. I assure you that it will give me more 
 anxiety than it can possibly give you, if I do not succeed in the 
 efforts I may make in discharge of the duties of the office in suc- 
 cessfully promoting your best interests. (Cheers). 
 
 The Hon. James Ferrier, as the Canadian Director, was then 
 re-elected a director unanimously and amid cheers— the Chairman 
 expressing his sense of Mr. Ferrier's most valuable services. 
 
 The Chairman then proposed the re-election of Mr. W. 
 Chapman. 
 
 Mr. Blaee seconded the motion. 
 
 Mr. Salisbury said, the time is now come for raising a question 
 which has been alluded to by the Chairman, and when we are to 
 consider, whether we should re-elect Mr. Chapman. I am quite 
 sure he will believe me, when I say that I have no personal feeling 
 of any kind in this matter. I do not know that I have ever spoken 
 to Mr. Chapman in my life, but he has been first secretary, and 
 then a direr ■ ;r of the Company from its commencement. I do not 
 for a moment, wish to intimate in any remarks I am about to make, 
 that I doubt the fitness of Mr. Chapman for the position of 
 director, not for a moment; but I think the time has come 
 when the gentlemen composing this body, who have 15 millions 
 of money expended on a railway in Canada, should avail 
 themselves of the opportunity of bringing new blood to the board. 
 That is the principle upon which I have always been so ready to 
 support the election of Mr. Watkin. He is a new man, and I am 
 glad to think that my friend Mr. Potter is also new at the board ; 
 but Mr. Chapman has been here from the first, and, without for a 
 moment implying that he has done anything wrong, either by 
 design or through accident, I am sure he will agree with me in 
 the general principle, that when shareholders or bondholders have 
 an opportunity of bringing in a new man and inaugurating a new 
 policy, they should avail themselves of that opportunity without 
 
•t 
 
 26 
 
 fear or favour. I see that Mr. Chapman nods assent to that, that 
 is upon the general principle. And now to the particular case. If 
 the general principle be good, and he assents to it, then in this 
 instance he has been with us from the first. I hope he will, with- 
 out a moment's hesitation, get up and second the nomination of the 
 gentleman I propose. (Laughter). Mr. Young is a gentleman 
 holding the highest position, and he has been chosen as a candidate 
 by gentlemen who have had a pledge given to them, that when an 
 opportunity came, the preference bondholders should have the 
 nomination of a gentleman to sit upon the board. The preference 
 bondholders represent something more than three millions of pro- 
 perty in this Company, and they have nominated Mr. Young, and 
 Mr. Jas. Caird. We have, however, no intention now for two 
 reasons to press the nomination of Mr. Caird. He is now on the 
 Continent, and he has had the misfortune to lose his wife, who is 
 but recently deceased. So we cannot now press him to serve. The 
 next is that we should have to replace Mr. Potter, who is a new 
 man, and a tried man, and therefore we have made up our minds in 
 conference, not to nominate Mr. Caird now, but to nominate Mr. 
 Young, who has undertaken to act if appointed. For my own part, 
 I believe and have every confidence that ho will give his attention 
 to promote the interest of this Company, that he will aid the Direc- 
 tors in bringing the Company out of its present difficulties, and 
 placing it on a firm and satisfactory basis. Mr. Salisbury con- 
 cluded by proposing the appointment of Mr. Young. 
 
 Mr. Morris seconded the motion. He could not say that a 
 bargain had been made, that the preference bondholders should 
 have the appointment of a director, but there had certainly been an 
 understanding to that effect. The arrangement act of 1862j 
 expressly provided giving the bondholders votes, and thereby led 
 the way to such an appointment. He did not want to raise a pre- 
 ference bondholder's question against a shareholder's question, or to 
 put one class against another, but he felt that they ought to seize 
 the present opportunity to fill the vacancy in the manner proposed 
 in the resolution. Mr. Young was a gentleman of the highest 
 
 . i 
 
 . 
 
27 
 
 possible position, and of great ability. His father was a solicitor, 
 well-known in London, and he was brought up under his father's 
 tuition, though now retired from business upon an ample fortune. 
 If appointed, he would give his time and attention to the interests 
 of this Company. He hoped his friend Mr. Chapman knew him 
 too well to think him capable of having any personal motive in the 
 matter. He altogether disclaimed being actuated by any personal 
 feeling whatever. 
 
 Mr. Newmarch said he had not intended to address the meet- 
 ing, further than to thank them for his appointment as auditor, but 
 he could not let the present motion go to the meeting without saying 
 a word in reference to it. Upon the general argument, he did 
 not know that there was much to be said. It was, no doubt, very 
 desirable that new blood should be infused on proper occasions into 
 concerns of this kind, and there was a great deal of it already at 
 the board, and all that was said in favour of Mr. Young was quite 
 admitted ; but when it was proposed on very short notice (hear, 
 hear), to supersede so valuable a director as Mr. Chapman, he did 
 not think the proposition ought to be accepted. (Hear, hear.) 
 They were asked to get rid of a tried and valued servant, and he 
 hoped the meeting would hesitate before they adopted the proposi- 
 tion. He had seen something of the affairs of the Company for the 
 last two or three years. He was obliged to say that from no one 
 did the committee of share and bond holders receive such constant 
 and valuable assistance as from Mr. Chapman. (Cheers.) He 
 had most extensive experience in Canada, and was also well known 
 as a man of business ; and he could assure the meeting on his own 
 personal testimony that, having had extensive opportunities of 
 observation, their affairs had passed through severe ?^rutiny, and 
 they had been well and faithfully served by the j2ntleman now 
 before them. Under these circumstances, and when the policy 
 inaugurated two or three years since was found to be fairly working 
 its way, he would suggest to Mr. Salisbury that it would be rather 
 hard on Mr. Chapman, having done what he has done to carry 
 out that policy, to be discharged, when it is now proving to be 
 
 . 
 
28 
 
 successful. There would be plenty of opportunities of infusing 
 new blood; but on this occasion he was sure they would not 
 disregard Mr. Chapman's long experience and faithful services. 
 (Hear, hear.) 
 
 Mr. Mercer said Mr. Chapman was thoroughly acquainted 
 with their affairs, and he believed that his removal from the board 
 would be a serious loss. He concurred in the general principle as 
 to the infusion of new blood, but there had lately been a carrying 
 out of that principle in the case of Mr. Potter. He did not know 
 anything of the abilities of Mr. Young, but he would undertake to 
 say that that gentleman could not bring the amount of personal 
 knowledge to bear upon the affairs of the Company which Mr. 
 Chapman could, and under these circumstances he would vote 
 against the motion. 
 
 Mr. CONYBEARE Said, he trusted that on this occawon no 
 change of such a serious character as that proposed would be made. 
 Mr. Chapman was an old and tried servant of the Company, he had 
 given most valuable assistance to the committee, and had shown 
 himself to be possessed of the qualities which were necessary in 
 a director of a company which had to struggle against much 
 difficulties as this had. 
 
 The Chairman : Perhaps I may be allowed to say a word on 
 this question. I do not know, as a rule, that directors ought to 
 interfere in reference to their successors. Mr. Young and Mr. Caird 
 are both gentlemen for whom the Board entertain so high a respect, 
 that if vacancies occurred we should be only too happy that they 
 should be amongst us. With respect to Mr. Chapman, he is a very 
 recent friend of mine, but I cannot speak in too high terms of his 
 invariable courtesy, and of the great assistance I have at all times 
 received from him. He this morning offered to place his resig- 
 nation in my hands if I thought that it would at all promote the 
 good of the undertaking. I said I was not prepared to accept the 
 offer, which I considered was kind and magnanimous. It is for the 
 meeting to consider the matter, not as a personal question, but 
 whether the motion ought to be pressed after the pledge whicli I 
 

 i , 29 
 
 am about to give. The first vacancy that occurs at the board we 
 shall be happy to elect Mr. Young, admitting the right of the 
 preference bondholders to have a fair share of representation on 
 the board, no more and no less. If that assurance be satisfactory, 
 I shall be most happy to give it. 
 
 Mr. Salisbury said, that under the act of Parliament it was 
 for the shareholders, and not for the Directors to elect members of 
 the board, but he found that on all these occasions the directors 
 hung together, and very probably he should not himself, if he was 
 a director, turn his back on his colleagues. If the meeting chose to 
 accept the pledge which was given in reference to the next vacancy, 
 they might do so, but the circumstances might then be different, 
 and Mr. Young might not then be a candidate. That was 
 altogether a matter for the meeting. He had no feeling in the 
 matter one way or another ; his desire was to have the right man 
 in the right place. 
 
 The Chairman : Am I to consider the resolution withdrawn 
 on our pledge ? 
 
 Mr. Salisbury ; I cannot withdraw anything. 
 
 On a show of hands, Mr. Chapman was elected. 
 
 The Chairman : I have now to repeat that we shall be only 
 too happy to recognise the conditional promise that has been alluded 
 to by Mr. Salisbury, in favour of Mr. Young on the first vacancy 
 occurring. 
 
 A resolution declaring the meeting adjourned to 11th June 
 at 1 o'clock, was then adopted, and a vote of thanks to the Chairman 
 and Directors, moved by Mr. Packer, seconded by Mr. Coulson, 
 and passed by acclama .Ion, terminated the proceedings. 
 
 li 
 
 M 
 
 Note.— On the following page is reprinted an article published in the Chicago 
 Tribune of February 24th, 1863, and from wliich some of the figures quoted at 
 page 11 of this Report were extracted. 
 
80 
 
 LEADING ARTICLE prom the CTIWAOO TRIBUNE, 
 February 24tli, 1863. 
 
 The defeat of tlie bill in Congress to enlarge the Illinois and Michigan and the 
 Erie Canals, has fixed the attention of the entire West upon the necessity of greatly 
 increased facilities to transport her rapidly increasing products to the ocean. The 
 meeting to be held to-night is in no sense, as charged by some eastern papers, a 
 political movement. It is simply a continuation of the efforts inaugurated in 1855 
 by the Boards of Chicago, Toronto, and other cities upon the Lakes and the St. 
 Lawrence, to call attention to the growth of the West, and to induce the opening of 
 new and enlarged channels of transit to the ocean. Our commercial readers have not 
 forgotten that a convention of delegates was held in Toronto on the 18th September, 
 1865, from Oswego, Chicago (Geo. Steele, and Wm. Bross, Esqs,, delegates), Toronto, 
 Barrie, the county of Simcoe, and other places, the result of which was a survey of 
 the route between the Georgian Bay and Lake Ontario, by Kivas Tulley Esq., and 
 Col. Mason of this city, shewing the entire feasibility of that route for a ship canal 
 for vessels of a thousand tons burthen. The commercial crash of 1857-8 and the 
 depression that followed, stopped the discussion of this and similar projects, but in 
 the meantime the production of the West has gone on increashig, till the produce 
 seeking transit to the ocean has completely clogged up all our avenues, and freights 
 iiave became so enormous that little or no profits is left to the producing classes. 
 To make this enormous increase the more evident, we present the following statistics 
 taken from our commercial tables heretofore published. 
 
 Total receipts of grain (flour into wheat) for four years : 
 
 Bushels. 
 
 1859 20,008,223 
 
 36,504,772 
 
 54,093,219 
 
 58,619,194 
 
 Total shipments of grain (flour into wheat) for four years. 
 
 1859 16,753,795 
 
 1860 31,256,697 
 
 1861 49,363,381 
 
 1862 65,720,160 
 
 Total receipts of hogs (live and dressed) from October 1st to February 21st, for 
 
 three years : 
 
 324,770 
 
 720,130 
 
 1,198,924 
 
 The total packing of hogs this season will foot up over 800,000. 
 
 The total receipts of beef cattle from October 1st to February 21st for two years. 
 
 Season 1861-62 62,626 
 
 „ 1862-63 87,926 
 
 The claims of the West having been ignored by Congress, all that we can is to 
 furnish the facts and figures to Canada, and through her, if she choose to forward 
 
 1860 
 1861 
 1862 
 
 Season 1860-61 
 1861-62 
 1832-63 
 
 It 
 
 ■,-n I 
 
 t 
 
81 
 
 them, to the parent Govornmeut, shewing the extent of the present and prospective 
 resources of the West, and the legitimate effect to be hoped from the enlargement of 
 the Welland Canal, or the construction of the Georgian Bay or the Ottawa Ship 
 Canal, in accordance with the best interests of all parties on both sides of the 
 Atlantic. Should tliese great commercial arteries, or either of them, be opened, 
 New York would have no more right to complain and to demand that our vast products 
 should pass through her hands than she had to ask that the cotton of the great 
 valley of the continent should be shipped from her docks instead of those of New 
 Orleans. What the West needs is direct trade with Europe, and both England and 
 Canada will find it vastly to their advantage to remove all obstacles from one of the 
 great natural watercourses of the continent, and give the vast commerce of the 
 West the largest liberty of transit to the ocean. So far as canada is concerned, the 
 mere statement of the proposition carried with it the most convincing argument. 
 
 The state, men of England are beginning rightly to appreciate tlie importance 
 of the agricultural riches of the West to their own people. Statistics recently 
 received show, that in round numbers England imported from other countries during 
 the last year, of cereals one hundred and eighty millions of bushels. Of this amount, 
 about one-third was received from this country ; and Mr. Cobden, in a recent speech 
 at Rochdale, stated that, had not this been received from America, all the gold in 
 Lombard Street could not have bought it, for all the nations of the Old World had 
 not the sur[)lus to sell them. Hence it is that to England the food is vastly more 
 important than the cotton question. The freight to Liverpool now takes seven- 
 eighths of the value of the corn shipped, that is, of eight bushels of corn starting 
 from Illinois, it takes seven of them to lag the eighth down in Liverpool. Reduce 
 the freight twenty per cent., and England will buy a hundred and twenty instead of 
 sixty millions of grain, from the West. And besides, if the Canadian canals be 
 enlarged, cattle by tlie tens of thousands can be shipped alive to the Liverpool 
 markets. The amount of pork, provisions, and other products that would seek a 
 European market by the Canadian canals, were they sufficiently enlarged to bring 
 down freights to a proper figure, is practically without limit. The rapid increase of 
 Western products, as shown by the above tables, will continue to the astonishment 
 of the commercial world, if these products find a remunerative market. Vast as 
 they now are, the West has but just begun to pour her exhaustless treasures into 
 the storehouses of the world. 
 
 But the mere opportunity to buy our products in tenfold greater quantities, and 
 at greatly reduced rates, is by no means all the advantage that England and Canada 
 would reap from the enlargement of her St. Lawrence canals. The West wants, and 
 is able to pay for, immense quantities of the manufactures of England, and their 
 consumption would be limited only bg the capacity of English capital and labour to 
 supply the demand. Goods mil come as return freight, and to pay for produce, and 
 thus the channels of commerce would be always full. 
 
 M'Corqnoflnle & Co.. Printers, J.ondon.— Woi'ks, Ncwtnn.