1903-09-22

NATIONAL TRANSCONTINENTAL RAILWAY.

[Stage Direction]
House again in Committee on Bill (No. 235) to provide for the construction of a National Transcontinental Railway.-The Prime Minister.
On section 7-Grand Trunk Railway Company may hold securities.
Mr. BORDEN (Halifax).: Mr. Chairman, it seems to me that the government is assuming a somewhat peculiar attitude in regard to this whole undertaking. The preamble of the Bill and the recital to the agreement both point to the fact that the intentions of the government in pressing this measure upon the House were to establish an all-Canadian route and to provide for the transportation of Canadian freight at Hon. Mr. FITZPATRICK.
as cheap rates as possible. Notwithstanding that fact, we had the spectacle yesterday of the government voting down all the stipulations suggested on this side of the House which were intended to prevent the diversion of traffic, and we had the spectacle, moreover, of the members of the government sitting 'Silently in their seats without saying a word after it had been pointed -out to them over and over again from this side of the House that the danger, as far as the diversion of traffic is concerned, was to be feared from the Grand Trunk Railway Company, and not from the Grand Trunk Pacific Railway Company. Notwithstanding that, there was an absolute refusal from the treasury benches to impose on the Grand Trunk Railway Company a single one of the stipulations which are imposed on the Grand Trunk Pacific Railway Company by this contract. Not only was this the case, but the hon. Minister of Finance (Hon. Mr. Fielding) was put up by the government, in the first place, to answer the suggestions made on this side of the House, by a reference of matters to fifteen or twenty years ago. After that we had the hon. member for North Norfolk (Mi-. Charlton) put up to deliver speeches, covering, I suppose, an hour, or an hour and a half in all, in regard to grades which were absolutely irrelevant to the subject we were then discussing. We can only assume, under these circumstances, that it is the policy of my right hon. friend (Rt. Hon. Sir Wilfrid Laurier), and of his government, to permit traffic to be diverted from Canadian routes, provided it is to be done by the Grand Trunk Railway Company. Otherwise, surely, there iis no reason for failing to impose upon that railway company some of the precautions which the government have thought wise to impose on the Grand Trunk Pacific Railway Company. That is one aspect of the ease. Another aspect of the case is the one to which I am about to draw attention in connection with 'the amendment I have moved. I gave notice of a motion to this effect, as an amendment to section 7 of the Bill :
That section 7 he amended hy adding thereto the following -subsections :-
Notwithstanding anything in this Act, or in the said agrememt contained, His Majesty the King, -acting as aforesaid, shall not be hound or obliged to -perform, cary out or fulfil any of the covenants, conditions or stipulations in the said agreemnt contained on behalf of the Dominion of Canada unless and until the Grand Trunk Railway Company of Canada shall have subscribed for the common stock of the Grand Trunk Pacific Railway Company payable in cash at par to the amount of not less than $24,300,000.
I understand that the hon. Minister of Justice is willing to accept that amendment, provided I strike out from it the words ' have subscribed for,' and insert in their stead the words 'shall acquire and

take,' and provided also that I shall strike out the words ' payable in cash at par.' I will read the amendment as it is suggested by the kon. Minister of Justice, because I will have to explain to the committee the reasons why I am unable to accept the amendment which is suggested by the government. The amendment as proposed by the bon. Minister of Justice is as follows :
That section 7 be amended by adding thereto the following subsections :-
(2) Notwithstanding anything in this Act or in the said agreement contained, His Majesty the King acting in respect of the government of Canada shall not he bound or obliged to perform, carry out or fulfil any of the covenants. undertakings, conditions or stipulations in the said agreement contained on behalf of His Majesty the King acting as aforesaid, unless and until the Grand Tramt 1 tailway Company of Canada shall acquire and take the common stock of the Grand Trunk Pacific Railway Company to the amount of not less than $24,900,000.
My proposal is that the Grand Trunk Railway Company shall subscribe for the stock at par, and shall incur all liabilities incident to such subscription, hut the amendment which the Minister of Justice is willing to accept does not require the Grand Trunk to incur the liability entailed by subscribing for the stock, and it carefully eliminates the words ' payable in cash at par.' It is, therefore, carefully designed to permit the Grand Trunk Company to acquire $24,900,000 of stock for any normal consideration that the two companies, different in name, though in reality the same, may agree upon between themselves. I am unable to accept the amendment which the government suggests, because it so emasculates my amendment that it takes from it everything of value, and enables the Grand Trunk to obtain the complete control of this railway, without putting more than a few dollars into it. If that is the policy of the government, let us understand It. The policy of the government, as suggested by the alteration handed to me by the Minister of Justice, is, that no matter what comes of this contract, the Grand Trunk Company must have liberty to acquire nearly $25,000,000 of this stock at any consideration that may be arranged between these two companies, which, according to the statement made from the treasury benches over and over again, though different in name, are the same in reality. And after all, the company which is obtaining the benefit of this contract with the government is the Grand Trunk Company of Canada. So far as I could gather from the attitude of the government to-day and yesterday, it intends to establish a so-called National Transcontinental Railway, and to place the line absolutely under the control of a railway which has its chief terminal and its only winter terminal, not in the Dominion of Canada, but in the United States of America. That is the first part of the policy of |
the government, and the second part of their policy is to deliberately permit the Grand Trunk Railway Company to divert to any extent which they desire Canadian traffic from Canadian routes and from Canadian ports. That is perfectly plain, because I got no answer from the treasury benches when I repeatedly asked, what reason there was for not imposing upon the .Grand Trunk Railway Company the same restrictions as to the diversion of traffic which are imposed upon jthe Grand Trunk Pacific Company. I challenge the ministry to give any answer now. I ask my right hon. friend to give one single reason which is not applicable to the Grand Trunk Railway Company with greater force in that regard than it is applicable to the Grand Trunk Pacific. I pointed out yesterday that the danger of diversion of traffic was not through the Grand Trunk Pacific, but through the Grand Trunk at North Bay, at Gravenhurst, at Winnipeg, and even at Quebec and Montreal. The Minister of Trade and Commerce recognized this danger, but the only answer I got was from the Minister of Finance who was put up to talk about dispute under contracts of fifteen or twenty years ago, and from the hon. member for Norfolk (Mr. Charlton) who was put up to talk about grades. Another feature of the policy of the government seems to be to deliberately frame the present Bill and contract so that the Grand Trunk may he enabled to construct a line in the great North-west of Canada at no cost to itself, except the guaranteeing of bonds representing one-fourth the cost of construction. The Grand Trunk obtains the absolute control of that road in the North-west ; it guarantees the issue of bonds to the extent of one-quarter the cost, but it enters into no other covenant or stipulation with the government in return for that great privilege. The fourth feature of the government's policy is to create $25,000,000 of common stock in order that $24,900,000, of that stock may be obtained by the Grand Trunk Railway for a mere nominal consideration to be arranged between the two companies which, according to the declaration of more than one member of the government, are, after all, in effect, only one company. That is what the gentlemen on the treasury benches call making the Grand Trunk Railway Company . * In ' and ' of ' this contract. Well, it is ' in ' and ' of ' this contract in a very peculiar sense. It makes no stipulation with the government; it is at liberty to divert traffic as it sees fit ; it is at liberty to use its own terminals at Portland, and it is at liberty to acquire the controlling interest in the Grand Trunk Pacific for a mere nominal consideration. In return for all that, the Grand Trunk guarantees the issue of bonds to the extent of one-fourth of the cost. We have been told that, from the standpoint of the country's interest, this

is one of the most magnificent and praiseworthy enterprises that any government ever entered into. At an early stage of this debate, the Minister of the Interior pointed out that as regards the western division of this railway there is absolutely no possibility of failure. He spoke of the 50,000,000 acres that are to be opened for settlement in the North-west; he spoke of hundreds of thousands of immigrants pouring into that country ; he declared that the conditions which faced the Canadian Pacific Railway when they built theii road on the prairies were far more unfavourable than those which to-day confront the Grand Trunk Pacific. He demonstrated conclusively that the building of this railway through that western country was one of the best business propositions that had ever been undertaken by anj company. The Grand Trunk is to have-placed at its disposal that splendid business proposition ; it is to have a road built through the North-west at no cost or risk to itself, except the guaranteeing of the bonds for one-quarter of the cost, and in return for that, what does the Grand Trunk give ? It gives no stipulation to the government that it will not divert traffic to American channels. Is the government willing to impose upon it any restriction or condition in that regard ? The government is not willing. It is to acquire a controlling interest in the Grand Trunk Pacific Railway Company. Is the government ready to say that that interest must be purchased for a substantial consideration ? The government is not willing, because we are now dealing with an amendment which seeks to impose on the Grand Trunk Railway Company an obligation to subscribe for that stock at par. The government say they are willing to accept the amendment in this emasculated form, by which it will still be left open to these two companies, in reality one company, to arrange the terms between themselves by which that stock shall be acquired by the Grand Trunk Railway Company. Under these circumstances, in view of this attitude of the government, I am not prepared to accept for one moment this amendment in the form in which it has been handed to me by my hon. friend the Minister of Justice, and I propose to take the sense of the committee on the amendment in the form in which I first submitted it.	[DOT]


The MINISTER OF JUSTICE.: I beg leave to move that the following be substituted for the amendment
2. Notwithstanding anything in this Act or in the said agreement contained, His Majesty the King a-ctimg in res-pect of -the government of Canada shall not be bound or obliged to perform, carry out or fulfl-l any of the covenants, undertakings, conditions or stipulations in the said agreement contained on behalf of His Majesty the King acting as aforesaid unless and until -the Grand Trunk Railway Company of


Robert Laird Borden: Canada sha-ll -have entered into an agreement with His Majesty -the King acting as aforesaid by which the said Grand Trunk Railway Company shall covenant and agree to acquire and take the -common stock of -the Grand Trunk Pacific Railway Company to the amount of not less than $24,900,000 as in clause 27 -of said agreement provided.
3. T.he Grand Trunk Railway Company of Canada shall hold ith-e -said common stock -to the amount aforesaid so acquired and taken as aforesaid during the entire -term of the lease mentioned in -clause 20 of the said agreement, and -so long as any of the bonds guaranteed by the government under the terms of the said agreement shall remain outstanding and unpaid, and no pledge, transfer or conveyance of any part of -the said stock -during the said period shall be valid or effectual.
My bon. friend, in moving bis amendment, said yesterday in the course of the debate that no answer bad been made to the contention of the opposition that the policy of the government was to allow the diversion of traffic to American ports. I hope my bon. friend will not suppose that if we did not answer bis argument more fully, it was because we did not regard it as serious ; but we recognized that all these matters bad been fully and repeatedly discussed before we went into committee on the Bill. We do not consider that the policy of the government is calculated to in any way allow the diversion of traffic to American ports to go on; but this Bill was framed and this contract entered into for the express purpose of preventing that diversion which has been going on heretofore under the railway policy adopted in past years. We think the effect of this Bill will be to prevent that diversion from Port Arthur to Buffalo and New York, and from Montreal to Portland and Boston ; and we submit that the policy of the opposition, as proposed by the leader in bis scheme, would have had the effect of confirming that diversion, which would necessarily have taken place. The original Grand Trunk scheme would have had the same effect, and of this scheme the opposition approved. The scheme of the government on the contrary, is to have a line of railway extending from Winnipeg to Quebec and from Quebec to Moncton, which will have the effect, if geographical conditions count for anything, of carrying the trade to the ports of the maritime provinces. Nothing that we can say in answer to the contention of the hon. leader of the opposition can be stronger than the terms of the contract itself. By the terms of this contract the Grand Trunk Pacific Railway Company are to construct this road from Winnipeg to the Pacific ocean ; and in order to prevent the Grand Trunk Railway Company, as a result of its control over the Grand Trunk Pacific, diverting the trade to American ports, the government are to own the road from Winnipeg eastward, and to fix the conditions under which it shall be operated. The condition under which this aid is given to the Grand Trunk Pacific

Company is that it shall carry its trade through Canadian channels to Quebec and Moncton. That is provided in the agreement, and the company entered into this agreement and accepted aid on this condition. Any government in this country that would fail to see that the spirit and the letter of that contract are complied with would fail in the performance of its duty to the people of Canada. The Grand Trunk Pacific Company concur in the preamble of this contract, which states that the very object of this measure is to have a Canadian road on Canadian territory to develop trade through Canadian ports. Then, you have that clause in the agreement which says that the condition on which we grant this assistance is that the company shall carry the freight to Canadian ports. Surely the government of Canada is strong enough to see that these conditions shall be carried out. So long as this government is in power, these conditions shall be carried out ; and if hon. gentlemen opposite should come into power, the duty and responsibility would rest upon them, and we have a right to assume, in view of all their contentions in this debate, that they will see that they are carried out. The hon. gentleman says that the Grand Trunk Company is going to construct the railway in the North-west from Winnipeg to the Pacific for its own benefit and at no expense to itself. It seems to me that we have rehearsed the terms of this contract often enough to understand what the true conditions are.


Robert Laird Borden: My hon. friend is not stating it quite correctly. I said that the road to be built in the North-west would be absolutely controlled by the Grand Trunk Company, which would incur no obligation for its construction, except the guarantee of one-fourth of the bonds.


The MINISTER OF JUSTICE.: I accept that statement. What are the conditions for the construction of the road from Winnipeg to the Pacific coast ? The conditions are that the road shall be built by the Grand Trunk Pacific, that to aid in the construction of that road the government of Canada agree to guarantee a first issue of bonds to the extent of 75 per cent of the cost of construction, provided the cost of construction ishall not exceed in the prairie section $13,000 and in the mountain section $30,000 a mile, and that the Grand Trunk Railway Company, not for its benefit, but for the greater security of the government, shall guarantee all the second issue of bonds to an amount sufficient to complete the construction of the road. That provision, it seems to me, was intended or designed to, and in effect will, protect the government in this first issue of bonds. The guarantee of the government in so far as this first issue of bonds is concerned is in this position, that if default is made with respect to any of the obligations on which
i
this first guarantee is given the effect will be necessarily that the road will pass into the hands of the government. That is we become owners of that road to the construction of which we have contributed seventy-five per cent of the cost. And what is the result of the second issue of bonds ? The second issue of bonds then will be absolutely of no value in the hands of the holders, whoever they may be, except in so far as the Grand Trunk Railway Company may make them of some value. Therefore the result is that the Grand Trunk Railway must make that road a success, must see to the performance of all' the conditions under the contract, because, otherwise, they will be responsible for the entire value of that second issue of bonds. In addition to that our first issue of bonds is guaranteed by a mortgage, not only upon the road-which for the sake of argument vve will assume will cost $100,000,000-not only upon the $75,000,000 contributed by the government, but upon the entire $100,000,000 which the road will cost for construction and also upon the $20,000,000 of equipment supplied by the Grand Trunk Pacific. Thus we will contribute $75,000,000, and in case of default the whole road and equipment of a total value of $120,000,000, will fall into our hands ; that is the contract and that is not disputed. I ask is it in the interests of the government or of the Grand Trunk Railway that this provision is made ? Is it in the interest of the government that we should have the Grand Trunk Railway as guarantor of the second issue of bonds, and that the Grand Trunk Railway should be placed in the position that, in the event of default of the first issue, the whole second issue should go by the board ; we take the road with the total equipment, the Grand Trunk Railway take the obligation to pay the second issue of bonds.
With respect to the extension of the road from Winnipeg eastward, the road is to be built by the government, and when it is completed the Grand Trunk Pacific Railway Company will lease it for the period mentioned in the agreement. If the road had been built, owned and operated by the Grand Trunk Pacific, that company being under the control of the Grand Trunk Company, as hon. gentlemen on the other side of the House assume, what would have happened ? That road would have been built by the Grand Trunk Pacific Company only so far as it suited their purpose and as would enable them to divert their trade to North Bay and to Montreal and Portland. What is going on now would have continued and hon. gentlemen opposite wanted that to go on ; they asked for it, and approved of that policy. We on the other hand, say to them: We shall construct a road from Winnipeg to Quebec and from Quebec to Moncton, and will make it a condition of granting aid towards the construction of the western end

that the eastern end is operated. They have to operate it and in default of operating it they forfeit $5,000,000 worth of equipment. And if they are obliged to operate that road are they not obliged to see that it pays. They have not only to pay the cost of maintenance and operation of the road, but also three per cent on the cost of construction. If the Grand Trunk Pacific is in reality another name for the Grand Trunk, as hon. gentlemen oppoisite state, are the Grand Trunk Company not under an obligation to see that that road is operated in such a way that they may derive a revenue sufficient to maintain and operate it and also to pay the three per cent interest ? If they are to do all these things they must get traffic for the road. If they are going to divert the traffic to Portland and United States ports what are they to do with the eastern end of their line ? Where are they to get the traffic which will- enable them to fulfil all the obligations under the agreement ? It seems to me-and I do not say this with any desire to be discourteous to my hon. friends -that we have gone over this ground so frequently that nothing can now be said that will not be idle reiteration. I take it that we must stand by this agreement. Hon, gentlemen opposite put one construction on the agreement, and I wish to say, speaking not in a parliamentary sense, that I believe my hon. friends would not speak as they do if they did not believe in the correctness of the interpretation they put upon the contract. They conceive the agreement to mean what they say it means, and we interpret it to mean what we say ; the country must decide between us. We must stand by this agreement and abide by it.


Mr. SPROULE.: If we must stand by the agreement which the government has made, why does the Minister of Justice himself propose amending it ?


The MINISTER OP JUSTICE.: I propose to amend it myself, with respect to two provisions of the agreement, and I will give my reasons for doing so. One clause provides that the Grand Trunk Pacific Railway Company shall secure from the Grand Trunk Railway Company the guarantee of the second issue of the bonds; another clause provides that the Grand Trunk Railway Company shall acquire the common stock of the Grand Trunk Pacific Railway Company to the extent of $25,000,000. Hon. gentlemen opposite say that the Grand Trunk Railway Company not being parties to the agreement, are not bound by these two stipulations, and on the qther hand, we argue that while these two provisions are not binding on the Grand Trunk Company, as tbe contract stands in law, in effect they are binding upon them because these two conditions are conditions precedent to our obligation to guarantee the bonds. That is to say that unless the Grand Trunk Railway


Hon. Mr. FITZPATRICK.: Company take the $25,000,000 of common stock and guarantee the second issue of bonds we are not obliged to do anything under the agreement. My hon. friend the leader of the opposition says that this does not result from the wording of the agreement. He says that it should be made clear. Now I have some regard for the leader of the opposition-I speak with all deference, using these words in his presence-I have some regard for him, and when he expresses doubt as to a contract, I want to set that doubt at rest. He has expressed a doubt as to this contract, and I want to eliminate that doubt and to make it absolutely clear, as we intended it should be, that the Grand Trunk Railway Company should do two things, first, take stock to the extent of $25,000,000, and second, undertake to guarantee the second issue of bonds. That is our intention; that was the intention of the parties to the agreement; I want to make that clear and that is the object of my amendment. I do not consider that by accepting such an amendment I am doing anything that is not praiseworthy. On the contrary, I think it is a complete answer to my hon. friends who say that we bring an iron-clad agreement to this House and will not accept any amendment. We bring the contract here to get such assistance in perfecting it as we can get; the leader of the opposition and the hon. member for Hamilton (Mr. Barker) say that there is room for doubt on this point, and we want to set that doubt at rest. That is the object in accepting the amendment.


Thomas Simpson Sproule: Why not accept the exact provisions of the amendment ?


The MINISTER OF JUSTICE.: We do not agree as to the length we should go.


Robert Laird Borden: My hon. friend the Minister of Justice will acquit me from any desire to be guilty of tiresome reiteration and if I do reiterate sometimes in this discussion it is because I doubt if I make myself clear to hon. gentlemen opposite, for when they rise to answer statements I have made they usually answer something which I never said at all, and I will take one or two minutes for the purpose of making my meaning clear. I pointed out that when the Grand Trunk Pacific Railway brings freight in the winter from the Northwest to Quebec or to Montreal it can carry that freight 297 miles from Montreal to Portland or 318 miles from Quebec to Portland, and it will be carrying that freight over its own lines and will be earning the entire tolls that will be charged for that distance. In lieu of that you will have the project of carrying that freight to the city of St. John or the city of Halifax in the maritime provinces. If you accept the extreme limit that has been put forward by tile Minister of Finance as to the saving of distance by the new line, you have a dis-

tauce of between 460 miles and 489 miles from Quebec to the city of St. John, and a distance of 586 miles from Quebec to the city of Halifax. Now, will it not be more in the interest of the Grand Trunk Railway that that freight shall be carried over its own line for that short distance to Portland than that it shall be carried partly over the lines of the Grand Trunk Pacific Railway and partly over the line of the Intercolonial Railway to Halifax or St. John ? That is a plain question for the consideration of any business man in this House. Where do the interests of the Grand Trunk Railway in that regard lie ? Will any hon. gentleman on the other side of the House venture so far as to rise in his place and say that it will not be in the interests of the Grand Trunk Railway Company that that freight shall go to Portland ?


The PRIME MINISTER.: What is the distance between Quebec and Portland by way of the Grand Trunk Railway ?


Robert Laird Borden: The distance, as I understand it by way of the Grand Trunk Railway, is 318 miles.


The PRIME MINISTER.: From Quebec ?


Robert Laird Borden: From Quebec. Does the right hon. gentleman controvert that ?


The PRIME MINISTER.: Yes, I do.


Robert Laird Borden: What is the distance ?


The PRIME MINISTER.: The distance between Portland and Montreal is 300 miles, and the distance between Quebec and Richmond is 100 miles, so that the distance between Quebec and Portland must be about 400 miles.


Robert Laird Borden: I am not talking about the distance between Quebec and Richmond. I am talking about the distance between Montreal and Portland. It is given by the Grand Trunk Railway in their timetable as 297 miles. The distance from Quebec to Portland via Richmond, as stated in the Grand Trunk Railway time-table, is 318 miles. Is my right hon. friend in a position to controvert that ?


The PRIME MINISTER.: The distance between Montreal and Portland is 300 miles. The distance between Quebec and Richmond where the road joins with the road from Montreal to Portland is 100 miles, so that there is a distance between Quebec and Portland of 400 miles.


Mr. HEYD.: May I ask the hon. gentleman (Mr. Borden, Halifax) how he would expect grain to get to Montreal and to be diverted to Portland because the distance from the point at which the railway would intersect the transcontinental line north of 375
North Bay to Montreal is much longer than it would be from that point to Quebec ?


Robert Laird Borden: I do not know whether it will go that way or not, but I know it has been alleged in this House by members of the government and by hon. gentlemen speaking on the other side of the House that there will be a branch built from this eastern division connecting with the city of Montreal and I understood that it was expected that a very considerable amount of freight would come from the west and go east by way of Montreal.


Charles Bernhard Heyd: From the poiut where the road will be deflected to Montreal will such distance to Montreal be greater than it will be to Quebec ?


Robert Laird Borden: I really do not know because no one up to the present time has been able to give any idea as to the location of this line or as to the distance from any point on the eastern division to Montreal and therefore my hon. friend (Mr. Heyd) knows when he asks that question that it is impossible to answer it. Whether you take it from Montreal or Quebec you are exactly in the same position, because, if 1 am right about the distance from Quebec to Portland, it is only twenty-one miles greater than the distance from Montreal to Portland. Assuming that I am right, and I would be very glad to be corrected if I am not, you have Quebec 318 miles distant from Portland and Montreal 297 miles distant from Portland, while Quebec is distant from Halifax, assuming that all the saving the government expects is realized, 586 miles. 1 make that up this way : 400 miles from Quebec to Moncton, taking the estimate of the hon. Minister of Finance, and 186 miles from Moncton to Halifax, making a total of 586 miles. From Quebec to Moncton it is 400 miles and from Moncton to St. John 89 miles. You may make a saving of twenty miles by running the line from Chipman to St. John, but allowing for that, you have a distance from Quebec to St. John of from 460 to 470 miles. I was going on to ask when I was interrupted :	Will or will it not pay the
Grand Trunk Railway Company to carry that freight over its own line to Portland and earn the whole of the tolls upon it or will the company be more likely to send the freight by way of Moncton and thence over the Intercolonial Railway to Halifax. My hon. friend states that the tolls are the same. The very fact that the tolls are the same will make it all the more in the interest of the Grand Trunk Railway Company to take it to Portland, because, even assuming that the Grand Trunk Railway Company has an interest of a substantial character in the Grand Trunk Pacific Railway Company you will have freight carried for the same tolls 489 miles to St. John, or 586 miles to Halifax, w-hen it can be carried by the Grand



Trunk Railway Company over its own line 318 miles from Quebec to Portland or 297 miles from Montreal to Portland. It seems to me perfectly obvious that there is very great danger as far as the Grand Trunk Railway is concerned that it will use all possible efforts to divert this traffic from St. John and Halifax to Portland as it has done in the past. I have repeatedly said that I do not blame the Grand Trunk Railway for looking after its own interests. It has great terminals at Portland and it wants to earn all the money possible for its shareholders, but it Is the duty of this government to see that the Grand Trunk Railway Company receiving in effect this aid for the building of this road shall not divert the traffic from Canadian channels. That is only one point of danger that I have pointed out. I have mentioned another point and it is the danger on the shore of the Georgian bay where the Grand Trunk Railway will take the traffic and carry it to Portland without let or hindrance. I have pointed out the danger at North Bay and Gravenhurst. I have pointed out the danger mentioned by the right hon Minister of Trade and Commerce (Rt. Hon. Sir Richard Cartwright) of the connection between Chicago and Winnipeg and the acquisition of freight by the Grand Trunk Railway Company which has been gathered up by the Grand Trunk Pacific Railway Company in the west to be diverted to American lines. I have pointed out all these dangers but the hon. Minister of Justice contents himself with using a general expression to the effect that sufficient guarantees and stipulations have been inserted in this contract. No guarantee or stipulation as far as the Grand Trunk Railway is concerned has been inserted in the contract. Therefore,-although these dangers exist, they have not been provided for at all. The hon. Minister of Justice seemed to think that I was arguing in some way or other that it was not in the interests of the country that the guarantee of bonds by the Grand Trunk Company should be executed. I am not arguing anything of the kind. My hon. friend also touches upon the security for the operation of the eastern division. Is there anything in that provision in regard to the eastern division that prevents the Grand Trunk Railway from doing what I have just stated it would be its interest to do ? I see nothing in this contract in regard to the operation of this eastern division which touches that question at all. Therefore. it does not seem that the remarks of my hon. friend in regard to that feature of the contract had any relevancy. I do not want to go into that as it does not seem relevant to the question, but does the hon. gentleman think that $5,000,000 worth of rolling stock is a sufficient guarantee for the operation of the road and the payment of rental ? In fifty years it might amount to $100,000,000.


Robert Laird Borden: 


The MINISTER OP JUSTICE.: We have recourse under the agreement.


Robert Laird Borden: You can only take over the eastern division.


The MINISTER OP JUSTICE.: No, we can take over the whole road. The Grand Trunk Railway owns the whole thing.


Robert Laird Borden: If this is subject to $100,000,000 of a mortgage your security would be more imaginary than real. The government would have guaranteed the bonds to the extent of 75 per cent.


The MINISTER OP JUSTICE.: I think we would be very glad to take over the Canadian Pacific Railway.
Mr. BORDEN) (Halifax). I do not know about, that. Perhaps so, but we are talking about, security. The only security there would be would be the value over and above the $100,000,000. We do not know what the value of the security might be.


Mr. BARKER.: In answer to the right hon. gentleman (Rt. Hon. Sir Wilfrid Laur-ier) I can give the exact distances from Quebec and Montreal to Portland. Prom Portland to Richmond, which is common to the two lines, it is 220 miles ; from Richmond to Montreal, it is 77 miles, or through from Portland to Montreal 297 miles. Prom Richmond to Quebec is 971 miles, making from Portland to Quebec 317i miles, just twenty and a half miles difference.


Robert Laird Borden: I over-stated it, then, about half a mile.


Mr. OSLER.: I understood the Minister of Justice just now to say that the government, in case of default by the Grand Trunk Pacific of the rental and other obligations that were incurred for operating the eastern division, will take over the western division, subject to the amount of bonds guaranteed by the government.


The MINISTER OP JUSTICE.: We can take it over, but if they fail to perform their obligations, all the assets of the Grand Trunk Pacific will be liable for the indebtedness, subject to the mortgages.


Edmund Boyd Osler: This contract has been altered, evidently, since I was here on Friday, because the government permits the Grand Trunk to issue bonds to the extent of 25 per cent, which become a second charge, with the consent of the government, on the whole western division. Now, the Minister of Justice says that the government have the security of the western division for the operation of the eastern division.


The MINISTER OP JUSTICE.: I did uot say anything of the sort.


Edmund Boyd Osler: I think the minister will find that is what he stated, but I am quite

sure lie did not mean that. He said, subject to the guarantee of the bonds. I want to make that very clear, that-the government has not that security, subject to the government guarantee of the bonds.


Robert Laird Borden: I understood the Minister of Justice to say, and I accepted his statement, that there was security on the western division for the operation of the road.


The MINISTER OF JUSTICE.: There is security to this extent, that if they fail in the operation of the eastern end, of course they would become liable under the contract for the rental, in which case we would have the liability of the Grand Trunk Pacific, for which liability of course all their assets would be available, and part of their assets would be the western extension. That is what I said.


Robert Laird Borden: I thought my hon. friend distinctly said that there was some charge on the western division, but there is not any charge. Of course, my hon. friend recognizes that all it amounts to is that there is a covenant, and we can enforce that covenant against any property of the Grand Trunk Pacific Railway that we can find.


The MINISTER OF JUSTICE.: That is it, outside liabilities.


Mr. KEMP.: I understood the Minister of Justice to say that if the Grand Trunk Pacific refused to operate the eastern section they would forfeit their equipment-I presume that is the equipment of the eastern section to the value of $5,000,000. Now, the only security which the government have, as I understand, is a second mortgage on that equipment-am I right in that ?


The MINISTER OF JUSTICE.: To this extent, that the first mortgage on the equipment is ours, so we have the first and second mortgage. We have the first mortgage on all the equipment of the road to SGCuie us against loss, and. our guarantee of the bonds for the construction of the western end; and then, in addition to that, we have a second mortgage for the equipment of the eastern end with respect to the operation of the road.


Albert Edward Kemp: If the Grand Trunk Pacific lefused to operate the eastern section, how could the government realize on 'hat second mortgage ? How would they proceed to realize on it ?


The MINISTER OF JUSTICE.: They would proceed to realize upon the second mortgage by simply foreclosing, a very simple proceeding.


Albert Edward Kemp: They would have to deal with the first mortgage first, before they could foreclose.


Mr. DEPUTY SPEAKER.: The Minister of Justice moves an amendment to the amendment, as follows :
2.	Notwithstanding anything in this Act or in the said agreement contained, His Majesty the King, acting in respect of the government of Canada shall not be bound or obliged to perform, carry out or fulfil any of the covenants, undertakings, conditions or stipulations in the said agreement contained on behalf of His Majesty the King acting as aforesaid, unless and until the Grand Trunk Railway Company of Canada -shall have entered into an agreement with His Majesty the King acting as aforesaid by which the said Grand Trunk Railway Company shall covenant and agree to acquire and take the -common stock of the Grand Trunk Pacific Railway Company to the amount of not less than $24,900,000, as in clause 27 of said agreement provided.
3.	The Grand Trunk Railway Company of Canada shall hold the -said common -stock to the amount aforesaid and so acquired and taken as aforesaid during the entire -term of the lease mentioned in clau-se 20 of the said agreement, and so long as any of the bo-n-ds guaranteed by the government under the terms of the said agreement shall remain outstanding and unpaid, and no -p-ledge, transfer or conveyance of any part of the said stock during said period shall be valid or effectual.


Mr. CLANCY.: I waited to bear the reply of the Minister of Justice to the statement made by the leader of the opposition, namely, that we are, after all, making a contract with the Grand Trunk Railway. The Grand Trunk Pacific Railway Company is a mere cipher, and a mere coloufable matter in the whole thing. It is admitted that the Grand Trunk Railway Company is, after all, the moving power'of tb-e whole affair from start to finish. The Grand Trunk Railway Company acquires complete control of the Grand Trunk Pacific Railway Company. Therefore, any contract that is made with the Grand Trunk Pacific will have no effect, because that company is under the control of the Grand Trunk Railway Company. Now, it has been pointed out by the Leader of the opposition that it is to the interest of the Grand Trunk Railway Company to carry freight over their own lines. It has -been pointed out that if even grain or any other freight were brought to the city of Montreal or the city of Quebec, it is in the interest of the Grand Trunk Railway Company to bring it to Portland, because the difference in the distance between Quebec and Portland and between Montreal and Portland is a mere fraction. The Minister of Justice laid great stress upon the fact that the freight would be carried to Quebec and then it would go to St John or Halifax. But it is pointed out that there is -absolutely no difference in the mileage, or that the difference is infinites-mally small, whether you go from Quebec to Portland or from Montreal to Portland. If you had taken it to the city of Quebec, and could show that you had placed it then nearer Halifax or St. John than to Portland, there might he some strong reasons urged

that you had taken it beyond that point where it could possibly go through other than Canadian channels. But when you reach Quebec by way of this transcontinental railway, you are as close to Portland as when you reach Montreal over the old Grand Trunk line. The Grand Trunk Railway Company will, of course, take the freight over its own line. It would be madness for a man to suppose that the Grand Trunk Railway Company, in becoming guarantors-they are more than guarantors, they have the control of the stock, they will control the whole operation of the road, and they will make ever}' part of the Grand Trunk Pacific feeders for the lines in tie, east which belong to the Grand Trunk Railway Company proper.		 , .
No person could find fault with that, but what we do find fault with, is that this is a bad bargain. Even if the traffic were carried over the Grand Trunk Pacific from Winnipeg to Quebec, it is in as much danger of going to Portland as if it were carried to Montreal. The distance from Quebec to Portland, as compared with the distance from Montreal to Portland is so small, as to make it certain that when you have that freight at Quebec, you have not carried it past the danger point. And in this consideration, 1 am leaving out of the question the fact, that distance from Quebec to St. John or Halifax is infinitely greater than it is to Portland. Every one knows that it is in the interests of the Grand Trunk, when they have this traffic at Quebec to take it along the line of least resistance, and every one knows that it is to their interests to take it to Portland. Whether this traffic is carried over the railway from Winnipeg to Quebec, or whether it is carried via North Bay. it is not unreasonable to ask that in either case, the Grand Trunk Railway, which derives the real benefit under this contract, should be bound to take it through Canadian ports. The amendment proposed by the leader of the opposition is the only safeguard the people of Canada can have, that Canadian traffic shall go through Canadian channels to Canadian ports. Outside of our political leanings, which no doubt have great influence upon us here, the question seems to me so plain, that it is not arguable from the other point of view.


Thomas Simpson Sproule: The government exhibit an extraordinary spectacle to the country in connection with this matter. They present a Bill for the ratification of parliament, and they tell us that no amendment can be made to it because it is a binding contract signed by both parties. However, when a proposal to amend it is made by the leader of the opposition, the Minister of Justice, says, that in deference to the high legal ability of my hon. friend (Mr. Borden) he is proposed to accept that amendment. But when it comes to accepting the amendment, lie
Mr, CLANCY.
accepts it by moving an amendment of his own which is quite different from the amendment itself. If the Minister of Justice entertains a high respect for the legal acumen of the leader of the opposition, why does he not leave the amendment in the legal phraseology presented by the hon. gentleman (Mr. Borden) ? If the Minister of Justice did that, we would have much more confidence that it would accomplish the end which the leader of the opposition desires. I direct attention to the extraordinary spectacle of the government amending their own contract, after they have signed and sealed it, thereby implying that their contract, which they have many times declared binds the Grand Trunk to carry out all its obligations, is, after all, not perfect or complete, and that the leader of the opposition has to step in to render it a better contract. That in itself is sufficient to discredit the whole contract. Would the Prime Minister, or the Minister of Justice, tell me, what object the government had in view in compelling the Grand Trunk to secure this $25,000,000 of common stock ?


The PRIME MINISTER.: To practically force them to take an interest in this road, and to have their interests bound with it.


Thomas Simpson Sproule: If the interest be of any real value it ought to be worth $25,000,000. If they acquire this $25,000,000 worth of common stock for the use of a few terminals, that only represents a value of a few thousand dollars to them, of what use is their interest in the Grand Trunk Pacific ? If they have to pay 100 cents on the dollar for that stock, they will have an interest of $25,000,000 in the new enterprise, but if they can get that stock for a few thousand dollars, their interest amounts to nothing. The Minister of Justice tells us that they will be compelled to acquire that stock.
There is a great difference between acquiring stock and subscribing for stock and paying a hundred cents in the dollar for it. If you compel me to pay Into a bank to the* credit of a company $1,000,000, that represents $1,000,000 to me; but if you allow me the privilege of playing cards for that $1,000,000, and I am fortunate enough to get it by the game and for which it cost me nothing, it does not represent anything of value to me, and I would not be istanding in the same relation to the company. If I got $1,000,000 of stock for something that represented very little value to me, I could not be regarded as having the same substantial interest in the road that I would have if I paid cash for that stock. I wish to ask another question in reference to this whole contract; that is, why do we have all this confusion ? Why is this agreement complicated by mixing up the Grand Trunk Pacific Company, the Grand Trunk Railway Company, and the Government Transcontinental Railway ? Why not throw

out the Grand Trunk Pacific Company and deal with the Grand Trunk Railway Company 1 This confusion and mixing up of these three railways makes the whole contract very difficult to understand. Why all this confusion ? There must he some object that is not plain to the ordinary mind. I fear that that object is to enable the Grand Trunk Company to accomplish in an indirect way what they could not accomplish in a plain and direct way. I think that is unfair to the members of this House and to the people of this country. What is the government's object ? Why do they not place a Bill before this House so plain that every member, whether a lawyer or a layman, and whether possessed of great acumen and intelligence or very little of it, could understand it, and so that he would know what he is doing, and his constituents would know ? Why do we have the Bill in this obscure and ambiguous language so that even a Philadelphia lawyer would be unable to understand what the outcome will be if we give legal sanction to it ? We have the government to-day dishonouring their own contract. Although they have argued day after day that there was not a weak feature in the contract, that it was perfect from beginning to end, yet now at the last moment, we have the Minister of Justice proposing an amendment to the amendment of the leader of the opposition, thereby discrediting the whole scheme. I think that is not very creditable to the government, and is not likely to inspire confidence in this House or in the country that they correctly understood the contract wheu they made it, or that if legal effect is given to it, it will accomplish what they have claimed for it.


Mr. GOURLEY.: I feel anxious about this contract as a maritime province man. The people of the maritime provinces have for thirty-six years been waiting for the fulfilment of the promises of confederation. Now, we want them fulfilled, and the hon. leader of the opposition has asked why should we give the Grand Trunk Railway Company the privileges of a principal and hot require from them all the obligations of a principal. That is the question to which we want an answer. The Minister of Justice appears pained that we are endeavouring to understand this question. I am bound as a maritime province man to understand it thoroughly, because when the government of this country undertakes to make this enormous expenditure of money, if this expenditure fails, we in the maritime provinces can never expect for twenty or forty years again to be in a position to demand from the people of Canada the fulfilment of the terms of confederation. Therefore, as a maritime province man, I am interested in finding out why the Grand Trunk Railway Company is not a principal in this matter. The Prime Minister, in opening this
debate, said: We have the Grand Trunk Railway Company behind us. If that is so,
1 want to ask him or the Minister of Justice why do you not make the Grand Trunk Railway Company the principal in this matter instead of the Grand Trunk Pacific Company ? The Minister of Justice knows that this objection is not raised simply by the political opponents in this parliament. The other day the hon. Minister of Finance received from the merchants of Halifax, irrespective of politics a telegram Risking him what was the meaning of clause 42, by which it was permitted to gentlemen who wanted to use this railway the right to route their traffic otherwise than over this railway ? That telegram was signed by Liberals as well as Conservatives, so that the government must realize that this objection is not a political objection. Therefore they must not be surprised if we press this question. The hon. Minister of Justice thinks he understands this contract ; but I am one of those who understand a contract better every hour that it is discussed. The question we in the maritime provinces want answered is why the Grand Trunk Railway Company is not put in this contract as principal ? The business men of the whole country want an answer to that question, and it is a question which I think the government should answer. The government should be frank with parliament and give its reasons. If the government will justify to me why the Grand Trunk Railway should stand aside and a dummy toe put forward in the person of the Grand Trunk Pacific Railway, I am fair enough to admit that they acted wisely. But the government must face the question, and explain to the maritime provinces why they contract with a dummy instead of the principal. Some people say that the Grand Trunk Railway did not want to assume the responsibility of operating the eastern section, but only wanted to control the western section, and that therefore it refused to be a party to this contract. It is pretended that the object of the Grand Trank Railway is to drop the eastern section and not operate it and let the government look to the Grand Trank Pacific Railway to make good the default. It is for the government to dissipate this suspicion by proving that no such contingency need be anticipated. The time is ripe for the building of a new transcontinental line, but it must be a line that will meet the present requirements of our national life. If you undertake to launch Canada into the building of a new transcontinental line which will not meet those *requirements, you will throw back the national development of Canada some twenty-five or fifty years. No doubt Canada, with her giant strength, will be able to recover from any false step, but what is the use of committing errors and crippling the country ? I appeal to hon. gentlemen opposite.

Surely they do no want any mistakes made. The government after all are only some fifteen men in the cabinet, and it is not possible that in these negotiations they could have foreseen every difficulty. They should therefore, not hold up this contract as something perfect and sacred which nobody must touch, but should be prepared to admit any imperfection that the right of discussion may reveal. My hon. friend, the leader of the opposition, has pointed out difficulties. Let us remove them in order that there may be no possibility of mistake. I am convinced that if the government had left the Grand Trunk Railway out of the scheme entirely, if the government had contracted with an absolutely new company, and compelled it to build from the Atlantic to the Pacific, there would be no danger of the freight going over that railway being diverted to an American port. That company would be interested in taking every pound of freight down to the port of Halifax. No question of routing to Portland could possibly arise, and there would have been no necessity for any high-sounding clause about the company receiving its aid upon high national grounds and being bound to carry its freight to Halifax, because the company would not be in a position to do otherwise. But this hybrid system makes the introduction of this routing clause necessary. It does not follow, however, that the clause will be effective. We know by experience that railway companies will not do anything no matter what may be the agreement, which is not in their own interests. They will always contrive to find some means to evade any such agreement. That much-vaunted clause requiring freight charges to be the same to Halifax as to Portland, I regard as the most disastrous clause in the whole agreement. From Montreal to Halifax is 850 miles, and from Montreal to Portland is 297 miles. If the Grand Trunk Railway is required to haul freight from Montreal to Halifax, that will mean 553 miles more of a haul than to Portland. The Grand Trunk Railway will therefore take every means possible to avoid carrying out that obligation. Every one of its customers, if he wants to stand well with the company, will route his freight to Portland rather than compel the company to haul it 553 miles further at the same price. We therefore, in the maritime provinces regard that clause as a direct blow at our interest. Suppose the freight passes Montreal and goes to Quebec, from Quebec to Halifax is 586 miles and from Quebec to Portland is 318 miles, so that the Grand Trunk Railway will have a longer haul of 168 miles to Halifax than to Portland. Gan any one doubt that every pressure possible will be exercised by the company to get its clients to route to Portland ? Consequently, in that routing clause there is nothing but danger to the maritime provinces. This agreement may perhaps bo advantageous to Quebec, but I would ask Mr. IJOURLT5Y.
the right hon. the Prime Minister and the hon. the Minister of Justice not to be sectional and to remember that there are other interests besides those of Quebec. The interests of the maritime provinces are vastly superior. No country was ever worth anything which had not great maritime interests, and if you were to cut off the maritime provinces and we were to declare our independence, the provinces of Ontario and Quebec would become back yards to the maritime provinces and nothing more. I do not care to make these assertions, because I have always stood here against anything sectional. I am a Quebec man as much as a Nova Scotia man, and a British Columbia man as much as an Ontario man. But if we are driven to make sectional issues, I am bound to say that the maritime provinces to-day control the destinies of Canada. No nation has ever been worth anything in the history of the world which is not a maritime nation. Your people must come down to the sea.


Peter Macdonald: I would call the attention of the hon. gentleman to the fact that he is going outside the point at issue.


Seymour Eugene Gourley: I submit, Mr. Chairman, that what I am saying is germane to the subject.


Peter Macdonald: I must call the hon. gentleman to order. He is wandering away from the question under discussion.


Seymour Eugene Gourley: I am always ready to bow to your decision, Air. Chairman. The question before us now is whether a sufficient security has been taken or sufficient provision made to compel this railway to carry freight to our ocean ports. The basis of this proposition was laid by the hon. the First Alinister when he said that , this was to be a Canadian line from ocean to ocean. What we are seeking is to compel the Grand Trunk Railway to pay for this stock and thus have a vital interest in carrying the freight from the west to the ocean port of Halifax. The Prime Minister and the Alinister of Justice must not think that because they live in the province of Quebec and have safeguarded the interests of the port of Quebec, they have also safeguarded the interests of the maritime- provinces. It appears to me as if this scheme had been engineered entirely in the interests of Quebec. The more I look at it the more I am convinced that it was engineered in the interests of Quebec and that not the slightest heed was paid to the maritime provinces. Those who put through the contract seemed to think that a few high-sounding words about this being a national enterprise and that the freights should consequently go to Canadian ports would be a sufficient sop for the people down by the sea. But they will find out their mistake. The maritime provinces have been looking

forward to a new national transcontinental line; and if this scheme would give us such a line it would have my hearty support. If the government had brought down an agreement with an entirely new company and a Canadian company, if they had selected a Canadian ocean port either St. John or Halifax, and if they had chosen a route through Canada that would be the shortest to the ocean for the freight of the west, I would have supported such a scheme. But because X find this scheme defective at every stage, because there are conditions in it fatal to the object it is intended to accomplish because it will not bring the trade to a Canadian maritime port, I am bound to oppose it. Every business man in the maritime provinces is hostile to the scheme. Hon. gentleman opposite may smile but when they will have to face an aroused public sentiment in the maritime provinces, whose interests are being betrayed in this contract-whether betrayed unwittingly or with malice aforethought does not change the fact-they will not find any occasion for smiling. The aspirations of the people in the maritime provinces must be consulted. We had a little rebellion at one time threatened in the province of Nova Scotia.


Peter Macdonald: The hon. gentleman must not proceed to discuss matters which have no bearing on the question before the House.


Seymour Eugene Gourley: I think in the interests of the Prime Minister, that my being called to order was perfectly justified.


Peter Macdonald: The hon. gentleman, having been called to order, might not proceed to discuss my decision of the Chair.


Seymour Eugene Gourley: I am congratulating you, Sir, on the justice of your ruling. I think that it wa s a very timely ruling to protect the Finance Minister from any reference to his appeals to Nova Scotia, in former days, against this confederation. We are charged, on this side, with making factious opposition, but surely the government do not want to spend 8200,000,000 and then fail in the very purpose which the Prime Minister says he has so much at heart. We know that the building of the Canadian Pacific Railway did not realize what it was expected to do for the maritime provinces. We know that Sir Charles Tupper and Sir John Macdonald did not, in some measure, fulfil the promises they had made to those provinces in connection with that great transcontinental line. Then, I would say : Let us not repeat that error. Surely, now, when we have this great scheme before us, we should adopt every safeguard in order that there may be no complaints from the maritime provinces against this government for having made the same mistake as it has been stated other governments have made. I, therefore, ask the government to accept
not only this amendment, but several others, in order to carry out this view. Why should the Grand Trunk control this undertaking and not be responsible for its obligations ? This is a question which has been asked in the maritime provinces. The people in those provinces take the view that the Grand Trunk Railway Company do not want to become responsible for anything in connection with the eastern division, because they hold property which might be forfeited if they were parties to this agreement. They wanted to be in the position to get all the advantages possible from this scheme, to use the Grand Trunk Pacific to pull the chestnuts out of the fire, and then, when the chestnuts are out, if they are nicely browned, they will eat them, but if they are burned, they will let the Grand Trunk Pacific have them. We want to know why the old Grand Trunk Railway Company are to have all the advantages arising from this contract, and not be responsible for what is done on the eastern section, and I think the government have made a very curious contract in introducing a third party into the agreement, and not making them responsible or compelling them to assume any of the risk.


Mr. TAYLOR.: We have heard a good deal from the legal gentlemen on both sides of the House in reference to this contract and to the amendment now before the House. I have carefully examined the amendment proposed by the leader of the opposition and the amendment to that amendment proposed by the Minister of Justice, and I find that the difference between them resolve themselves down to the difference between two words. In the amendment of the leader of the oposition the word ' subscribe ' is used. The Minister of Justice puts in the word 'acquire.' Now, what is the difference between these two words ; what is their significance, looked at from a business point of view ? The Minister of Justice pays great respect to the legal ability of the leader of the opposition, and I think he is right in doing so, judging from the different amendments that have been made by that gentleman to legislation presented to this House during the last two or three sessions. The difference is this: the word in the amendment proposed by the leader of the opposition means that if the Grand Trunk Railway subscribe for this $25,000,000 of stock, they are legally responsible for the payment of that amount for the benefit of the people of this country, should there be any failure on the part of the Grand Trunk Pacific to carry out the undertaking. But the proposition of the Minister of Justice absolves the Grand Trunk Railway Company from any legal liability whatever ; they simply can acquire that stock by any arrangement they may make with the Grand Trunk Pacific Railway Company. It may be handed over to them for $100 or $1,000, or any sum agreed upon between

them. If the Grand Trunk subscribe as stockholders, they will be legally responsible to the people of this country for the $25,000,000. Half a dozen persons may join themselves together, form a limited liability company with a capital stock of $50,000 or $100,000. and start a manufacturing concern. They may pay in only 10 per cent of the amount of the stock for which they subscribe ; but they are legally liable for the remaining 90 per cent, if the business requires it. After they have been in business for a few years, they may find it would pay them better to wind up the company than to pay in the balance of the stock and lose that money also ; but if the company fails in business, the creditors can call on the stockholders to pay up the balance of the subscribed capital in order to discharge the indebtedness of the company. What is the case with a banking institution ? You subscribe for stock, and you are liable for double the amount of the stock for which you subscribe. Why should it not be the same in this case ? The Grand Trunk Railway Company would subscribe for the $25,000,000 stock in the Grand Trunk Pacific Railway Company and would pay in 25 per cent, or 10 per cent, or whatever might be required by the Grand Trunk Pacific in order to carry on this work. But if the Grand Trunk Pacific should fail in carrying out the obligation imposed upon it, then the people of this country, through the government, could call on the Grand Trunk Pacific Railway to compel the Grand Trunk Railway Company to pay up the $25,000,000 in order to discharge the indebtedness of the Grand Trunk Pacific Railway, the 3 per cent on the cost of building the road. That is the security we would have, if you would put in the word proposed by the leader of the opposition. The people of this country would then have a legal claim on the Grand Trunk Railway Company. But if you put in the word used by the Minister of Justice, then this clause is as big a fraud as calling this railway a transcontinental railway, when it ends at Moncton, not near the ocean at all. It is not a transcontinental railway, because at Moncton it has to connect with the Intercolonial Jtailway. And I say that the word ' acquii-e ' is as big a fraud on the people of this country. This clause will bear out the words of Sir Charles Rivers-Wilson, president of the Grand Trunk Railway, who said in England that the stockholders of the Grand Trunk Railway are not responsible in any way for this enterprise. The clause of the Minister of Justice is simjily a verification of Sir Charles Rivers-Wilson's statement. When the people of Canada come to understand this amendment of the Minister of Justice, they will see that it is simply a declaration that we have no hold upon the Grand Trunk Railway ; they can acquire that stock under any agreement they choose to make with the Grand Trunk Pacific Rail-


George Taylor: way. They can say to the, Grand Trunk Pacific : We will give you terminal facilities at Montreal for your road for that stock. They can acquire it by such a bargain as that, and the people of this country could not force the Grand Trunk Railway to see that the Grand Trunk Pacific fulfilled its obligation in operating the road from Quebec to Moncton, a section which is practically uncalled for, and which will be of no benefit to the people of this country in transporting grain from the west to the Atlantic, because it cannot compete with any line now in existence or with the water route. What is the use of the government trying to make the people of this country believe they have got security, when they have not security ? If they want security, let them put in the word suggested by the leader of the opposition, which would bind the Grand Trunk to the amount of $25,000,000. If that is done, we will be satisfied that the Grand Trunk Railway will be in this scheme and of it, but if you put in the word suggested by the Minister of Justice, the Grand Trunk are not in it, are not of it, and are not responsible to the people of this 'country for one cent of money under that section.


Albert Edward Kemp: One of the chief reasons given by the government for the construction of the eastern section of the Grand Trunk Pacific Railway was that it would bring business to the ports of the maritime provinces. There are two ways of getting from our Canadian West to the Atlantic sea-board ; one is north of the great lakes and the other is south of them. Let us consider for a minute which of these ways of getting to the Atlantic sea-board the Grand Trunk Railway will take. The Grand Trunk Railway have improved their line from Chicago to Port Huron, and have double tracked it ; they have improved their line from Port Huron to Toronto, both by the Grand Trunk main line and by the western division ; they have improved their line from Toronto to Montreal by double tracking it, and at the present time they have one of the best roads on this continent. They have improved their line from Montreal to Portland so that it is now a first-class railway in every respect. The conditions of operating railways south of the great lakes, the climatic conditions, are much more favourable. The conditions with, regardi to the question of fuel are very much more favourable than they would be north of the lakes, much more than they are even on the Canadian Pacific Railway, which touches the great lakes where coal can be easily secured. But what about the coal needed to operate a railway 100 miles away from where it can be delivered to that road by water ? Then as I said, there are the climatic conditions to take into account. Now, what is the distance from Winnipeg to the Atlantic sea-board north of the lakes, and what is the distance from Winnipeg

south of the lakes by way of the old Grand Trunk system ? I contend that the Atlantic sea-board can be reached more easily south of the great lakes by way of their well developed line, owned for almost the whole distance by that company. The mileage will be less from Winnipeg to Portland than it will be fri m Winnipeg to St. John or Halifax via this northern route.


Charles Bernhard Heyd: Will you give us that mileage ?


Albert Edward Kemp: The mileage from Winnipeg to Portland will be a little over 1,800. I have not got the exact figures, but I calculate it will be a little over 1,800.


Charles Bernhard Heyd: What is the other ?


Albert Edward Kemp: Well, I calculate the distance from Winnipeg to Moncton will be about 1,900 miles ; then you add the distance from Moncton to St. John and from Moncton to Halifax by way of the Intercolonial.


Charles Bernhard Heyd: What is it by the southern route ?


Albert Edward Kemp: I stated that by the southern route, by way of Chicago to Portland, the distance will be a little over 1,800 miles. 1 stated that the mileage from Winnipeg to the Atlantic sea-board at Portland by way of Chicago would be less than the distance to the Atlantic sea-board at St. John or Halifax via the Grand Trunk Pacific Railway. That is the view I take of it ; and I say that it is in the interest of the Grand Trunk Railway Company, which will practically control the Grand Trunk Pacific, to use the lines which they already have. That brings us to the question of the contract : In what way is the Grand Trunk Pacific bound to operate this eastern division ? In the amendment, as I understand it, the leader of the opposition desires that the Grand Trunk shall pay a reasonable sum, that it shall pay par for this common stock of $24,900,000 which it has to acquire. That is what the amendment of the leader of the opposition means. The government are willing that the Grand Trunk shall acquire that stock for a nominal sum, it may acquire it for $1 or 10 cents on the dollar. The fact of the matter is that the Grand Trunk will have control of this railway, and they will have very little interest in it if they acquire the stock for 10 cents on the dollar or 5 cents on the dollar ; but if they have to pay 100 cents on the dollar for the stock, they would have some real interest in the Grand Trunk Pacific. They are not going to have any very real interest in it because they are not going to pay very much for this stock, and that is the intention of the Bill.
At one o'clock, committee took recess.
Committee resumed at three o'clock.


Albert Edward Kemp: Mr. Chairman, when the committee rose for recess we were considering to what extent the Grand Trunk Railway were interested in the Grand Trunk Pacific project. It has been shown that by the Grand Trunk Railway Company owning the common stock of the Grand Trunk Pacific to the amount of $24,900,000 it absolutely controls the policy of the Grand Trunk Pacific. There will be a board of directors for the Grand Trunk Pacific, but the directors will only hold proxies to vote in the way in which they are directed to vote through the influence of the Grand Trunk Railway Company. I pointed out that it would be in the interest of the Grand Trunk Railway Company, controlling the policy of the Grand Trunk Pacific Railway, to divert the traffic which the Grand Trunk Pacific gather in the North-west for transportation to the sea-board south of the great lakes instead of carrying it over the Grand Trunk Pacific Railway to the sea-board north of the great lakes by way of Quebec to St. John or Halifax. The reasons I gave for that were simply that the Grand Trunk Railway Company has improved its road-bed all the way from Chicago to Portland to such an extent that it can haul freight cheaper, and that it can thus get the earnings from carrying the freight all the way instqad of allowing it to pass over the government road. Then again the eastern section of the Grand Trunk Pacific will be finished last. It will be finished very many years after the Grand Trunk Pacific road and its branches are built in Manitoba and the North-west Territories. Therefore, for a number of years freight gathered by the Grand Trunk Pacific Railway in Manitoba and the North-west will have to find its way to the sea-board and of necessity it cannot, even if the Grand Trunk Railway Company were willing, find its way out by the eastern section of this road. The question was raised as to what extent the Grand Trunk Pacific is bound to take its freight which originates in the west to the sea-board by the government portion of this road. I think I remember the hon. Minister of Finance (Hon. Mr. Fielding) saying that the Grand Trunk Pacific would under no consideration dare violate the spirit of this agreement, because the agreement was an agreement with the government of Canada. My own impression is that the Grand Trunk Pacific Railway Company, in years to come, when the influence and effect of this debate waste away and other men of this government,, or possibly of some other government, take office this obligation will not appear so strong as it may to-day, that there will be no moral obligation to observe and that the only obligation which will be observed will be that which is imposed by a strict interpretation by the contract in existence. Therefore, I do not see on what the hon. Minister of Finance and the hon. Minister of Justice (Hon. Mr. Fitzpatrick) can base

the assertion that this government, or any future government, would dare to bring pressure to bear upon the Grand Trunk Pacific Railway in any way in which the contract did not justify. It seems to me that history in this matter is repeating itself. A few years ago we had before us the project extending the Intercolonial Railway system to Montreal. That was advocated by the present administration and opposed by the opposition. What was the effect of the agreement ? AVhat did it bring about ? It brought about the extension of the Intercolonial Railway to Montreal. What else did it bring about ? It enabled the Grand Trunk Railway to do something which it had never done before. It enabled the Grand Trunk Railway to make Portland its summer terminal as well as its winter terminal. It had not developed Portland as far as its summer terminal was concerned, but through the tremendous advantages it got from the Drummond County Railway deal, through the rental it received, for the use of the line between Ste. Rosalie and Montreal and for the use of the Victoria bridge and in other ways it got sufficient money to enable it to improve its whole line to Portland and also to spend a considerable amount of money on its terminals in Portland. That was not contemplated by the government. That is not wThat the government thought the Grand Trunk Railway Companay were going to do, but that is what the Grand Trunk Railway Company did do and that is one of the effects of the bargain between the government and the Grand Trunk Railway Company in respect to the .Drummond County deal.


Mr. HOLMES.: Mr. Chairman, I would like to draw your attention to your ruling this morning in connection with this subject. The hon. gentleman (Mr. Kemp) is not discussing the resolution before the committee. I understand your ruling this morning. was that discussion must be confined to the resolution before the committee. I ask for your ruling on the point of order.


George Taylor: He is discussing the amendment.


Robert Holmes: He is not discussing the amendment.


Peter Macdonald: I am sorry that I was not in a position to hear the hon. gentleman (Mr. Kemp). I was trying to do a little work on the quiet. The hon. gentleman knows as well as any hon. member of the House that we all desire that each member shall keep to the subject.


Robert Holmes: The bargain for carrying the Intercolonial Railway to Montreal has nothing to do with this resolution.


Peter Macdonald: The hon. member (Mr. Kemp) knows if he has been out Mr. KEMP.
of order, what the resolution is, and if he has really been discussing a question outside of that I will appeal to him to come to the question. But, I really did not hear him.


Albert Edward Kemp: Mr. Chairman, I have the utmost respect for your ruling and I can assure you that I shall not depart from the rules of the House in such a way as to make it necessary for you to call me to order. I was just illustrating my argument by referring to a former bargain made by the government. What I said was that history was repeating itself in regard to this bargain, and in regard to the Bill which is now before us which will enable the Grand Trunk Railway Company to develop its whole line from Chicago to Portland, which will enable it to build up Portland and which will give the Grand Trunk Railway an outlet from the North-west by way of Chicago. That is something which I am sure the government did not intend when this bargain was made any more than that it intended that Portland should be built up by the Drummond County agreement. Yet I contend that is what is going to happen. Another thing that makes me very suspicious that the Grand Trunk Railway Company are not absolutely sincere in regard to operat: ing the eastern section of this road is the fact that there is no agreement between the Grand Trunk Pacific and the government in regard to terminals at St. John or Halifax or in regard to the use of the government road from Moncton to St. John or from Moncton to Halifax. Surely this is very important and if the Grand Trunk Railway had gone into the arrangement intending to utilize the Intercolonial Railway from Moncton to St. John or from Moncton to Halifax would there not have been some reference to it in the bargain. Under what clause of the agreement can the Grand Trunk Railway be compelled to build elevators and wharfs at St. John andi Halifax ? We have heard a great deal about the tremendous amount of money the Grand Trunk Railway Company is spending at Portland in terminal facilities. What amount of money are they willing to spend at these other places ? Surely, if the Grand Trunk were serious about this matter they would have had some agreement with the government in reference to it. Suppose that hereafter when the government say what they will charge the Grand Trunk as a rent for the use of the Intercolonial, the terminals at St. John and Halifax, could not the Grand Trunk refuse to pay the sum asked, and would not that be a loop-hole by which they could get out of their bargain ? I cannot help characterizing the whole contract as a very loosely drawn document indeed.


Charles Bernhard Heyd: If it was the intention of the Grand Trunk to divert the traffic via Chicago, why should they originally have applied for a charter from North Bay for

900 miles of road, which would cost them $50,000,000 ?


Albert Edward Kemp: The original proposition of the Grand Trunk Railway to make North Bay and Port Arthur their objective points, instead of Moncton, was a sane proposition. So far as building a line in the east was concerned, all that the Grand Trunk originally proposed was to build from North Bay or Gravenhurst, in order to connect their existing lines in eastern Canada with Port Arthur. Mr. Hayes, on November 24 last, stated in the ' Globe ' that they intended to buy the Canadian Northern Railway, and that was evidently their first intention. I am perfectly safe in saying that the Grand Trunk do not want this railway from Winnipeg to Moncton, which has been forced upon them.


Charles Bernhard Heyd: If it is the intention of the Grand Trunk to divert the grain via Chicago, why did they apply for a charter from North Bay at all ?


Albert Edward Kemp: The Grand Trunk were desirous of getting to the head of Lake Superior, but this proposed road takes them far to the north of Lake Superior. Let me call the attention of the House to this fact : the Canadian Northern Railway are now at Port Arthur, and the Canadian Pacific Railway at Fort William, and under an agreement with the Manitoba government the Canadian Northern Railway have reduced the rates on grain within the last few years, to the extent of 4 cents per hundred pounds.


Charles Bernhard Heyd: That does not answer my question.


Albert Edward Kemp: The Grand Trunk have a perfect right to ask for a charter to build to any point they please, and as a matter of fact in the Bill we have passed they have asked for a charter to the Yukon. In a contract like this, which the people of the country will have to spend vast sums of money to carry into effect, it seems to me that if the government intended that the Grand Trunk should carry grain to the head of the lakes, they should have inserted a clause in the charter providing that from Winnipeg and all corresponding points on the Canadian Northern Railway, the Grand Trunk should never charge higher freight rates than do the Canadian Northern Railway. The Canadian Pacific Railway are to-day charging 2 cents per bushel more than are the Canadian Northern Railway from Manitoba points. I am told that in time the Canadian Pacific Railway rates will come down, but they will only come down because of the competition of the Canadian Northern Railway.


Mr. DAVIS.: The Canadian Northern Railway has a bargain with the government of Manitoba, whereby the people of Manitoba
agree to pay any shortage or any loss. That is a different proposition entirely.


Albert Edward Kemp: I do not see that that has much bearing on the subject. The hon. member for Saskatchewan (Mr. Davis) will not deny that the people of the west are getting the benefit of a reduction of 4 cents per hundred pounds on grain carried on the Canadian Northern Railway, and if this government had at heart the welfare of the shippers and grain growers of the west, they would have provided in this contract that the Grand Trunk should carry freight at the same rate as the Canadian Northern Railway carries it. Let me point out, that there are two practical ways in which the Grand Trunk Railway might bind themselves to operate this eastern section. One way is, by purchasing the $24,900,000 of stock at par, which would make them absolutely interested in the Grand Trunk Pacific, and the other way is, that the Grand Trunk Railway Company of Canada should give a guarantee that the freight carried over the Grand Trunk Pacific, would not be diverted to American ports. The Minister of Justice admitted this morning that the only guarantee we have that the Grand Trunk will operate this eastern section, is a second mortgage on the five million dollars worth of rolling stock which is to be ear-marked for the eastern section. I would like to have the opinion of the Minister of Justice as to what that second mortgage is worth. As a matter of fact it is only worth the equity of the mortgage, and, what is that equity ? How could you realize on that second mortgage ? Suppose it should become necessary for the government to force the Grand Trunk to carry out its agreement, and suppose the government foreclosed that mortgage, who would buy the equity in that mortgage ? Would any man in this House or out of it pay five cents for that equity ? Even suppose any one did buy it, the rolling stock could not be taken away, because the first mortgager would have his lien on it. No man would invest a dollar in it in any shape or form.
But, Sir, what will the Grand Trunk Pacific Company care for any moral obligation ? These gentlemen, I admit, are respectable gentlemen, as respectable as any others ; they are well intentioned men ; but we have an illustration of the working of this contract in the case of the agreement between the government and the Grand Trunk Railway Company with respect to the Intercolonial Railway. The letter of that agreement is not being lived up to. The Grand Trunk Railway Company are no doubt trying to live up to it, according to its strict legal interpretation ; but there is a lawsuit going on at the present time between the government and the Grand Trunk Railway Company in regard to that portion of the agreement relating to the traffic of the Drummond Counties Railway. It was rather startling to the Premier this morning

to be told that Quebec was nearer to Portland than to St. John or Halifax. I am surprised that with all the information which the right hon. gentleman and his colleagues have had on this subject, this fact was not brought out before. The distance from Quebec to Portland is 31S miles, while the distance from Quebec to Halifax is said to be 580 miles ; so that when freight from the west reaches Quebec, especially in the winter time, it will be more economical to take it to Portland than to Halifax or St. John. Therefore we are justified in discussing the details of this contract and moving amendments to it ; and in order to safeguard the interests of the country, it seems to me that it is the duty of the government to adopt these amendments instead of voting them down by sheer force of majority.


Mr. BELL.: The great interest of the maritime provinces in this road is unquestionably in having it operated so as to divert, as far as possible, all the traffic originating in the west to Quebec in the summer, and to maritime province ports in the winter. Unless- the Grand Trunk Railway Company have such a direct interest in the eastern division that it is of the utmost importance to them to make that portion of the road capable of earning a large revenue, I do not think the purpose which the government profess to have in this matter, and which the people of the lower provinces unquestionably have, can be served at all. The view of the people of the lower provinces can be recognized in the resolutions which have been passed by boards of trade and various public bodies in Halifax, Truro, and elsewhere. In every case, while not solicitous to have this road constructed, they are anxious, if it is constructed, that it should be built over such a route as will, as far as possible, guarantee that freight originating in the west and in the hands of the Grand Trunk Pacific Company, should be carried to the sea-board over that road. The right hon the Prime Minister, in speaking of this particular feature of the transaction at an earlier stage of the session-in fact, before the Bill had been introduced as a government measure at all, and when it merely appeared as a Bill to incorporate the Grand Trunk Pacific Company-in fact, at an earlier period, when I think it was spoken of as a Bill to enable the Grand Trunk Railway Company to obtain access to the west-stated in his opinion, legislation alone would be useless; that it would be important to make such stipulations or regulations as would insure the diversion of traffic in the direction. The right hon. gentleman at that time laid down the proposition that in order to make the new road effective in that direction, it would be necessary to resort to a geographical condition ; that is to say, it would be necessary to place the line of the road so far Mr. KEMP.
north as to make it almost essential to the welfare and success of the road that the freight gathered on it should be taken to Quebec. Now, as nearly as we can judge at present, the line of the road, as finally decided upon, passing south of Lake Winnipeg and into the city of Winnipeg, will not fulfil that condition. We do not know exactly how far north that road may pass through Ontario and Quebec on its way to the city of Quebec ; but we know, in the first place, that the traffic to be gathered up by the Grand Trunk Pacific in the west will be brought into Winnipeg, where it will be affected by ail the forces which have a tendency to divert the export of grain away from Canadian winter ports to ports on the Atlantic coast of the United States. That port which is typical, which represents all the others, which represents most fully the fears which the people of Canada have that the trade of this country will be diverted to United States ports, is Portland. Not only is that port favourably situated for export, being comparatively near to Canadian points, being only 300 miles from Montreal and 318 miles from Quebec, as compared with the longer distances which separate Montreal and Quebec from St. John and Halifax, but we know that the Grand Trunk Railway Company have spent at that port something like $20,000,000 in important, well-developed, and no doubt convenient terminals ; so that there is every reason and inducement for the Grand Trunk Company, id the furtherance of its own business interests, to divert such traffic as the Grand Trunk Pacific may collect in the west, over its older system to Portland. Now, there might be, it seems to me, a course followed in carrying out this measure, which would 'make it to the interest of the Grand Trunk Railway Company to overlook the reasons which might influence it in favour of Portland, and more anxious to develop the trade of Quebec and St. John ; that would be by the Grand Trunk Railway Company acquiring a direct monetary interest in the road. The amendment offered by the hon. leader of the opposition is entirely in this direction. His suggestion is that the $25,000,000 of common stock in the Grand Trunk Pacific should not be a great block of stock which may be acquired at a nominal price or for nothing by the Grand Trunk Railway Company, but that it should be acquired by that company paying for it exactly what that stock is worth ; and every stock in a well-devised, well-considered and sound commercial institution is represented by par. It is held, on the other hand, that the Grand Trunk Railway Company should not be required to do this, but that they should guarantee bonds to a sufficient amount to pay for the construction of all that portion of the western division of the Grand Trunk Pacific Railway which will not be provided for by the sale of bonds, guaranteed by the gov-

eminent of Canada. It seems to me that the railway would he much better financed if the Grand Trunk Company were to buy the stock at par and apply the $25,000,000 raised in that way to the construction of that road, rather than to get the stock at a nominal value or at no value at all, and provide for the construction of the western division by the sale of bonds, which would probably be sold considerably below par. We have constant complaints from gentle-ment representing western constituencies in this House of the evils of over capitalization.
We hear, session after session, assertions to the effect that in every case where a road is over-capitalized or financed in the usual manner by having large issues of bonds sold below par, with the result that the nominal capital does not represent the money actually put into the construction of the road, but represents large blocks of bonds or stocks in the hands of ostensible shareholders-in every such case the companies operating these various systems have to impose such tolls on the traffic as will give dividends on the excess of capitalization. Over and over again, gentlemen representing the western portion of Canada have insisted on the evils of over-capitalization, yet here we have in this contract a provision for the transfer of capital stock to the extent of $25,000,000 into the hands of certain shareholders, who may not have one million dollars invested in the road. Under the circumstances, it seems to me that the proposition of the leader of the opposition is entirely in the direction of preventing over-capitalization, and consequently preventing the evils of which the people complain. If the Grand Trunk Railway Company took this stock at par and built that road, the chances are that there would be absolutely no necessity whatever to issue a second set of bonds. There would be no second mortgage on the road, and the stock which the Grand Trunk Railway held on the road, and for which it paid par, would be represented by a property worth every dollar paid for it. If the Grand Trunk Railway paid $25,000,000 for $25,000,000 of stock, the only liability resting upon that capital stock would be that first issue of bonds, guaranteed by the government, and for which, in all probability, the public would pay par. The consequence would be that the company, through purchasing $25,000,000 stock at par, would own a property which would give full value for every dollar put into it. There would be, besides, this great advantage, that the road would not be over-capitalized, and it would be to the direct interest of the Grand Trunk Railway, which owned this $25,000,000, actually invested in the road, to divert every ton of traffic originating in the west over the line of the Grand Trunk Pacific Railway. Otherwise, there always must be the idea that the Grand Trunk Railway will have a
divided interest in this matter, that its chief interest will be in the development of the western portion of its system, and its secondary interest will lie in bringing all the traffic originating in that western portion to enrich its older system between Montreal and Portland. It seems to me inevitable that the interests of the Grand Trunk Railway in that case would be largely to use the Grand Trunk Pacific Railway as a feeder for its older system, and not for the purpose of developing the eastern division. Under these circumstances, you could not at all blame the Grand Trunk Railway ; but. unquestionably, the people of Canada will blame us. if we do not show ourselves quite as much awake to our interests as the Grand Trunk Railway are to theirs. We should guard against the possibility of defeat of the intention of the government by so shaping our legislation as to make it in the interest of the Granl Trunk Railway to develop and build up the traffic of the eastern section, not only by diverting to it the traffic front the west, but by aiding the work of colonization as rapidly as possible. If we make it the interest of the Grand Trunk Railway to make the eastern division an important part of their system, we will have done all we could do in order to guarantee that the purpose set forth in the preamble of the Bill shall be carried out. That purpose was amplified at great length by the First Minister, when introducing the Bill. He explained that the intention was not only to develop the trade of the west, but to divert it as largely as possible over the eastern division. As regards the western portion, no doubt it will be profitable, and no doubt, if the Grand Trunk Railway is not prepared to go on with its construction, other companies are ready to do so. This session, the Canadian Pacific Railway came before the Railway Committee with a proposal to build a line from Winnipeg to Edmonton, same 700 miles, parallel to the line undertaken by the Grand Trunk Pacific Railway, and they did not ask o-ne dollar's assistance. They merely asked to be allowed to build it. What was the result ? The result was. that the Canadian Pacific Railway were met in such a spirit and with such discouragement that they withdrew their Bill, and, practically, the parliament of Canada prevented the Canadian Pacific Railway from constructing that great work, which would have covered a large part of the teritory to be traversed by the Grand Trunk Pacific Railway, and the construction of which would not have cost the country a dollar.


Thomas Osborne Davis: If the Canadian Pacific Railway are so anxious to build, why do they not build the Kirkella line that runs over the same ground in the same direction ?


John William Bell: They are rapidly building that road. It was made clear before the committee that in respect of every one



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of these guarantees, the company had complied with every condition exacted from them in the previous session hy the Railway Committee ; and if in any ease there was seemingly a little delay, It was because there had been difficulty in procuring steel rails.
Thomas Osborne Davis: Why do they want the other charter, when they cannot complete the two they have ?


John William Bell: There can be no doubt at all that if one company can build, another can. If the Grand Trunk Pacific Railway can build this road ,there can be no doubt that the Canadian Pacific Railway could quite as successfully build it. Other companies were perfectly ready to go into that territory and furnish all the railway accommodation needed, without any assistance. There can be no doubt about that fact, that there is no necessity to assist railway construction through the fertile plains of the west. My hon. friend who has interrputed me must know that the prospect of successful railway construction in these territories is sufficient to induce capitalists to go in and build these roads without assistance.


Thomas Osborne Davis: My hon. friend must be aware that that same country has been there for the last twenty years, and that there is no road through it yet. Surely, that is an answer to that statement.


John William Bell: I suppose it can be said that it has been there for a thousand or two thousand years.


Thomas Osborne Davis: It has been .settled for twenty years.


John William Bell: It may not have been settled so thickly as to justify railway construction through it to as great an extent as through other parts of the west. The most these companies can do is to meet the requirements of settlements as rapidly as they are justified in doing so. I have no doubt that there are people in the west who have settled so far in advance of railway accommodation that they are in need of railways, but such cases are being overtaken very rapidly by the existing companies. The Canadian Pacific Railway, to my own knowledge, are rapidly building branches reaching out to the settlements which require railway accommodation, and I have no doubt that wherever there is sufficient colonization to give promise of paying traffic to the road, that company is perfectly ready to extend the road. My point is, that this scheme must be considered in two different parts ; the western part will take care of itself absolutely, but the eastern part Is problematical and may not be built for a long time. We have at this time no idea as to when the surveys necessary for the building of that eastern section will be completed; we know nothing of the country through which


John William Bell: it will run, although we have a blue-book that gives some information. No one pretends that a trial line has been run over the country or that we can gather sufficient knowledge from reports of geological surveys, which are largely compiled from the results of canoe voyages, to justify 'the selection of a line. Many of these reports are made by officers who never went two miles from the streams on which they were travelling. The information given to the House by the blue-book is no doubt valuable and important, but still it is not sufficient to establish the fact that a line of railroad fulfilling the conditions laid dowm by the hon. member for North Norfolk (Mr. Charlton) can be constructed in that country. That being the case, it seems to me that if we are to have a successful scheme of transportation, complete from the eastern to the western extremities of the Dominion, we must see to it that the company behind this scheme, the Grand Trunk Railway Company, shall have so direct and deep and important an interest in the financial burdens which will be entailed on some one in the construction and completion of this railway, as to make it to their interest to see that the traffic of the west is not only collected in the west, but is carried over the eastern division of the transcontinental road to Canadian ports in the east. The figures given by the hon. member for North Norfolk (Mr. Charlton) show that if this road is to be a successful carrier of grain, it must carry it at prices never yet heard of in the history of railways. Even if they should carry thirty or forty million bushels, or should carry the whole crop of the west, they would do it at such prices as would leave to the company practically nothing whatever to be divided as dividends among the shareholders.


Mr. CHARLTON.: Might I remind my hon. friend that my statement was, that if it was necessary, they could carry the grain at such prices ?


John William Bell: The hon. gentleman is right. The figures he gave last night show the prices at which the grain could be carried without a loss ; but If work is to be done at prices which merely cover the cost of performing that work, it is clear that it is done without a profit, and if we make it compulsory that the Grand Trunk Pacific Railway should carry this great volume of through-traffic over that road and must carry it at prices that will leave no profit, it becomes perfectly manifest that it will be essential to the continued success of that enterprise, to the continued solvency and operation of the road from year to year, that the company shall develop, in every way in its power, enterprises along the line, shall promote colonization and develop in that country a great local traffic, because they cannot hope, at the prices they will be able to charge, to secure enough revenue

from the carriage of grain and lumber to enable them to meet their obligations to the government. If we assume the cost of that road to be as low as It has been estimated by government speakers, there will be a liability attaching to every mile of the road of $840 per year. How is that to be earned ? It cannot be earned with through grain traffic ; and, therefore, if we are to ensure the success of this enterprise and fulfil the hopes that have been held out to the people of the lower provinces, we must frame this legislation in such a fashion that the Grand Trunk Kailway Company, which is constructing this road, will be compelled by force of circumstances and the necessities of their position to develop and divert all the traffic that comes into their possession over that read and consequently to develop every local industry along the line and to become a great colonization company. Therefore, it seems to me that the amendment offered by the hon. leader of the opposition should be adopted, as it would frame this legislation in such a way as to practically compel the Grand Trunk Railway to put the Grand Trunk Pacific Railway on a sound basis in the most economical fashion, and to give assistance to the construction of that road to the extent of $25,000,000 of their money. In that way we would have taken the most important step of all and secured the completion and operation of the road in such a way as to realize for the people of Canada those hopes which the right hon. the Prime Minister and the government must have had in view when they introduced the scheme.


Thomas Osborne Davis: I wish to say but one word in reply to some statements with reference to the prairie section. The hon. member (Mr. Bell) would lead the committee to believe that the Canadian Pacific Railway are prepared to build a road up through that section of country to be traversed by the Grand Trunk Pacific, without any money grant or assistance whatever. I wish to draw attention to this fact, that the Canadian Pacific Railway at the present time have in that country one branch, called the Manitoba and North-western, on which they are building very little. They have another branch line which traverses practically the same country for which a charter was asked, called the Kirkella branch, on which they are building very little. They have also another branch in the same district, called the Great North-west Central, 'on which I do not think they are building at all. Therefore, if the people of the west have to wait until the Canadian Pacific Railway were to build all these roads, they would have to wait some time. The hon, gentleman has not taken into consideration that what the people of the west are suffering from is that the Canadian Pacific Railway are not subject to government control of rates, that they charge excessive rates, and even if the Canadian Pacific Railway should I
build all these roads, still, so long as the main line is exempt from control of freight rates, the people of the west would get no relief and would be in the same position as they are at the present time.
Amendment to the amendment (Hon. Mr. Fitzpatrick) agreed to.
On the section 7, as thus amended,


Robert Laird Borden: Before this section is carried, I desire to propose another amendment to it, which is somewhat along the lines of the one I have already moved, although it is more limited in its extent. I have already moved an amendment which the government did not see fit to accept, by which, if adopted, it would have been necessary for the Grand Trunk Railway Company to become bound by all the covenants, conditions and stipulations in the agreement contained, and which are therein made binding upon the Grand Trunk Pacific Railway Company. In speaking to that amendment I mentioned several clauses of the agreement which I thought contained stipulations that ought to have been made binding upon the Grand Trunk Company. I mentioned clauses 42 and 43 which have particular relation to the diversion of traffic. The amendment which I now propose is one that is more especially limited to clauses 42 and 43 and is to the following effect :
That section 7 be amended by adding thereto the following subsection :-
Notwithstanding anything in this Act or in the said agreement contained, His Majesty the King acting as aforesaid, shall not be bound or obliged to perform, carry out or fulfil any of the covenants, conditions nr stipulations in' the said agreement contained on behalf of the Dominion of Canada, unless and until the Grand Trunk Railway Company of Canada shall have entered into an agreement with His Majesty the King acting as aforesaid, by which the said Grand Trunk Railway Company of Canada shall covenant and agree as follows : That neither the Grand Trunk Pacific Railway Company nor the Grand Trunk Railway Company of Canada shall in any matter within its power, directly or indirectly, permit, advise or encourage the transportation of traffic by routes or at rates other than those provided in the said agreement, and that each of the said companies shall, in all respects and in good faith, use its utmost endeavours to fulfil the conditions upon which public aid is granted and accepted, namely, the development of trade through Canadian channels and to Canadian ocean ports.
That is an amendment which, I think, ought to commend itself to the government. In effect it amounts to this, that the Grand Trunk Railway Company shall be obliged to enter into a covenant with the government that neither tliei Grand Trunk Pacific Railway Company nor the Grand Trunk Railway Company itself shall do anything to encourage the transportation of traffic otherwise than by Canadian routes, and further that both companies shall in all respects use their best endeavours to

fulfil the conditions named in the contract with regard to the transportation of traffic through Canadian routes. The reasons which might be adduced in support of this amendment I have gone over pretty fully already in support of the amendment 1 have already suggested. I do not want to go over them again with anything that might be regarded as unnecessary reiteration. I point out again the reasons to which I have adverted, regarding the diversion of the traffic to United States ports and by United States routes. I say that inasmuch as the Grand Trunk Railway of Canada is seeking aid in the construction of a line to the west, there is every reason why this amendment should be added to section 7, providing that the stipulations on behalf of the government shall not take effect until the Grand Trunk Railway shall have entered into the stipulations contained in this amendment.


Samuel Barker: I had hoped that this amendment might be accepted by the hon. gentlemen opposite. We have tried in various ways to obtain some provision in this Bill that might give a little security, to the country for the performance by the Grand Trunk Railway Company of what are considered by the government essential features of the arrangement. Perhaps the feature that interests the country more than any other is that which relates to the traffic to be carried by the railway called the great transcontinental railway. If there is no provision made that will be effective as to the routing of that traffic and as to the' rates upon that traffic, it would be better [DOT]that the money should be saved and that the country should enter into no obligations. The government, by introducing into the agreement provisions relating to the routing of that traffic through Canada, and the rates upon it, admit that these are very important considerations for the future of the country.
The question is whether in this contract there is effective provision to secure the benefit of the conditions which have been inserted in it. I have listened with a great deal of attention to the arguments of the hon. Minister of Justice and the hon. Minister of Finance and I fail to see that there is one point from first to last in which protection has been afforded against the opposing and separate interests of the Grand Trunk Railway Company. I desire to say a few words upon that point because I think it is of the utmost importance in considering what the government proposes to do for the Grand Trunk Pacific, to see whether we shall have as a return for the assistance some substantial guarantee from the company which is really getting the benefit of the aid. The hon. Minister of Justice tells us, as if it were something of importance in regard to this question, that the Grand Trunk Railway Company is guaranteeing 25 per cent of the cost of the western section. Well,


Robert Laird Borden: let us consider for a moment what the Grand Trunk Railway Company is guaranteeing. Is there an hon. gentleman in this House who has followed the proceedings on this Bill who doubts for a moment that the word ' Pacific ' is a mere fiction, that the real name of the company which is receiving this aid from the government is the Grand Trunk Railway Company of Canada, that the other is a thing of straw put up to enable the Grand Trunk Railway Company to receive the benefit without entering into' any obligations under this Bill in return ? The hon. gentleman says that the Grand Trunk Railway Company is guaranteeing the bonds for one-quarter of the cost of the road. The Grand Trunk Railway Company is simply guaranteeing 25 per cent of the cost of its own road. It is the Grand Trunk's road as much as any property the Grand Trunk Railway possesses the moment this Bill passes and the agreement is entered /into. Does not every person know that from first to last, that from the notice which was published in the ' Gazette ' by the solicitor of the Grand Trunk Railway Company, from the day the officials of the Grand Trunk Railway Company appeared first in the Railway Committee to the present hour, there has been nothing but the Grand Trunk Railway connected with this transaction, and that in all the negotiations between the Prime Minister and the Grand Trunk Pacific no person has appeared in the name of the Grand Trunk Pacific who has not been a director or an official in some capacity of the Grand Trunk Railway Company ? That company has been in it from first to last and the Grand Trunk Pacific is a mere fiction, a statutory name given to the Grand Trunk Railway Company, because the latter company does not wish to be. direct party to this transaction. I do not wish to belittle the value of the Grand Trunk guarantee of these bonds even to the extent of 25 per cent. On this side of the House we are not disputing that. The hon. Minister of Justice seemed to place that question before the committee as if we were ignoring the value of the guarantee. We do not, but we object to exaggerating the value of dt. We object to any over-straining of the importance of its entering into that guarantee because it is simply guaranteeing something that is in its own interest and for its own benefit. The Grand Trunk Railway Company will receive great benefit from this western division as a feeder, and if it were entering into a contract with some other railway company for such a feeder as this it would be glad to give such a guarantee as is stipulated here and would never expect from that company a gift of the majority of its stock. As the Grand Trunk Railway Company is to receive enormous aid from the country, we ask that it shall give in return some adequate covenant and obligation to protect the country under the provisions of this agreement. We have asked for that in

different shapes. We have asked for a covenant from the Grand Trunk Railway Company, but hon. gentlemen say: No, you cannot have a covenant. You can have the covenant of the Grand Trunk Pacific Railway Company, a covenant that is absolutely worthless when you consider the mortgages and obligations into which it must enter under these arrangements. The Grand Trunk Pacific Railway is bound by these arrangements to mortgage its railway up to the extent of the whole cost of the railway. It give a mortgage for 75 per cent of its cost connected with the government guarantee, and it gives a mortgage next in connection with the Grand Trunk Railway guarantee for the whole of the balance to complete the railway. Even its rolling stock is mortgaged to its full value. The covenant of that company would not be considered worth $1,000 by any bank in this Dominion, and yet that covenant is all we can get in connection with this transaction. Failing in getting a covenant from the Grand Trunk Company we have asked the government to make provision in regard to the common stock of the Pacific Company so that at least we shall have some security, but again we have been met with a refusal. We contend that the arrangement made by the government in regard to the common stock of this company virtually makes a present of $24,900,000 of common stock to the Grand Trunk Railway Company. The hon. Minister of Justice shows clearly enough that he treats it so, because the proposal that we have made that the Grand Trunk Railway Company shall subscribe for the common stock in the ordinary manner is carefully met by the hon. Minister of Justice by striking out the word ' subscribed ' and by putting in the word 'acquire.' He knows the distinction between the two words and he knows that the charter of the Grand Trunk Pacific enables the Grand Trunk Railway Company to acquire the stock without paying for it. Thus, we are deprived of the protection that we would have if the Grand Trunk Railway Company were obliged to subscribe for this stock. Under its charter the Grand Trunk Pacific Railway Company has power to give its common stock as paid up stock for rights and privileges, and in exchanging its common stock for rights and privileges, it has tlie right to deal with that stock upon its market value at the time. We have shown clearly enough that under the circumstances of this contract it will be absolutely impossible to fix any market value for it, that nobody can say what the market value is because the stock will never be put upon the market at all. We have under this arrangement a condition of things under which the same board will exist upon the Grand Trunk Pacific as will exist upon the Grand Trunk Railway and these two boards, being the same individuals, will meet together to make this 376
arrangement. The board of directors acting for the Pacific will value the common stock which is to be given in exchange for the privileges, and the same gentlemen acting for the Grand Trunk will value the privileges which are to be given in exchange for the common stock. The Minister of Finance tells us, that his anxiety is lest this common stock should be frittered away at a fictitious value by the Grand Trunk Pacific Company. But, what more perfect means could he have devised, for its being so frittered away, than the very arrangement he has made. What more simple process could be invented for giving this $24,900,000 away at a fictitious value ?


Charles Bernhard Heyd: If the Grand Trunk Pacific give away this stock for a fictitious value, how can they get money to fulfil their obligations ?


Samuel Barker: The Grand Trunk Pacific gets 100 cents on the dollar in bonds for the cost of its railway. What more does it want for that ? It gets $20,000,000 of preferred stock for the equipment. What more does it want for that ? If this common stock is paid for, the money would be in the treasury and it would not be necessary to issue all these bonds. But the mere fact that the Grand Trunk can get this $24,900,000 without paying a dollar for it, compels an issue of 100 cents on the dollar for the whole cost of the railway. You are loading this railway up with bonds, because the common stock is not paid for. That is the transaction. The hon. gentleman (Mr. Heyd) has heard the discussion time and again, and it is wonderful that he should ask such a question.


Charles Bernhard Heyd: I wanted to be sure.


Samuel Barker: I hope you are sure now.


Charles Bernhard Heyd: I am not.


Mr. BROCK.: You mean, you do not want to be sure.


Samuel Barker: What is there unfair in our asking that the Grand Trunk shall pay for that stock ? It does not mean that they shall be compelled to pay the money right away. When a man takes $100 worth of stock in a company he pays it up as the needs of the company require it, and if the Grand Trunk subscribe for $24,900,000 worth of stock it will not pay a dollar on that until the money is required for the needs of the company. Is not that perfectly clear ? No call could be made upon that stock except for the necessities of the company, and the Grand Trunk directors being the directors in the Pacific Company, can protect themselves against any unnecessary calls. But the importance to this country would be that the obligation to pay that stock up would remain, and if the Grand Trunk Pacific makes default in its obligations to the country, the right to make that call will be there and we can get



compensation. That is the distinction and nobody knows it better than the Minister of Justice. The Minister of Finance told ns that if we did not give this stock to the Grand Trunk, it might be frittered away at a fictitious value, but what is the difference between that, and putting it in the hands of the Grand Trunk without their paying a dollar on it ? It might as well be in any other hands so far as the country is concerned. We will suppose that there are branches to be built, instead of the Grand Trunk Pacific Company issuing heavy bonds, they could call on the holders of the stock to pay up, say 10 or 20 per cent, or whatever might be necessary. If that 10 per cent or 20 per cent is paid up, it will rank for dividend, but we object to all this stock ranking for dividend when the money never gees into the treasury. The government proposal loads the company up with watered stock. The Minister of Justice has urged that the Grand Trunk will have an interest in the success of the eastern division because the branch to North Bay will furnish its line through Ontario with traffic. That is a very important consideration, and it shows very clearly to my mind why it is of the utmost importance that the Grand Trunk Company, should be under direct obligation to the government. Let us suppose that the Grand Trunk does receive traffic from the Grandi Trunk Pacific at North Bay. What control from that moment has the Grand Trunk Pacific over the traffic which may be way-billed through ? The Grand Trunk would carry out the instructions of the way bill, wherever it may be to-Halifax, St. John, Portland or anywhere else. But what is more easy, in the carrying out of the business of these two corporations, than to bill every carload of traffic that comes from the west to the Grand Trunk at North Bay. at Montreal, or at Quebec ?


Charles Bernhard Heyd: Would not the distance via North Bay be much longer than the distance via Quebec ?


Samuel Barker: I am dealing now with the remark of the Minister of Justice, that the fact that the Grand Trunk could get its traffic at North Bay gave it an interest in the Grand Trunk Pacific, inasmuch as it would afford traffic to be hauled over its Ontario and Quebec lines. I am pointing out why that illustrates the necessity of having control over the Grand Trunk with regard to all that traffic. Suppose that the Grand Trunk Railway receives traffic from the Grand Trunk Pacific, billed from Edmonton or Winnipeg to North Bay, Montreal or Quebec, it matters not which. The Grand Trunk can then re-bill that traffic to any port it pleases. It is the easiest thing in the world for the companies to arrange the matter in that way


Charles Bernhard Heyd: But if the distance is longer, why should it do so ?


Samuel Barker: 


Samuel Barker: I am not going into the question of distance now at all. The hon. gentleman, I suppose, assumes that the traffic of the Grand Trunk Pacific is going to Quebec.


Charles Bernhard Heyd: I assume that all the traffic is going the shortest distance, that is via Quebec, and there is no motive for it to go to Montreal.


Samuel Barker: I am willing to assume that it all goes to Quebec. The Minister of Justice represented that some of it would go to North Bay. Whether it goes via North Bay or Quebec, there is nothing to prevent the Grand Trunk Pacific sending all its through traffic to these points, there to be delivered to the Grand Trunk. The Grand Tunk could then forward it to its destination, either via Halifax, St. John or Portland. It could do the same if the traflic were shipped to it at Montreal. There is no provision in this contract to prevent the Grand Trunk sending to Portland all the traffic it receives at Quebec, and it would send it there if it could save money by saving a long haul. Yet the hon. gentleman says that he has the interest of the Grand Trunk in this agreement as a guarantee that the traffic will be sent to a Canadian port. The interest of the Grand Trunk will be to send the traffic to its own nearest port. I will again read the words of the amendment which is designed to meet such a case :
That neither the Grand Trunk Pacific nor the Grand Trunk Railway of Canada shall, in any matter within its power, directly -or indirectly, permit, advise or encourage the transportation of traffic by route's or ait rates other than those provided in the agreement.
We want hotli companies bound l>y that -not only the Grand Trunk Pacific, lmt the Grand Trunk. When it receives traffic at either of these points, we want it hound that the traffic shall go to a Canadian port. Under the agreement as it stands, the Grand Trunk can send every carload of the traffic to Portland. There is not a word in the agreement to prevent that. If the hon. gentleman, who lias the interests of the country at heart, can devise some provision by which the Grand Trunk Company ahull be obliged to send the traffic to a Canadian port, we shall he glad to have his assistance.


Charles Bernhard Heyd: Your contention is, that the freight having once arrived at Quebec can be diverted by the Grand Trunk from St. John to Portland ?


Samuel Barker: What I say is, that it is quite possible, consistent with all the provisions of this agreement, for traffic coming from Edmonton. Brandon, Winnipeg or anywhere else in the west, to be consigned to the Grand Trunk at Quebec, and the moment the Grand Trunk receives it at Quebec, it will become the forwarder, and

It can send it wherever it pleases without breaking this agreement in doing so ; and the Grand Trunk Pacific Company will have complied with its part of the agreement also. We want both companies to be hound to send the traffic to a Canadian port. There is another feature of this agreement the keeping these two companies distinct, which is important, and which perhaps has not been considered ; that is, with reference to the division of rates between the two companies. It appears to have been assumed that this traffic must necessarily go the whole distance over Grand Trunk Pacific rails ; but that cannot be relied upon. The traffic will go just where it i;s in the interest of the Grand Trunk for it to go. There is no question that a large portion of the traffic originating on the Grand Trunk Pacific will go over both railways. All that goes to Buffalo-and that is a very large traffic which you cannot stop-will go partly by the Grand Trunk Pacific and partly by the Grand Trunk. When you come to the question whether the Grand Trunk Pacific is going to earn enough to pay its rent, whether it is to be freed from the payment of rent to the government because it does not earn it, it is a very important consideration to know what the division of rates between the two companies shall be. The Grand Trunk Company may make the division of rates between the two companies such that the Grand Trunk can take the cream and leave the skim milk for the Grand Trunk Pacific. There is no provision in the whole agreement protecting the country against arrangements between the Grand Trunk and the Grand Trunk Pacific whereby all the profit shall go to the former and the latter be worked at a loss.
I mention that incidentally to show that from first to last the question of the possibility of the Grand Trunk acting in its own interests, which may be adverse to the interests of the Grand Trunk Pacific, and adverse to the interest of the country, has never been considered in these negotiations. Now, Mr. Chairman, this resolution is a very mild one indeed. It is one which I think no person can reasonably object to. It simply provides that what has been contracted for in this agreement on the part of the Grand Trunk Pacific shall be honourably carried out by both companies.
Where is the trouble about the Grand Trunk Railway agreeing to it ? I would like the Minister of Justice to teli us in what respect the Grand Trunk Railway will have any difficulty whatever in preventing the Grand Trunk Pacific Railway doing anything contrary to the terms of this agreement. What trouble would there be on the part of the Grand Trunk Railway in undertaking an obligation, on behalf of the Grand Trunk Pacific Railway, either to do or not to do anything. The Grand Trunk Pacific Railway will be the Grand Trunk Company's railway, and the Grand Trunk I 376i
will only be agreeing for itself. The same board of directors will act for each company, the same officers will control the whole system. They are one company to all intents and purposes. Should the Grand Trunk Pacific Railway contract with this government to do a particular thing or not do it, the Grand Trunk is in a position to make it perform honourably what it has undertaken.


Mr. LENNOX.: The issue between the parties,' Mr. Chairman, is as to whether the Grand Trunk Railway shall be compelled to carry out the declared policy of the government. At the time it launched this scheme, the government declared that it had made a good bargain with a responsible company, namely, the Grand Trunk Railway. It is evident that the Grand Trunk Railway is the sole beneficiary in this transaction. No one who will scan the provisions of the contract carefully, can come to any other conclusion than that the Grand Trunk Pacific Railway is merely a figurehead, merely a company on paper. Large benefits are being conferred upon' the Grand Trunk Railway. A very substantial assistance is given it in the west, and also on the eastern branch, by allowing the company to have the use of that branch for seven years, and probably three years more, without paying anything; the government undertaking to build that portion of the line. During the last two or three days we have been endeavouring to get from the Grand Trunk something by way of return. Absolutely nothing is obtained from it now under this agreement. It is idle to speak of the Grand Trunk Pacific Railway in this matter. There is no benefit, no return to Canada in any case for the benefits that are conferred by the government. We ask that the Grand Trunk Railway be made responsible for the obligations assumed by the Grand Trunk Pacific Railway. We are asking to have it provided in the contract that the Grand Trunk Railway shall not get $25,000,000 worth of stock in the Grand Trunk Pacific Railway for nothing, but shall pay for it. This is the only means by which the public can be protected with regard to the eastern division. We have it acknowledged by the Grant Trunk Pacific Railway that it will issue mortgage bonds for the twenty-five per cent of the cost of construction which the government does not supply ; and should this $25,000,000 worth of stock go into the hands of the Grand Trunk Railway without payment, another unfortunate result will be that the Grand Trunk Pacific Railway will have to borrow money on second or third mortgage bonds in order to equip the line with rolling stock to the extent of $20,000,000. The only security we have got will therefore be made worthless. For what cause ? Well, it is very difficult to suggest the cause without suggestng something uncompli-

1200S
mentary to the government. We are told both by the Minister of Finance and the Minister of Justice that not a line of this agreement can be altered, that it must be either accepted or rejected as a whole.
I fail to see why, if we amend this Bill, we should not also modify the agreement so as to bring it in harmony with the Bill. I do not accept that proposition. In my opinion we have the right to alter the terms of the contract and to frame such an agreement as we believe to be fair and just. It will then be for the parties to the agreement to consent to the modifications or let the contract fall through. The only possible ground upon which the government can pretend that any benefit results to Canada from this contract is that the Grand Trunk Railway undertakes to guarantee the bonds of the Grand Trunk Pacific Railway for the construction of the western division to the extent of 25 per cent of the cost. But does that confer any advantage on this country ? The construction of the western division is, to all intents and purposes, a private enterprise, wholly under the control of the Grand Trunk and Grand Trunk Pacific Railways.
Assume that we are not dealing with a transcontinental railway but that a railway is being constructed from Winnipeg to the Pacific ocean. We are guaranteeing it as largely as we ever do, we are guaranteeing it to an extent that is probably not necessary, having regard to the facility with which a railway can be constructed over the prairie. The Grand Trunk and. the1 Grand Trunk Pacific are identical, but} whether they are identical or not it is simply a case of a company undertaking to build a railway on condition that if we provide three-fourths of the money required they will provide the other one-fourth. Can in itself for one moment be said to be something done for Canada, in return for the concession we are making in the matter of this transcontinental railway ? If it were' that the Grand Trunk Rii^lway were coming to our aid in the construction of the eastern division, then perhaps a plausible argument could be advanced that this was something the Grand Trunk was doing in return for what we are doing by this contract. But this is in the construction of that portion of the railway which is to remain the property of the Grand Trunk Pacific from which we derive no more benefit than we do from that construction of a section of railway in any other part of Canada. It is impossible to point out how we are to obtain a return from the fact that the company are to contribute a certain portion of the money required to bui'ld their own line. I call the attention of the government to a fact- which will be significant to the minds of those to whom the government is ultimately responsible-namely that from the 30th of July, when this scheme was announced


Haughton Lennox: Rivers Wilson adre,sse:d*that committee he made the remark that the old Grand Trunk Railway would stand behind this enterprise. We have not been content that they should stand behind it, we have required, and they have readily consented, that they shall be in it, and of it, . and form the whole thing.
That is pretty strong.


Albert Edward Kemp: Who said that ?


Haughton Lennox: The Minister of Finance, on the 12 th of August,- speaking on that question in this House. He went on :
W-e think it is to the advantage of this country to have the Grand Trunk Railway extended both east and west and we think it is better that (thus enterprise should toe in the hands of the old Grand Trunk Railway than of promoters who could be characterized as irrespon-slbles.
What is the hon. gentleman speaking of there ? He is speaking not of any scheme with which the Grand Trunk Company shall be remotely connected, but of a scheme by which the Grand Trunk Railway as it is in Canada to-day, shall be extended east and west, meaning-if the language istohaveany meaning at all-that we are to have the Grand Trunk Railway system extended into western Canada. I would like to ask you, Mr. Chairman, if this is tiie fact, what kind of a company are we dealing with in reference to the Grand Trunk Pacific Railway ? This is a great scheme. It is not an ordinary transaction where we say to a company : We will give you a charter to build a railway. In that ease parliament very properly require that there shall be substantial people behind it, men who can put into the enterprise a sufficient amount of money to make it a success. But if this is important in the ease of an ordinary railway, how much more important it must be in a case such as this, where the government is entering into a gigantic scheme to construct the eastern division out of the money of the people of Canada, when, if it can be made a success at all, the whole success of the enterprise depends upon having men of undoubted ability and a company of undoubted substance at the back of it, to take over the railway when it is constructed, and to carry it on in a successful way to develop the trade resources of the country. Now, the hon. gentleman points out that we cannot expect that this Grand Trunk Pacific Company will be able to raise even the $5,000,000 that is to be paid in as a deposit, emphasizing still further the fact, which I think is becoming very evident to this House, that this Grand Trunk Pacific Railway Company is a company only in name, and that the Grand Trunk Company, as has been pointed out by members of the government themselves, are the parties that the' government understood were launching this transaction and would consummate it through the medium of the government. The minister says that the Grand Trunk has declared its intention to be a truly
Canadian road. That is a matter of faith only, and we know that the road to a very bad place is paved with good intentions. I have referred to the Minister of Finance, I will now refer to the Minister of the Interior, although others have spoken in the same strain. The Minister of the Interior was speaking of what the leader of the opposition said in reference to having no security that the grain would be routed through Canadian channels, and in reply the minister said :
I may say that I agreed largely in -the view expressed by my hon. friend the Finance Minister, when he said that inasmuch as we were making a clear, distinct and unambiguous contract with -a responsible company, with a respectable institution which might reasonably be expected to -implement its -obligations, we should have a good deal of confidence that every reasonable effort would -be made by them to carry out the contract.
Referring back to wbat the Minister of Finance said, speaking of the Grand Trunk Railway Company, we see that the Minister of the Interior endorses the view that we are dealing with the Grand Trunk Railway Company. But he makes this absolutely clear when he says :
He (-the leader of the opposition) said that there was no s-a-ncti-on, no penalty provided in case the G-ran-d Trunk Rail-way -failed to meet Us obligations in that respect.
Did the Minister of the Interior at that time say that it was not with the Grand Trunk Railway Company we were dealing so far as the routing of traffic was concerned, or as regards the obligation to carry out the policy of the government of having an all-Canadian route over which grain would travel instead of feeding the railways of the United -States ? Did he say we were not dealing with the Grand Trunk Railway ? No ; he pointed out what the leader of the opposition understood at that time, namely, that we were dealing with the Grand Trunk Railway. Then he says :
But I go further, I would not coinsider it at all advisable -to put in this contract a final clause-a clause -that would provide, for instance, that a fine in the ordinary sense, should be levied against the Grand Trunk Railway for the violation of this clau-se.
Mark, Mr. Chairman, that here again the Minister of the Interior regarded it, as I venture to say every member of the government then regarded it-because I do not want to impute bad motives to them, but only that they have been over-matched by the Grand Trunk Railway Company-he regarded this contract then as being with the Grand Trunk Railway Company. He goes on further and says :
No parliament, certainly -not the parliament of Canada, was ever -asked to assent to an important fi-nia-n-cial proposition which w-a-s so buttressed with security, so im-pregnably fortified by all the securities that were required, as this proposition which we are dealing with at the

present time. Amd yet, w,e are asked to believe that after a little while the Grand Trunk will fail to carry ouit its contract and it won't go on. What does that argument amount to ? What is the Grand Trunk going into this scheme for ?
Well, I suppose we know pretty well wlmt they are going into the scheme for now :
It is because it has a magnificent system of railways in the eastern portion of Canada, because there is 'an enormous and growing traffic in the w-est, and the Grand Trunk wants to get there, and by means of this railway it is going to get in. Moreover, its thousands of miles of railway all over Canada are going to be connected with the growing trade in western Canada, and they are going to do a large and profitable business in consequence.
Then the hon. gentleman points out that they are going to make millions*of money out of it, that they are not going to abandon it. Summarized, it comes to this, that the government understood at the time, or If they did not so understand it they represented it to this House and to the people of Canada that they were getting the security of the Grand Trunk Railway, not in an isolated instance, but for the carrying out of the scheme as a whole ; they represented it as an extension of the Grand Trunk system, they represented it as a means by which the Grand Trunk was extending its system into the west, with connections in the east. Now, I charge it upon the government that, if at this stage, as they appear likely to do, they refuse every reasonable amendment which can be made, giving to the Grand Trunk all the profits of this great scheme, and while giving to them all the benefits, still refusing to ask the'Grand Trunk Railway Company to become responsible for the faithful carrying out of this contract, they are not acting I believe in harmony with the wishes of the people of Canada, nor in the interest of the people of Canada.


Edmund Boyd Osler: We have the very curious spectacle of the government endeavouring to avoid taking securities upon a property upon which it is quite competent for them to take security in the present position of affairs. The government profess to be anxious to build a transcontinental railway. For some reason or other they are undertaking to build the eastern portion of it, the expensive portion of it, that portion which we believe will not be a paying portion. We think that the prairie section of the line is a good business proposition. We believe that under ordinary conditions the government would find very many bodies of men who would undertake the building of that western section. Messrs. Mackenzie & Mann are duplicating that line in the west. We are contending that the security which the government is taking from the ' Grand Trunk Pacific Railway Company for operating thie eastern section of the line is practically a second mortgage, because the Mr. LENNOX.
rolling stock is already mortgaged to the extent of $5,000,000. The Grand Trunk Pacific Company is authorized to mortgage its line to the amount of its full value and the government has the ordinary promise of the company to operate the road in addition to a second mortgage upon $5,000,000 rolling stock. The promise is practically valueless if the railway company does not find it in its own interest to live up to it. We are suggesting that the government should take security upon the western section to ensure the carrying out of the obligation that is undertaken by the Grain! Trunk Pacific Railway Company for the operation of the eastern section and that it should take such further securities as are outlined by this amendment. The government, instead of trying to get all the security it can, has apparently made up its mind to take as little security as possible.
I do not propose to go into the point made and so very clearly made by my hon. friend from East Toronto (Mr. Kemp) who showed that it would be in the interest of the Grand Trunk- Railway Company, when it gets to Winnipeg, to divert its traffic over its own line by way of Chicago. X believe that any railway man of experience would tell the minister that such would be the course most likely to be pursued by that company. Now, we have the unique spec-' tacle of the government endeavouring to avoid taking the security that it might take for the payment of interest upon nil expenditure of at least $100,000,000. When this matter comes to be worked out I think' it will be found that there was great necessity for having this security taken by the country. It might be taken for granted that the government under ordinary circumstances would be anxious to obtain all the security possible. Why has this line been divided into two sections ? Why does the government persist in refusing to take security by not retaining an interest in the western division to ensure the payment of interest on the money it is expending in building a portion of the line ? That in something I cannot understand, and I am quite sure that the government does .not realize the serious position that it will be in if it passes this Bill without including in it the amendments which have been offered.


William Rees Brock: Mr. Chairman, I am justified in discussing this matter at some little length. A few minutes ago one of the most intelligent, one of the brightest business men on the other side of the House and a gentleman of considerable importance in hi;? party, tlie lion, member for South Brant (Mr.' Ileyd), actually interrupted my hon. friend from Hamilton (Mr. Barker) and asked iny hon. friend for some information on this question. When he got his answer he said :	I wanted to know, showing that
there was something in this matter that

even that brig]it gentleman did not know. I think there are a great many hon. gentlemen, probably not quite as bright as that hon. gentleman, who also want to know, and I think there are a great many people in the country who want to know and who are seeking for information. I did a few minutes ago, hear several groans from the other side of the House, merely typical of the groans that will come from this whole country when this load is shoved uj)on it. We have had this matter discussed very carefully and with a great deal of learning by legal men on both sides of the House and I do think, that, when a business arrangement of this kind is under consideration, it is not out of the way that an ordinary business man should have a little to say in regard to it. We are dealing with a business institution. The Grand Trunk Railway Company is a business institution, a very shrewd one, and we would lave thought that the government would have joined with the opposition in its endeavour to make as good an arrangement with the Grand Trunk Railway Company as wan possible under the circumstances. Instead of doing that we find that the Grand Trunk Railway Company is being sheltered by the government and by its followers. Why should hon. gentlemen opposite be so solicit tous about making a good bargain for the Grand Trunk Railway Company and about preventing the Grand Trunk Railway from assuming responsibility to any extent? Why should there be any such anxiety to protect the Grand Trunk Railway Company ? Have these hon. gentlemen become responsible to the Grand Trunk Railway Company in such a way to prevent them from asking for better terms for the country ? All the provinces of this Dominion have come up and asked for better terms. Why should we not urge upon the government that it should try to get better terms in the interest of the country ? All we are asking by this amendment to clause 7 is that the Grand Trunk Railway Company should do what the Grand Trunk Pacific Railway Company, its own child, has promised that it will get it to do ; that is to stand behind it to the fullest possible extent in the work which it has to do. The right hon. Prime Minister led the country to believe that the Grand Trunk Railway was going to do that, that the Grand Trunk Railway was not only in it but of it, in fact, that it was the whole company. Under these circumstances I think it is most unreasonable that the government shall not insist that the Grand Trunk Railway Company shall assume some responsibility for the carrying out of this contract.
I believe the government has the verbal promise of the officials of the Grand Trunk Railway that the company will be behind the enterprise, and that it will be to its interest to back the Grand Trunk Pacific up in every way possible. This is just like going into a bank and saying that you will
back a man's note. The banker turns it up and says : Well, sign. All we ask the Grand Trunk Railway Company to do is to implement its promise. I could understand irresponsible promoters trying to evade responsibility. The eyes of the people of this country, and not only of the people of this country but the people of the old country, are upon this parliament and upon this Bill to-day. When you go into the financial circles of the old country they will investigate this matter because Sir Charles Rivers-Wil-son stated to his directors that lie was not going to make the Grand Trunk Railway Company responsible for one dollar. Yet, here it is stated that the Grand Trunk Railway Company is behind this scheme and responsible for it. Therefore, I contend it would have been better if we had had irresponsible promoters in this country to deal with because we would have known how to deal with them. I think it is an extraordinary thing that this whole discussion is allowed to proceed on this side of the House and that outside of twro hon. gentlemen connected with the government and of a question asked now and again wre have had no statement and no information from the other side of the House.
The country is calling for it. You have the majority, and you know it; and you can shove this thing through by merely saying aye. That is ail the more reason why the Prime Minister, who has such-I will not say subservient-but who has such.a loyal following, who depend so implicitly on has guidance, should be very careful that he is not misleading them. Upon him rests a great responsibility. I call upon the Minister of Justice, if he is not satisfied with this amendment, to word an amendment that will make the Grand Trunk responsible for the carrying out of the agreement the government has -made with the Grand Trunk Pacific.. The Minister of Justice can turn a corner as quickly as any man I know, and he -can -easily frame such an amendment. There are other questions, such as the freight rates which the wheat-growing country will have to pay. Notwithstanding all tine figures which that great light Which has lately been shed on the country, that great transportation expert, who -is going to haul n -train of 2,000 tons across Canada as cheaply as lie could -a train of 500 tons ; notwithstanding -all that he has said, we have to come to hard business principles in the end. If they are going to haul these trains up against -the stream, -as they are practically doing, it will have to be done at the expense of the western farmer. The man who grows the wheat has to pay tli-e shot in tli-e long run. All tlies-e questions - will'have to be considered, but in the meantime this amendment is so fair and reasonable, and so absolutely necessary, that I can hardly believe members on the other side will vote it down.

Mr. BOltDEN (Halifax). Are we not to have any answer from the government as to whether or not they accept the amendment V If they reject it, will they give the country no reason why they do reject It ? The Prime Minister laid great stress on the fact that this measure was intended to send Canadian traffic along Canadian routes. This amendment is calculated to bind, not only the Grand Trunk Pacific, but the Grand Trunk Railway to that object ; and yet we have the spectacle of the government sitting mute, and not offering one reason why this amendment should not he accepted.


The PRIME MINISTER.: I can assure my hon. friend (Mr. Borden, Halifax) that there is no discourtesy intended to him, but lie must admit that his speech in presenting the amendment contained no matter other than that.which we 'conceive has been, answered over and over again. Perhaps it is that tire answer has not convinced my hon. friend, but if lie repeats his argument and if we repeat our answer, we are no further advanced than before. If the time of the House is of any value, we have nothing to gain by repeating the same answers to the same argument. Our position is before the country, and the country will appreciate between the opposition and ourselves as to who is right and who is wrong. I speak witli no less confidence than does my hon. friend on that point, and I am qijite willing to leave the issue to those who are our judges as well as the judges of the gentlemen opposite. I protest against the idea that we should forever and forever go on repeating the same thing, and calling it argument. We have said that we do not believe that the amendment is conducive to any good effect. For the fifth time at least, the Minister of Justice stated our opinion this morning. We have stated that we depend upon the character of the road, we depend upon geography to carry out what we have in view, namely, that this road will take the Canadian trade to Canadian and not to American harbours. Let me say that 1 am surprised at the conduct of gentlemen on the other side. I am sorry to have to go over this ground again, but I do it for the last time. When the Grand Trunk Company announced last fall that their new' line was to run from North Bay through the North-west Territories, that scheme was approved by gentlemen opposite, wdio now hold up their hands in horror. They are now' not sure that the trade will go to Montreal instead of to Portland. But where would that trade have gone if tlie original scheme of the Grand Trunk had been carried out ? It could have no other outlet than Portland. And yet gentlemen on the other side now lift up their hands in holy horror because we have devised a plan whereby Canadian trade must go to Canadian harbours and not to


William Rees Brock: 
Robert Laird Borden: My right hon. friend has referred to geography. This morning he did not agree with my statement of the geography. He thought I was altogether in error when I stated that the distance from Quebec to Portland by the Grand Trunk Railway was 318 miles. My right hon. friend had evidently not considered the situation very thoroughly, or he would have investigated that question before he went into this contract. His views on that question this morning show how little consideration the government have given to the very question which I raised this morning, and which my right hon. friend has sought to. deal with'just now. He was not even aware that the distance from Quebec to Portland was only 318 miles, only 20 miles more than the distance from Montreal to Portland. My right hon. friend says that it will not be in the interest of the Grand Trunk Railway Company to take that freight to Portland instead of to Halifax and St. John. I am as ready to take direct issue with my right hon. friend with regard to that as he is with me. What is his argument ? In the first place, his argument is that the Grand Trunk Pacific Railway must have shipping .facilities at St. John and Halifax, and therefore it will be in the interest of the Grand Trunk Railway Company to send that freight to Halifax and St. John instead of to Portland. I trust that I have apprehended: rightly my hon. friend's contention in that regard. If I have misunderstood him, he will correct me as I go along. Then he refers to section 45 of the contract. What does that section say ? It says :
The company shall arrange for and provide, either by purchase, charter or otherwise, shipping connections upon both the Atlantic and Pacific oiceians. sufficient in tonnage and in number of sailings ito take care of and transport all its traffic, both inward and outward, at such ocean ports within Canada.
So that if the Grand Trunk Pacific does not send any traffic to St. John or Halifax, it need not provide any shipping facilities there; and my right hon. friend thinks that this provision is an absolute and perfect guarantee that freight shall go to Halifax and St. John instead of to Portland. Is there any answer to the point made by my bon. friend from Hamilton and by other hon. gentlemen on this side of the House, that the freight from the west can be routed, by tlie Grand Trunk Pacific to Quebec, and that when it once arrives there, the Grand Trunk Railway can take possession of it? The Grand Trunk Railway, controlling as it will, under the provisions of this contract, the entire business of the Grand Trunk Pacific, will receive the freight at Quebec. Now, this is the important point, namely, Whether it is in the interest of the Grand Trunk Railway Company, which controls the situation, to
send that freight to St. John or Halifax, or to send it to its own terminals at Portland V My right hon. friend cannot get over the difficulty, by reason of the provision in section 45, because if tlie Grand Trunk does not send freight to St. John or Halifax, it need not provide any ships there. Let us look again at the situation. The distance from' Quebec to Halifax, according to the most favourable estimate of the government, is 586 miles, and: the distance from Quebec to St. John is by one calculation 450 miles and by another 489 miles. In sending the freight to either of these ports, the Grand Trunk Pacific will nse the Intercolonial Railway from the city of Moncton. It will receive the same toll for sending it only 318 miles to Portland. It will get more than that, because when the freight is sent to St. John or Halifax, the Grand Trunk Pacific will have to divide the tolls with the,Iuter-eolonial. Under these circumstances, can it he doubted that it will be in the interest of the Grand Trunk to send the freight to Portland rather than to Halifax or St. John? We have heard no suggestion of an answer from my right bon. .friend except the suggestion 'based on the provisions of section 45 ; and, that section defeats itself, because it depends altogether on the freight sent to Halifax or St. John whether any shipping facilities will be required at those ports. Therefore you have the Grand Trunk Railway, with the option of sending the freight 318 miles over its own line' to Portland, and getting for it precisely the same toll that will be paid for carrying it 586 miles to Halifax or 489 miles to .St. John. My right Ivon, friend cannot understand under these circumstances that there, is any need whatever for inserting a provision in this contract to restrict the Grand Trunk Railway from diverting that traffic from Canadian parts. My right lion, friend has this afternoon made the first attempt to answer what lias been urged from tills side of tlie House. We have repeated, these arguments over and over again, I admit; but we have done so because there was not one syllable of answer from the other side of the House until my right lion, friend attempted to answer this afternoon ; and I venture to say that bis answer is not a very satisfactory one, after all, because It depends altogether on the provisions of section 45, which are illusory. My right Iron, friend is face to face with this condition, that tlie freight can he brought by the Grand Trunk Pacific to Quebec, and when it is once there, it can be taken possession of by tlie Grand Trunk, because that railway controls the situation. Under these circumstances, will my right hon. friend, on his reputation as a public man. say that it will not he in tlie interest of the Grand Trunk Railway to carry that freight to Portland over its own line instead of sending it over the Grand Trunk Pacific and the Intercolonial to. St. John or Halifax ?

especially in view of the fact


The PRIME MINISTER.: 
Robert Laird Borden: My right hon. friend (Rt. Hon. Sir Wilfrid Laurier) will not get rid of this difficulty by eloquent words about new Canada, and about the Grand Trunk Railway realizing that they need an all-Canadian line. It Is for the very purpose of making the Grand Trunk Railway realize that and of making it become a Canadian line that we are suggesting the adoption of this amendment. My right hon. friend (Rt. Hon. Sir Wilfrid Daurier) says that geography is too strong for anything else. If that is the case, how is it that he expects the Grand Trunk Railway, if it is not bound by any clause in this contract, to send this freight to Halifax and St. John instead of to Portland. I do not know what he means by saying that geography is too strong, unless he wishes

to emphasize the argument I made iu support of exactly the opposite view to that which he has presented. If the Grand Trunk has this freight at Quebec it can send it 318 mileis to Portland. My right hon. friend (Rt. Hon. Sir Wilfrid Laurier) thinks there is no danger of that; he thinks it will be more in the interest of the Grand Trunk to send that freight to Halifax and St. John than to Portland. Did I rightly comprehend my right hon. friend (Rt. Hon. Sir Wilfrid Laurier) ?	.


The PRIME MINISTER.: I say that the Grand Trunk, having undertaken to maintain and operate that road and to pay a rental for it, must use it, and therefore they will send traffic over it.


Robert Laird Borden: My right hon. friend has fallen once more into the same error into which half a dozen ministers of the Crown have already fallen. The Grand Trunk has not undertaken anything of the kind, because it is not a party to this contract. I am asking that the Grand Trunk Railway shall be made a party to this contract, and I moved a motion to that effect in the House yesterday. I asked that every covenant in this contract which is binding upon the Grand Trunk Pacific Railway should be made binding upon the Grand Trunk Railway as well. My right hon. friend (Rt. Hon. Sir Wilfrid Laurier) called upon his followers to vote that down, and they voted it down immediately.


The PRIME MINISTER.: The hon. gentleman said again and again that the Grand Trunk Railway Company is this company. If he takes that view then surely that settles it.


Robert Laird Borden: Mr. Chairman, I have heard some transparent things stated in the House, but really I have never heard anything so transparent as the argument my right hon. friend has just enunciated. 1 will tell you how the Grand Trunk Railway Company is really this company. Surely the right hon. gentleman has heard it stated over and over again and surely he understands it. The Grand Trunk Railway Company is to have $24,900,000 of the common stock of the Grand Trunk Pacific Railway Company ; it can elect every director, it can and will absolutely control the policy of the Grand Trunk Pacific Railway Company, while occupying the enviable position of having that railway built for it in the north-west of Canada, at no cost or obligation to itself except the obligation of guaranteeing bonds for one quarter of the cost of that road. My right hon. friend (Rt. Hon. Sir Wilfrid Laurier) does not point out one isingle stipulation in this contract from beginning to end that is binding upon the Grand Trunk Railway. My right hon. friend stands up in the House and says:	Well
you say that the two companies are the Mr. BORDEN (Halifax).
same, and therefore the Grand Trunk Railway Company must be bound by a stipulation in a. contract to which it is not a party at all. If my right hon. friend is reduced to arguments of that kind. I do not wonder that he and his colleagues sit silent when arguments are made on this question. But, Mr. Chairman, I have not yet received my answer to the question I asked a moment ago. Does my right hon. friend say or does he not say that it will be rather in the interest of the Grand Trunk to send that traffic to Portland than to St. John or Halifax ? My right hon. friend did not make himself very clear as to that point when he addressed the House a moment ago, and I would like him to state now, whether or not he thinks it, would be more in the interest of the Grand Trunk Railway Company that that traffic should go over its line to Portland than over the Grand Trunk Pacific and the Intercolonial to St. John or Halifax. Is my right hon. friend prepared to give an answer on that point now ? One should not have very much difficulty in arriving at a conclusion with regard to this. If it is more in the interest of the Grand Trunk Railway Company to send that traffic to Portland, then I say you should have some stipulation in this contract which should restrict that company from taking that course, and if it is not more in the interest of the Grand Trunk Railway to send the traffic to Portland, then I .say as this is a matter about which the hon. gentlemen in this House are somewhat divided in-opinion, it will be better to have a sufficient covenant on the part of the Grand Trunk Railway Company that it shall be sent to a Canadian port, a covenant to which the Grand Trunk Railway Com-i pany should not have the slightest objection as according to the view of my right hon. friend it would be in the interest of the. Grand Trunk Railway Company to send' that traffic to the maritime ports of Canada.
Now these are the two aspects in which you can regard this question. If it is to the interest of the Grand Trunk to send this traffic to Portland then let them be bound by some covenant in this contract, or in some supplementary contract. If it is more in their interest, according to the view of the government, to send it to St. John and Halifax-and I cannot understand how any argument to that effect can be made-then surely the Grand Trunk Railway Company should have no objection, and certainly the government, looking to the interest of this country, ought to have no objection, to insisting in the contract that that shall be done.


The PRIME MINISTER.: One word to show how inconsistent my hon. friend (Mr. Borden, Halifax) is in his arguments. He asked me if the Grand Trunk had any interest to carry freight over the Moncton line. I told him that the Grand Trunk has

covenanted to use the Moncton line, but he says the covenant is not made with the Grand Trunk Railway but with the Grand Trunk Pacific Railway Company. But in the next breath he says the Grand Trunk Railway Company controls the Grand Trunk Pacific Company. Then the two things are the same, and the government in making a covenant with one makes a covenant with the other.


The MINISTER OF CUSTOMS.: It is strange that we should have these remarks from an hon. gentleman who opposed the building of the road from Quebec to Moncton altogether. This language, detrimental to the interests of the maritime ports, comes from gentlemen who have done all in their power to prevent the road being built to Halifax. Now. I want to ask the leader of the opposition this question :	Suppose a
shipper at Edmonton effects a sale in Europe for one hundred thousand bushels of grain, and he goes to this railway company and says : I want that grain'shipped by a Canadian port under this contract-is this railway company bound to send it in that way or not ? I want to know the opinion of the hon. gentleman on this section :
It is hereby declared and agreed between the parties to this agreement that the aid herein provided for is granted by the government of Canada for the express purpose of encouraging the development of Canadian trade and the transportation of goods through Canadian channels. The company accepts the aid on these conditions, and agrees that all freight originating on the line of the railway, or its branches, not specifically routed otherwise by the shipper, shall, when destined for points in Canada. be carried entirely on Canadian territory or between Canadian inland ports

Now, this is the question I ask for information from hon. gentlemen opposite :	Do
they think there is any meaning in that clause at all ?
-and that the through-rite on export traffic from the point 'of origin to the point of destination shall at no time be greater via Canadian ports than via United States ports, and that all such traffic, not specifically routed otherwise by the shipper, shall be carried to Canadian ocean ports.
The question is this : If the wheat shipper iu Edmonton or any other point in that country has the Canadian patriotic sentiment in him, which is not interfered with by self-interest, and he says :	I want that
wheat to be shipped via a Canadian route to a Canadian port, is the railway not bound to take that wheat at precisely the same rate as if it were carried over any other route ? I want to know whether hon. gentlemen opposite think that all these shippers in the North-west will agree to send nothing through Canadian ports, but will ! prefer to ship their grain via Portland when they can do it just as cheaply over a Canadian line and to a Canadian port.


Robert Laird Borden: My hon. friend has evidently been indulging in a little slum- '*
ber recently, or he would understand that the object of this amendment is to make the very portion of the agreement which he has just read, binding not only upon the Grand Trunk Pacific, but upon the Grand Trunk Railway.


The MINISTER OF CUSTOMS.: It binds this road.


Robert Laird Borden: 1-Ie does not seem to understand that. Let me point out to the hon. gentleman what the object of the motion is. It is dealing with the very clause he mentions, but it asks that that clause shall be made binding, not only upon the Grand Trunk Pacific, but upon the Grand Trunk Railway, and upon that amendment asking that that shall be done, he will stand up in a little while in this House and vote that the clause shall not be made applicable to the Grand Trunk Railway. As this is the gentleman who, with the blood of patriotism fiercely boiling in his veins, will stand up in this House and vote that the Grand Trunk Railway Company shall be absolutely free from all restrictions upon it, I do not think I require to answer what the right hon. gentleman suggested a moment ago, that because the Grand Trunk Company control the Grand Trunk Pacific Company by holding a majority of its common stock, it is therefore, as a corporation, bound by the covenant of the latter. Surely my right hon. friend, upon his reputation as a lawyer and a public man, would not take any such position as that, yet that is virtually the position which lie expressed a moment ago when he said in effect that because the Grand Trunk held a majority of the common stock of the Grand Trunk Pacific Company it would be, ns a corporation, bound by any covenant which was made with the Grand Trunk Pacific Company.


The MINISTER OF CUSTOMS.: The hon. gentleman does not meet the point I made. A shipper goes into Edmonton with his cargo of wheat and he has a bill. He has bis shipping bill made out for that cargo of wheat to go to Liverpool via the port of St. John, or via a Canadian port, and that bill has to be accepted by the agent of the company to go through on this line ; and does the hon. gentleman mean to tell me that the Grand Trunk Railway Company j can alter that, and when the shipper has ordered that his wheat shall go in that way, does the hon. gentleman mean to say that tlie railway can send it to an America i port ? I want his answer to that plain question. He goes to the agent on this line. there1 are his instructions, and he says :	I
want it to go that way, and he bills it that way ; therefore it must go that way, and it cannot be diverted to Portland.


Robert Laird Borden: I will answer my hon. friend at eight o'clock.
At six o'clock, Committee took recess.

1202S
After Eecess.
Committee resumed at Eight o'clock.


Robert Laird Borden: Before we took recess at six o'clock my hon. friend the Minister of Customs (Hon. Mr. Paterson) was addressing some questions to me. I do not know whether I gathered very accurately the import of what the hon. gentleman desired to inquire about, but as- I understood him he asked, whether, if having regard to the 'provision contained in section 42 of the contract, a shipper going to the Grand Trunk Pacific in the west and asking that his grain should be sent by a Canadian port would not be entitled to require that that should be done.	.
The MINISTER OP' CUSTOMS. Yes, for export.


Robert Laird Borden: Certainly, he would and if he went to the Grand Trunk Pacific in the west and required that his grain should be shipped by Portland he would also be equally entitled to have it 'shipped by Portland over the Grand Trunk Railway. Let me point out to my hon. frieud what his position is necessarily in regard to that. The Grand Trunk Railway Company controls the Grand Trunk Pacific in that it appoints all its directors. The Grand Trunk Railway Company can therefore advance, or dismiss, or retard any man in the service of the Grand Trunk Pacific Railway Company in the western part of Canada, or anywhere else, and as has been pointed out before in this debate^ any serJ vant of the Grand Trunk Pacific Railway Company in the west who does not see to it that goods, as to which any shipper makes inquiry of him. are shipped to Portland and not to Halifax and St. John, will not probably be advanced very much in the service of the Grand Trunk Pacific Railway Company. My hon. friend does not seem to appreciate the fact that what we are asking in this regard is to make these very stipulations to which he has called our attention binding upon the Grand Trunk Railway Company itself, so that the officers and servants of the Grand Trunk Railway Company in the west, whom, no doubt, it will send into that country for the purpose of seeing that the traffic goes to Portland, cannot by means of this contract seek to divert Canadian traffic from Canadian, ports which they will he able to do unless we adopt this amendment which the government proposes to vote down. My hon. friend observes that the provisions of this contract are binding on the Grand Trunk Pacific Railway Company. Is my hon. friend aware that these stipulations are not binding upon the Grand Trunk R'ailway Company itself ? The right hon. leader of the government advanced the extraordinary proposition before six o'clock that this stipulation was binding upon the Grand Trunk Railway be-Mr. BORDEN (Halifax).
cause, he said, the Grand Trunk Railway holds a controlling interest in the capital stock of the Grand Trunk Pacific. It does not require a lawyer to understand that there is no force in that contention ; a com; pany that holds a majority of the capital stock of another company is not bound by the covenants and engagements of that company. Therefore, my hon. friend the Minister of Customs will see that he iias the Grand Trunk Pacific, which has no terminal in the United States, which has no direct connection in the United States, restricted by the terms of this contract, but that the Grand Trunk Railway Company, from Which all the danger is to be apprehended in the shape of the diversion of Canadian traffic to United States ports, is not bound by the stipulation in the clause to which he refers. For that reason we have asked that the government should make this stipulation binding upon the Grand, Trunk Railway Company as well as for the reasons which I cited at some length before six o'clock. I do not know whether I have answered the inquiry of my hon. friend in a manner satisfactory to himself. If he desires any other information which I am able to afford from, my standpoint, I am sure that my hon. friend knows me well enough to believe that I will give it to him as .fairly and fully as I am able to do.


The MINISTER OF CUSTOMS.: I believe my hon. friend has answered my question very fairly and fully and he has answered it in the direction, that I would have expected he would. He says that if a person desires his grain shipped through Canadian ports and so ships it this company is bound to carry it through by Canadian ports. Well now it seems to me that this question of the Grand Trunk Railway does not come in as my hon. friend says it does. There must be a management for this road. Call it the Grand Trunk Railway, or call it what you please, there must be a management ; the management of the road so constituted will be bound under this contract and thei-efore I cannot see where the view of my hon. friend comes in at all.


William Rees Brock: A management of the Grand Trunk Railway, or the Grand Trunk Pacific ?


The MINISTER OF CUSTOMS.: I do not care whether you call it the Grand Trunk Railway or the Grand Trunk Pacific, there mulst be a management of the road and whatever the management of the road may be I think the hon. gentleman will not say that it is not bound by the terms of the contract because the terms of the contract are specific on that point. It goes farther than I put it. It does not say that export freight must be specifically routed to go by Canadian ports. It says that whenever any export freight is shipped, if the shipper does not specifically route it otherwise, then

it has to go by Canadian ports. It is stronger than I put it but I put it in the way I did in order to bring- as clear an answer as that which the hon. gentleman (Mr, Borden, Halifax), gives. My hon. friend knows that it is not necessary for the shipper to .say that he desires it to be shipped by a Canadian port. If I desire to ship 10,000 bushels of wheat from Edmonton to Liverpool all I have to do is to put on my bill ' 10,000 bushels of wheat from Edmonton to Liverpool ' and that being there, the -management of this road, let it (he the Grand Trunk Railway Company or the Grand Trunk Pacific Railway Company, must carry that wheat by a Canadian port and/ it must carry it by a Canadian port as cheaply as it will carry it by a United States port. My hon. friend says that, if we leave it to the option of the Grand Trunk Pacific, the Grand Trunk Railway will divert the traffic. It is not in the power of the Grand Trunk Railway to divert the traffic. It is in a specific contract that it shall be carried by a Canadian port. If I may be permitted to say so to my hon. friend I must say that I cannot understand his position. He has more than once in the course of this debate spoken of the danger that lies before us and he has told us that we should have allowed the Grand Trunk Railway to do what it wanted to do at first and that we should even allow it to go on .vet with its original scheme.


Robert Laird Borden: Yes.


The MINISTER OF CUSTOMS.: The Grand Trunk Railway asked that it should he allowed to build from North Bay'to Winnipeg.


Robert Laird Borden: And pay for its own road.


The MINISTER OF CUSTOMS.: My hon. friend says that we should have allowed the Grand Trunk Railway to do that instead of building this line to the maritime provinces. Suppose we adopted this scheme the grain would inevitable conse down by way of North Bay. What would the company do ? There would be no road to the maritime provinces and yet hon. gentlemen have been spending hours and hours and days and days trying to arrange the thing so as to prevent the grain traffic from being diverted, when the very scheme which they propose would leave the Grand Trunk Railway no alternative than that. It would have to do that. It could not do anything else. Hon. gentlemen opposite, having condemned this eastern section, having condemned the attempt to get a line that would run direct to our ocean ports and having been defeated in the House, bring forward these amendments which are not in my opinion calculated to produce any good effect at all, but which might possibly be an obstacle to prevent this enterprise from being carried out in the attempt to accomplish their end in
another way. I do not approve of that. The principle having been confirmed by the House, I have not the slightest objection to any suggestions which hon. gentlemen opposite may offer that would be in the direction of improving the contract if it can be done in that way, but they have not offered any suggestion which has not been answered time and time again and I think it puts them in an anomalous position to maintain that we should adopt the original scheme of the Grand Trunk Railway to build from North Bay to Winnipeg and not build this eastern section at all, and then going on to Moncton when they profess to be so anxious that no grain shall possibly come down by way of North Bay, but that all must go the other way. I cannot understand that position and I am very glad that the hon. leader of the opposition has been courteous enough to answer my. question, and as I have said, it has been answered in tiie way that I expected it would be answered. It does not involve a question of patriotism on the part of a man to require that his grain shall be shipped from the North-west Territories by a Canadian port. He gets the same rate precisely whichever way it goes and it is not necessary for him to stipulate that it shall go by a Canadian port. Certainly, if he does mention it, it must go by a Canadian port and it must go at as low a figure as it will go by any American port. Can anybody suppose, that, if things are equal, the Canadian shipper, leaving the question of his being patriotic or anything else out of consideration, will order it to go through an American port, because, in order that it shall go through an American port, he must specifically route it in that way ? Is that the estimate that our friends opposite take of the spirit that animates Canadians. Surely they ought be content with decrying our country, and talking of muskegs and jack pines, without impugning the patriotic sentiment that ought to actuate the breasts of all Canadians.


Robert Laird Borden: The Minister of Customs has twice stated that I had opposed the building of a railway which would shorten the distance between Quebec, and Halifax and St. John.


The MINISTER OF CUSTOMS.: No.


Robert Laird Borden: If the hon. gentleman's remarks did not mean that, I do not know what they meant. He said I had opposed the building of a line through New Brunswick which would shorten the distance from Quebec to the maritime ports. I said nothing of the kind. I said that if after a proper survey, it should be found that the distance would be materially decreased by the building of a line through New Brunswick, I would advocate the building of that line, not for the purpose! of handing it over to the Grand Trunk Pacific, but for the purpose of retaining it

as part of the Intercolonial, to he operated by the government of Canada for the people of Canada. Let there he no misunderstanding about that. The Minister of Customs says that he sees no danger in this contract, because it is binding upon the management of these railways. I do not know what he means by that. Let me assure him, that not a lawyer in this House Will pretend that this covenant is binding upon the Grand Trunk Company.


The MINISTER OF CUSTOMS.: I think you admitted that just now.


Robert Laird Borden: I seem to have il great deal of difficulty in making myself clear to my hon. friend. The curious part of the situation is, that while the Grand Trunk Railway Company, by virtue of this contract absolutely controls the policy of the Grand Trunk Pacific and the appointment or dismissal of the servants of that company, nevertheless it is in no way bound by this contract, for the simple reason that it is not a party to it. Does the Minister of Customs understand that? If he controverts that proposition, he will get no support from the Minister of Justice.


The MINISTER OF CUSTOMS.: I understood the hon. gentleman to say in reply to me, that the officers of the company would be bound to route freight as required. He says that this road is going to pass under the Grand Trunk management ; is it not inconsistent for him to sqy that the Grand Trunk management can depart from the stipulation ?


Robert Laird Borden: My hon. friend has not got the situation into his mind yet. I will try to make it so plain that even a wayfaring man may understand. The Grand Trunk Pacific Railway Company will have its officers and agents in the west. If any shipper goes to any of these agents, the agent must obey his directions as to the shipment; but that does not prevent the Grand Trunk Railway Company from having its own servants in the west with instructions to divert that traffic from Canadian ports to Portland, in so far as it is within their power. There is not a syllable in this contract which would prevent the Grand Trunk from doing that. These servants of the Grand Trunk Pacific could be promoted or degraded in the service of the company, just as the Grand Trunk Railway Company of Canada wills. These servants would soon learn that it was in the interest of the Grand Trunk to have goods shipped to a particular point, and that they had better use their influence in a quiet way to have that done. But outside of that altogether, the Grand Trunk Railway Company of Canada could have its own officers and servants in the west for the purpose of diverting this traffic. Now, coming further east; suppose a portion of that traffic reached North Bay or Gravenhurst, the Mr. BORDEN (Halifax).
Grand Trunk could take possession of it and carry it to Portland without interfering with a single stipulation in this contract. And suppose that traffic reached Quebec in the winter months ; the Grand Trunk Pacific would have discharged every obligation under this contract by taking it to Quebec, and the Grand Trunk having their terminals at Portland only 318 miles away, could take that traffic to Portland, and not one single line of this contract would be contravened, because there is no stipulation that binds the Grand Trunk in this regard. It is no use to say that the management of the company is bound. You cannot bind one corporation, simply because the directors of that corporation happen to be directors of the corporation which binds itself under a contract. There is no dispute about that among lawyers, and although the Minister of Customs is not a lawyer, upon a moment's reflection he will understand it, because he is a clear headed business man. That is the situation we are trying to guard against by this amendment which the Min-ter of Customs thinks is unimportant and unnecessary. It is not unimportant and it is not unnecessary in the interests of the maritime ports for which I am speaking.


The MINISTER OF CUSTOMS.: I think I really do understand the meaning of the hon. gentleman (Mr. Borden), and as he has a much keener intellect than I have, though I may not state my case as plainly, perhaps he will be able in turn to comprehend my meaning. The hon. gentleman (Mr. Borden) has darkened counsel with words. He admits all I have said, but his argument is that the Grand Trunk will have their officers-				
Mr.	HEYD.	What	does lie	mean by
' their	officers '			
Mr.	DAVIS.	They	are going	to have a
whole army of officials in the west.


Charles Bernhard Heyd: Will they be under the direction of the Grand Trunk or the Grand Trunk Pacific ?


The MINISTER OF CUSTOMS.: The Grand Trunk Pacific, I presume.


Robert Laird Borden: Not at all.


The MINISTER OF CUSTOMS.: I suppose this road will be worked by the Grand Trunk Pacific, and whatever officers may be there will be officers of that company.


Charles Bernhard Heyd: That is what we would infer.


Robert Laird Borden: You are not to infer that from me at all.


The MINISTER OF CUSTOMS.: The argument made by the leader of the opposition, was also made by the member from Hamilton (Mr. Barker). Speaking with all due respect, I thought it was not a strong argument. The argument of the hon. lead-

er of the opposition is this, that the company will appoint all the staff on this road, and will hint to them to violate the covenant which they have made which provides :
The company further agrees that it shall not, In any matter within its power, directly or indirectly advise or encourage the transportation of such freight by routes other than those above provided, but shall, in all respects, in good faith, use its utmost endeavours to fulfil the conditions upon which public aid is granted, namely,-the development of trade through Canadian channels and Canadian ocean ports.
The hon. gentleman suggests that there will be bad faith in the management of that great road, and that despite this solemn covenant, they will employ a staff of men to whom they will quietly hint : You are not to use your endeavours to direct the traffic to Canadian ports, but if you want a chance for promotion, you will violate what we have agreed to do. It seems to me that is going a long way to conjure up some danger.


Samuel Barker: Will the hon. gentleman allow me to ask him a question? The hon. gentleman says ' we ' have covenanted that we will do so and so. Whom does he mean by ' we ' ?
The	MINISTER	OP	CUSTOMS.	The
Grand Trunk Pacific, of course.


Samuel Barker: Let me ask him another question. Whose	servants will these be
who will route the traffic after this road is in operation ?
The	MINISTER	OP	CUSTOMS.	The
Grand Trunk Pacific, of course.


Samuel Barker: Not a bit of it ; they will be the servants of the Grand Trunk Railway.
The	MINISTER	OP	CUSTOMS.	They
will be the servants of the Grand Trunk Pacific, of course, or of whomsoever may be in the management of that road. I think I understand clearly the position of the hon. leader of the opposition. He admits jhat traffic which is not specifically l'outed through American ports must go through Canadian ports. Much more surely must it go through Canadian ports if it is specifically routed that way. But he says there is this danger, that the Grand Trunk will by some means get men in the management of the road over whom they will have control, that these will engage men to whom they will intimate that they are to pay no attention to this contract, but are to violate what has been agreed upon, and that the road to preferment is in that direction. Well, I have not taken that position in reference to this matter, and I am very glad that I am not forced to take that position, nor to see the danger which the hon. gentleman sees. But let me repeat again, it is rather humorous-I will not say farcical, although that term has been used on the other side of the House-to see an opposition that opposes altogether, the building of tills 377
eastern division, which does lead to our maritime ports, and will give some chance for the grain to go there, rising in all their solicitude for the maritime ports, and in the same debate telling us that the proper course for Canada to have pursued was to take the original plan of the Grand Trunk to build by North Bay, and bring all the freight down that way. Now they want an amendment adopted to prevent some of the grain coming down by North Bay, although by their own proposition all of it was to go there. It is rather a humorous situation, and if hon. gentlemen on this side of the House have not replied to hon. gentlemen opposite on this point, it has been because it was already dealt with very fully and very clearly, and not through any lack of courtesy to them.


Robert Laird Borden: Will the hon. gentleman tell us in what way this amendment accomplishes the result he mentioned, that is, the transportation via North Bay ?


The MINISTER OF CUSTOMS.: I did .not say it was the amendment. I say that the plan advocated by the hon. member for Centre Toronto and others who have spoken was to take the original proposition of the Grand Trunk and build from North Bay to Winnipeg, and not build the eastern division at all.


Robert Laird Borden: I thought the hon. gentleman was talking about the amendment. It is that which is before the House.


The MINISTER OF CUSTOMS.: No ; I think I made myself very clear.


Robert Laird Borden: Does he say the amendment accomplishes that result ?


The MINISTER OF CUSTOMS.: I did not say so.


Robert Laird Borden: Does he say so now ?


The MINISTER OF CUSTOMS.: I say what I did say.


Robert Laird Borden: Has the hon. gentleman any opinion on the subject ?


The MINISTER OF CUSTOMS.: Yes, I rather think at present that I will vote against the amendment. My opinion is so adverse to it that I think I will cast my vote against it, and for a very good reason. I have not heard any argument yet from hon. gentlemen opposite to make me think otherwise. The hon. gentleman is trying, by a little side issue, to make out that I was speaking of his amendment. I think every other hon. gentleman who heard me knew that I was alluding to the original proposition which was mentioned by the hon. member for Centre Toronto, who said he was opposed to the construction of the eastern division as proposed in the contract. I trust I have made myself clear to the hon. gentleman.


Robert Laird Borden: I certainly apologize to my hon. friend if I misunderstood him in any way. I gave his remarks exactly as I comprehended them. I under stand'that my hon. friend regards the provisions of the contract t-o which he has referred as very important, namely that ' the company accepts the aid on these conditions, and agrees that all freight originating-on the line of railway, or its branches, not specifically routed otherwise by the shipper, shall when destined for points in Canada, he carried entirely on Canadian territory,' and ' that the through-rate on export traffic from the point of origin to the point of destination shall at no time be greater via Canadian ports than via the United States ports,' and that ' the company will in all respects, in good faith, use its utmost endeavours to fulfil the conditions and to develop trade through Canadian channels and Canadian ocean ports.' 1 think I am correct in saying that my hon. friend attaches a great deal of importance to these provisions ?


The MINISTER OF CUSTOMS.: I do.


Robert Laird Borden: Well, I would like to point out to my hon. friend that all this amendment does is this :[DOT] It provides that:
The Grand Trunk Railway Company of Canada shall not, in any matter within its power, directly or indirectly permit, advise or encourage the transportation of traffic by routes or at rates other than as provided in the said agreement, and shall in all respects and in good faith use its utmost endeavours to fulfil the conditions upon which public aid is granted and accepted, namely, the development of trade through Canadian channels and through Canadian ocean ports.
My hon. friend, perhaps, has not observed closely the provisions of the amendment. It comprises exactly the provisions to which he attaches so much importance. Why does he regard them of importance when applied to the Grand Trunk Pacific Railway, and absolutely of no importance when applied to the Grand Trunk Railway, which has its terminal in Portland and has every inducement to take its traffic to that port ?


The MINISTER OF CUSTOMS.: I shall answer my hon. friend. There must be a management of this road which will be bound by the terms of the contract, and I care not what that management may be. But my objection is this, that hon. gentlemen opposite, whose aim it is to defeat this measure, are striving, in default of being able to do so, to obstruct its passage in every possible way. Their amendments are simply intended to cause delay. I can see no advantage, no additional safety, in what they propose, but I can see cause for delay in the construction of the work ; and as I consider the contract perfectly satisfactory in its present shape, I can see no reason why it should not go through. I hope I have made my objection plain.


Hon. Mr. PATERSON.: 


Robert Laird Borden: Not by any means. Would my hon. friend be good enough to explain why a covenant with the Grand Trunk Railway would delay the construction of the work ?


The MINISTER OF CUSTOMS.: I suppose the Grand Trunk Railway would have to be consulted.


Samuel Barker: When I entered the House a few minutes ago, my hou. friend the Minister of Customs was amusing himself and the House by a reference to the employees of the Grand Trunk Pacific Railway. He seemed to think that they would be an independent body altogether, absolutely free from the influence of the Grand Trunk Railway, and bound to carry out the covenants of the Grand Trunk Pacific Railway. That is theoretically quite correct, but I shall be very pleased to give the hon. gentleman some information how that works out practically and I can give him a parallel case in every particular.


The MINISTER OF CUSTOMS.: You admit that I am theoretically correct.


Samuel Barker: Yes, but an ounce of fact is worth a ton of your theories. The Grand Trunk Railway is going to guarantee some bonds on this Grand Trunk Pacific Railway road, and is going to have a majority of the stock and control the hoard. The hon. gentleman thinks that the Grand Trunk Railway will not be the masters of the employees on that road. Let me point him to another case, to show him how that will work out. The Grand Trunk Railway guaranteed by traffic arrangement the bonds of the Chicago and the Grand Trunk Railway. The Chicago and Grand Trunk was under a distinct charter, just as distinct as that of the Grand Trunk Pacific Railway. It had a distinct board, but that board was composed partly of Gi-and Trunk Railway officials and directors. It had some independent directors, and was worked under an independent charter. In fact it had a charter from two different states. Yet in the practical operation the general manager of the Chicago and Grand Trunk Railway was appointed by the general manager of the Grand Trunk Railway. Not merely the station agents but the general manager and the traffic manager and every officer of the departments was appointed by the general manager of the Grand Trunk Railway, and every large transaction of the Chicago and Grand Trunk was reported directly to the Grand Trunk Railway at Montreal. It will be just the same with the Grand Trunk Pacific Railway.


The MINISTER OF CUSTOMS.: Were they able to violate their agreement ?


Samuel Barker: They did not violate agreements. They did what they thought was in the interests of their employers. The Chicago and Grand Trunk Railway gen-

eral manager, Mr. Spicer, was appointed by the general manager of the Grand Trunk Railway. He reported to the general manager of the Grand Trunk Railway. Of course, he sent in official reports'to his board, but the business was done in accord with the manager of the Grand Trunk hour by hour and day by day. In every considerable transaction he was in communication with the office at Montreal, and that gentleman's officers dared not make an important freight or other contract against the wishes of the general manager of the Grand Trunk Railway at Montreal.


The MINISTER OF CUSTOMS.: Where is the parallel ? Does the hon. gentleman mean to say that this management can violate this agreement without any legal recourse on the part of the government or the shippers ?


Samuel Barker: The hon. gentleman asked whether the employees of the Grand Trunk Pacific Railway will be the employees virtually of the Grand Trunk Railway. That is what I asserted, and what he denied.


The MINISTER OF CUSTOMS.: Supposing they are, can they violate this contract ?


Samuel Barker: They need not openly violate it.


The MINISTER OF CUSTOMS.: Give an answer as a lawyer.


Samuel Barker: I explained that before, and the hon. gentleman knows it very well ; but there seem to be other gentlemen who do not. When a shipper comes to a station agent on the Grand Trunk Pacific Railway, that agent will not say to him that the company is under obligation to send freight to Halifax or St. John. If the shipper happens to say that he wants to send it to Halifax or St. John, the agent will say, for instance, certainly you can ; there will be a steamer there next week, there will be an earlier one at Portland.


Charles Bernhard Heyd: But suppose the shipper says nothing ?


Samuel Barker: Then it will go just where the agent wants, and that will be to Portland.


The MINISTER OF CUSTOMS.: My hon. friend has now got on to another quibble. He says that the agent will tell the shipper that he can send the freight to Halifax or St. John, and there will be a steamer there the next week. But is he not aware of a clause of the contract which provides :
The company shall arrange for and provide, either by purchase, charter or otherwise, shipping connections upon both the Atlantic and Pacific oceans, sufficient in tonnage and In number of isallings to take care of and (transport all its traffic, both inward and outward, at such ocean ports within Canada, upon the said line of railway, or upon the dine of the Intercolonial Railway, as may be agreed upon from time to 3774
time, and the company shall not divert, or, so far as it can lawfully prevent permit to be diverted, to ports outside of Canada any traffic which it can lawfully influence or control, upon the ground that there is not a sufficient amount of shipping to transport such traffic from or to such Canadian ocean ports.
Yet he talks about the agent saying to this man :	You can ship by Halifax, but
there will be no steamer there for a week, and that is the hon. and legal gentleman who undertakes to dispose of a layman's criticism of the contract. I would prefer to take my judgment of it than his.


Samuel Barker: What is the hon. gentleman's objection ? We are providing that the Grand Trunk Railway shall be bound to do what he says the Grand Trunk Pacific Railway are going to do ?


The MINISTER OF CUSTOMS.: As I said before the objection I have to these amendments is that when we have here a contract, the best ever made In this country


Some hon. MEMBERS: Oh, oh.


The MINISTER OF CUSTOMS.: Yes. I repeat it, when we see hon. gentlemen opposite doing their best to destroy this scheme, to vote it down, and introducing amendments, I cannot help thinking-although I do not want to be uncharitable-that their object is to prevent or delay the progress of this great work.


Edmund Boyd Osler: The childlike simplicity and faith of the Minister of Customs is something that is absolutely refreshing. Here is a man who throughout his political life lias denounced corporations ; since I have come into the House I have head him denounce them ; he has no faith in railways or their pledges, now in Indignant tones, in the old fashioned thunder, he says : You have dared to doubt the faith of this railway baby of ours ! Why it is heresy to think that the men who have given their word in this bargain will not carry out their contract absolutely to the letter. He is so sensitive iu regard to the honour of these men that he absolutely refuses to have them bound by pen and Ink and paper, he will not have it, it would be an insult to tilts grand corporation, to the Grand Trunk Pacific and the Grand Trunk Railway, to doubt for a moment that they will not for all time, carry out the spirit of their contract. He tries to draw red herrings across the path and says that every one hailed with delight the prospect of the entrance of the Grand Trunk into Manitoba. We all bailed that with pleasure. We thought it would be to the advantage of Canada, of Ontario and of the North-west that the Grand Trunk should get an entrance into the North-west Territories and when the Grand Trunk proposed to build from North Bay to the west, when they were asking government aid which they always thought might, to a certain extent, be given to them, every man on this

side of the House agreed that it was a good thing to do. The government has seen lit to grant to the Grand Trunk Pacific aid to an enormous extent and to extend the road to the east. The only object of hon. gentlemen on this side of the House is to endeavour to secure a guarantee that the Grand Trunk Pacific whose childlike simplicity the hon. Minister of Customs so loudly proclaims, are going to carry out a verbal agreement. The Grand Trunk Railway are not bound by this agreement.
Mr. I1EYD. Why should the Canadian Pacific Railway also enter into this agreement ?


Edmund Boyd Osler: What has the Canadian Pacific Railway to do with it ?


Charles Bernhard Heyd: Why cannot they get control of the officers of this railway and divert traffic over the Canadian Pacific Railway just as well as the Grand Trunk Railway can V


Edmund Boyd Osler: Now I did give credit to the hon. member for South Brant for having some business sense. He asks, why does not the Canadian Pacific Railway get possession of this road, get control of the rates.


Charles Bernhard Heyd: I did not say that.


Edmund Boyd Osler: They do not pay the employees.


Charles Bernhard Heyd: Why could they not get control of the officials and have the traffic diverted over the Canadian Pacific Railway as well as the Grand Trunk Railway can do it ?


Edmund Boyd Osler: The Grand Trunk Railway are getting the stock of this road for nothing.


Charles Bernhard Heyd: That does not affect the question.


Edmund Boyd Osler: Well the question is too silly to answer. The New York Central Railway to-day, in this way and in this way only, owns the Canada Southern Railway, the Michigan Central Railway and the West Shore Railway.


Charles Bernhard Heyd: What has that to do with this agreement ?


Edmund Boyd Osler: It is exactly similar to it, because they entirely control the employees. The Grand Trunk Railway Company are the men who will appoint the officials of the Grand Trunk Pacific and will pay them and they will control every ounce of business originating on the whole of this road through these employees. Suppose a shipper in Edmonton wants to send grain to England. He goes to the agent in Edmonton and gets a rate, we will say the same rate to Portland as to St. John. The agent at Edmonton says : We have the same rate to St. John, but it will be a day shorter going
to Portland as there are better shipping facilities there. The hon. Minister of Customs (Mr. Paterson) is business man enough to know exactly what would happen and what will happen. It is the direct interest of the Grand Trunk Railway to send all of this traffic to Portland, because they get the same rate for hauling it practically the same distance from Quebec, but by taking it to Portland they get the whole of the terminal charges and in the other case they have to divide with the Intercolonial Kailway the proportion of the rate on 186 miles to Halifax and on something like 89 miles to St. John. Now it is not in human nature, it is not in business nature, not to take that advantage and every bushel of grain, every consignment of freight will go to Portland and not to St. John or Halifax unless the shipper distinctly says : I want this sent by such and such a port. Well, now the shipper is not a fool. He will take the route that the agent advises him to take. He will take the route where he can get the quickest service, where he is certain of vessels and of having the grain delivered promptly. The Grand Trunk Railway can delay a shipment if it goes to Halifax, and there is nothing in this contract that will impose a penalty on them for doing so. It is to their interest to send this grain to Portland if it originates at Edmonton andl they will send it to Portland without any doubt. Further, we believe, I personally believe, that it is the interest of the Grand Trunk Railway when that grain gets to Winnipeg in the winter time to send it via Chicago, because, as a matter of fact, the Grand Trunk Railway Company have within a comparatively few miles a connection from Chicago to Winnipeg. They own the line to Chicago and practically control the line up to Minneapolis and they can very easily make an arrangement with one of the roads there because there are spare roads from St. Paul to Winnipeg. I believe the grain and the trade will come that way because the Grand Trunk Railway now work in close connection with the Great Northern Railway and ship very largely to the British Columbia coast over the Great Northern.


John Charlton: Has my hon. friend with him the mileage of the connection between Winnipeg and Portland via Chicago, the Grand: Trunk Railway from Chicago to Port Huron and from Port Huron to Portland ?


Edmund Boyd Osler: No, I have not that.


John Charlton: I venture to say that if he would give the mileage It would be sufficient to disprove his statements.


Edmund Boyd Osler: I say the shipment of freight is being made to-day in that way from Ontario, via Chicago by the Great Northern Railway out to the Pacific coast notwithstanding your mileage. That is being done to-day to a considerable extent, and I


Edmund Boyd Osler: say that the danger is that when the Grand Trunk Railway get to North Bay, as I hope they will, they will not send any freight over the Grand Trunk Pacific. Now the point that we make, and X think it has not been disputed at all, is that the government have practically no security whatever that the Grand Trunk Railway will operate the eastern section of the line If It will pay them to give it up. The government have a second mortgage on $5,000,000 worth of rolling stock upon which there is also a first mortgage of $5,000,000. That is the only security except what is practically a note of hand that will take rank after all the other securities and which we all know will never be enforced. Now what we contend is that the government are in duty bound, if they go into this expenditure, to make the security for the operation of the eastern section as strong as it can be. We contend that the government should have the security upon the western section. I believe that the western section will be to the Grand Trunk Railway or any railway that builds or operates it a very paying proposition. Why should the government build and own and have the responsibility of the eastern section which some of us think will not pay ?
Why should the government build that and take the responsibility of it, why should they not take control over the section which will pay to an enormous extent on the prairies ? The Minister of Customs answers that by saying: The Grand Trunk won't do it, we cannot alter the contract. I am sure the Minister of Customs is right, the Grand Trunk will not come under any such obligations. They will not admit the liability under the contract of the cost of operating and paying interest on the eastern section. If this road is to be built for the benefit of Canada throughout, we ought to have all the safeguards possible, we ought to bind the Grand Trunk as tightly as we can, so that it will operate the eastern section, bad as the bargain is. so that they will send all the produce of the west over that road. We contend, and the argument has not been refuted, that the government are taking no security whatever, and that the Grand Trunk Railway is not under any obligation to pay the rent and operate that road, but that it will pay them better to drop it at Winnipeg after they get the prairie section built. Now, the whole question is very much on a par with the man who is doing business in his wife's name. The Grand Trunk Pacific is the wife of, the Grand Trunk Railway Company, and the Grand Trunk Railway Company is not liable for the debts of the Grand Trunk Pacific; the Grand Trunk is simply doing business, and is obtaining all this advantage from the Dominion government without, as we contend, giving any satisfactory security that they on their part will carry out their bargain. The government, instead of trying to
strengthen their agreement iu every possible way, simply say: We have made these arrangements and we are not going to change them. Why? Solely because we have got the Grand Trunk Railway Company to go, in this matter of a guarantee, as far as they will go. The Grand Trunk know perfectly well what are the risks of undertaking to operate this road in the north, and making their connections with Quebec, with Montreal, with Toronto. They know perfectly well that if they should go as far as Quebec, it will pay them better to send all their stuff from Quebec to Portland-because they then get the whole of the earnings upon it-rather than send it to Halifax or St. John. Now, the opposition are arguing, not against this road, but that if you go into an expenditure of $100,000,000 or $150,000,000, every safeguard possible should be taken to secure trade for our own Canadian ports. That is our contention, and it has not been refuted, except by the very childlike simplicity of the arguments of the Minister of Customs who believes in the promises of the railway. We have nothing whatever to rely upon, we have no other security. Now, when the railway men were being examined before the Interstate Commission, one gentleman gave evidence which was significant. I think he exaggerated a little, at all events, he was speaking of American railways. He said that, taking all these men who owned railways and controlled them, individually he would believe any word that they said, he would take the word of any one of them for all they were worth in any transaction; but take them collectively as a railway corporation he would not trust them unless they were under seal, and under such control that the state courts could make them do it. Now I do not go so far as that, but I say that the Minister of Customs knows what human nature is, and he knows that whatever patriotism the Grand Trunk people may have now, whatever patriotism he may have, if he is shipping large quantities of stuff, he will send it by the way that suits him best. I say that now is the only time for the government to make such conditions and stipulations in this contract as will, as far as possible, ensure the building up of our own maritime province ports of St. John and Halifax, and possibly other ports that may be opened up. But if he allows this contract to go as it is now, he has no security whatever that these shipments wifi go through Canadian ports. Clause 45, which the Minister of Customs has so strongly emphasized, says:
The company shall arrange for and provide, either by purchase, charter or otherwise.
Now, ' otherwise ' covers a great variety of ways, they may charter from time to time vessels to carry their stuff; they know beforehand what stuff they will send there, and they may divert it to Portland just as easily as they could send it to St. John or

to Halifax. But they will earn more on their money if they send the freight by Portland, and the Minister of Customs does not for a moment believe that it is a business proposition to say that these men, in their present contract, have said that they will always be patriotic and send their freight to a port in Canada, when in five years not one of these men may be in control of the Grand Trunk or of the Grand Trunk Pacific, and it will be to the interest of that road to send all their stuff to Portland, as under this contract I am perfectly certain they will do.


Mr. LOGAN.: It is very refreshing to hear the director of a railway corporation charging the Minister of Customs with childlike simplicity because he believes the word of a railway corporation. The hon. gentleman no doubt knows whereof he speaks. I have more faith in the Canadian Pacific Railway Company, even than he would lead us to believe they deserve. Now, Mr. Chairman, it is also refreshing to hear our friends opposite become so zealous about the ports of the maritime provinces. Why, the echoes of their voices have scarcely ceased ringing in this chamber when they derided the very idea of building from Quebec to Moncton. Why, Sir, the soul of my hon. friend from Centre Toronto (Mr. Osier) burned with indignation at the idea of squandering the money of this country upon a road from Quebec to Moncton. His opinion was seconded by nearly every member on that side of the House, particularly by the member for Hamilton (Mr. Barker). If it is a waste of money to build this road from Quebec to Moncton, what are we to think of the efforts of the hon. gentlemen when they talked about ruining the Intercolonial by the construction of this new road? We said to them: We want to build this road from Quebec to Moncton because it will shorten the distance first, and secondly, because it will give the Grand Trunk Pacific an interest in the maritime provinces, which will be a strong inducement for them to use the ports in the maritime provinces. But the hon. gentlemen opposite tabooed this idea, and said we must use the Intercolonial. Well, their conversion has not come any too soon. They know they have got to face the electorate within the next two years on this question, and it is about time that they should begin to be converted. The only government of the Conservative party that is appealing for the support of the electors of any part of Canada on this question, is the Conservative government of British Columbia, and they are supporting the Grand Trunk Pacific scheme, and I would not be surprised if these hon. gentlemen opposite, when they come to face the electors, are also foundl supporting this Grand Trunk Pacific as one of the greatest schemes ever undertaken for the benefit of Canada.


Edmund Boyd Osler: Now, what is all this tempest in the teapot about? The hon. leader of the opposition desired that we should force the Grand Trunk Railway Company to route its freight by Canadian ports. If the Grand Trunk Railway and the Grand Trunk Pacific are one and the same institution, then, it will not be in the interest of the Grand Trunk Railway to divert the freight from the Grand Trunk) Pacific Railway. If, for instance, a shipment of grain is at Edmonton to be shipped to Liverpool and if the Grand Trunk Railway and the Grand Trunk Pacific are the same institution why should the Grand Trunk Railway have an official there to divert the trade from the Grand Trunk Pacific to some connection down by way of Chicago or North Bay to Portland ? If they are the same institution is it not in the interest of the Grand Trunk Railway that freight should travel over the Grand Trunk Pacific to the city of Moncton ? The only advantage, admitting that they are the same institution, that would accrue to the Grand Trunk Railway from diverting the trade to Portland would be that they would get a haul of 400 miles farther between Quebec and Portland than between Quebec and St. John. In other words hon. gentlemen contend that they are going to keep an army of servants and officials in the North-west Territories to go round amongst shippers and endeavour to divert the trade of that country to Portland for the purpose of getting the advantage of 100 miles of a haul from Quebec to Portland.


Mr. CAMPBELL.: In violation of their agreement.


Hance James Logan: In practical violation of their agreement.


Robert Laird Borden: Whose agreement ?


Hance James Logan: In practical violation of their agreement if they are one and the same institution. If they are not the same institution, if they are distinct institutions, why should we force the Grand Trunk Pacific any more than, we force the Canadian Pacific or the Canadian Northern Railway ? For instance, if they are to be distinct institutions this case might arise : A man has a shipment of grain at Edmonton. A Grand Trunk Railway official comes along to him and says :	I want you to ship this grain
via the Grand Trunk to Portland. We will give you a lower rate if you will do so. What is going to prevent the Canadian Pacific Railway from coming along and say- [DOT] ing : If you will ship your grain from this point to the first junction with the Canadian Pacific Railway and thence by our line to Montreal, we will give you a lesser rate ?
If we are going to bind one company why not bind another company, if they are to be distinct institutions ? It seems to me that this is not a fair prop<r ition and will not

commend itself to the country. I am sure that the country -will be glad at last to know that these hon. gentlemen have become so zealous in defence of the maritime province ports, that, after fighting a proposition to build a line from Quebec to Moncton tooth and nail, they now come down and say : We must force this Grand Trunk Railway to ship their goods to Moncton because we are afraid, forsooth that they are going to keep a whole army of officials in the North-west to go round amongst the farmers and shippers of grain and try to seduce them away from their loyalty to their own country and send their goods by American ports.


Mr. FOWLER.: The hon. gentleman who has just taken his seat (Mr. Logan) aska if an army of officials is going to be employed by the Grand Trunk Railway to go around amongst the farmers and shippers of the North-west to seduce them, as he puts it, to ship their goods by American ports. It is not necessary for these officials to go around amongst the farmers because the farmers, when routing their grain, come to the officials and the officials do not go to the farmers.


Hance James Logan: Come to what officials V


George William Fowler: Come to the Grand Trunk Railway station agents to ship their goods.


Hance James Logan: What officials will they come to-the Grand Trunk Railway or the Grand Trunk Pacific ?


George William Fowler: They will interview the Grand Trunk Pacific officials appointed and controlled by the Grand Trunk Railway.


Hance James Logan: I do not care who controls or appoints them. They are Grand Trunk Pacific agents and if they influence a man to ship his goods by American ports they are violating this agreement.


George William Fowler: The hon. gentleman says that he cares not who has the appointing of these officials. It makes a very considerable difference as to whether they are appointed and controlled by the Grand Trunk, Pacific or by the Grand Trunk Railway Company, because it makes a difference as to whose orders they will obey, whether they will obey the orders of the Grand Trunk Railway or the Grand Trunk Pacific which is only the shadow of the Grand Trunk Railway.


Hance James Logan: The argument of the hon. gentleman opposite is that these Grand Trunk Pacific officials will desire to divert the trade to the Grand Trunk Railway. Suppose they acted in accordance with that desire, would it not be a violation of the express terms of this contract ? It makes no difference who appoints them so long as they are officers of the Grand Trunk Pacific Railway.


George William Fowler: Well, now, I gave my hon. friend credit for far more astuteness than that. It is a simple matter to evade a thing of that sort. A little hint dropped into the ear of a shipper of grain will ac' complish the purpose they have in view without doing anything that will lay them open to the charge of having violated the contract. The hon. gentleman has made a statement that it is very refreshing to see hon. members who opposed the building of this eastern division of the line now endeavouring to have it fixed in the contract that all the freight should go by that eastern division. AVhy should the hon. gentleman be surprised ? If the government has determined upon its mad course, if it has determined to discard the Intercolonial Railway, it is the duty of this opposition and of every hon. member in this House to do his best to see that the interests of the country are protected and that the interests of the people who have to pay for this $100,000,000 are safeguarded.


Hance James Logan: May I ask the hon. gentleman if he is opposed to the building of this short line between Moncton and Quebec.


George William Fowler: I am not afraid to answer the question. I come from the maritime provinces and I propose to try for re-election in the province to which I belong. I say here and now that I am opposed to the building of this eastern division and that I am prepared to defend the position that I have taken upon any platform in my own province. I would be only too happy to have the hon. gentleman come into my county and oppose me on the stump.


Hance James Logan: Come into mine. I have a better county.


George William Fowler: The hon. gentleman's friends have been so kind to me as to give me another county and my constituency has been made so large that it will probably take me most of my time to attend to it.


An hon. MEMBER.: I think so.


George William Fowler: Very well : we will see what the results will be. The hon. gentleman (Mr. Logan) said that only one Conservative government, the government of British Columbia, had appealed to the people since the Grand Trunk Pacific scheme was proposed, and he said that the government of British Columbia were in favour of it. The hon. gentleman cannot show a single utterance by any public man on the Conservative side in British Columbia, favouring the government scheme, since the leader of the opposition made his proposal.


Mr. MACPHERSON.: If the reports in the Liberal and Conservative newspapers alike are correct, the Prime Minister of British Columbia favour's the building of the Grand Trunk Pacific.


George William Fowler: That is not the point. I say that since the leader of the opposition laid down his proposal, there cannot be found the utterance of any Conservative public man in British Codumbia, favouring the government scheme as against the scheme of the leader of the opposition.


Robert George Macpherson: At the opening of the campaign in New Westminster one week ago, the ' Daily Columbian ' reports Premier MacBride as saying, that the province of British Columbia was now getting the Grand Trunk Pacific without it costing the province anything, and he is claiming credit to himself for that.


George William Fowler: What has that to do with it ?
Some lion. MEMBERS. Oh.


George William Fowler: Just wait a moment please. These gentlemen opposite have had a very hard day of it, and they are anxious for a chance to laugh, just as a drowning man catches at a straw. They will find that this is a very weak straw for them. The hon. member says that Premier MacBride endorsed the building of the Grand Trunk Pacific through British Columbia, but is not the building of that western division of the Grand Trunk Pacific entirely in accord with a proposition of the leader of the opposition ? What we are talking about here is the building of the eastern division, and I defy my hon. friend (Mr. Macphersou) to point to any utterance of Premier MacBride or any other Conservative, favouring that. Let me deal with the hon. member for Cumberland (Mr. Logan).


Thomas Osborne Davis: Now you'll catch it.


George William Fowler: Is the hon. member for Saskatchewan asking a question ?


Thomas Osborne Davis: No.


George William Fowler: Then you had better hold your tongue, and keep still. Let me tell the hon. member for Cumberland, that the only Conservative government which has appealed to the people since the Grand Trunk Pacific scheme has been launched, is the Conservative government of Manitoba, and the Prime Minister of Manitoba denounced this scheme, and his party were so triumphant that the opposition were practically swept out of existence. I need not say that so far as the eastern division is concerned, the province of Manitoba is more deeply interested in it than the province of British Columbia can possibly be.


Hance James Logan: The Manitoba elections were held before the leader of the opposition announced his scheme.


George William Fowler: And since then, the people of Manitoba are still more in favour of the alternate scheme. The hon. member iMr. Logan) has spoken of a union between Mr. MACPHERSON.
the Grand Trunk Railway and the Grand Trunk Pacific. Yes ; there is a very close union between these two companies, but there is also a very wide separation between them. Wherever any benefit is to be got out of the country these two companies are one and indivisable, but where-ever there is any responsibility to be borne they are as far asunder as the poles. United they are, for benefits ; separated when it comes to share responsibility. That is what we object to. The Grand Trunk Railway Company has not hitherto proven itself much of a friend to Canada, and if it is to reap all these benefits which the government seem anxious to shower on it, let it assume the responsibilities and obligations which should accompany such benefits. I cannot understand why gentlemen opposite refuse to impose these obligations on the Grand Trunk. Do they fear the Grand Trunk ? Are they under the control of the Grand Trunk ? Has the Grand Trunk such influence over the government that the government is afraid to impose obligations commensurate to the benefits which they bestow ? Is it, that the mighty shadow which the member for Colchester spoke of, forced itself into the council chamber, and so scared the government out of their wits, that they are afraid to impose any obligations whatever on the Grand Trunk ? That is what the country will ask. These gentlemen opposite, in their newly-found patriotism proclaim themselves the friends of Canada. They forget that one prominent member of the government was howling for secession in Nova Scotia, while other members of the government were advocating commercial union with the United States. The people will not forget these things. These gentlemen in their new found patriotism profess to be desirous that every pound of freight shall be carried over Canadian soil to Canadian ports. If that is not mere hypocrisy intended to delude the people of Canada, why do they not surround this contract with the safeguards that will carry out that object ?


Thomas Osborne Davis: I remember reading of an old coloured man who was out in a heavy thunderstorm when the night was very dark


George William Fowler: Chestnuts.


Thomas Osborne Davis: I will attend to you presently. The coloured man was much afraid, and lie prayed : Good Lord, give us less thunder and more light. The hon. gentleman from King's (Mr. Fowler) might have given us less thunder and more light. One of the members from Toronto, spoke of the Grand Trunk Pacific routing its traffic through Chicago, but the hon. gentleman failed to give us the name of any line which is running from Winnipeg to Chicago, or in the direction of the boundary. As a fact, the only road running in that direction at present, is the Canadian Northern Railway,

juicl the Manitoba government entered into a bargain with that road with the object of getting its freight carried to Canadian ports, so that I imagine it would be difficult for the Grand Trunk Pacific to arrange to have Its freight carried to the United States by that railroad. Another member from Toronto repeated the saime argument, but he failed to tell us what distance the railway haul was by that route, or how, when they got the freight to Chicago, they would take it to an ocean port. If there is anything in the argument to which lion, gentlemen opposite have treated this House during the last three or four weeks, that it is an impossibility to take grain by rail over long distances, it should be equally impossible to take it around by Chicago through the State of Michigan and the province of Ontario and on down to Portland. So that if they are right in the one instance, they must be wrong in the other. My hon. friend the leader of the opposition had a proposition of his own before the country, involving running powers, and so on. We do not hear anything about that now. But one part of that proposition was to help the Grand Trunk Pacific to build a road from Winnipeg to the Pacific coast. To show the value of the arguments of hon. gentlemen opposite, one of the hon. gentleman's lieutenants from the lower provinces, the hon. member for Pictou (Mr. Bell), this afternoon said that we need not have given anything to get a road built on the prairie *section because we could have got the Canadian Pacific Company to build it for nothing. It seems to me that that hon. gentleman was turning down his leader, who said he would assist the Grand Trunk Pacific to build through that section of country. If he would, that road would be just as liable to pick up the traffic and take it out by Chicago as the road provided for by this Bill. So that, under the proposition of the hon. leader of the opposition, if it were earned out, matters would be just the same in that respect as they are under the proposition before the House. I do not understand how these hon. gentlemen can advance such arguments. The Grand Trunk Pacific Company are bound by a certain contract to ship all goods to Canadian ports at equal rates to those charged to American ports. The company are liable for the acts of their officials, and if the officials were to do anything else, they would violate the contract. To say that some one is going to whisper into the ears of the officials, and that the officials are going to whisper into the ears of the farmers of the North-west, as to what they should do in this matter, is absurd.. Imagine any railway official whispering into the ear of a farmer and suggesting to him the way he should ship his freight. I know something about station agents in the North-west, and something about farmers. If any railway station agent were to suggest to a farmer how
he should ship his wheat, the farmer would tell him to mind his own business. It seems to me that hon. gentlemen opposite underrate the intelligence of the farmers of the North-west, when they suppose that they would be taken by the ear by railway agents in that way. As a matter of fact, these hon. gentlemen are putting up a man of straw for the purpose of knocking him down. They are doing this, I fancy, for the purpose of taking up time and keeping us here. That may be all very well for gentlemen who can go home on Friday night, and come back on Monday and Tuesday ; but it is not very well for men who live 2,000 miles away.
Amendment negatived on division.


Robert Laird Borden: Before the section is adopted, I have one more amendment, which is not very different from the one I last moved. It is to this effect :
Notwithstanding anything in this Act, or in the said agreement contained, His Majesty the King, acting as aforesaid, shall not he bound or obliged to perform, .carry out or fulfil any of the covenants, conditions or stipulations in the said agreement contained on behalf of the Dominion of Canada unless and until the Grand Trunk Railway Company of Canada shall have entered into an agreement with His Majesty the King, acting as aforesaid, hy which the said Grand Trunk Railway Company of Canada shall covenant and agree as follows :-
That the Grand Trunk Railway Company of Canada shall mot in any matter within its power directly or indirectly permit, advise or encourage the transportation of traffic by routes or at rates other than as provided in the said agreement, and shall in all respects and in good faith use its utmost endeavours to fulfil the conditions upon which public aid is granted and accepted, namely, the development of trade through Canadian channels and through Canadian ports.
I want to say a very few words witb regard to this amendment. The distinction between it and the amendments which I have previously moved, as. my hon. friend the Minister of Justice will of course have observed, is that in this amendment I am requiring that the Grand Trunk Railway Company shall covenant on behalf of itself only, and not on behalf of the Grand Trunk Pacific Railway Company. In other respects, it is exactly the same as the other amendment. I have gone Into this matter fully in connection with the last amendment, and I need not make any extended observations. Bet me say, in reply to my hon. friend from Cumberland (Mr. Logan), that he' is not making this matter any clearer by speaking as he does of these corporations. He say that If we regard them as one institution, the Grand Trunk Railway must be bound. Well, an argument of that kind would sound fairly well perhaps out of the mouth of a layman, but my hon.. friend is a member of the bar of some experience, aud surely be will not, In the presence of law. yers, commit himself to the proposition that

the Grand Trunk Railway is liable under any stipulation in this contract, merely by the fact that it holds a controlling Interest in the stock of the Grand Trunk Pacific Railway. I understood him to say that the Grand Trunk Railway is really bound because the two corporations are the one institution.


Hance James Logan: My hon. friend is mistaken. I said nothing of the kind.


Robert Laird Borden: Then he does not pretend that the Grand Trunk Railway is bound by any stipulation in that contract?


Hance James Logan: I am not making that contention.


Robert Laird Borden: I thought he would not dare, as a lawyer, to make it. Well, the object of the last amendment is that the Grand Trunk Railway shall be bound by one of the most important stipulations in the contract, namely, that the trade shall not be diverted from Canadian ports. My hon. friend from Saskatchewan (Mr. Scott), said that my alternative proposition the other day permitted exactly the same difficulty which I am trying to guard against here. He forgot, no doubt, that when I made my proposition the other day, I expressly said that in giving aid to the building of the Grand Trunk Pacific Railway in the west, I would exact from the Grand Trunk Railway in that regard exactly the same stipulations as we were exacting from the Grand Trunk Pacific Railway. In proposing this amendment, I am carrying out exactly what I said. I have eliminated from this amendment any obligation on the part of the Grand Trunk Railway to become responsible for the Grand Trunk Pacific Railway, and I am asking that the Grand Trunk Railway, so far as its own acts are concerned, shall undertake that it will not, directly or indirectly, permit, advise, or encourage the transportation of traffic by routes other than those provided in this agreement, and shall in all respects and in good faith use its utmost endeavours to fulfil the conditions upon which public aid is granted and accepted, namely, the development of trade through' Canadian channels and through Canadian ocean ports. Whatever objection there may have been to the previous amendment, in so far as it asks the Grand Trunk Railway to covenant for the acts of another railway company, is removed by the form of this amendment, which merely requires the Grand Trunk Railway to covenant that it will not divert traffic from Canadian routes, but will in good faith use its best endeavours to fulfil the conditions of the agreement.


The MINISTER OF JUSTICE.: By his first amendment, my hon. friend proposed that this Grand Trunk Railway should guarantee all the obligations of the Grand Mr. BORDEN (Halifax.)
Trunk Pacific Railway under the contract. Then he proposed his other amendment that neither the Grand Trunk Pacific Railway nor the Grand Trunk Railway shall permit or advise or encourage the transportation of traffic by routes or at rates other than as provided in the agreement. Then comes the last amendment, which practically is the same, the only difference being that the Grand Trunk Railway simply covenants on its own behalf. The same argument that applied against the other amendments also applies against this, and I need not repeat them.


Mr. KENDALL.: 
Mr. MORIN.: Mr. Chairman, I have an amendment which I wish to move to this clause. I move:
That section 8 of the Bill be amended by addling thereto the following .-
Provided that the said railway, in its course through the province of Quebec, shall run from the Quebec bridge, on the River St. Lawrence, in a south-easterly direction through i.ho counties of Levis and Dorchester, following the course of the Etchemin river up towards Etche-min lake and thence easterly through the province of Quebec towards the city of Moncton.
In regard to the proposal to construct this railway, I may say that I do not believe that the Prime Minister, in his speech on the 30th of July last, in introducing this Bill, explained exactly what he intended to say in regard to the location of this railway. The Prime Minister stated that the railway would run through the counties of LGvis, Bellechasse, Montmagny L'ls-let, ICamouraska and Temiseouata. I do not know whether he did it intentionally or accidentally, but nevertheless he did not mention the county of Dorchester, and indirectly the First Minister said that, owing to the chain of moontains, the line would have to run south of the range of mountains. I may tell the right hon. Prime Minister that in running a railway from the Quebec bridge easterly, in order to secure a crossing of the mountains at the proper place, lie would have to run it through the county of Dorchester. You will hear in mind that in the province of Quebec there are only two rivers which cross the Alleghany mountains, the Champlain or Richelieu river is one and the other is the Etchemin river. These are the only two rivers in the province of Quebec that flow from the south through the Alleghany mountains and into the St. Lawrence river. Consequently, this is a natural pass for a railway. If you go into the library you will see that the first l-ailway that was
run in 1837 h-om Levis to St. John, N.B., was run right through that valley. I have myself, as a boy, heard my father talk about that, and he showed me some of the stakes that marked the place where the engineers had mil their line. Hon. gentlemen will bear in mind that the stretch of land between the state of Maine anid the St. Lawrence river varies in width from about 30 to 45 miles, and in length it is about 110 miles. In running a railway from the north-west corner of that belt of land to the south-east, it would be impossible to run it in a straight and direct line, because to do so you would have to run your road lengthwise through the Alleghany mountains. I have read five or six reports, and they all show that it is almost impossible on account of the heavy grades and sharp curves. The result is that you will have to build the railway at an angle. If you do not make your angle at the west end, you can run down along the Intercolonial to Riviere du Loup and then make your angle at the east end, going towards Edmundston. If you don't make your angle there, you have to make it through the county of Dorchester.
Now, as I said, that line varies from 30 to 45 miles. Those six counties are well served already by the St. Lawrence and by the Intercolonial. The Intercolonial runs Horn about one mile to six miles from the St. Lawrence. The north side of the mountains has been settled up for a great many years. The jteople who live on the north side of the mountains do not need the railway at present, and probably never will need more railway facilities than they have now. So you have between the Intercolonial and the boundary line of the State of Maine, a belt of land only 28 to 40 miles wide. By building this new road where I suggest the government should buildi it, on the south side of the mountains, you would build it at the very place where it is needed. That part of the country I know very well. The people have a pretty hard time to live there. It is a well timbered country, but they can only sell their timber to the people in Maine. Their timber has to he floated down the St. John river, and they get very small prices for it generally. They have no other way of shipping their timber except down the River St. John. But by running this railway where I am suggesting, you would serve all these counties very satisfactorily. The route I speak of and the route recommended by the government both start from the bridge at Chaudi^re, as I find by this map prepared! by the government. I compare this map with one issued by the Quebec government, and I find by them that both roads start at the Chaudiere bridge and run probably 50 miles from one to five miles apart, and in the county of LYslet they join and become one road. That is about ail the difference there is between the two routes. One route up to the Etchemin river

is tlie natural route; the other was surveyed by a. man named Tache, whom 1 know very well. It goes up the Etchemin river to a place called Itiver Abenalds, and then it takes a very heavy grade for about eight ibiles. In fact it follows a zig-zig course all the way through the mountains ; sometimes it runs east and sometimes west, and sometimes north. Well, Sir, the line I propose to the government is the best that could be discovered. You can run that line thirty miles from the Chaudiere bridge without a curve, or a cut, or a fill, or a bridge. I say now plainly to the government that from the ChandiSre bridge for about 45 miles, if they find it necessary to build a bridge over 20 feet long, let them call on me and I will build the bridge myself. Moreover, I have this to say to the government, if you have any desire to build a road through there let me know before you send engineers, and I will show them the route and I will not charge the government one cent for my services. I could show them 45 miles in about four days.
Now the other day the bon. member for Bellechasse (Mr. Talbot) read a statement made by an engineer named Light. That report from Mr. Light was a pretty fair one, it was made in 1884 or 3885, when the conditions were not such as they are to-day. He was instructed to start at St. Anselme, and he kept on the east side of the Etchemin river and encountered some awful curves, and some awful cuts. But to-day, owing to the Quebec bridge being under construction, the whole matter is changed. The departing point and the arriving point of the railways must be at the Quebec bridge. That changes the situation altogether. That is the only reason why I move this amendment asking the government to run the road through the county of Dorchester, and in doing so it will run also through all the counties named by my hon. friend.


The PRIME MINISTER.: I am very glad that my hon. friend from Dorchester (Mr. Morin) has changed his rniud with regard to this Bill, and he now sees there is some merit in it. That is a disposition which I think he did not indulge at a former stage of the discussion. At all events, it is never too late to repent and to amend one's ways, and I congratulate my hon. friend that he has seen new light in favour of this enterprise. With regard to the amendment he offers, he will agree with me that it would be premature to localize the road at the present time. I stated when introducing this Bill that I thought the line would start from the Quebec bridge and go south of the range of mountains. In that case I hope it will pass through the county of Dorchester, it must pass inevitably through the county of Levis, and I think it will also pass through Dorchester and some other counties there. But he will agree with me that Mr. MORIN.
it would be impossible at the present time to say that the road must pass through any particular locality. That is a question for the engineers to decide.


Jean-Baptiste Morin: My right bon. friend tries to put me in a false position. But I will tell him frankly, while we are looking at each other face to face, that if there is any one to blame because I did not support this scheme at first, it is my hon. friend the leader of the government-and you know who he is, no doubt. As I said before, I do not know whether it was intentionally or accidentally, but in naming the counties through which the road was to pass the right lion, gentleman left out the county of Dorchester. Soon after, my hon. friend the Minister of Justice spoke to me about it, and I replied to him, If you give me nothing you get nothing from me. I may say this much to the Minister of Justice and to the First Minister, that if you attempt to run a line through there, try and get an engineer who is an honest man, and I assure you that he will run that line where I am asking you to run it. But If you get a Vanderbilt engineer or a Hays engineer, well, I do not know where he will run the line.
Amendment (Mr. Morin) negatived.


Seymour Eugene Gourley: Mr. Chairman, I desire to move an amendment to section 8 as follows :
That 'section 8 of Bill (No. 235) intituled an Act respecting the construction of a National Transcontinental Railway be amended by striking out the worlds ' city of Moncton ' in the second line thereof and inserting in lieu thereof * the town of Truro via Parrsiborough, Five Islands and Great Village ' and that the contract in the schedule of the said Act De varied accordingly.
In the course of this debate the hon. member for Cumberland (Mr. Logan), whom I am glad to see here, was good enough to inform us that the reason that the road stopped at Moncton was that from there could radiate a number of lines to different parts of Nova Scotia. He was good enough to say that Mr. Hays had said that there would he not only freight enough for one port to handle but freight enough for five or six ports to handle and that therefore from Moncton might radiate other railways to different ports in the maritime provinces. 1 understand that the reason that this railway is left at Moncton is that every hon. gentlemen from the maritime provinces may go to his constituency and claim that the ocean port is to be in his county. I noticed a short time ago that Mr. McDonald, of Pictou, after coming here, went home and intimated to the press in his county that he expected to have an ocean port at Pictou by a line along the north shore of my county, perhaps, and his county. I am delighted that the province of Nova Scotia at least is to he so generously treated that it is not going to have one ocean port hut

many. The hon. member for Cumberland, in exploiting this splendid eventuality, undertook to say that very likely the road
would	be	extended	into	my county,because	the	line in	its	course eastwards	first	passes	into	Cumberland,
then into Colchester and then through to Halifax. We have been agitating for a railway to be built through my county for a long time from Truro along the shore of the Bay of Fundy by way of Economy and Five Islands to Parrsboro', and thence connecting with the Intercolonial Railway near Amherst. When the Intercolonial Railway was built it was thrown 15 to 20 miles back from the shore. Hon. gentlemen frequently talk about parallel lines and the necessity of having railways within a short distance of each other. Last summer at a meeting which was held in my county to discuss this question one man got up and said : My farm, which I received from my father 30 years ago, was worth at that time $12,000, but I could not get more than $2,000 for it now because I am on the Bay of Fundy, and by the Intercolonial Railway being built away from the Bay of Fundy the whole of the trade has been taken back and we are side-tracked. Therefore, there has arisen in the county of Colchester an agitation to have a railway from Truro to Parrsboro' which would follow the course of the old highway in connecting with Amherst and thus avoid the Cobequid mountains. When the Intercolonial Railway was built it was taken over the Cobequid mountains and of course this increased the grades of the road. The grades are too great for a great ocean to ocean railway. Not only are the grades too great but the curvatures are greater than would be permissible on a transcontinental road. When the Intercolonial Railway was located the notions we have of railways to-day were not in existence. People believed that if they had a railway it was a railway no matter what course it took, just as people in the olden time believed that an ordinary road which crossed a mountain was just as good as one that went around it. The Intercolonial Railway was located with many curves. When it left Truro it was swept away from its proper course in order to meet the requirements of the Acadian iron district thus making the Grecian bend. After going to the Londonderry mines it had to be pulled away in another direction in order to get through the Cobequid mountains by way of the pass. The pass is a very high one and although it crosses the Cobequid mountains it makes an enormous grade to surmount. After it crosses the Cobequid mountains it is pulled again to the west to get to the Springhill mimes. Therefore, the Intercolonial Railway is a zig-zag route located to meet the then local requirements of the country and iu consequence of that is not fitted in any way to be a transcontinental railway. At
tlie time that the Intercolonial Railway was surveyed the route that I propose, from Truro along the shore of the Bay of Fundy by way of Economy and Five Islands to Parrsboro' was surveyed, and these surveys are in the railway department. That route was recommended as the proper route for the Intercolonial Railway but the political forces of that time backed by the capital of the country determined to take it by this other route which probably better suited the business interests of the country then. I am not complaining about the location of the railway. The line was put there in the best interests of the country at that time,
I presume, but now, since we are going to have a transcontinental line which requires grades and curves such as the hon. member for North Norfolk (Mr. Charlton) has spoken of, I desire that the railway shall follow the approved route from Moncton to Truro along a level line without grades and with very few curves. My hon. friend from Cumberland county was kind enough to suggest to me that when the Grand Trunk Pacific was built and connected with the Intercolonial Railway at Moncton a single line between Halifax and Moncton would be unable to handle all the business. We would have to double track the railway, and as the hon. gentleman said before, we would, in double tracking the Intercolonial Railway, be duplicating and perpetuating its grades and curves. He said we had better swing it around by Parrsboro ' and Truro, and get a better road. I fancied he had some quiet understanding with some gentleman in my county, who might be my opponent next election.


The PRIME MINISTER.: Possibly.


Seymour Eugene Gourley: I have no quarrel with any of my colleagues in the maritime provinces, but I noticed the extreme generosity in the proposition, in that, when his own county needs so many railways, he should be so kind as to make this offer to my county which has so few. I therefore thought, that when such an offer had been made, it might be misunderstood during the election if I did not say something here. My training has been a business one, and if there is any possible way of making an arrangement so as to have no misunderstanding, I would adopt that way. I therefore ask the hon. gentleman (Mr. Logan), and the Prime Minister, and the Minister of Finance, to give us a helping hand, and without any further ado here or on the hustings let us have the terminus of this line at Truro. There will be this great advantage. Moncton is ISO miles away from an ocean port. You can not even smell the salt water at Moncton, but when you come to Truro you are only C>2 miles away, and the shad that are fished out of Halifax harbour at three in the morning are delivered on our breakfast tables.


Hance James Logan: And lobsters.


Mr. BELCOURT.: And sharks.
Mr. GOL'RLEY. Anyway we have the smell of the salt water at Truro which they have not at Moncton. I want this railway to have some of the appearance of a salt water railway, and consequently I hope the the Prime Minister and the Minister of Finance will give me a helping hand.


The PRTME MINISTER.: A salt water railway is something new.


Seymour Eugene Gourley: Of course, I mean a salt water port. 1 move this, hoping that my friend (Mr. Logan) who has been so kind, will now get his friends on the other side to support it, and I will have great pleasure in telegraphing to Truro in the morning that: We have been selected as the ocean port instead of Moncton.


Hance James Logan: I will guarantee that the amendment of my hon. friend (Mr. Gourley) will not be supported by many of his own party.


Seymour Eugene Gourley: Oh, yes.


Hance James Logan: If the hon. gentleman desires, we will take the vote and test it. I do not think that this amendment is a serious one, and therefore I shall not waste the time of the House about it. The facts are : We determined that any transcontinental railway should he built into the maritime provinces, and with the conflicting interests of the different ports, we had to settle upon some one point as a compromise. We found that we could all agree on the city of Moncton, and Moncton was incorporated in the Grand Trunk Bill as the terminus and it was supported by my hon. friend (Mr. Gourley). He did not move such an amendment as this to the Grand Trunk Bill, when it was on its passage through this House, and it is too late for him now to think of it. I have no doubt that when this road is built to Moncton, and when the words of Mr. Hays come true, that there is enough traffic for half a dozen ports, we will not only have a government railway built from Maccan or Athol, around by Parrsboro', and Five islands to Truro, but we will also have a road built from Moncton, through northern Westmoreland and Cumberland counties, and on to Pictou, to connect with Sydney, Country harbour, Louisburg and Whitehaven ; thus accomplishing a saving in distance of 39 miles between Moncton and New Glasgow. These are things that are bound to come. However, we have entered into an agreement that Moncton should be the terminus in the maritime provinces, and that was incorporated in the Grand Trank Pacific Bill. I believe myself that a road will be built south of the Cobequid mountains to accommodate the traffic, but it will be built by the government itself as part of the Intercolonial Railway. There is a great temptation to-night for a member on this side of the House to speak at some Mr. LOGAN.
length, because if we ever had an opportunity of holding these gentlemen opposite tip to ridicule, we have it now. They talk about paralleling the Intercolonial Railway, hut here is a proposition from their side, by which, the hon. member for Colchester proposes they will have two ra il-ways running side by side and paralleling the Intercolonial Railway from Moncton to Maccan or Athol.


Seymour Eugene Gourley: With a branch to Amherst.


Hance James Logan: My hon. friend is not acquainted with the geography of that country. He could not branch off at Amherst. These lines would be running side by side according to his proposition, until we could divert the line at Maccan or Athol, probably, to Parrsboro' and on to Truro. These gentlemen opposite have talked about the Intercolonial Railway as being the pet lamb of Canada. But the hon. gentleman (Mr. Gourley) now talks about the zig-zagging of the Intercolonial Railway, and the Grecian bend on the Intercolonial Railway and the bad grades on the Intercolonial Railway, and he winds up by saying that it is useless as a transcontinental railway, crossing as it does the Cobequid mountains. The temptation is great to retort on these gentlemen opposite, but I think the country understands their position.


Seymour Eugene Gourley: The hon. gentleman (Mr. Logan) is very good to refrain from obeying the calls of temptation. It shows a strong virile nature, and I congratulate him. But, when a man is not weighing every word he utters, he says very funny things. The hon. gentleman says ' we ' have entered into an agreement to adopt the city of Moncton as the terminus. Who are ' we ' ? As a member of this House, I have not entered into any agreement, and I do not think my friends on this side have. Who are ' we ' that undertake silently and secretly, behind the backs of their fellow members to enter into this agreement ?


Hance James Logan: I will tell my hon. friend who are 'we.' 'We' include the member for Colchester who voted for this resolution in the Railway Committee.


Seymour Eugene Gourley: My hon. friend is incorrect. I was in Nova Scotia when that resolution was passed.


Hance James Logan: Will my hon. friend deny that he supported the resolution to build to Moncton ?


Seymour Eugene Gourley: I have not supported any resolution yet. I have been reluctantly compelled to vote against the government project because I wanted a transcontinental scheme, if it were a wise one. And, if the friends of a transcontinental railway are driven to oppose this scheme, what on earth will be the attitude of those who are

opposed on principle to the building of any transcontinental railway? My hon. friend from Cumberland cannot exploit against me any attempts to belittle any of the insti-tions of Canada. I have endeavored to maintain them throughout my whole life, and have never said anything against them. Therefore, it is idle for him to attempt to exploit anything against me in that regard. Although the Intercolonial Railway has bad grades, it was located in the business interest of Nova Scotia. But our ideas of what a railway should be were entirely different then from what they are now. We then thought that a railway to connect two points was all that was needed. We know now that a railway means the most direct route between two points, with the easiest grades and the fewest curves, and equipped with the most complete rolling stocks. Local railways may continue to have grades, but railways intended to compete for transcontinental traffic must have practically no grades. I am a student of the geography of this country. I believe we possess in Canada the strategic position with regard to the trade routes of this continent, and that through this continent we command the trade routes of the world. The people of Canada are rather slow to apprehend these new ideas, but I have no doubt that in ten years every man in Canada will realize the truth of what I am now saying. I think this debate marks an era in the history of Canada. It is the only great debate that has occurred in the parliament of Canada. You could have thrown half the other debates into the sen, and you would have improved the literature and the political history of Canada. This debate is worth all the others put together. From this time we will know the geography of the country better than before, and lie more intelligent men. I suppose the hon. member for Cumberland thought that I should take the offer of his kindness for the thing itself. I know that it is not right to look a gift horse in the month, and perhaps I should have regarded his offer as a young and pretty colt, although it had the appearance of an old nag, knock-kneed and maimed, and intended to be exploited at the next election in Colchester. My hon. friend appeared in my county before the last election. I may say that he is known to have a splendid lot of kites, and I understand that his friends telegraphed to him : ' Come over, Logan, and bring your best kites.' And he did appear with the finest assortment of kites that I ever beheld, and I have no doubt that he gave his political friends some aid by the exhibition of those kites, and one of them was to build the very road which we are now talking about. He had met all the leading men in the county of Cumberland, and they were all prepared to build this railway through my county. That was only four or five days before the election, and the greatest sorrow the hon. gentleman had was, that
they had not given him more notice. If they had, the railway would have been built by the time of the election. The most he could do was to assure them that the road would certainly be built. I tried to tell tlie people that this gentleman was a kite-flyer and did not mean half what he said. They said, it is impossible that this gentleman, with his sincerity of manner, does not mean everything he says, and they took his kites as realities. Was it the Trojans who feared the Greeks bearing gifts ? 1 fear the hon. gentleman bearing the gift of this great transcontinental railway to my county. I want him to get his friends to support the resolution that Truro is to lie actually the winter port. We do not want any more kites. They look very nice in the air, but they are not railways. Surely, ray lion, friends will vote to extend the road from Moncton to Truro, a distance of only sixty-two miles from the ocean. With that extension, there will be a very good transcontinental road from Truro to Halifax. If we do not get this port at Truro, I am going to appeal to the Finance Minister to give us a subsidy of $10,000 a mile for a railway from Truro to Five Islands, though I would much prefer to have this transcontinental railway. I would be delighted to have the road pass through my county, and I hope all hon. gentlemen will vote to have the ocean port located there.


Hance James Logan: I would call the hon. gentleman's attention to the fact that his own leader has gone out, and is not here to vote.


Mr. KAULBACH.: I wish to say just a word with reference to the amendment submitted by the hon. member for Colchester (Mr. Gourley). In answer to the remarks made by my hon. friend, I would say that while I appreciate his motives in asking for a road from Moncton to Truro, I would be opposed to such a road being built to parallel and sidetrack the present Intercolonial Railway. But if it Is to be a part of the Intercolonial, it would in that case be in the interests of the public generally, and it would shorten the distance between Moncton and Truro by some fifty miles. That is, take the road from Moncton to Sackville. which could be made a straight line, and from Sackville to the mines, south of the Cobequid mountains, and you would have an easier road with better gradients and less curvatures, and shorten the distance as expressed. With an object of that kind, I would readily support the amendment as submitted by the hon. member for Colchester (Mr. Gourley), but I would stoutly oppose having the line a part of the Grand Trunk Pacific Railway, to parallel the Intercolonial Railway.
Amendment negatived.


Edmund Boyd Osler: I am not sure whether the question I want to raise comes under this section. In this agreement I do not see anv reference to the operation of telegraph

lines. Whether this omission he intentional or not, there is no doubt that telegraph lines in connection with the eastern section and also in connection with the western section, should belong to the railway company and the earnings form part of its revenue. There should he no loop hole allowing a separate company to be organized for the operation of these lines. It is well known that the telegraph business in connection with such a railway system could not fail to be an exceedingly valuable asset. It would be operated at very little cost and bring in a very large revenue. I feel quite sure the government will agree that there ought to be some clause providing that the telegraph lines should belong to the railway company and not be diverted to another company and the profit therefrom be taken from the railway company.


The MINISTER OP JUSTICE.: Under section 22 of the charter provision is made for the construction of telegraph and telephone lines along the railway, and also that the company may construct and operate the lines for its own profit. But as regards the eastern division, section 22 would not apply. The suggestion is one worthy of consideration. It would, however, have to be dealt with in a special clause and I will undertake to do that.
Mr. Obl.EIt. No doubt it is within the knowledge of every one in this House that the question of telegraph monopoly, both in Canada and in the United States, has been a very serious one. When the telegraph companies were first making very large strides, it was quite natural that they should make agreements with railway companies to use their poles, and obtained monopolies for twenty-one years or longer. These monopolies were frequently of enormous value. In the case of the Western Union Company, I think that the privileges which it obtained from the various railway companies, especially the transcontinental railways, were of such value that the stock of the company was watered to the extent of $30,000,000 or $40,000,000, and yet the earnings were sufficient to pay the dividends and interest. Within the last five or six years the railway companies have been trying to shake off these monopolies. In the ease of the Baltimore and Ohio, they have succeeded, but the Pennsylvania Railway Company have had many law suits over old agreements >in connection with branch lines which they had acquired. In the present case, assuming that this road is to be a transcontinental one. the telegraph franchise in connection with it will be of great value, worth millions of dollars, and it is very important that a careful arrangement should be made to prevent any control of the telegTaph system passing into the hands of any private company. It would be legitimate for a private company to lease a line from the Grand Trunk Pacific
Railway in the west and then from the government in the east, and in that way get an enormously valuable franchise, which ought to go to swell the revenues of the eastern and western portion, and I am quite sure that this arrangement would meet with the approval of every member of this House and with the approval of the country.


The MINISTER OF JUSTICE.: I think that matter would have to be considered altogether independently of section 8. My horn, friend Mr. Osier) has not overlooked the fact that so far as the western end of the line, the section from Winnipeg to the coast is concerned, clause 22 of the charter provides that the company may construct, control and operate telegraph and telephone lines. The question to be considered would be in reference to the eastern extension, from Winnipeg. Provision has been made for the operation of telegraph lines, but it is exclusively for the operation of the road. If it is intended to use that telegraph line for the purpose of general business we would have to make a special provision for it. It is not contemplated in the present agreement.


Edmund Boyd Osler: It would be a very simple matter to string an extra wire along these poles, a very small thing compared with the *value of such a service. I am not finding fault in any way but in looking over this clause it struck me that it would be as good a clause as any on which to bring up this matter. I am not pressing it at all.


The MINISTER OF JUSTICE.: A special clause would be necessary and I will see that a section is drafted'.


[Stage Direction]
Section agreed to.
On section 14,
Robert Laird Borden: I thought that the amendment proposed by the hon. member for Toronto was to section 17, but apparently from the record of the chairman it must have been moved to section 16.


The MINISTER OF JUSTICE.: Perhaps it would be better to bring this up when we come to consider section 2. This amendment has reference to the question of customs duties with respect to the contract.


Robert Laird Borden: If my hon. friend would have no objection to having section 10 stand it would1 perhaps be better. I have prepared an amendment to the section but I am not quite convinced yet whether it will be necessary to move it.
Section allowed to stand.
On section 19, member of parliament not to be paid employee or contractor.


Thomas Simpson Sproule: Would that refer to what is called .a silent partner, a party who is interested but whose name would not appear ? That is a common way of evading


Edmund Boyd Osler: tire law and I would like to know whether this would coyer such a case ?
The MINISTER O'F JUSTICE. Certainly it would, if any attempt to evade the law in that way was made the parties could easily be reached under the Independence of Parliament Act. This is the best I could do in the way of drafting a clause but I am quite willing to accept any amendment that would better meet the object desired, that is to prevent any member of the Senate or of the House of Commons having anything to do with this matter directly or indirectly for profit. I have adopted this clause from the Intercolonial Act. It is practically the same section as in tbe Intercolonial Railway Act and I think it is similar to the Independence of Parliament Act, but if we can improve it and make it more effective, I am willing to consider any suggestion.


Thomas Simpson Sproule: I am not saying it would not be effective, but I think the way such laws have been evaded before is by means of construction companies. A tender would be put in and a contract obtained but names of the parties interested would not appear ; but they would be silent partners all the same.


Robert Laird Borden: I think this clause stood the other evening on account of some discussion with respect to the general question of the independence of parliament. The Minister of Justice will recollect that we discussed the possible necessity of some amendment to that Act by reason of the fact that so many of the business transactions of the country are carried on at the present time by corporations. The Prime Minister said that some discussion had arisen some twenty years ago, and that no better safeguards could be found than those which we now have in the Independence of Parliament Act. I think I mentioned at that time, that very many of the commercial transactions of the country, nearly all of the business transactions of the country, are carried on now by persons associated together under the form of corporations, and somewhat different considerations might apply now to those which applied twenty years ago. I think we discussed the possibility that, notwithstanding the clause the Minister of Justice has taken from the Act respecting the construction of the Intercolonial, it would be possible for the members of the Senate and House of Commons to associate themselves together, to go through the necessary form which would constitute them a joint stock corporation, and to make any contract with the commissioners, which means a contract with the Crown, that they might see fit. It seems to me, the Minister of Justice permitted this clause to stand at that time for the purpose of considering whether the government could offer to the House any addition to the words to be found here which 378
would obviate what might be a difficult situation in that regard. It is quite true, that under modern methods you could have members of parliament contracting with the Crown in respect to this large enterprise, under the guise of a corporation. I am not using the word ' guise ' in any offensive sense, because it would he quite proper for gentlemen to do that, as the law stands at present-at least, it would be quite legal. Now, the Act respecting the Independence of Parliament has not taken that change of condition into consideration. It may be necessary that at a very early date we should take that change of conditions into consideration. But we are dealing here in this contract with interests that may run up to 50, 75, 100 or even 125 millions, according to the various estimates which have been made of the cost of this undertaking. When you go into a business of that magnitude, is it not time to consider whether you should not have some better safeguard than is to be found in the general Act relating to the Independence of Parliament ? We have got along, it may be said, fairly well, without any great scandal up to the present time. At least it has not come within my knowledge that members of parliament have associated themselves in the form of a corporation for the purpose of contracting with the Crown. But it might also be said that no such temptations as would be presented by a scheme of that kind have up to the present time made themselves felt. When you are here, face to face with an undertaking of this magnitude, is there not fair room for consideraton as to whether, in respect of this enterprise, some other safeguard should be provided which would prevent members of parliament from taking the course I have suggested they might take, a course which may be taken by members with perfect propriety under the Act respecting the Independence of Parliament.


The MINISTER OF JUSTICE.: The section 11 provides :
This Act shall not extend to disqualify any person as a member of the House of Commons by reason of his being a shareholder in any incorporated company having a contract or agreement with the government of Canada.
That is the general principle; here is the important exception :
Excepting any company which undertakes a contract for the building of any public work.
No member of parliament can be a shareholder in any company which undertakes to contract to build any public work. We might have to amend section 15 to read as foliows :-
No member of either House of parliament shall receive an appointment to any office of emolument under the commissioners, or shall be a contractor or party to any contract with the commissioners, for the construction of the said eastern division or any part thereof, and the said eastern division shall he declared for



the purposes of this section a public work within the meaning of section 15.
That is to say, we declare this to be a public work, and, as a result, it will be impossible for any member of parliament to be a member of any incorporated company which is in any way connected with this enterprise. It appears, therefore, to be quite clear, that no member of either House of parliament can be a stockholder in an incorporated company which would undertake a contract for the building of any public work in connection with this enterprise.


Thomas Simpson Sproule: Would it not do to add at the end of the third line the following:-
No member of either House of parliament shall hold or be appointed to any office of emolument under the commissioners, or shall be a contractor or a party to any contract, either Individually or as a member of any incorporated company, with the commissioners for the construction of said eastern division.


The MINISTER OF JUSTICE.: That is to the same effect. Either suggestion would meet the case.


Robert Laird Borden: I think the Minister of Justice suggested the other night that a company might be formed for the purpose of furnishing supplies. I do not know whether that would be important enough to require us to deal with it. There is one more suggestion which occurs to me, from examining section 15, that is, whether the same form that was adopted then with regard to the Canadian Pacific Railway should not he adopted now with regard to the western division of this railway.


The MINISTER OF JUSTICE.: I can see no objection to that.


Robert Laird Borden: The expression in this statute is, ' any company incorporated for the construction of any part of the Canadian Pacific Railway.'


The MINISTER OF JUSTICE.: I have no doubt it will be a public work for the purposes of this Act.
supplies. This opens up rather a large question. You might have a man in business for instance a large hardware merchant who would be in a position to furnish hardware supplies. Are you going to prevent the commissioners or a contractor from purchasing from that gentleman in the open market ? It seems to me that it would be very far-reaching if that is the intention of the hon. gentleman. I would like to understand what is intended, because, when one is expected to draft anything, it is necessary for him to know what the object is that is aimed at. If my hon. friend would say that he would be content that we should make section 15 of the Independence of Parliament Act applicable to this road in its entirety, to both the eastern and the western divisions, it is very easy for us to do it, but if it is intended to go beyond that and to make the prohibition applicable to all those who might have occasion to furnish supplies to any contractor, I do not know where it is going to lead us.


Edmund Boyd Osler: I think it is going to be a very difficult thing, because in a case of the steel company, for instance, its shareholders are all over the country. Any one having a few shares of stock would be absolutely precluded from furnishing supplies. It would be a very desirable thing to do in some ways, but at the same time it is very difficult to frame a provision that would exactly meet the case.


The MINISTER OF FINANCE.: If these parties were furnishing supplies direct for the government they would come under the disqualification. The only doubt would be in case they tshould furnish supplies to a contractor. We could hardly go as ar as that.


The MINISTER OF JUSTICE.: I will endeavour to have drafted in my department a clause upon the lines of section 15 of the Independence of Parliament Act, and if there is any suggestion to offer in addition to that we will consider it.


Robert Laird Borden: However, if the hon. Minister of Justice will prepare some such amendment as he thinks will meet the case we can then consider it.


The MINISTER OF FINANCE.: As far as the individual is concerned I do not imagine that we can add anything to the clause which is here. It is only where a member of parliament might be a member of an incorporated company that there is any question.


The MINISTER OF JUSTICE.: I understand that this amendment should be made applicable to the western division and that divison should be put in the same position as a public work within the meaning of section 15. I understand that to be the extent to which my boil, friend would desire that we should go in respect to the furnishing of Hon. Mr. FITZPATRICK.


Samuel Barker: Will the hon. gentleman consider the question of equipment as well as supplies ? The equipment of this road is a very large item, amounting to some $20,000,000, and while I see some very great difficulty in applying the law to ordinary supplies, it might be very important that members of parliament should not deal in matters that might involve many millions.


The MINISTER OF FINANCE.: That would be a direct contract, and there would be disqualification in that event.


The MINISTER OF JUSTICE.: That
would be a contract with the Grand Trunk Pacific.


Samuel Barker: I only suggest that the hon. member should consider the question.


Tlie MINISTER OF JUSTICE.: That would come under the section, because that would he a contract in respect to the equipment of the road, and it would be a violation of the spirit of the clause.


Samuel Barker: It might not be a public work.


The MINISTER OF JUSTICE.: Still, the equipment is part of the road, is it not 5 If we declare the road to be a public work, of course, the equipment, it seems to me, would become a public work as a matter of necessity.


Robert Laird Borden: I think the language would probably require to be a little closer than that contained in section 15. The language is ' any company which undertakes a contract for the building of any public work.' Of course, the building of different portions of this work might be undertaken by a great many different companies or contractors, Then, as far as supplies are concerned, really the only thing I (had in my mind was a company formed for the purpose of furnishing supplies-


The MINISTER OF FINANCE.: To contractors ?


The MINISTER OF JUSTICE.: No, to the commissioners.


Robert Laird Borden: What I was seeking to guard against waf members of parliament forming themselves into a company for the purpose of furnishing supplies to this railway whether to contractors or to the commissioners. That is an entirely different thing from the furnishing of supplies by a merchant, or by a going concern at the present time.


The MINISTER OF FINANCE.: As between the commissioners and persons 'furnishing supplies they would clearly be disqualified, because the commissioners stand in place of the government. But, suppose a contractor takes a contract from the commissioners and becomes a perfectly independent person, is he to be prevented from buying his hardware at the shop of a member of parliament ?


Robert Laird Borden: No, the only prohibition would be against members of parliament, now or in the future, associating themselves together in the form of a corporation for the purpose of furnishing supplies for the building of the road whether to contractors or to commissioners. That is to say, looking at the worst possible aspect of the case, we might have a number of members of parliament forming themselves into a corporation for the purpose of furnishing supplies to contractors and relying upon their political influence to see that the contractors bought from them. Although that is a very remote contingency, it should be guarded against.
378J


The MINISTER OF FINANCE.: I am afraid you cannot reach that without laying down some very general rule. Whether the company is formed now or whether at some future time it does not affect the principle involved.


Robert Laird Borden: Well, I am content to leave it in the judgment of the hon. Minister of Justce.


The CHAIRMAN (Mr. March).: Section 19 stands.
Section allowed to stand.
On section 21-power to suspend work.


Robert Laird Borden: Does the hon. Minister of Justice remember why we allowed this section to stand ?


The MINISTER OF JUSTICE.: It was considered that perhaps it would be inadvisable to put such a great power in the hands of the government. We thought that by adopting this section, we were reserving to parliament control over the whole work. If there is any objection to that, we are not wedded to it at all. We are quite willing to let it go. I myself adopted it from the Intercolonial Railway Act, and from the Quebec, Montreal, Ottawa and Occidental Railway Act.


Thomas Simpson Sproule: The only difficulty I see in the clause is that it leaves it in the hands of the government to stop the work until the next session of parliament. In the meantime, if the surveyors or engineers report against the work, and if the Grand Trunk Pacific are anxious to get out the contract to operate the eastern portion of the road, the government might take that means of abandoning it entirely.


The MINISTER OF JUSTICE.: That can be done without suspending the progress of the work. Supposing that during the progress of the work, we met with some unforeseen difficulties, is it not proper that parliament should have some control over that ? I would like to have the views of my colleagues on the subject, but so far as I am concerned, I do not think there is anything to be gained by keeping the clause in, beyond giving parliament absolute control over the enterprise.


Thomas Simpson Sproule: You have absolute control over a government work at any time.


The MINISTER OF FINANCE.: There is nothing in the clause beyond the possibility that something may arise that we have not clearly in our mind now. Suppose we should come to the conclusion that the commissioners were not properly discharging their duties-which is not at all likely to happen with the excellent commissioners that will be chosen-but suppose it did happen, and we did not wish to act at once, we merely say that we will reserve our judgment until parliament meets. We

attach so little importance to the clause, that if anybody has grave objection to it, we do not insist on it staying in.


Robert Laird Borden: If its scope is what the Minister of Justice suggests, there is no objection to it, so far as I can see at present.


The MINISTER OF JUSTICE.: I may confess that it was taken bodily out of the Intercolonial Railway Act.


Robert Laird Borden: 
The MINISTER OF JUSTICE.: That is the usual clause in the Public Works Act.


Robert Laird Borden: It practically is. The Minister of Justice might consider whether it is not desirable to incorporate it.


The MINISTER OF JUSTICE.: Suppose we pass the clause, and then if later on it is considered advisable to add the amendment, we can consider it.


Robert Laird Borden: There is no objection to that.


[Stage Direction]
Section agreed to.
On section 22-advances to commissioners.
The MINISTER OF FINANCE.: The words in the Bill are : * Certified by the chairman of the commissioners,' and the hon. member for Simeoie (Mr. Lennox) has suggested : ' Approved by the commissioners and certified by the chairman.' I think that makes it clearer and we will insert these words.


Thomas Simpson Sproule: There ought to be some provision whereby the government could compel contractors to pay their labourers and workmen.


The MINISTER OF FINANCE.: There is a special Act applying to all public works subsidized by the government.


Tlie MINISTER OF JUSTICE.: I refer my hon, friend (Mr. Sproule) to section 40 of the agreement.


Samuel Barker: The wording of this clause seems to be somewhat unusual. It reads :	.
The Minister of Finance may on the recommendation of the Minister of Railways, from time to time, pay claims and accounts for work done.
I suggest that you should add to the clause :
-and that the making of payments shall be subieet to the provisions, regulations and re-


Hon. Mr. FIELDING.: quirements of the Consolidated Revenue Audit Act.


The MINISTER OF FINANCE.: When we come to section 30 which refers to the audit, instead of providing that the audit shall take place under section 50 fof the Audit Act, I shall move that the account shall be audited in the same manner as the usual supplies in the appropriation grants.


Samuel Barker: Very well.


[Stage Direction]
Section agreed to.
On section 28-books to be kept.
The MINISTER OF FINANCE.: I forget what point was reserved with regard to this section.


Robert Laird Borden: We suggested that after the words * Governor General,' there should be added the words ' Or by the Auditor General.'


The MINISTER OF FINANCE.: There is no objection to that.


[Stage Direction]
Amendment agreed to, and section, as amended, agreed to.
On section 29-annual report of commissioners.
The MINISTER OF JUSTICE.: This was held over so as to make provision that this report shall be laid on the Table at the opening of the session.


The MINISTER OF FINANCE.: We can add, that such reports shall be submitted to parliament within fourteen days after the opening of tlie then next ensuing session.


Thomas Simpson Sproule: Suppose the report is not prepared until the session opens ?


The MINISTER OF FINANCE.: In that case, I think we shall have to call the government and the commissioners to account. We shall see that this report is prepared in good time.


Robert Laird Borden: I had drafted something ; I do not know whether it is any improvement on the amendment of my hon. friend the Minister of Finance :
And each such annual report shall be submitted to each House of parliament wivhin fifteen days after the meeting thereof, or wiihin fifteen days after the commencement of the next ensuing session of parliament, whichever event shall first happen.


The MINISTER OF FINANCE.: I think that is all right.


Thomas Simpson Sproule: Why not use the same expression as is used in the case of a Governor General's warrant, that it shall be laid on the Table within fifteen days after the opening of the session ?


Robert Laird Borden: Governor General's warrants are issued between two sessions of parliament, and, therefore, all that

is necessary to say is, that they should be laid on the Table of the House within fifteen days. There is no date fixed for the issue of this report, so tjiat we do not know whether it will bie issued between two sessions or during a session. My amendment is intended to cover both cases.
Amendment agreed to, and section, as amended, agreed to.
Sections 13, 30 and 31 agreed to.
Progress reported.
On motion of the Prime Minister, House adjourned at 11.45 p.m.


The MINISTER OF CUSTOMS (Hon. William Paterson) :: 1.	The rental for ,T. O. Scrimgeonr's bonded warehouse (class 2) at Cardigan has been paid for the period ending 31st December, 1903.
2.	The right to enter goods for warehouse in the said bonded warehouse has been recently discontinued by the Department of Customs, its further continuance being considered unnecessary and having been objected to.
3.	Petitions against the said warehouse have been received. Copies of petitions and correspondence will be laid on the Table of the House if the House so directs or consents.

Wednesday, September 23, 1903.