1904-05-11

PRIVATE BILLS-EXTENSION OF TIME.

Mr. R. F. SUTHERLAND (North Essex) moved :: That that portion of the 49th rule -which limits the time for receiving petitions for private Bills, be, in accordance with the recommendation of the tenth report of the Select Standing Committee on Standing Orders, suspended in reference to the petition of J. T. Schell and others on behalf of the Lake Erie and Detroit River Railway Company, praying for an Act to construct a branch line of railway, and that it be read and received forthwith.


Mr. SPROULE.: I beg to call attention to the fact that for some years past this House has been guilty of very loose habits with regard to the time for receiving petitions for private Bills. It is provided in the British North America Act that no petition shall be presented for a private Bill after the first three weeks of the session and that no private Bill can be presented after the first four weeks of the session. That provision was made, I assume, to enable parliament to deal with its business as expeditiously as possible, and only in case of extreme urgency should the rule be suspended. The House has been now two months in session and parties desiring private legislation should have taken precaution to get that legislation before the House in due time. The rule seems now to be honoured more in the breach than in the observance; it has been so often broken that people think it is a matter of little importance to obey the rule. It is incumbent upon the right hon. gentleman who leads the House to see that the rules are closely observed, so that the business of the session may be transacted within a reasonable time.


Sir WILFRID LAUKIER.: I am forced to say that my hon. friend (Mr. Sproule) is quite right. His criticism is very proper, and to a large extent I agree with him, but as an old parliamentarian he knows that it is very difficult to keep within the rule. My memory goes back quite a number of years, and I do not think that the rule has been more frequently broken this session than any other session. For my part, I do not think that we should agree to accept such petitions unless good cause be shown.
Motion (Mr. R. F. Sutherland) agreed to.



PETITIONS.

Mr. LEIGHTON MCCARTHY (North Sim-coe) moved :: That the petitions re the Western Assurance Company and the British American Assurance Company be read and received forthwith, and referred to the Select Standing Committee on Standing Orders.
He said : This motion has been rendered necessary by reason of the Toronto conflagration. The Western Assurance Company and the British American Assurance Company find it necessary to issue new stock, and they require legislation for that purpose. They are the two strongest Canadian companies doing business in the fire assurance world, and their application to parliament has been rendered necessary by reason of that great conflagration. I am sure no hon. gentleman will object.


[Stage Direction]
Motion agreed to.

[Stage Direction]
Bill (No. 104) respecting the Tilsonburg, Lake Erie and Pacific Railway Company.- Mr. Calvert.	*
Robert Franklin Sutherland: 



QUESTIONS.


Mr. LAVELL asked :: 1.	Is the mail service at Wolford Centre post office now semi-weekly ?
2.	When was it changed from a daily service ?
3.	If any change was made, why was it made ?
4.	Did the change, if any, lessen the expense of maintaining the office ? If so, how much ?
I-Ion. Sir WILLIAM MULOCK (Postmaster General) :
1.	Yes.
2.	First of January, 1904.
3.	and 4. Wolford Centre was established on the 1st January, 1896, with a semi-weekly service from Easton's Corners. In January. 1900, tills service was amalgamated with Easton's Corners and Irish Creek Station service, and Wolford Centre thus served daily. The contract for this amalgamated service expired on 31st December, 1903. It being considered by the department that a semi-weekly service, having regard to the importance of the Wolford centre post office, would be sufficient to meet all requirements, tenders were invited for separate services as heretofore when no tenders were received for the Wolford Centre service. It was therefore necessary to make a temporary arrangement to supply Wolford Centre semi-weekly. In view of there being no permanent contract, it is not possible to state what the reduction if any will amount to.


WOODSTOCK, N.B., DRILL HALL.
Mr. DANIEL asked :: 1.	Does the government propose to build a drill hall at Woodstock, N.B. ?
2.	Has the site been chosen ?
3.	Has the land been purchased ?
4.	If so, from whom was the land obtained ? What is the location and area, and what was the price paid ?
5.	Does the government own a lot on the corner of Green and Elm streets, in the town of Woodstock, N.B. If not, to whom has it been sold, and at what price ?


Rt. Hon. Sir WILFRID LAURIER (Prime Minister) :: 
KINGSTON POST OFFICE INVESTIGATION.
Mr. BRODER asked :: 1. Did Chief Inspector Ross hold an investigation at the Kingston post office early in February last ?

2.	If so, what was the result of the same, and was the deputy postmaster, one John L. Renton, charged with opening letters in transit through the mails ?
3.	Is it correct, as reported in the [DOT] British Whig ' and ' Canadian Freeman,' that Renton was charged by fellow-clerks with tampering with letters ?
'4. Was that the only charge preferred against Renton ?
5.	Was he not accused of further conduct of a serious nature ?
6.	Is it true, as is reported in that city, that the postmaster, Mr. A. Gunn, has stated his unwillingness to have Renton as his assistant ?
7.	Has Renton been absent from duty since the investigation ?
8.	Has he been suspended or dismissed ?
9.	Will the Postmaster General kindly have all the papers dealing with this and the investigation of 1899 laid on the Table, including the correspondence forwarded by the postmaster at Kingston to the department, in reference to the said John L. Renton's conduct ?


Hon. Sir WILLIAM MULOCK (Postmaster General):: 1.	Yes.
2.	Yes, and acquitted of the charge.
3.	Yes.
4.	Yes.
5.	No.
G. No.
7. Absent on vacation and since on sick leave.
S. Neither suspended nor dismissed.
9. It is open to the hon. gentleman to move for papers.



FISHING PRIVILEGES IN CUMBERLAND LAKE.

Mr. BOYD asked :: 1.	Have exclusive fishing privileges been granted in Cumberland lake, an extension of the Big Saskatchewan river ?
2.	If so, to whom ?
3.	For how many years ?
4.	How much per year ?
5.	What kind of nets ?
6.	If gill-nets, what length of net, and what sized meshes ?
7.	If pound-nets, how many nets ?
8.	If the above has been granted, by whuun' recommended ?


Hon. RAYMOND PREFONTAINE (Minister of Marine and Fisheries) :: 1.	Yes, for pound-net fishing for Sturgeon only. All other kinds of fishing are open to all. No interference -with Indians, or settlers.
2.	F. L. Merritt and E. D. Coffey, of Win-nipegosis.
3.	Five.
4.	Two hundred dollars.
5.	Pound-nets. only.
6.	'Answered by No. 5.
7.	To be regulated through the inspector of fisheries.
8.	Arrangements were made directly between tlie department and lessees, in the usual way.



RAILWAY FREIGHT RATES IN ONTARIO.

Mr. ANDREW BRODER (Dundas).: Mr. Speaker, before the Orders of the Day are proceeded with, I wish to call the attention of the House to a paragraph in a newspaper in regard to railway freight rates in northern and western Ontario ; and, if it is necessary to put myself in order, I will move the adjournment of the House. The question was raised in a letter addressed to the Railway Commission in regard to an increase of rates by the. Grand Trunk Railway Company, in which the company gave the excuse that they had been obliged to incur increased expenditure for maintenance and working expenses. There is no question that some additional expenditure was caused to the company by the very severe winter and the snow blockades that we have recently experienced ; but the people have suffered more than the railways from those causes. Business interests have suffered more than the railways by the detention, of goods which were ordered at Christmas and not received until March, by many perishable articles getting frozen and becoming unmerchantable while lying along the tracks of the Grand Trunk and other railways, and by winter goods being so delayed in delivery that people have had to sell them in the summer months. These are some of the ways in which the people have suffered ; yet the Grand Trunk Railway Company propose to raise their rates because they have suffered some loss. In other words, the people have no rights at all in connection with the railways of this country. The government lend to the rail- ' ways their sovereignty, so to speak, by giving them rights over private interests. In that way the railways to some extent become public highways ; and, being such, the people should have some voice in regard to their interest in these railways. I have never had any quarrel with the Grand Trunk or any other railway ; but I question the right of a railway to raise under exceptional circumstances the freight rates generally throughout the country, and make that rise practically permanent. Exceptional circumstances may have to be dealt with in an exceptional way ; but the Grand Trunk Company propose to raise the rates in Ontario simply because they have suffered loss in the abnormal circumstances which have recently existed. Have the people no rights in this matter ? Let any hon. gentleman look into the public records and see the amount of public money which the railways have received at the hands of the people, and he will come to the conclusion that the people have some rights as well as the railways. I will read from the public records to show the extent to which the people have taxed themselves in aid of railways.



The provincial government of Ontario, gave $9,708,377.69, the provincial government of Quebec gave the enormous sum of $17,561,089.08, and the municipalities of Ontario $12,000,000, and out of that $12,000,000, the Grand Trunk Railway through local roads, of which it has assumed the control, received $2,610,348.31, with in addition a loan ot $390,0(00., That is tha extent to which the people of the province of Ontario have taxed themselves through their municipalities. Taking the total mileage of railways throughout the Dominion-I am speaking generally-I find it amounts to 19,078 up to the 30th of June, 1903. During the building of that mileage, these railways received from the provincial governments an average amount equal to $1,719.77 per mile and from the municipalities $867.55, making a total average per mile of $2,587.32 for the entire mileage. That is the money which the people have spent on the railways of this country per mile, on some 19,000 miles. Before the Railway Commission, we have had the question of increased expenditure raised as a justification for increasing the freight rates. In the ' Citizen ' of yesterday, I found the following quotation from the London ' Financial Times ' regarding the appeals made to the Railway Commission to intervene in the matter of the increased freight rates over the Grand Trunk Railway :
Apparently the good people of Ontario do not realize that railways were not built in Canada solely for the purpose of providing cheap transportation for the inhabitants. Outside capital was put in for dividends, and not for philanthropy. The paper learns from a well informed source that it is very unlikely that the law authorities will intervene.
That is a very straight statement coming from a London newspaper. What authority can that paper have to say that the law authorities will not intervene 1 I would ask, is there no limit that we can set to what a railway company will do ? If a farmer should raise a bulky product, he is virtually working on shares with a railway company ; and the railway company makes a very serious mistake in charging high rates of freight on such products, because by so doing they virtually prevent the farmer from raising many jbulky products on which the companies could realize very considerable profit in the shape of freights. But so long as they impose fi eight rates which are prohibitory, so long will our farmers refuse to raise such products. The only way in which they can be induced to do so will be for the companies to charge rates that will make it possible for such products to reach the market and realize a reasonable return. It Is time that this whole question should be looked thoroughly into by parliament. Why should the Grand Trunk be allowed to take the people by the throat and say to them : we have lost money and you must make Mr. BROJVER.
up our loss. Do the men who put their money into these undertakings not run the risk of loss ? Are the people to be the only ones who stand to lose anything ? It was shown in the House a couple of years ago that while railway companies are precluded by law from raising freight rates without previously submitting these rates to the Governor in Council, yet they had invariably done so without complying with any such formality. But should they not b" compelled to submit their schedules of rates to the Railway Commission, if that is the proper authority to deal with the matter ? What right has the Grand Trunk Railway to say to the people :	we have
suffered loss and consequently are going to raise the rates ? Is there no remedy which these companies can adopt outside of taking the people by the throat ? There ought to he some remedy which can be found in the management of the road and in the way business Is being done. The companies plead increased taxation, increased price for lumber and oil, equipment, bridge building, snow blockade, etc., hut they never raise the point that there have been large increases in traffic receipts. They are careful not to point to the fact that there has been a great increase in the business of the country. If there has been an increase iu expenditure, there also has been an increase in business, hut the latter element, Mr. Hays very adroitly leaves out of the question altogether. But let him turn to the files of the ' Globe ' of a i.\ eek ago, and there he will find a glowing article showing how the railway companies were able to keep up their traffic and make money. Mr. Hays, however, carefully keeps that in the dark. Of course, with increase or business, expenses must increase. Timber. lumber, oil, coal, and all these articles, which enter into the consumption of a railway, have increased in price and Mr. Hays argues that because these things are higher, the people should pay higher freight rates, regardless of increased railway earnings. If that means anything, it means that if the railway companies find a man is making money, they are entitled to take part of his surplus. If they find a man is making a little more money than formerly, tl.ey consider they have a right to take a bigger share of his profits, hut they keep cut of sight this other fact, that if for instance, lumber Is higher at the factory, the cost of bringing the logs there, the labour, the cost of running the factory, the tic cost of putting the lumber on the cars -all these are very much increased, and the manufacturer does not get so much profit out of his lumber. Therefore, Mr. Hays lias no right to take a second slab off the sawlog, as he wants to do in this case. I have heard to-day of a man who shipped 100 barrels of apples from one of the counties west of Toronto, which were somewhat damaged in quality. The apples sold for

$100, of which the Grand Trunk got $75 end the shipper $25.	_


An hon. MEMBER.: What about the barrels ?


Andrew Broder: The shipper lost the barrels. It is about time that something was done to bring the Grand Trunk Railway and other railway companies to a proper sense of the conditions surrounding them. \ am not opposing the. Grand Trunk Railway in particular, but speaking generally. And, Sir, it is about time for the people of Ontario to understand what the building of these railways means. If the railways, when they are built, are to take the people by the throat, the people had better be careful about the building of railways, that is all. I bring this matter up because it is important to the interests of the people. I do not wish to speak of a personal matter, but I know that local freight rates, in some cases, are away beyond what are reasonable. In many parts of the country where there is no competition they are almost prohibitory. And the local freight rates pay the losses on the through rates where there is sharp competition. There ought to be some regulation of the companies, and I hope the right hon. gentleman (Sir Wilfrid Laurier) who leads the government will see to it that the people's interests are properly protected in this matter, which is of such vital importance to every man who is carrying on business and every man who, by tillage of the soil, is increasing the products of the country.


The Rt.   H@: I have to remind my hon. friend from Bundas (Mr. Broder) that parliament, only last session and after many years of agitation of the question of controlling railway rates, passed a law to create a commission for the very purpose of dealing with such questions as the hon. gentleman has brought to our attention. The commission is now in operation. I understand that their time is fully occupied, and that questions of the nature of that suggested by my hon. friend are always coming before them. It would not be advisable for the government at this time to interfere, and perhaps it would be premature also for parliament to interfere in any way until we have had some experience of the commission so that we may be able to judge what relief the people are to receive through its operation-I am sure my hon. friend will agree with me that neither the government nor parliament can do more, at this time, than give the commission a fair trial and see how far it is successful in remedying the abuses complained of.
it is the force of public opinion that largely controls railway commissions and brings to their notice grievances under which the people suffer. Now, in view of the substantial aid that the Canadian people have given towards the building of the Grand Trunk Railway and roads controlled or operated by that company, and in view of the proposal of that company, because of merely exceptional circumstances recently existing, to substantially increase their freight rates all over the country, I think it becomes absolutely necessary to draw attention to the question. Had the country not done anything to assist in building these railways, had the country not undertaken a substantial portion of the outlay involved in their construction, it might be proper to leave the matter wholly to the railway commission or the railway company ; and the Grand Trunk Railway Company might, with a certain degree of propriety, put forth the argument that they have advanced to justify their proposed increase of freight rates. I agree with the hon. member for Dundas (Mr. Broder) that it would seem that the railway companies work under a misapprehension as to the relative rights of the public and the railway corporations. I hold with Judge Black in the United States, that every railway is a highway of commerce and that every highway belongs in part to every individual who makes use of it. We are part owners of these railways. And I need only point to the fact that the franchises we have given them, the power we have given them to tax us, to take profits out of us in a hundred different ways, is an indication that we are part owners, and that we have rights-silent rights though they may be-that are too often ignored by those engaged in carrying on railway operations. The people's rights are disregarded, yet the people seem to have very little to say about the matter. So long as we assist in building railways, so long have we proprietary rights in these highways of commerce and so long should we have control to prevent them doing what is contrary to the interests of the country. I did not understand that this question was coming up at this time, and so I have not under my hand any figures showing the exact amount of money that has been given by way of federal bonus, provincial aid, municipal assistance and private contribution in land and money toward the building of the 19,000 miles of railway that we have in Canada. But, with reference to this railway that is proposing to increase its freight rates, I want to draw attention to the aid it has received for the lines that it controls. I believe that the first sod for the construction of the Grand Trunk Railway was turned in 1852:	Between ~TS35 and 1857, tho oril'iiro-


Thomas Simpson Sproule: It seems to me that parliament is not wasting its time or abusing its privileges in drawing
attention to this important question; for

Trunk'Railway. That was given out of the
public attention produces public opinion, and 93i
vmces of Upper and Lower Canada gave 815.142,033 to help to build the first Grand
public treasury, and every one who is using


Mr. RUFUS POPE (Compton).: Mr. Speaker, I think the question that has been raised is one of the most important questions that we have had to consider for some time in this House, one which has attracted some attention in the past and if I am not very much mistaken will receive some consideration in the future in this House. It is rather surprising that this question, so serious as it is, should be treated so lightly by the right lion. Prime Minister, who seems to be disposed now to fall into that position of 'wait' to which he so seriously objected a year ago in reference to some other matters. There are some people who have been waiting and paying in this country. They are the farming community of Canada. We find that we have bonused railways in Canada by way of municipal, Dominion and provincial subsidies to the extent of $237,000,000, in addition to which we have granted from 57,000,000 to 62,000,000 acres of land, making about sixteen thousand dollars per mile of public aid for the total mileage in Canada, valuing the land at one dollar per acre. Now Sir, what has the farmer received for this tremendous taxation that has been imposed upon him ? We know what he has contributed towards aid to transportation in Canada. The figures are before us and surely they are large ones for a population of six or seven million people. When a community has loaned its credit and employed its powers of taxation to the extent of the figures I have just quoted, it indicates that the people are entitled to some consideration either at the hands of the government or somebody else in return for the money they have invested in this way. What are they getting for it ? It is a fact that you can ship grain or other products cheaper from Chicago to Montreal than you can from points in Ontario to Montreal. You may have a train load of grain leaving Midland and on that train there may be half a dozen cars of Canadian grain and half a dozen cars of; American grain going to the same port, going to the same destination, goipg to the same point in Canada or Europe. We have bonused these railways, built wharfs, subsidized bridges, subsidized lines of steamers in order to carry the grain from this country to Europe and what have we got out of it. We pay from ten cents to twenty cents per hundred pounds to carry Canadian grain more than is charged for foreign grain going through our country. Under these circumstances this is a question that we may spend an hour or two possibly this afternoon in discussing. It may be true that the interests of the farmers of this country do not appeal very warmly to the right hon. leader of the government. It may be that he has forgotten that there is a community in this country that have borne a heavy burden

and borne it without much grumbling or fault finding, but the time comes, and it may be only the straw, which shows which way the wind is blowing, when the people at least think they have the right to begin to consider their own welfare and I believe that in the matter of freight rates and in the matter of railways the time has arrived. Every day the Railway Committee of the House of Commons of Canada is occupied in considering blanket charters applied for by men of straw, mere brokers, as it were, gamblers in the rights and privileges that they get from this House, who have not the slightest intention of ever carrying out the undertakings with which they are identified. What is the result? These charters are traded around through the country and they are sold at anywhere from $50,000 to $500,000 acofding to the value that may be created by the opening up and peopling of the district through which the railway contemplated by the charter is designed to run. There, the burden begins. That is the beginning of the freight rate question. The price of the charter has to be paid by the freight rates which are charged in the future. On top of that comes the man who speculates in the construction of the road and who jockeys the market and saddles the road with an immense burden in order that he may make his millions out of it. The result of the whole thing is that the railway company have to impose upon the business community and the agricultural community the tremendous rates in order to carry this debt from year to year. Under the conditions that exist in this country I think we have the right to lake up a little time in the consideration of this question. When the Grand Trunk Railway Company say that because they had a difficult winter they are going to raise the freight rates in western and eastern Ontario, or in any other part of the country, or when any other railway corporation say that they propose to do the same thing, I say that they should stand in no different position from that in which any business man stands in fair competition. If he has difficulties he has to get over them. He has to pass dividends. He has to carry a profit and loss account and it is not always a profit account that he has. When some of the railway companies in Canada think that because they have had a hard winter the community must bear an extra load, it is not going to be said without a voice being raised in the House of Commons of Canada, when this House is in session and when members are supposed to be present, that we care so little about what may happen to us as a people we dare not enter our protest, forsooth, because a commission has been appointed. The commission have been appointed, I believe they have given a decision or two and I believe these decisions were cancelled by the government of the day. From the first there seems to be a Mr. POPE.
want of confidence on the part of the government as far as that commission is concerned. I ask if the Grand Trunk Railway Company carried the mails according to their contract in Ontario last winter ? They do not care a snap about their contract as far as the delivery of the mails is concerned. If it were a private party who had failed in his contract he would have to suffer. If he did not complete his contract he would be punished by being made liable for any damages which had occurred. The time has arrived when the people of Canada, who have paid for these railways, who have subsidized them to an extent that no country has ever subsidized railways are entitled to enter their protest. Under these circumstances the farmer, and every individual in this country, not only the members of this House but the taxpayers of Canada, have the right to raise their voices and express their opinion in regard to these matters more particularly in Canada than in any other country. In regard to the question of transportation in the future we have to consider very seriously the legislation of this House. If it be true that we have no hold upon these corporations, if it be true that after taxing ourselves to the extent of $300,000,000 we have no right to a voice in the matter of freight rates it is time that this parliament called a halt in regard to giving out further charters to corporations enabling them to impose burdens upon the people of Canada in future. It is time we changed our system and I believe that the time has arrived when we should give no charters, when we should issue no special privileges, but let the men who are promoting a railway get together, register themselves in a proper office to be provided for the purpose and build their road from point to point, build as many roads as they see fit and build them with their own money. Every day in the Railway Committee we see people holding up raiiways. A man applies for a charter from one point to another. We find that we have given a charter for a similar line last year or the year before. Nothing has been done. The holder of that charter comes forward and says : You are paralleling my line for 10,12, 15 or 50 miles as the case may be. I say that the corporation that will put their own money in and construct a road ought to have the privilege of paralleling any other road for which a charter has been given, and if the corporation which had the first right to build that road had not built it they should take the consequences.
The time has arrived when this parliament will be justified in considering a change in the system under which it has granted charters and privileges to special bodies of men in this Dominion. If you take the watered stock into consideration, and if you take other such matters into account, you will find that there is imposed upon the people of Canada a burden, in the paying of dividends,

that would stagger the most prosperous community on the face of the earth. The prosperity and development of our great Northwest is beyond question, but why should we shackle future generations with these heavy burdens, and why should we be told in this House that we have no right to look at the kind of shackles that are put on. I enter my protest against the Grand Trunk Company, or any other company, taking the position that because of temporary conditions they have the right to impose extraordinary burdens upon the people of Canada in the way of additional freight rates. I enter my protest against the declaration of the Prime Minister, that because there is a commission appointed we have no right to take such a matter into consideration in this House. There is nothing so important to the progress and prosperity of Canada as this very question of transportation. The mere building of a railroad will not benefit the people ; the question of how much they will have to pay to transport their products over that railroad when it is completed is the all-important consideration. We have so aided railway construction in this country that the roads have been built with comparatively little money invested by private individuals, and if we are to band over these roads to private companies without having any voice ns to the charges that are made on ihem, then it would he far better for this House to consider the purchase and the acquisition of all the railroads in Canada, so that we may try to get -some benefit out of the $230,000,000 we have expended upon them.


Mr. M. K. RICHARDSON (South Grey).: I do not feel it a very pleasant task to be compelled to say anything which might be calculated to accentuate the growing feeling of antagonism between the farmers and pro ducers of this country and the large railway corporations ; and that such a condition does exist no one who has his eyes and ears open can fail to recognize. I believe it is incumbent upon us in this parliament not to say anything unnecessarily that will intensify that feeling. It is only right that the people of Canada should recognize that foreign capital invested in the building of railroads has not been invested upon sentimental principles, and that railroads are not run for philanthropic purposes, hut on business principles. At the same time, at the close of a winter which has been of such an abnormally severe character, it is an inopportune time for the Grand Trunk Railway Company to come before the Railway Commission and make the proposition that they intend to increase their freight rates, to the great detriment of the farmers of this country. It is true, perhaps, that the railroads have been put to extraordinary expenses in keeping their connections open during the past winter, but there are at the same time thousands of business men throughout Ontario who have lost the profits on their business, and there are thousands of men
throughout Canada to-day who are embarrassed as a result of these same conditions. It should not be lost sight of that the Grand Trunk Railway Company, for a year before the beginning of this exceptional winter, were giving a very inferior service in Ontario, so that taking ail things into consideration a worse time could not he found in which to impose more onerous conditions on the business community. It would seem as though the Grand Trunk Railway had said : If this company loses because of abnormal climatic conditions, or if the Ontario government think it well to increase taxation on railways, we will take good care that we shall not lose anyway, but that we will make -the public pay for it in the shape of increased freight rates. Canada has granted more aid in the shape of money and land grants for the development of railway communication than has a-ny other country in the world. The people of this country have to a large extent taxed themselves for the building of these roads, and those who invested their private capital in the enterprise should recognize that if exceptional conditions arise, and if their profits are reduced, they have to take their chances on that score. If the shareholders have had their dividends reduced, it must not be forgotten also that the farmers of Ontario have been unable to get their products to the market, and that the business men though being unable to transact business, have suffered corresponding losses.
I would not like to see the feeling of antagonism that exists between the railway corporations and the farmers of this eoun-trv accentuated more than- it is at present. There is a marked and growing feeling today that we are not a self-governing people, but that the country is largely dominated by great railway corporations-that it is being practically sold to them and governed by them. This is an unhappy state of things, and it would be well if to some extent it could be ameliorated. It would be well if the producers would always recognize the fact that money is invested in railway corporations in order to earn dividends, and that that money is not always invested by people of wealth who have abundance and can afford to lose, but that in many cases it is the small capital of people in humble circumstances. Therefore, it is reasonable that over a series of years there should be a fair return for the money invested in the railways of the country ; but for the railway corporations to take advantage of an exceptional season to make a permanent rise of rates is something that will be keenly resented by the people, in view of the liberal grants which they have made in land and in other ways in aid of these railways. There should be some consideration of this by the railway companies themselves. The people of this country are paying a very large share of the cost not only of building these roads, but of maintaining them ;

and the railway companies should not have the power to dominate so completely the material interests of the country as practically to put a price on all the products of the country. So that no longer can a man say that he can raise any particular article at a profit, but it is for the railway companies to say whether there shall be any profit left to him or not. This is against the material interests not only of one class of our people, but of the country at large, and therefore it is important that the whole matter should have full and fair consideration in the House and before the country.


Mr. ROBERT JOHNSTON (Cardwell).: Mr. Speaker, I do not take up much of the time of this House, but I feel it my duty to have something to say on this important question. I was not one of those who believed that the appointment of a railway commission was going to be in the interest of the general public. X looked upon it as a hiding place for any government that might be in power. It is like farming out a job ; the government can hide behind tlie commission. I have not yet seen any benefit from it. Although I believe it has given one or two decisions, the government has overruled them. I understand that after the commission gives a decision on any question, it has then to come before the government, which is to say whether it will stand or not. Now, it is an easy matter for a railway corporation or railway officials to come and see this commission privately, compared with seeing the government or the House of Commons, composed of 214 members. Though I was not one of those who believed in the appointment of a railway commission, I notice that it has had one result. We do not need a Minister of Railways any more. Since its appointment he has not appeared in this House, and the only thing he has done in connection with railway matters has been to sign the contract with the Grand Trunk Pacific. He has not said a word on the Bill so far, but is leaving to the other members of the government all the explanations of the contract to which he put his signature. The railway companies talk about the great losses they have sustained during the past winter from snow blockades and other things ; but the people throughout the country have suffered great loss and inconvenience as well as the railways. All we could do was to bear our troubles and say nothing. But we think 'it is unjust for the railways to impose on the people extra freight charges in order that they themselves may be at no loss. I do not usually growl at the railways ; but I wish to state that during the past winter I sold a number of young cattle. By an arrangement made with the railways some years ago, all the registered stock are carried at half rates. The cattle are snpposed to be of a certain weight according to their age. An animal which is one day over two years old will be charged just double what a Mr. RICHARDSON.
two years' old animal will be. I sold eight head of cattle. The oldest one was three months short of being a year old. I could not get a car at my station, either on the Grand Trunk or the Canadian Pacific Railway, to take those calves away until the oldest one became two years old. The result was that I had to pay twice as high a freight charge as I would have had to pay had I got the accommodation at the time they were sold. It cost me $21 to provide for the feeding of these cattle during the time they had to wait for railway accommodation. If this government will stand by and let the railway corporations raise the freight rates as they please, and then go and settle the matter with the three commissioners whom the government have appointed, the people will not be satisfied. I believe this is the thin edge of the wedge ; and if the Grand Trunk is allowed to raise the freight rates, there will be nothing to hinder the Canadian Pacific Railway and all the other railroads in the country from doing the same. The railways do not fight against each other, even at competing points. What we call competition is not competition at all. The railways charge the same rate from competing points, and we have only the choice of two lines. If the government would settle this matter in the interest of the whole public, instead of leaving it in the hands of three commissioners, it would be better for the country at large. I sympathize with the railways in the trouble and expense to which they have been put in struggling with snow blockades during the past winter ; but the farmers throughout the country have had to spend their own money in clearing the highways. They have had to stand that loss, and why should not the railways stand their losses ? They have their good times as well as their bad times, just as the farmers have ; but the farmers have no means of making anybody pay their losses but themselves.
I think that the government should act right away and say to these companies : we will fix your rates of freight, you are not in a position to say to the people that because you have lost money the people must reimburse you. What I would like to know is whether railway companies have the right to take this position, that because they have lost money during the winter, they will raise their freight rates during the summer, and thus make the public pay their loss. If there ever was an argument which convinced me that the sooner we have government owned railroads the better, it is the stand taken by this railway company. I hope that the government will not wait until the railway commission deals with the matter , but wrill take steps to have the commission deal with it right away, in order that the people may get fair play.


Mr. E. COCHRANE (East Northumberland).: This is a subject, Mr. Speaker, that

comes very close home to the general public, and while I have no desire to make a speech, I wish to submit a few facts to the attention of the House.
Some lion. MEMBERS. Louder.


Edward Cochrane: I am suffering from a cold and cannot yell. If hon. gentlemen will keep still and pay a litle attention, they will hear what I have to say. I was sorry to see the Prime . Minister and the Postmaster General talking and laughing when this serious matter was up before the House. It may be very nice for them to talk and laugh when the money of the people is being taken out of the people's pockets. That of course does not concern them. As long as they are in office and get their salaries and enjoy a good time, they care little who is bled. But the hon. Minister of Trade and Commerce (Sir Richard Cartwright) I know will not laugh, because in times gone by. when the Conservative party was in office, he was wont to indulge in a very mournful wail over the farmers being bled white. 1 often wonder how that hon. gentleman feels now7. But I just want to draw7 to his attention and that of the right hon. the Prime Minister, the present condition of things, and to ask them why they should want us to wait until we see what the commission will do. Why, only last year, when introducing the Grand Trunk Pacific Bill, with such a flourish of trumpets, we were told by the right hon. gentleman that time w7ould not w7ait and that every moment that w7as lost was lost for ever. But now he tells us to wait and see what the Railway Commission will do. But I say that not a moment should be lost in urging the Railway Commission to prevent the Grand Trunk Railway putting this iniquitous proposition of theirs into effect. I have no feeling against the' Grand Trunk Railway or any other railway. I have been in this House many years and have aided by my voice and vote the construction of many railways, but after these roads are constructed, we do not want to be oppressed-, as we have been, by these railway companies which we have bonused, not only by provincial and Dominion subsidies, but also by municipal grants, which we have paid by direct taxation. What is the position in which we are? We are told by the Grand Trunk Railway that because they have had a hard winter, they must make the farmers pay for it. But have we not all had a hard winter ? Let me tell those people from the Northwest who are complaining about the difficulty of getting coal in that section, that we were in the same position in Ontario on the main line of the Grand Trunk Railway. For weeks and almost months our people could not get in or out over these roads, which we had paid for out of our own pockets. If
the Prime Minister has not time to deal with this matter, I know that the Minister -of Trade and Commerce has plenty of time on his hands. We are paying a large sum to that hon. gentleman for his cab hire, and if he cannot walk, he can drive to that commission and see that this matter is attended to. Let me draw to his attention the fact that these hundred barrels of apples, which were spoken about to-day, v ere sent from the village of Hastings, in the north part of the county which I have the honour to represent. They were sent over a road to which the peoplejraid large bonuses by direct taxation, and that company charged 75 cents a barrel for bringing these apples from Hastings down to Ottawa. I sent some apples on commission to Great Britain this year, and the freight to that country was only $1 per barrel That surely is a matter to which we should give a little attention. This whole question is one of great importance to the people, and the Ministers would do far better to give it their serious attention instead of allowing members on their side to fritter away the time of the House talking on the same subjects and repeating the same speeches, and in listening to which my head has grown gray. Apparently the Minister of Trade and Commerce has no time to give any attention to a subject which so closely interests the farmers, with whom in the olden days he used to sympathize so deeply. But of course, talk is cheap, and once in office, we find these people, who were so vociferous in opposition, not willing to give the slightest heed to the principles or policies they then advocated and quite content to remain silent in their seats while the farmers are being bled, not only by this extravagant government, but also by these railway companies which we have so largely bonused. There is another point, and one w7hich I would like to bring to the attention of the Minister of Agriculture (Mr. Fisher). We are advised from Great Britain that our people's shipments to that country arrive in a bad condition. To w7hat is that due ? In the village of Brighton, W7here there is the largest storage accommodation in the Dominion, shippers have been so handicapped by the fact that they could not get cars properly heated to carry their fruit, that they had to take anything the Grand Trunk Railway would stnd them. Consequently the apples got frozen and arrived in poor condition. That was not due to any fault on the part of the farmers, but because the railway company did not provide the proper facilities to carry the fruit to market. If the Minister of Agriculture had paid less attention to fattening chickens and more to the carriage of freight, Hhat difficulty might have been avoided. If the Prime Minister would take this matter into serious consideration and consult with the Minister of Trade and Commerce, something might

b ; done. Then we have this other injustice inflicted on Canadians. The same road which will carry a Yankee from the state of Michigan to New York at the rate of two cents a mile will charge a Canadian three cents a mile, although that company has been aided by Canada to the extent of from $75,000,000 to $100,000,000. It is an insult to the Canadian people to say that a railway chartered by them and aided by them to such an enormous extent should be allowed to treat our people with such unjust discrimination.
I want to-impress that upon the Prime Minister and the Minister of Trade and Commerce. The Minister of Trade and Commerce has not much else to do in that place that he spoke of as a sinecure before he got into it. Now that he has plenty of time, he ought to pay attention to this matter. And I am sure that, now that the case is brought to his attention, he will avail himself of the opportunity to do something to earn his money.


Mr. JAMES J. DONNELLY (East Bruce).: Living, as I do, on one of the branch lines of the Grand Trunk Railway in western Ontario, I have good reason in my own experience to know that the hon. member for Dundas (Mr. Broder) and other hon. members who have spoken have good ground for the criticisms they have directed against that company. We not only have to pay high freight rates, but we have great difficulty in getting cars in reasonable time. We suffer from this difficulty now, but the same difficulty existed even last year, before the snow blockade. Then, the time-tables on these branch lines are a very poor guide as to when the trains will come along. It is quite a usual thing for trains to be an hour or an hour and a half late. I am not speaking of freight or mixed trains, but what are called express or mail trains. Occasionally a train will be on time, and so the public are obliged always to be at the station at the hour given in the time table, and very much valuable time is wasted in this way. These causes of annoyance have been frequently brought to the attention of the company, but, though there has been some temporary improvement it has never continued for a very long time.


Mr. JABEL ROBINSON (West Elgin).: I am like the hon. member for Cardwell (Mr. Johnston), I had great faith in the Railway Commission, I have been advocating the establishment of a court at which the farmers could plead their grievances and have them redressed. And now the government have appointed a railway commission and we are expecting great things from it. Perhaps we are expecting too much. The commission will have to be governed by the Railway Act. If the Act gives them no power to settle a question of freight rates between the railway companies and the producers and consumers, we might as well Mr. COCHRANE.
have no commision. It seems to me, however, that they have power to say what shall be a maximum rate. If that power is not conferred by the law then we had better change the law at once. It seems 1o me that this is a very inopportune time for the Grand Trunk Railway Company to-fail foul of the people of Canada, just at a time when they are asking so many privileges from the government-but they have not got them yet. I suppose that the Grand Trunk Railway Company is connected with this Grand Trunk Pacific, and that it is on behalf of the Grand Trunk that these privileges are being asked. We are to give them a transcontinental road for fifty years to operate without let or hindrance. I think they should think twice before they impose heavier taxes upon the farmers of this country as they seem to intend doing. They are going to levy a higher rate( both ways upon the stuff they carry. That is what I understood from what was stated by the hon. gentleman (Mr. Broder) who introduced this question. If they are allowed to do that, what does it mean ? It means this : that it will not only reduce the price of what we have to sell but it will increase the price of what we have to buy. And the necessary effect of that is that it will reduce the value of our land. These men are masters of the situation. By a stroke of the pen, they can say what we shall pay for what we buy and what we shall receive for our labour. It is time that this condition was changed. I do not think that the government have any power to act at once under the circumstances. I am not one of those therefore who shout at the government to jump up at once and do something. If the Railway Commission has power to settle this difficulty, let them settle it; if not, let us pass a law that will give that power. We are apt to boast and to sing very loudly 'Britons never shall be slaves,' But we are all slaves to the railway corporation, and we are going to be greater slaves, and slaves for all time, if you hand over the Transcontinental Railway to the Grand Trunk. We shall be slaves for fifty years anyway, and that is as long as I am likely to live. I know that this is not the time to discuss the Transcontinental Railway. But the question is whether these people have the right to place these heavy taxes on the farmers and not let them have a word to say about it. The first tiling the railway commission ought to do is to find out what it costs to carry a ton of freight or a passenger a hundred miles. If they do not know that now, the best thing they can do is to figure it out. Then, they would have some basis to go upon. At present, we are groping in the dark. We have been advertising Canada for a number of days in this House as a country that is in a deplorable state in winter. We abused Kipling like everything because he called our

country. ' Our Lady of the Snows.' But we go on so much further than anything he said that we are apt to prove that our country is Our Lady of the Frost as well as Our Lady of the Snows. We do not want to say too much about these things. We do not want to let a railway company think that because they get stalled for a few days in winter they are to take that as an excuse for laying heavier burdens upon the producers and consumers. I remember reading a story not long ago-and you know I very seldom tell stories-of how one of the magnates in the United States was petitioned for a grant to the University of Chicago. He asked how much was required, and was told that half a million or so, would set the institution on a proper basis. He wrote his cheque and then turned to his clerk and said, ' Put up coal oil two cents a gallon.' In a month he had his money back from the consumers of coal oil. That is about the way these railway companies are going to do with us-use the extra expense of an unusually severe winter as an excuse for laying burdens upon us out of all proportion to the cost. I do not want to make a speech but only to enter my protest, not against the position of the government, but against any monopolists in this country being allowed to treat people as the railways are treating us today.


Mr. HAUGHTON LENNOX (South Sim-coe).: I understand the right hon. gentleman (Sir Wilfrid Laurier) who leads the House to say that this is not an opportune time to bring up this matter and endeavour to secure a remedy. He seems to think that this is a time for us to pause, to consider, to delay, to deliberate. This is the time when the hon. gentleman would have us say : Tomorrow, and to-morrow, and to-morrow. It is a time when we are not to be in any hurry, a time when we are to let matters drift as they will, leaving the farmers in the meantime, to suffer as they may. I understand that the right hon. gentleman says that the remedying of this grievance should be left to the Railway Commission.
Either the right hon. gentleman (Sir Wilfrid Laurier) knows this or he does not know it. If he understands it at all he is not giving us the best conclusion he could arrive at. The Railway Commission cannot remedy all the grievances of which the people are complaining. I may say here that I have not that abiding faith in the Commission which the right hon. gentleman seems to have. I presume the right hon. gentleman is aware, being the leader of a great business government, that there are other grievances besides rates of which the people are complaining, that for many months past, if not for years, the question of not having adequate accommodation and reasonable facilities for the transportation for the products of this country from point to point, has been as serious as the question of rates. It is important for the government to know that great as the congestion is in the west, crying as is the need for additional facilities for transporting the produce of the west, great and immediate as is the need of a transcontinental railway, equally great is the need, in the older portions of Ontario, of having the Grand Trunk so equipped that it can with reasonable facility carry the produce of old Canada from place to place and from port to port. I do not know whether the right hon. gentleman (Sir Wilfrid Laurier) is aware that the Grand Trunk Railway which has now been in operation for more than half a century having absorbed the Great Western and other of the old railways of Canada is today very poorly equipped for the transportation of the produce of Canada. Its equipment is on a par with that of the Intercolonial although the Intercolonial Railway is now like an old song, they are going to throw it away ; it has never been, according to the government, a railway of any importance, and they are going to side-track it. The Grand Trunk Company which is supposed to be able to serve every city and town in old Ontario and Quebec and to a large extent in the maritime provinces has only the same equipment as we have on the Intercolonial Railway. Of engines the Grand; Trunk has 22 to the 100 miles ; the Intercolonial has 21 to the 100 miles. Of freight cars the Grand Trunk has 775 to the 100 miles, and the Intercolonial 774 to the 100 miles. Now what is the remedy the right hon. gentleman tells the people of Canada he is going to apply to this ? He says that when we come to have the Railway Commission running smoothly-and I do not know when that is going to be, it did not start off very smoothly in the matter of telephones- we will have these matters adjusted. We cannot have these matters adjusted by the Railway Commission ; the remedy was for the government, when the Grand Trunk came to them and said they were going to open up the west, to have said :	We want
as a guarantee for the services you are to render in the new land something to show that you have carried out what is necessary in the old territory which you occupied before ; we want you to give some guarantee, aye, and to implement it if you will, that you will give adequate facilities for the-transportation of the grain over the territory you already occupy before we open up a new territory for you at vast expense to the people of Canada. The government had the opportunity to exercise that control ; to-a large extent, they have it yet. This transcontinental railway scheme is not yet consummated, and it is becoming more difficult of consummation every day. The government I know are hesitating now ; they do not know exactly what the next move is to be. I urge upon the government to take-

this matter In hand, to be practical business men and now when they have the opportunity I ask the right lion, gentleman and his colleagues to pause, to consider, to delay, to deliberate and let the result of it be that we will have a better bargaiu for the people of Canada, particularly in the matter we are discussing this afternoon.
There is another matter that is not entirely under the control of the Railway Commission, that is the question of accidents.


Wilfrid Laurier: Order. I think my hon. friend should coniine himself to the question of freight rates which has been brought up by the hon. member for Frontenac (Mr. Broder).


Haughton Lennox: I understand that the adjournment was moved on the question of railways but as I am not particularly anxious to speak on the question of accidents I shall not insist; but at the same time I would be very glad to have your ruling, Mr. Speaker.


Mr. SPEAKER.: The question as I understood it was a question of freight rates purely and simply, and I think that it would perhaps be better if the hon. gentleman would limit himself to that subject.


Mr. HENDERSON.: The same point was raised only a few days ago and Mr. Deputy Speaker moved exactly to the contrary ?


Mr. CLARKE.: Take your choice.


Haughton Lennox: 
Mr. A. B. INGRAM (East Elgin).: Mr. Speaker, it seems to me that there is one very important point that has not been dealt with in this discussion this afternoon. One of the reasons that the general manager of the Grand Trunk Railway Company gave for raising the rates of freights was that the Grand Trunk Railway Company have been compelled to pay $230,709 in taxes or something like $75,000 more than they were held to pay the previous year. This is the increase according to the figures as given in the ' Globe ' of Saturday last. AVe have not stopped to consider the question as to whether the Ontario government were justified in passing the Act imposing heavier taxes on the Grand Trunk Railway Company

or upon any other company. The Grand Trunk Railway Company complain because they own the only double tracked road in Ontario or in the Dominion of Canada. It is true that the Michigan Central is partially double tracked, but the Grand Trunk Railway Company, I understand, suffer more by reason of this than any other line of railway. Their double track costs per mile .$40 taxation, and that is what they complain of as being particularly hard on them. The Ontario government have the right to impose these taxes but the right to control railways has been taken out of the hands of the provincial governments and placed in the hands of the Dominion government. The Ontario government have placed this tax upon the railway companies in Ontario and I want to draw the attention of the House to the fact that had it not been for the enormous extravagance of the Ontario government many of the taxes which they have imposed on the people would not be necessary. They have taxed the living and they are taxing the dead. They are taxing every professional gentleman in the province, they are placing taxes upon every insurance company anil bank in the province, they are placing taxes wherever they can in order to raise funds to meet the extravagant expenditure they are making from year to year. It must be admitted that where a government impose taxes unnecessarily, whether it be on insurance companies, railway companies, or upon any other line of business carried on in any province, these companies must of necessity impose larger rates on the public in order to meet this increased taxation. The Ontario legislature voted not long ago $2,000,000 to the Consolidated Lake Superior Company and took the Algoma Central Railway as security, a road that they themselves furnished the money and'gave the lands to build, taking as security au institution that they themselves brought into existence. The voting of this sum of money was quite unnecessary and quite uncalled for. I wish to draw the attention of the government to the fact that when the Hon. G. W. Ross became premier of the province of Ontario he made a speech at Whitby during the course of which he made this statement:
The Ontario government has nothing to do with the control of railways. The control of railways has been taken from us. I was in the House of Commons when that change was made, and I regret that it was made. We want to get into the British market, and I pledge my word as leader of the government that the Ontario government will lend all the assistance in its power to encourage the Dominion government in providing quick and cheap transportation for our produce to England. The Dominion government cannot afford to turn a deaf ear to our representatives in the Ontario legislature. When the Ontario legislature asks they must move, because more than one-half of the influence of this country lies in Ontario. It shall be my early duty to see if there cannot be a
reduction of freights to ocean ports on agricultural products.
I would like to ask the right hon. leader of the government if he has ever been petitioned by the Ontario government, or if the leader of the Ontario government has ever interceded on behalf of the farmers of the province of Ontario in order to secure cheap transportation. But, what do we find the premier of Ontario doing in the following session after he had made the statement at Whitby ? The following motion was moved by a gentleman who represented one of the ridings of the city of Toronto-Mr. Crawford :
That in the opinion of this House it is the duty of tile provincial government to, without delay, urge upon the government of Canada, the necessity of taking steps to obtain for the people of this province, cheaper rates for the transportation of agricultural products.
Would it surprise the right hon. leader of the government if I told him that not only Mr. Ross but every one of his followers voted against that resolution asking for cheaper transportation ? I am afraid that this is in line with- some of the professions made by hon. gentlemen opposite. These hon. gentlemen make great professions in the country but when resolutions are brought into the House they vote against the principles which they have proclaimed outside. I would like further to state that upon referring to the General Railway Act I find in section 255 the following under the head of ' freight classification ' :
The tariffs of tolls for freight traffic shall be subject to and governed by that classification which the board may prescribe or authorize.
I find further in section 250 :
All tariff by-laws and tariffs of tolls shall be in such form, size and style, and give such information, particulars and details, as the board may, by regulation, or in any case, prescribe.
In section 257 I find the following :
The board may disallow any tariff or any portion thereof which it considers to be unjust or unreasonable.
If that be true and if this matter is submitted to the commission, then, I take it that if the commission find that the rates imposed by the Grand Trunk Railway Company are exorbitant or unreasonable they have the power to refuse to sanction these increased rates in the matter of freight. But, I take it that if this matter is brought before the commissioners they will weigh well and carefully the nature of the obligations of the Grand Trunk Railway Company. If the obligations of the Grand Trunk are so and so by reason of certain provincial legislation, whether it he by the Ontario government or any other government in this Dominion, and if they have been imposed through no fault of the Grand Trunk Company, then, the commissioners must take

into account the question as to whether the reasons for increasing the rates were good and sufficient and if they are the Grand Trunk	Railway	Company	will	be	justified in charging the rates which they have charged. If that cannot be proved	then I	take it	that	it	will
be their duty to disallow the rates imposed by the Grand Trunk Railway Company. As members of this House I think it is our duty to point out the weakness of the action of the provincial government in imposing obligations on railways that we in this parliament have the right to control and to point out that the provincial government should exercise greater economy in the administration of the affairs of that province and thus remove any reason for imposing unnecessary taxes on the Grand Trunk Railway Company or any other railway company in this country. '
Personally, I am in favour of having as low freight rates as possible on the Grand Trunk or any other railway. I believe that one cent more paid for transportation is a cent out of the pockets of the farmers of this country, and that a cent saved on transportation is a cent earned by the farmers. If the government of Ontario had exercised economy and had not increased the expenditure from $3,000,000 to nearly $6,000,000, they would not to-day find it necessary to impose this taxation. And .let me point out to the right hon. the Prime Minister that when he is proposing legislation which will entail vast expenditure, let him remember that every burden he imposes upon the people will interfere with the welfare and prosperity of Canada.
Motion (Mr. Broder) to adjourn negatived.



GRAND TRUNK PACIFIC RAILWAY.

[Stage Direction]
House in committee on Bill (No. 72) to amend the National Transcontinental Railway Act.-Sir Wilfrid Laurier.
On section 1 of the Bill,
Mr. R. L. BORDEN.: Before we proceed, I wish to say a word with regard to a document which has been quoted from by members on this side of the House, and which is a report of the minutes of proceedings of the ordinary general half-yearly meeting of the shareholders of the -Grand Trunk Railway Company, held at the Terminus Hotel, Cannon street, London, E.C., on Tuesday, the 8th of March, 1904. This report has been attacked from the other side of the House by more than one speaker. In fact, one bon. gentleman described it as a fabricated document, and said that it was a fake report. That was the description given of it by a very prominent speaker on the other side. It is to all intents and purposes the same as the report in the ' Railway News,' but there are some minor differences ; the speeches of some of the shareholders are reported fully in this document, whereas they Mr. INGRAM.	.
are not reported in the ' Railway News.' As these insinuations have been made against the correctness of this document, I have thought it right to have it verified, and I now have a declaration, having all the sanctity of an oath, from the gentleman who attended the meeting and prepared the report. The declaration is as follows :
I, James Watson Mills, of 13 Cheverton Road, Hornsey Lane, in the county of London, shorthand writer and reporter, do solemnly and sincerely declare as follows
On the 8th March, 1904, I attended the ordinary general half-yearly meeting of shareholders of the Grand Trunk Railway Company, Canada, and the printed report hereto annexed marked ' A ' with the red ink alterations initialled by me is a true report of the proceedings of such meeting, and I hereby verify the correctness thereof to the best of my belief.
And I make this solemn declaration conscientiously believing the same to be true and by virtue of the provisions of the ' Statutory Declarations Act. 1835.'
Declared at St. Lawrence House, Trump Street, in the city of London, the 28th day of April, 1904.
Before me,-
(Sgd.) W. W. Hortin,
A commissioner for oaths.
(Signed) JAMES W. MILLS.
I should say that the alterations which are made in this printed document are, I think, not material,, except so far as one is concerned. That error was obvious, and it was corrected in the copies of this document which some weeks ago I sent across the floor to hon. gentlemen opposite. I have prepared a copy of this document exactly as it has been verified by Mr. Mills, and I will be glad to place it in the possession of my hon. friends on the other side.
I think it would have been well if we on this side of the House had been furnished with copies of what is called the official report of the meeting of shareholders of the Grand Trunk Company, which has been largely quoted from by gentlemen on the other side. We have not had the courtesy of being furnished with that report, but I have procured a copy. It does not purport to contain the speeches in full, but there is one important statement in it which it might be well to bring to the attention of the House. In the special report of directors to the shareholders of the Grand Trunk Railway Company of Canada, bearing date the 20th day of February, 1904, which was considered at that meeting, and which has as an appendix the fwo agreements-although I think there are some few typographical or clerical errors in the copies of the agreement annexed-in that report Sir Charles Rivers-Wilson states most distinctly what was afterwards stated in the speech of himself and of other directors of the Grand Trunk Railway Company. One paragraph of the report previously sent out and read to the shareholders on that occasion is this :

It should be mentioned that in consideration of the guarantees and other assistance given to the Grand Trunk Pacific Company, the Grand Trunk Railway Company are to receive the whole of the $25,000,000 of common stock of the Grand Trunk Pacific Company.
We have proposed several amendments to the Bill, and the Minister of Justice suggested that we should give these to him, in order that he might furnish to us a written statement of the reasons on account of which he might not see fit to agree if he did not agree. I have not received from the Minister of Justice any statement of reasons, although I believe that my hon. friend from Hamilton (Mr. Barker) has a letter from the Minister of Justice stating that as to certain of these proposed amendments the government does not see its way clear to assent. We are, therefore, not very much further along than we were before we gave these amendments to my hon. friend. I observe in a recently established organ of the government the assertion that this was designed as a ' trap.' Well, I do not suppose there is anything in that, but still it may be well that these arrangements made across the floor of the House would be carried out perhaps a little more strictly in the line of what was intended. I am not much afraid of any trap we may have been led into, although it is asserted in this organ of the government that this was a trap or intended as a trap, and that a very great stroke of strategic genius has been performed by the government in inducing us to hand over these amendments.
I do not regret giving the government time to consider them ; I would do so again ; but it is not perhaps in very good taste, after a courtesy a little out of the ordinary course has been accorded by this side of the House, for organs of the government, recently established in the province of Quebec, and speaking for the government, to make these assertions in regard to gentlemen on this side of the House.


Wilfrid Laurier: What paper ?


Robert Laird Borden: ' Le Canada.' It was brought to my attention this morning. I do not care one snap of my fingers for any trap the government might set for us. I do not think they did set any trap. I think the arrangement was made in good faith. All I regret is that it was not carried out more in accordance with the understanding which we had at the time it was made. These amendments were sent to the Minister of Justice in good faith, and I have no doubt he received them in good faith. I know that he has been absent from the city and only returned yesterday afternoon. Unfortunately we have not had the understanding carried out in the way we had reason to hope. However, I shall be glad to learn, even at this late date,' from the Prime Minister or the Minister of Justice, in what order they would suggest that
the amendments be taken up. I am as desirous as they are to take them up in the order that will most expedite the discussion of the measure, while giving us an opportunity of making a full argument in support of the amendments.


Mr. FITZPATRICK.: With regard to the reference made by the hon. leader of the opposition to the statement in ' Le Canada,' it seems to me that we are getting down pretty low to suppose that there could have been anything in the nature of a trap intended when these amendments were asked for. I do not see what trap there could be.


Robert Laird Borden: Nor I either.


Charles Fitzpatrick: The hon. member for Hamilton gave me some of the amendments on Friday afternoon, and on Saturday I received duplicates of what I had got before. I left town on Sunday and returned last night. The first thing I did this morning was to write to the hon. member for Hamilton informing him of the amendments that I would accept and those that I could not accept. That is the beginning and the end of the matter so far as I am concerned.


Mr. BARKER.: I hope the Minister of Justice does not suppose that there has been any trap, or that I intended to trap any body. I never saw ' Le Canada ' and never heard of it until this moment.


Robert Laird Borden: I distinctly stated, when I mentioned the matter, that I had uo doubt that the hon. Minister of Justice had received the amendments in good faith as I had given them to him in good faith. I was commenting on the fact that in the organ of the government in the province of Quebec this statement had been made.


Wilfrid Laurier: My attention had not been called until this moment to the article in ' Le Canada ' ; but I do not attach much importance to it in view of the facts. I would say to my hon. friend- and I am sure he will accept my statement- that we received the propositions in good faith and answered them in good faith, and there was no intention of taking any unfair advantage of the opposition. In fact, I do not see what advantage could be taken of them. In all our arrangements across the House, we have never had reason to complain of the good faith of my hon. friend, and I think he can say the same of our side.


Charles Fitzpatrick: With regard to the order of taking up the amendments, the hon. gentlemen opposite who have prepared them have no doubt arranged some order for moving them. I think it would be well to consider every section of the Bill, and then we will take up the amendments in the order in which hon. gentlemen wish to move them. There is one amendment to clause 1 which we accept.


Robert Laird Borden: That has been already moved.


Samuel Barker: That section 1 of the Bill be amended by adding thereto the following as subclause (2) :-
(2.) It is hereby declared that the intent and meaning of the agreement, a copy of which forms the schedule to the National Transcontinental Railway Act, was, and as modified by the supplementary agreement, a copy of which forms a schedule to this Act, is, that the rolling stock in the twenty-second clause of the said original agreement mentioned, as the first equipment, shall be so acquired by the Pacific Company that an absolute and indefeasible interest therein shall vest In the said company subject only to the several mortgages referred to in clause thirty-five of the agreement, and free from any prior charge, rent, or interest whatsoever, whether as working expenditure or otherwise.


Charles Fitzpatrick: I understand that this amendment is intended to give effect to the objection raised in the course of the debate on the Bill introduced last year. My hon. friend argued that the rolling stock might be acquired under a title which would enable the company to hand it over to ns subject to a prior lien. In addition to that, my hon. friend has argued that under the provisions of the Railway Act at the time the Bill was introduced, this rolling stock would be subject to a prior lien in respect oi any penalty that had been incurred and also in respect of working expenses. That, I believe, was the argument of the hon. member for Hamilton the other day.
Mr. BARKER, My argument was this, that if the rolling stock be acquired subject to a 'rental, that rental would be a portion of the working Expenses, and would rank ahead of the mortgage.


Charles Fitzpatrick: My argument is that under the contract as, we have it, the rolling stock must be held in absolute ownership, free from any claims or liens, before it can he considered as having been held according to the terms of the contract.


Samuel Barker: That brings us hack to the original argument. What we have contended throughout is that in the 22nd clause of the original agreement there are no words which even by implication call for the acquisition of the rolling stock free from any rent charge. All that the clause provides is that the company shall equip the road with $20,000,000 of rolling stock. W7e tried last year to get the Minister of Justice to accept a suggestion that words should be included in that clause expressly stating that the rolling stock should he acquired and paid for, so that there should he no doubt upon that subject. We contend that the word ' equip ' would he sufficiently satisfied by putting the rolling stock on the road under any conditions whatever, whether as rented or hired, or purchased on Mr. FITZPATRICK.
time, with a large charge for the purchase money on it, or purchased and paid for. Some hon. gentlemen contended that because section 85 of the agreement required the company to give a first mortgage on all the property, including the equipment, that in itself showed that the rolling stock must be owned absolutely.
I referred to the provisions of the Railway Act to show that the giving of a first mortgage does not necessarily mean that the property must he owned absolutely by the company. I referred also to the 18th section of the Act of last session incorporating the Grand Trunk Pacific, which enabled the Grand Trunk Pacific to give this first mortgage that is called for in clause 35 of the agreement. In that section there is provision made for giving a first mortgage, subject to the conditio is of section 94 of the then General Railway A ct. When you turn to section 94, you find that the first mortgage to be given by any railway company is subject to the working expenditure ; and when you turn to the definition of working expenditure, you find that it includes the rent of rolling stock. In addition to that you find that clause 14 of the original agreement-the one referring to the rolling stock equipment for the eastern division-expressly refers to rent of the rolling stock in connection with that * very equipment. Under these circumstances what did we say ? We said that you could have removed all doubt on the question by simply using the words ' acquire and pay for.' We urged that again and again last year. The answer then given was, first, it .was considered clear that there must be an acquisition free from any charge, because a first mortgage upon the property must be given under clause 35, and second that the agreement had been settled with the Grand Trunk Railway and could not be altered. Since then that agreement was cast aside by the Grand Trunk Railway, who refused to confirm if. Subsequently negotiations took place between the government and the Grand Trunk Railway, resulting in this supplementary contract, which alters the original contract in may particulars. Yet, although this question of the rolling stock, take what ever view you like, must he a doubtful one, the hon. gentlemen on the treasury benches did not take advantage of their opportunity to remove any doubt but left it just as it was. This is not a trifling question, but an exceedingly important one from two points of view. First of all, as regards the $5,000,000 of rolling stock for the equipment of the eastern division, the result of any rent charge or interest on that rolling stock is that the government will not obtain as their security tor *the preformance by the Grand Trunk Pacific of the conditions of the lease a first mortgage on that $5,000,000 of property, [DOT]which is the only security the government have got, first and last, for the performance
of the covenants of the Grand Trunk Pacific ; and moreover the interest or rent upon the rolling stock will be ahead of our rental under the lease. Not only is that the case with regard to thjj eastern division, but instead of having a first mortgage on the western division to secure the bonds we guarantee, we have $15,000,000 of an encum-biance placed prior to these bonds, because if the $20,000,000 of rolling stock are not acquired by clear and absolute title free from rent, the working expenditure of the western division will include the rental of three-fourths of that rolling stock, and be ahead of our mortgage. That is the result of leaving this question where it is. I do not c-are, for my part, as a matter of business, whether the view taken by the Minister of Justice be more or less arguable than ours, but I say it is absurd, having regard to the difference of opinion on this point having regard to the fact that the hon! gentleman has had to obtain opinions of counsel upon it, that it should have been left in a state of uncertainty, when all doubt might have been removed by a few words. That is the position I take, and we are .iustified in finding fault with the government that in a matter of such moment- the question of whether $20,000,000 obligation shall be ahead of our rent and oui mortgage should be left open to a difference of opinion, as a question perhaps to be settled by the courts, when it could have been settled by the insertion of two or three words in the supplementary contract I therefore think, as it is not yet too late as we are yet considering the advisability of validating this contract, we should not lose this opportunity to declare that this contract means what hon. gentlemen opposite have all along said it does, but which Sir Charles Rivers-Wilson says it does not mean. Wily should the government hesitate to declare in this Act that the contract means what they themselves say it does ? The non.. Minister of Justice says we hav;e nothing to do with the opinion of Sir Charles Rivers-Wilson. Nevertheless why should we not declare what our view is, and let that be the law, and then there will be no question for litigation.


Charles Fitzpatrick: I do not know that any good purpose would be served by my going over again the argument I offered seme time ago. The contract provides for an absolute obligation on the part of the company to give us a title, absolutely free to this property, so that we will be able to secure a first mortgage upon it. Mv hon friend says that the $5,000,000 of rolling stock is the only security we shall have for the working of the eastern division. He has entirely overlooked clause 25 which provides :
The said lease shall also contain such other covenants and provisions, including proper indemnity to the government in respect of the working of the railway as may he deemed necessary by the government to secure the proper carrying out of this agreement.


Samuel Barker: I said you would have the covenant of the Grand Trunk Pacific.


Charles Fitzpatrick: And we will have the indemnity they will be obliged to give us for the working of the railway.


Samuel Barker: It is the same thing.


Charles Fitzpatrick: I do not know that indemnity is the same thing as covenant. Perhaps it is. I have never looked upon it as the same.


Mr. R. E. BORDEN.: What importance dees the hon. gentleman attach to it ?


Charles Fitzpatrick: Very considerable. They can indemnify us against any breach of the agreement in the working of the railway. They must give us indemnity to the effect that they will properly work this railway, the form of indemnity to be determined at the time -the contract is made. Mith reference to the working expenditure raking precedence over the lien of the government let me draw the hon. gentleman's attention to the fact that section 94 of the Railway Act is not the section that applies in this case. The question is whether, under section 35 they can fail to give us a first lien on the property. They undertake to give us such a lien. As I say the right is not to be exercised under section 94 of the Railway Act, but under section 3o of the agreement. It seems to me that there is all the difference in the world.


Robert Laird Borden: I must confess that T do not quite understand the hon. gentleman's (Mr. Fitzpatrick's) argument. I do not understand what value he gives to the word ' indemnity.' In the preparation of legal documents, so far as I have had experience, an indemnity is created by a covenant. The hon. gentleman seems to find some extraordinary difference between ' indemnity ' and ' covenant.' As I say, indemnity is usually created by covenant and would be, I suppose, in this ease. I supposed at first that he meant that the -word 'indemnity' involved security. If that was the effect of his argument I could understand it. But the hon. gentleman does not put that forward. So. it is reduced, as my hon. friend from Hamilton (Mr. Barker) says to the covenant of the Grand Trunk Pacific Railway Company, and nothing more. The hon. gentleman (Mr. Fitzpatrick) relies altogether on section 35. But this must be construed in connection with section 14. In the argument, of the Minister of Justice and in the opinions which have been given by the Deputy Minister of Justice and by Mr. Shepley, paragraph 14 of the contract is absolutely ignored. Yet, it must be read in connection with paragraph 35. Now, paragraph 14 says distinctly that the words ' working expendi-

[DOT]2963

ture ' as applied to tlie eastern division shall include all tolls, rents or annual sums paid in respect of property leased to or held by the company In respect ot the said eastern division, or in respect of the hire of stock let to the company as part ot the equipment of the said eastern division. If that is not a distinct recognition ot the ii<=ht of the company to equip the eastern division by means of rolling stock on hire, I do not Know what expression would convey that idea. Mr. Shepley, in his argument, says that he does not see how, in view ot the conditions in the contract to which his telegram refers, it is possible to argue that the hiring of rolling stock would be an equipment within the meaning of thereon-tract. The use of these words by Mr. Shep-ley would indicate clearly that his attention had not been directed to clause 14 of the agreement. Had be looked at that clause he would have found the very condition recognized by the contract which he says cannot possibly exist. There can be no doubt about that. I have the utmost ^aspect for Mr. Shepley's opinion, but, when I hnd that certain clauses of the contract have
not been brought to his	Jf^Uuld
cannot but lessen the weight that would otherwise be given to the opinion of a o-entleman of his position at the bar. in the same way, the memorandum prepared bv some gentleman in the Department of Justice and assented to by the deputy minister, makes not the slightest reference to clause 14. Now, the president of the Grand Trunk Railway Company realizes the importance of that clause, because be has stateu to the shareholders that the rolling stock of this division is to he supplied by means of a trust. When we find the other party of this contract taking a view of it different from that taken by the government, there surely can be no objection to the insertion of a3 clause which will make the matter perfectly plain. We on this side are not clear that the section means what the mm-ister says it does. I am not asking that great importance shall be attached to our doubts. But when we find that our understanding of the section, as against that of the Minister of Justice, is that which is taken by the president of the^Grand Trunk Railway Company1 in addressing the shareholders on a matter of great importance to them. I think there is every reason that the matter should be.put beyond peradventure and that the section should be dedaied to mean what the minister says n does mean. Will that prejudice the Grand Trunk Railway Company ? Will it prejudice the public interest'! Certainly there will be no prejudice to the public interest in making this change. If it is said that it will prejudice the Grand Trunk Railway Company, the answer is that it can only prejudice them if their Interpretation of the contract is different from that put Mr. R. L. BORDEN.
forward by the minister. But if their mter-i pretation of the contract is the same as that of the minister, and if it is m the public interest that that should be made clear, i think there is every reason why the change should be made. Different men may be at the head of the Grand Trunk Railway Company in the future, or there may be a different administration in power. it is desirable, in view of these contingencies of the future to remove all possible doubt and make the meaning absolutely plain. I think that, under the circumstances, the amendment of the hon. member for Hamilton (Mr. Barker) is a reasonable one, and one which the government in all fairness, and in the public interest should adopt.


Charles Fitzpatrick: 
Robert Laird Borden: It seems to me that the hon. the Minister of Justice (Mr. Fitzpatrick) when he takes that position has perhaps not fully considered all its bearings. He says, as I understand'his argument, that the words :
As part of the equipment of the said eastern division.
do not relate to the first equipment, but to some subsequent equipment.


Charles Fitzpatrick: Any additional equipment.


Robert Laird Borden: Yes. Has my hon. friend (Mr. Fitzpatrick) fully considered the language of section 35 when he takes that stand ?


Charles Fitzpatrick: I think so ; I tried to consider everything.


Frederick William Borden: Let us look for a moment at the wording of that clause :
A mortgage which shall be a first charge upon the railway, undertaking, equipment and property, tolls, rights and franchises of the company, including all equipment and property to he thereafter acquired by the company.
That carries my hon. friend too far.


Charles Fitzpatrick: No.


Robert Laird Borden: It certainly does, and I will show you how in a very few moments. He must admit that section 14 contemplates that the equipment, a portion of the equipment at least of the eastern division, a portion of some of the equipment, either the first or a subsequent equipment, shall be acquired by hiring by the company. If he does not admit that, I do not know what office those words serve ; they do not serve any office if they do not mean that. Then niy hon. friend says that this is subsequent equipment, and is not covered by the mortgage. It is covered by the mortgage under section 35. _ Therefore, my hon. friend (Mr. Fitzpatrick) meets the same difficulty under section 35 that he met under my construction, because if you are to have a first charge upon the first equipment, you -must also have a first charge upon the subsequent equipment, and yet, according to the argument of the Minister of Justice, that subsequent equipment need not be vested in the company by an absolute title. If that is not acquired by an absolute title, you cannot give to the words ' first mortgage ' in section 35 the office my hon. friend assigns to them. It is all covered by the same provision :
A mortgage which shall be a first charge upon the railway, undertaking, equipment and property, tolls, rights and franchises of the company, including all equipment and property to be thereafter acquired by the company.
Well, then, the argument of the Minister of Justice, it seems to me, fails when he endeavours to draw the distinction he has drawn. He says that the provision in section 14 refers to subsequent equipment and that subsequent equipment might be acquired under a hiring agreement. If it does, and you rely on section 35, you are up against the same wail as before, because section 30. according to the Minister of Justice, means a first charge upon an absolute title. That charge is to cover not only the first but also subsequent equipment. Then the words in section 35 cannot mean what my hon. friend the Minister of Justice says they mean because he has admitted that the subsequent equipment at least might be acquired by the company under a hiring agreement.


Charles Fitzpatrick: I used the word ' part.' I dad not want to eliminate the word ' part from section 14. I want to insist on giving it effect as on giving effect to everything else. Part of the equipment may be leased, but I put the question seriously to the hon. leader of the opposition (Mr. R. L. Borden) if he believes that, taking section 35 as it is there, if the company acquires property under leasehold interest, the company can give a mortgage on that property which shall be a first charge upon it. If that is the contention, then I cannot understand the meaning of the word.


Mr.   R.@: Li. BORDEN. I have already said that section 35 must be construed in connection with section 14.


Charles Fitzpatrick: Yes.


Robert Laird Borden: And I have said that the opinion which he has given to this House has absolutely ignored section 14. The Minister of Justice has not ignored it, because he has given a certain office to the words of section 14 and he points out, and is right in pointing out, that section 14 refers in express terms to only part of the equipment. Does the hon. the Minister of Justice get much consolation out of that ? Ninety-nine one hundredths of the equipment would be part of the equipment. There is not much virtue in the word ' part.' Then he says one thing further. He says that those words do not include the first equipment of the road, they include subsequent or additional equipment. I point out to the Minister of Justice that he is in exactly the same difficulty about that under section 35 as if he adopted the construction I have put forward. He asks me:	Do you say
a first charge can be a first charge upon anything but an absolute Interest ? I say that if you take these two sections together vou may have a great deal of doubt about it, because if you find in one section of the sta-

296S
tute that a company Is authorized to equip its road by rolling stock acquired under a title which is not an absolute title, and if you find in another section that the company is to give a mortgage, which shall be a first charge, it is a very fair argument to make, and would he a fair argument to make in any court, that the mortgage which is to be a first charge is to he a first charge upon the interest of the company described in a preceding clause of the contract. Taking those two sections together, it is to be a first charge, not necessarily upon an absolute interest, but a first charge upon the interest which has been described in a preceding clause. That may not be an unanswerable argument. I am not putting it forward as an unanswerable argument, but as an argument which can be reasonably made upon these two sections of the contract, and I must say that, with all due deference to the opinion of the Minister of Justice, I am not at all convinced that it is, not a proper argument and a proper conclusion to be drawn from a consideration and construction of these two sections.
At six o'clock, House took recess.
After Recess.
House resumed at eight o'clock.



PRIVATE BILLS.


[Stage Direction]
Bill (No. 32) to incorporate the Walkerton and Lucknow Railway Company.-Mr. Henderson.
Bill (No. 53) respecting the North American Telegraph Company.-Mr. Morrison.

[Stage Direction]
Bill (No. 97) respecting the Trans-Canada Railway Company.-Mr. Girard.

[Stage Direction]
House in committee on Bill (No. 72) to amend the National Transcontinental Railway Act.-Sir Wilfrid Laurier.
On section 1,
Samuel Barker: Mr. Chairman, before six o'clock the hon. Minister of Justice (Mr. Fitzpatrick) referred to a remark that I had made in discussing the mortgage provisions and he stated that the provisions I had referred to in clause 13 of the charter of the Grand Trunk Pacific Railway Company were not applicable to the mortgage referred to in clause 35 (c) of the original contract. I desire to refer once more to clause 35; it contains this provision :
For the purposes hereinafter in this paragraph respectively defined, the company may and shall create mortgages to trustees, as follows.


Robert Laird Borden: Then follow sub-clauses (a), (b) and (c).
(a)	Is an agreement to give a ' first charge ' on certain property, including rolling stock equipment, to secure the bonds guaranteed by the government.
(b)	To give a ' second charge ' on the same property, excepting Eastern Division equipment, to secure bonds guaranteed by the Grand Trunk Company.
(c)	To give a charge upon the Eastern Division equipment, ' next after ' the mortgage or charge (a), to secure the conditions of the lease.
You will observer Mr. Chairman, that (a) is an agreement to create a first mortgage or charge, to secure certain bonds of the company. The power of the company to give such a mortgage is derived from, section 13 of its charter, which section is to be read in connection with section 94 of the general Railway Act 1888, and the mortgage, although called a first mortgage is expressly declared to be subject to the working expenditure of the railway, and working expenditure is declared to include rent of rolling stock. So, Sir, not only is (c), but (a) also is subject to such rentals. Mortgage (c) which is supposed to secure the conditions of the lease is not in any sense whatever a first mortgage. It is expressly made subject to (a) and both are subject to the rolling stock rentals. So that it seems to me that there is very strong ground indeed for contending-I will not say, having respect for the hon. Minister's opinion, that it is absolutely beyond question-that all these mortgages are subject to the working expenditure; in other words, subject to rent of rolling stock. The question is very important, because, as I have pointed out before, if they are subject to the rent of the rolling stock it means that the mortgages of these trustees created under section 35 are subject to a prior lien of 820,000,000. Now, I repeat that even if we were to accept as probable the interpretation put upon this clause by the hon. Minister of Justice it would be a monstrous piece of carelessness on the part of this parliament to have that exposed to litigation, subject to discussion when we have the power to avoid that by simply saying in this Bill now before us that the rolling stock to be provided must be provided free from any lien. The hon. gentleman says that is the intention. I think every hon. gentleman who has spoken on the other side of the House has contended that it is the intention of the government that $20,000,000 of the rolling stock to be provided as equipment shall be absolutely free from any charge for interest, rent or any other claim whatever.
Assuming that is the bargain between the country and the Grand Trunk, where is the harm of saying that it is the bargain ? Sir Rivers-Wilson says he has a different view of it. and the government tell us they do not care what Sir Rivers-Wilson says, that this rolling stock must be clear from every claim

*whatever so that the government shall have a mortgage on the absolute title of ownership in that property. Well, where is the harm of saying so ? Are we to leave it open to those with whom we are contracting to argue that such is not the contract at all ?


Robert Laird Borden: They do say so.


Samuel Barker: They do, but let us provide that they cannot say so. One of the most absolute securities that can be created *on a railway property is the rolling stock rental because it goes in with the wages of the workmen and must be paid before anything is given to the creditors; and here is a question whether rent on this $20,000,000 is to become part of the working expenses, and when we ask the government to put it beyond doubt that the rolling stock shall be [DOT]owned, they say they will not do it.


Wilfrid Laurier: I have listened to the argument of my hon. friends ojjpo-site, and their contention is that while we put one interpretation on this contract, the president of the Grand Trunk Railway puts another interpretation upon it. As I understand, my hon. friends rely on the statement of Sir Rivers-Wilson-I have not the exact words before me-which if I remember aright was, that it was intended to have the equipment provided by a trust company.


Charles Fitzpatrick: No ; here are his words.


Wilfrid Laurier: This is what the president of the Grand Trunk Railway said :
That rolling stock will be provided by the Grand Trunk Pacific, and as the general manager will perhaps tell you, they have laid their plans for providing that rolling stock by a trust fund.
That is the statement made by the president.


Samuel Barker: 
Wilfrid Laurier: He referred to the general manager, and as I understand, the general manager never said a word about it, and that being so you cannot take from the words of the president the meaning that my hon. friends opposite attach to them.


Mr. OSLER.: The Prime Minister is not Tight in that contention surely, because the piesident of the Grand Trunk Railway in defining the liabilities of his company direct and indirect, distinctly states that the general manager would say that this large sum was to be provided by a trust fund. It is quite natural that if no further questions were asked, the general manager would not refer to it again, but certainly the president of the company did not refer to that very important matter in these words without having an understanding with the general manager as to how that money was to be
raised. The shareholders took the statement of the president as a matter of course.


Mr.   I@: Surely the president of the Grand Trunk Railway Company, whose name is first signed on behalf of the Grand Trunk Pacific, could speak with as much authority as the general manager, and he says :
That rolling stock will be provided by the Grand Trunk Pacific Company and as the general manager will tell you, they have laid their plans to provide that rolling stock by a trust fund. Therefore you may wipe it out-and call it four millions.
It Is true he speaks of a future reference to be made by the general manager, which the general manager does not make, but the president of the company does not the less definitely make the statement. We have been told by the Minister of Customs, and by the Finance Minister, that all these amendments were made simply because the Grand Trunk Railway refused to go on without them. Suppose the Grand Trunk Railway Company should say to-morrow : This is our interpretation of the contract, and unless you construe the contract as we do we shall not proceed further with the enterprise.


Mr. FIELDING.: They would lose their five millions.


Robert Laird Borden: If the government should give the same answer as they have given in the past, they would say : interpret the contract as you like ; we will accept your Interpretation of it. The Minister of Justice distinctly took the ground that although my argument might be correct, that the words in section 14 could be construed as relating to the rolling stock equipment of the eastern division ; nevertheless my argument was of no importance because these words referred only to that portion of the rolling stock which should be acquired afterwards ; and he said that so far as the first equipment was concerned that was controlled by paragraph 35 of the original contract under which a mortgage must be given which should be a first charge upon the railway, undertaking, equipment and property. As I pointed out to the Minister of Justice before six o'clock : when he adopted that argument he went too far, because he brings himself up against the fact that in section 35, upon which he relies, the provision is for a mortgage which shall be a first charge not only upon the first equipment, but upon all subsequent equipments.
Therefore the construction of the hon. Minister of Justice is not consistent with the argument he is adopting ; it is absolutely inconsistent with it, because that subsequent rolling stock equipment which he admits1 might be acquired under a hiring agreement is also to be subject to a first charge as much as the first equipment under

the terms of section 35. He is in a worse position after making that argument than he was before, because he has admitted a construction of paragraph 14 which is absolutely inconsistent with the view of this contract which he has expressed to the House. Under these circumstances, as this involves a question of 820,000,000, we are entitled to have put into this contract words which will remove any possible doubt on this question ; and I for my part cannot understand the hesitation of the government, if they are sincere-and we are bound to assume that they are-in the view they are pressing on the committee, I cannot understand their hesitation to accept this amendment and thus put the matter beyond doubt. We are not asking from the Grand Trunk Pacific Company anything beyond what the government themselves say is the-correct interpretation of the contract. Then why hesitate ? We have the president of the Grand Trunk Pacific Railway stating, by necessary implication, if not by express words, that that is not his interpretation of it, and we have offered some argument from this side of the House to show that there may be some foundation for his opinion ; and when we simply ask the government to place the question beyond doubt, there is some extraordinary, unnecessary and unusual hesitation about making the matter plain. Why should it not be made plain ? My right hon. friend, twenty years ago, in discussing the loaning of $30,000,000 to the Canadian Pacific Railway Company, said the government of the day had created a power which was stronger than itself. Has this government created a power which is stronger than itself ? Has it created a power which induces the government to hesitate in placing on the statute book a plain expression setting at rest all possible doubt as to the interpretation of this clause? That is all that is being asked on this side of the House. I for my part cannot understand the hesitation, and I do not think that any other hon. member of this House understands it. If the Grand Trunk Pacific Company understand that contract in the same way as the government understand it, then there ought to be no hesitation on the part of the government in accepting this amendment. On the contrary, if they desire to leave this matter open to doubt, and leave to the Grand Trunk Pacific Company an argument which can be advanced afterwards, and to which the country is to be induced to yield, so that a charge of $20,000,000 is to be placed in priority to this so-called first mortgage-if they desire to leave that open to question, they are adopting the proper means for that purpose. If, however, they desire to safeguard the interests of the country and place this matter beyond question, they are acting in a most extraordinary and unusual manner in opposing this amendment.


Robert Laird Borden: 


Charles Fitzpatrick: Dealing with the argument of the hon. member for Hamilton (Mr. Barker), I will point out in what respect we differ. He relies on section 13 of the Act of Incorporation as the section which confers on the company the power to issue bonds and give this mortgage, and he says you have to read the last lines of that section which say that the company have a right to create a first charge on the property subject to the provisions contained in section 94 of the Railway Act. My argument is that for the purposes of this agreement we eliminate that section 13 altogether. Section 35 of the agreement contains all the power the company require,, and in that section there is no reference whatever to that reservation in section 13 of the charter. With respect to the question which the hon. leader of the opposition raised, it seems to me you have to give some meaning to the word ' acquired in section 35, and I take issue, straight and direct, with my hon. friend. If I understand him to put it forward as a legal proposition that the company, with a mere leasehold title to this rolling stock, can give to the government the first mortgage contemplated in section 35, then I must differ absolutely from him. You cannot give effect to that clause if you give such a meaning to the word ' acquired.' You can conciliate the terms of section 13 with the terms of section 35. Section 13 applies only to part of the equipment. When you come to section 35, you find that the equipment which the company must put on is an equipment which they must hold by such a title that they can give a mortgage on it which shall be a first mortgage, necessarily exclusive of everything else. If they lease the rolling stock under an arrangement by which, after a certain number of payments are made, the title to the rolling stock passes to the company, it ceases to be held under lease, and becomes absolutely vested in the company, and would be subject to a first mortgage under section 35. It seems to me that you cannot give any effect to that clause unless you put that construction upon it. My hon. friend said a moment ago that we must bear all the clauses in mind. I reply that you must bear in mind not only all the clauses, but all the words of each clause ; and how are you going to give effect to section 35 if you do not interpret it in that way ?


Samuel Barker: I suppose the Minister of justice will not dispute that a corporation is the creature of its charter. It exists and acts under its charter.


Charles Fitzpatrick: My hon. friend cannot think that I am going to admit that it acts under its charter when it gets subsequent powers under a subsequent Act.


Samuel Barker: Until a subsequent Act is passed altering its powers under its;

charter it acts under its charter; and in section 13 of its charter this company has power to create first mortgages subject to the provision of section 94 of the General Railway Act of 1888. Section 94 of the Railway Act of 1888 provides that a first mortgage shall be subject to the rental of the rolling stock. There is no question about that, and when a company, created as the Grand Trunk Pacific has been, executes a first mortgage upon al'l its property, you must go back to that section of the Railway Act, and you will there find that that first mortgage is subject to the rent of the rolling stock, that rental being considered part of the work expenditure. 1 now come to what the hon. minister tells us alters all that. The Grand Trunk Pacific enters into a contract with the government, and it is that agreement we are considering now. And what is that company bound to do? Under subsection ' a ' of section 35, it has to give a first mortgage upon its ' undertaking, equipment and property, tolls, rights and franchises, including all equipment and property to be thereafter acquired by the company.' That is perfectly clear. Is not that in accord with section 13? It expressly provides for a mortgage to secure the bonds of the company, which is the very thing that section 13 enables the company to give. The hon. gentleman will not dispute that so far.


Charles Fitzpatrick: It is all very technical and very fine.


Samuel Barker: It is not at all technical, and does not require a very expert lawyer to understand it. Section 13 enables the company to give a first mortgage. The company enters into an agreement with the government to give such a mortgage.


Charles Fitzpatrick: What is the use of refining in that way when my hon. friend has before him section 2 of the Act authorizing the construction of a National Transcontinental Railway, which specially empowers the company to do all that the agreement requires it to do ?


Samuel Barker: I suppose that this agreement will be construed according to the powers of the company at the time the company entered into it. This company has the power to grant a first mortgage upon all its property, under an Act which says that the first mortgage shall be subject to the rent of the rolling stock. It is empowered by subsection * a ' of section 35 to give a first mortgage to secure the bonds guaranteed by the government. I will drop ' b ' for the present and see what subsection ' c ' says. Subsection 1 c ' provides for a mortgage to secure the conditions of the lease. It reads as follows :
A mortgage which shall be a charge upon the rolling stock constituting the equipment of the eastern division next after the charge mentioned in paragraph 35 (a).
But if the mortgage in paragraph 35 (a) is subject to the rent of the rolling stock, surely the mortgage 'c,' which is subject to paragraph 'a,' must also be subject to the rent of the rolling stock. You cannot make the mortgage in ' c ' a better mortgage than that provided in ' a when ' c ' is subject to * a.' If paragraph ' a ' stood alone, I doubt whether the Minister of Justice would have argued that mortgage * a ' was not subject to the working expense of the railway, and when he takes a mortgage which is subject to ' a ', how can that be in any sense prior to the working expenditure ? If ' a ' is subject to the working expenditures, surely ' c,' which is in a lower grade still, must also be subject to the same expenditure.


Charles Fitzpatrick: I do not believe that the company is the creature of this charter. In my judgment it is the creature of the law which gave it existence. In this respect, without any reference whatever to the charter, suppose that section 13 never existed, under section 35 of the agreement, and section 2 of the National Transcontinental Railway Act, and give it the authority to do that which is necessary to give effect to section 35.


Robert Laird Borden: Does my hon. friend say that you are not to consider section 35 in conjunction with the terms of the charter?


Charles Fitzpatrick: If the terms of the charter are amended, you take the amending Act.


Robert Laird Borden: Do you not have to look at it to see that it is amended ?


Charles Fitzpatrick: It is amended.


Robert Laird Borden: Do you not have to construe the two together ? It is a remarkably novel proposition that you are to deal with this section apart from the charter as the Minister of Justice seems to suggest. You must look at section 35. You must also look at the terms of the charter and the powers conferred by them on the company and construe them in connection with this Act as if they were one Act. That is the view 1 take of the situation as far as the statutes are concerned. The whole point of the argument of my hon. friend the Minister of Justice, with respect to section 14, in answer to myself, turns on one narrow suggestion which he made. He says that the company may make a contract for the hiring of rolling stock, the ownership of -which, after a certain time, will vest in the lessee or the person to whom it is hired. Then he says that after this transfer takes place, the company to whom the rolling stock was so hired will have a good title as owner and then section 35 will have effect. But does my hon. friend say that section 14 is restricted to any such hiring ? If' so, I invite him to show me one word or line which so restricts it. I have made some in-

quiry, and X find that there is not only the method of hiring rolling stock to which my hon. friend has referred, but that there is also a very large business carried on by more than one company-certainly by one very large company-under which the title to the rolling stock is retained for ever in the company which owned it in the first instance, and the payments are perpetual payments, and the rolling stock does not at any time become vested in the person to whom it is hired. Section 14 permits part of the equipment of the eastern division to be so provided, in which case the rolling stock would never vest in the Grand Trunk Pacific. And since section 14 permits that, the argument of the Minister of Justice, based upon the suggestion he made a moment ago, seems to me to absolutely disappear. If he says it does not. I take issue with him just as strongly as he does with me with regard to the legal construction of this contract. I am equally entitled to my opinion as my hon. friend is to his, and I say that construing section 35 with section 14, it seems to me, not only open to reasonable but to convincing argument, that, so far as a part of the equipment of the eastern division is concerned, the Grand Trunk Pacific need not be vested with an absolute and complete title, but will satisfy the conditions of this contract by furnishing a portion of the equipment under an agreement of lease and hire. That is my conviction, after having listened with every respect and attention to what has been said by the Minister of Justice and the First Minister. Under these circumstances, I see no possible reason why this government should be afraid to place upon the terms of the statute a clause which will remove absolutely any doubt, and make the interpretation, which the government says is a true interpretation of this contract, plain beyond doubt and cavil.


Charles Fitzpatrick: I would like to put on ' Hansard ' the exact words used by Sir Charles Rivers-Wilson, and thus possibly remove some doubts which appear to exist in the minds of some hon. gentlemen.


Edward Frederick Clarke: What is the hon. gentleman reading from ?


Charles Fitzpatrick: From the official report of proceedings at the ordinary general meeting of the company-that is the Grand Trunk Railway Company of Canada-held at the City Terminus Hotel, Cannon street, London, on Tuesday, 8th March, 1904.


Edward Frederick Clarke: Would there be any difficulty in the way of laying that document on the table and having it printed ?


Charles Fitzpatrick: I do not control the document, nor have I any supply of them.


Edward Frederick Clarke: But could it not be laid on the table ?


Robert Laird Borden: Mr'. FITZPATRICK. I rose to accomplish a purpose and would like to be allowed to do so. Here is what the president said :
As regards the 5 millions for rolling stock-in the first place the estimate is not 5 millions, hut 3 millions. With that the Grand Trunk Company has nothing to do,
I do not think that anybody would contend that the Grand Trunk had anything to do with the rolling stock. The providing of the rolling stock is an obligation on the part of the Grand Trunk Pacific.
That rolling stock will be provided by the Grand Trunk Pacific Company, and, as the general manager will perhaps tell you, they have laid their plans for providing that rolling stock by a trust fund.
These are the words used as they are reported.


Robert Laird Borden: I understand that the Minister of Justice is reading from a circular to the shareholders dated 28th February ?


Charles Fitzpatrick: No ; I am reading from the remarks of the president as reported at the meeting.


Robert Laird Borden: The hon. gentleman (Mr. Fitzpatrick) has been kind enough to send me the document. It is something I had not seen. This is the speech of Sir Charles Rivers-Wilson.


Charles Fitzpatrick: His second speech-after Mr. Allen had spoken.


Robert Laird Borden: 
Wilfrid Laurier: We have had no correspondence with the president of the Grand Trunk on this point, I think it would not be advisable to have such correspondence. The Grand Trunk Company are aware of the interpretation the government have put on tlie contract. They are aware that we have cited the opinion of the legal gentlemen who framed the contract and have discussed it again and again with then-counsel. This contract was not prepared ex parte by the counsel of the government, but was carefully revised by the counsel of the Grand Trunk and revised jointly by the counsel of the government and the Grand Trunk. It is the matured deliberate opinion of the government. Now, take the words of Sir Charles Rivers-Wilson as he uttered them. The most that you could get out of them is simply this,-* That rolling stock will be provided by the Grand Trunk Pacific Company, and, as the general manager will perhaps tell you, they have laid their plans for providing that rolling stock by a trust fund.' Let us suppose that Mr. Hays, of the Grand Trunk Pacific, contemplated providing this rolling stock not by the Grand Trunk Pacific or by the Grand Trunk, but by a separate organization. It seems to me clear beyond a doubt that, whoever may be the parties who organize the trust, they must carry on their operations subject to the conditions of the Act which we are nowdiscussing. The conditions upon which they place that rolling stock upon the road- w-hether they take the precaution of ascertaining w-hat the conditions are or not-are those provided by the Act. The Act says that, whoever places this rolling stock upon the road to comply with the conditions of the contract he must place it in such a way
as to give to the government a first mortgage. So, if the rolling stock be provided by a trust, the trust must be ready to take a second mortgage and give the government the first mortgage. That is the argument w-hicli we have from our counsel, and it seems to me it must strike hon. gentlemen on the other side as reasonable. I listened with some care-with great care indeed- to all the arguments addressed to the House from the other side. I do not pretend to discuss the matter after the gentlemen w-ho have given it their best attention and consideration. But, looking at it in the light of ordinary rules of legal interpretation of a contract, one surely must say that these words are as binding as they can be :
For the purposes hereinafter in this paragraph respectively defined, the company may and shall create mortgages to trustees as follows :-
(a.) A mortgage which shall he a first charge upon the railway, undertaking, equipment and property, tolls, rights and franchis'es of the company.
Now-, it is to be remarked, before we go further, that this Act provides that the Grand Trunk Pacific Company must build a road extending from a certain point to a certain point. Upon that road they must place rolling stock to the amount of $20,000,000. They are not at liberty to'rttSfe-'5ard- any of these provisions. The contract is not completed until they have built the road and put upon it $20,000,000 worth of rolling stock. Then the special Act says explicitly in so many words that upon this there should be a first mortgage. The hon. the leader of the opposition (Mr. R. L. Borden) has drawn an argument also from the words w-hieli follow- :
Including all equipment and property to be thereafter acquired by the company.
Now when they provide rolling stock to the amount of $20.< 00,000 upon w-hich they may be able to give a first mortgage they can obtain rolling stock also upon lease : they can obtain it in full ownership or they can lease it, and it is provided that if they acquire roads these roads shall be subject to the lien of the government, but if they lease roads they cannot give a first mortgage upon them. Therefore, upon this it seems to me that the amendment is very clear, that anything they acquire subsequently comes into the mortgage if they can give a first mortgage upon it. The hon. leader of the opposition (Mr. R. L. Borden) and the hon. member for Hamilton (Mr. Barker) say : How do you construe this section 14, which contemplates that rolling stock may be hired. Rolling stock may be hired and certainly the drafters of this Act never contemplated that the Grand Trunk Pacific would have to put only $20,000,000 w-ortli of rolling stock on the road. They contemplated that the Grand Trunk, as the enterprise developed, would be forced to put on more than $20,000,000

worth and they gave the company the latitude to lease rolling stock as well as to buy and purchase it. There is nothing extraordinary in that and they contemplated that probably it would be better for them to lease than to purchase it, and therefore they provided that if any part of it was leased beyond $20,000,000 under such circumstances the hire could go as part of the expenditure.


Robert Laird Borden: What is there in section 14 that enacts that the hiring of equipment is to be restricted to that which is subsequently hired ?


Wilfrid Laurier: The contract contemplates that there shall be acquired $20,000,000 worth of rolling stock upon which a first mortgage can be given. Then I say that as far as this $20,000,000 is concerned, it is impossible to conceive that they can lease it. They must give a first mortgage upon it.


Robert Laird Borden: What are the words in section 14 that enact that ?


Wilfrid Laurier: The words are to be found in section 35. My hon. friend has said again and again that the contract is not to be interpreted as so many separate clauses, but that all the clauses must be contemplated. Taking section 14 and section 35 together it seems to me that you have it beyond a doubt that to the extent of $20,000.000 the company must give a first mortgage. If the company leases the rolling stock upon which they give that mortgage it does not fulfil the contract. If the company having purchased $20,000,000 of stock, leases $5,000,000 worth more of stock they are within their rights beyond a doubt. Under such circunflstances you come under the terms of section 14 and the hiring of this rolling stock would be counted as expenditure. My hon. friend (Mr. R. L. Borden) says why do you not agree to this, or to this. I may say that more precautions have been taken upon this contract than have ever before been taken on any contract of the kind. We have had the best legal advice we could obtain not only to interpret the contract but to prepare and to draft it. When the best counsel tell us that this is the construction, I think that we can stand by it and ask the House to accept it.


Robert Laird Borden: I am not finding fault with the gentlemen who drafted the contract, but I have to take the contract as I find it and to use my own common sense and experience as best I can in the endeavour to understand what it means. I would like the right hon. gentleman now to follow me attentively, because I want an answer. I asked him to point to me any words in section 14 which indicate that the hiring of rolling stock is confined to that equipment which is subsequently acquired and is not to apply to any portion of the equipment acquired in the first instance. My right hon. friend answered me and said : You Sir WILFRID LAURIER.
must construe section 35 with section 14. And when you come to section 35 you discover there the provision that the company is to give a mortgage which shall be a first charge. Does not my right hon. friend (Sir Wilfrid Laurier) realize when he looks at section 35 that that answer will not do ? Surely he must realize that. The Minister of Justice has been struggling with that difficulty and has not been able to overcome it. Section 35 provides for-
A mortgage which shall be a first charge upon the railway, undertaking, equipment

That is the first equipment, but there is something else.
-including all equipment and property to be thereafter acquired.
Therefore section 35 puts you exactly iii the same position, as to a'll equipments. There can be no doubt about that. How are you to say that you get any light toy going to section 35 ? Section 14 is not restricted by any words so that it shall mean that rolling stock may be hired for subsequent equipment and shall not be hired for the first equipment. There is no word in section 14 that points to that, not one word from beginning to end, and if yon attempt to construe it by section 35 you are met with exactly the difficulty I have been pointing out, the difficulty that the mortgage on all equipments must be a first mortgage. If my right hon. friend's contention is right it must be a first mortgage not only upon the first equipments tout upon all subsequently acquired equipments. Therefore it does not put these two equipments in contradistinction; it puts them on the same footing and they are left in the same position by the terms of the two clauses. Inasmuch as under paragraph 14 of this agreement you have a distinct l'ecognition of the right of the company to furnish some portion of its equipment by means of a hiring agreement and as under paragraph 35 you have no distinctions between the first equipments and subsequent equipments so far as the character of the title is concerned, then you are at once forced to a conclusion that this company, whether the first equipment or a subsequent equipment is in question, is at liberty to furnish some portion of that equipment by means of a hiring agreement. That is the inevitable conclusion to which we are driven and I must say that I have not got much light thereon from my hon. friends, the Prime Minister and the Minister of Justice. and of course I say that with all respect to their arguments. I am saying that in all sincerity and I am stating what I believe to be the true Interpretation of the contract.


Wilfrid Laurier: I also am giving my own views and I do it also with due deference to the opinions of hon. gentlemen opposite, but I ask the hon. gentleman to again look at section 14. I think he and I agree that section 14 contemplates that for

the equipment of the road rolling stock may be purchased and rolling stock may be leased. That is my view.


Robert Laird Borden: There is no question about that ; undoubtedly it may be purchased and we say it may be leased too.


Wilfrid Laurier: Undoubtedly that is so. Then if we have this much admitted on both sides of the House, let us go beyond that. We next come to section 35. It is admitted on both sides that the rolling stock under section 14 may be leased and it may be purchased. I suppose my hon. friend will agree also that in order to give a first mortgage to the government the rolling stock must be owned by the company. I cannot improve on what I said before but I will try to make my meaning a little clearer. By this contract it is provided that the company undertake to build a railway from Winnipeg to the Pacific ocean and they undertake to equip this section as well as the other section to the extent of $20,000,000. Well, how are we to interpret these words ?
A mortgage which shall be a first charge upon the railway, undertaking, equipment and property, toils, rights and franchises of the company.
The only way in which I can interpret that is in order to give effect to the covenant of the company the rolling stock to the extent of $20,000,000 which is to be supplied under the contract by the company must be owned by such a title as will enable them to give a first mortgage upon it. Then, the company may also subsequently and beyond that acquire and purchase rolling stock or other property. Not only can they acquire rolling stock, but they can acquire other railways, branch railways, different roads and everything they subsequently acquire a title to becomes also subject to mortgage to the government. If they do not acquire the title to the property, if they lease it, then of course, the government cannot claim a lien upon that. It seems to me that there is as fair an interpretation of the contract as you can have.


Robert Laird Borden: My right hon. friend has made rather an extraordinary argument, because, according to his view, all the company need do in order to avoid giving any mortgage at all is simply to hire this rolling stock.


Wilfrid Laurier: No, it cannot escape that.


Robert Laird Borden: I understand from the argument of my right hon. friend that if the company wish to avoid giving a mortgage, all they have to do is to hire the rolling stock. At least that is his argument about the subsequently acquired rolling stock.


Wilfrid Laurier: That is m.v argument.


Robert Laird Borden: Well, how does he escape the effect of section 14, which makes no distinction in terms between the first acquirement and the subsequent acquirement of rolling stock and I do not see any such distinction by necessary implication. I do not think that the interests of 'the country are very - well protected by the argument which he suggests. My right hon. friend in the first part of his remarks, assumed the very question which we are discussing. He says : They must provide $20,000,000 of rolling stock. We say they must, but the question is : By what title are they to provide it ? How does the contract safeguard the interests of the country in that respect ? What possible effect are you to give to the words in section 14 ? The hire of rolling stock ilet to the company is a part of the working expenditure. Does the section say that that applies to the first equipment or to the subsequent equipment ? It says neither. It may be both. Part of the first equipment and" part of the second equipment may be by means of a hiring agreement. I think further that when you consider section 14, and section 35 together, you have a complete answer to the argument of the hon. Minister of Justice. I say that the expression first mortgage' means a first mortgage upon such title as is contemplated by this agreement. I say it means that and no more. It cannot mean anything more. Then, if by construing section 14 and 35 together, you find that some portion of the equipment (and some portion may mean ninety-nine one-hundredths), can be furnished by a hiring agreement, this provision for equipment, outlined toy the president of the Grand Trunk Railway Company, can be completely carried out as to that portion. Yet, the government for some reason which I am not sure I can comprehend, declines to remove the doubt, that more than doubt, declines to place upon the statute book a clause which would remove for ever any possible question as to the necessity of the Grand Trvqrk Railway Company acquiring and having an absolutely indefeasible title to that rolling stock.


Edmund Boyd Osler: The hon. Minister of Justice stated before six o'clock that the Grand Trunk Pacific Railway and the government were quite in accord as to this agreement and understood what it meant. The hon. Minister of Justice says that the government understood that this equipment is to be provided and paid for in cash. The president of the Grand Trunk Railway Company, the promoter of the Grand Trunk Pacific, states distinctly that the equipment is to be provided by a rolling stock trust. No one who has had the first experience in railway matters could suggest that there could be any two meanings on such a subject. There is only one meaning

when a railway man speaks of creating rolling stock by a trust. That means that the rolling stock is bought by a long hiring lease. There cannot be any other meaning. It is not discussable by any one who knows the first thing about railway matters. The Grand Trunk Railway Company uis-ciaim all liability in connection with the money which is to be provided for this rolling stock. Under the agreement presented to the House all means of credit by the Grand Trunk Pacific Railway Company are exhausted by the issue of bonds and the transference of stock to the Grand Trunk Railway Company, so that if it comes to a question of providing the rolling stock by the Grand Trunk Pacific Railway Company, they have no means of raising the money to pay for it unless through the endorsation of the Grand Trunk Railway Company or some equally solvent and wealthy concern. There can be no possible question on that subject. I may venture to make the assertion that if this contract goes on and if the government insist upon their interpretation of this clause, we will have another amendment next year, or at some subsequent meeting of this House, to allow the rolling stock to be hired as the Grand Trunk president outlined in his speech that it is intended to be hired. As a layman listening to the discussion and to the expression of the differences of opinion between the legal gentlemen on the other side of the House and the legal gentle-on this side of the House, I think there is not a layman here but feels thgt if this were his own transaction he would not like to put himself into the position of signing this agreement while leaving such an important question undecided. This agreement will be open to dispute from the very fi,rst. The government will state that they understand a clause to mean one thing while the president of the Grand Trunk Railway Company has stated to his shareholders that he takes it to mean another thing. When a condition like that arises and when that condition may be so simply removed by making it plain as to what the meaning is, there must be some.stronger reason than that we have had given to the committee to-day, or on a previQus occasion, when this point was discussed, why the government should refuse to amend that clause so as to make the measure clear beyond dispute as to the meaning in years hereafter. If it is so plain from a legal point of view as interpreted by the Minister o: Justice, I cannot understand why he dees not at once accept the amendment offered by the opposition, and make it so clear that even an ordinary layman can un-clerstand what the contract means.


Haughton Lennox: Statutes are difficult to understand in any case, and it is the duty of the enacting power to make their meaning as clear as possible. We discussed this important question last session, and it was well Mr. OSLER.
known to the Grand Trunk Pacific authorities what the contention of the opposition was upon the question. It was known also what had been said by the government, and in the face of that Sir Rivers-Wilson and the manager of the Grand Trunk Railway interpreted it as having a different meaning from the language of the. amendment. It is said by the Prime Minister that Sir Charles Rivers-Wilson having referred to Mr. Hays as endorsing his statement that the rolling stock would be procured by lease and not by purchase, and Mr. Hays not having said anything, that showed that Mr. Hays did not concur in the view taken by Sir Charles Rivers-Wilson. Why, Sir, the very opposite is the fair and logical construction to be placed upon the incident. Silence gives consent, and Mr. Hays, not having disputed the statement of Sir Charles Rivers-Wilson, we must infer that Mr. Hays concurred in that satement. I was amazed, and the country will be amazed, to hear the leader of the government advance a proposition so devoid of common sense, if I may be allowed to express myself as I feel. T hope the right hon. gentleman will now amend his views in that regard. Over and over again the ministers have said that our construction of the contract is what is intended. But knowing as they do that the Grand Trunk people have definitely expressed an opposite view, surely it is the duty of the government to accept our amendment and place the matter beyond all doubt. The Minister of Justice attached a good deal of weight to the fact that when the lease came to be executed certain indemnities had to be given. Well, we have nothing more than the covenant of the Grand Trunk Company, without security, that these indemnities will be forthcoming, and if they are not forthcoming it is left for us to sue the company. If the government be sincere in their desire to protect the public, as we must suppose they are, there is no reason in the world why they should not accept this amendment. It is not now a question of leaving this Act intact as it was introduced to this House. Hon. gentlemen will remember that in the earlier stages of this discussion the Minister of Justice told us that this Bill was drawn with very great care, and that he hesitated to have any alteration made. That plea does not avail the government to-night, for not only are numerous amendments proposed by the Minister of Justice himself, but in several instances amendments suggested by this side of the House are being made for the purpose of clearing up the meaning. When the Minister of Justice is altering the Act in some particulars in order to make it more clear, surely it is the duty of the government to make its meaning clear in this very important particular.


Thomas Simpson Sproule: It has always been surprising to me, a layman, that there is so

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often such diversity of opinion amongst lawyers in the interpretation of a law.


Wilfrid Laurier: And doctors do not differ.


Thomas Simpson Sproule: Doctors may differ, hut we always aim at coming to an understanding so as to remove diversity of opinion. It has always seemed to me that where we are legislating on contracts such language should he used as would be absolutely clear and capable of no interpretation but the one which we intend. This contract involves an immense sum of money, but lawyers on that side differ from lawyers on this side as to its proper interpretation, and even the Minister of Justice must have some doubt, because he submitted this very clause for the opinion of a firm of lawyers in Toronto. The object of the amendment moved from this side of the House is to put the meaning of the clause beyond all question of doubt, and surely, for the purpose of clearness and for the purpose of safeguarding the interests of the country, the government ought to accept our proposition.
It seems to me that you could hardly use the English language in any way that would make the matter plainer or more conclusive than it is made in the amendment. As we have offered this amendment for that purpose, in my judgment it ought to be the desire of the government to accept it, so as to put the question beyond dispute for the future. If troublesome lawsuits should arise, what excuse could there be for the government refusing to accept this amendment to-day ? Seeing that there is a diversity of opinion not only among the laymen but among the lawyers of the House, surely we should avoid leaving anything on the statute-books of the country which would be subject to two interpretations. For that reason, it seems to me that the government ought to accept the proposed amendment.


Edward Frederick Clarke: The hon. Minister of Justice, in the course of a statement he made this evening, quoted from a document which he held in his hand, and I had the temerity to ask him what he was quoting from. He made the announcement that he was quoting from a report of a meeting of the Grand Trunk shareholders. The hon. gentleman having quoted from that document, I suppose we have a right to have it laid on the table of the House, so that we may make a comparison between it and the report quoted by the hon. leader of the opposition. The hon. leader of the opposition quoted from a verbatim report of the meeting of the Grand Trunk shareholders held on the 8th of March. That report has been characterized by some hon. gentlemen opposite as a faked report. I would like to have your ruling, Mr. Chairman, as to whether we cannot now have this document from which the Minister of Justice quoted
laid on the table, so that we may make a comparison between the two documents, and see if there is any serious discrepancy between them.


Wilfrid Laurier: I may say to my hon. friend that t.hp.document quoted by the Minister of Justice is not a State document. It is a printed newspaper report, which is for sale, and can be got for fifteen or twenty-five cents.


Edward Frederick Clarke: Then I think we can appeal to the liberality of the right hon. gentleman to get us a copy.


Wilfrid Laurier: I will get a copy for the hon. gentleman.


Edward Frederick Clarke: That will do. I would like to ask the Prime Minister or the Minister of Justice one question. Has the amendment which the leader of the opposition suggested been submitted to the Grand Trunk Pacific authorities or anybody acting on their behalf, and have they refused to accept it ?


Charles Fitzpatrick: So far as I am concerned, I have not submitted it to them, because I do not consider it any part of my duty to consult them as to the construction we should put upon the agreement, or as to the construction they put upon it.


Edward Frederick Clarke: Has any communication been received from them with respect to it?


Charles Fitzpatrick: If it has not been submitted to them, they would hardly communicate with us in regard to it.


Edward Frederick Clarke: Am I to understand that no communication has been received from them with regard to this amendment ?


Charles Fitzpatrick: Absolutely none, direct or indirect.
Amendemnt (Mr. Barker) negatived ; yeas, 25 ; nays, 41.


Samuel Barker: [DOT]
That section 1 of the Bill be amended by adding thereto the following as subsection 2 -
2. Nothwithstanding anything contained in clause 3 of the supplementary agreement, it is hereby provided that in the event of the completion of that portion of the eastern division which shall extend from a point at or near Winnipeg easterly to the point of junction with the Pacific Company's branch line to Lake Superior, or easterly to the point of junction with the Pacific Company's branch line to North Bay, before the completion by the Dominion of Canada of the whole eastern division, then the Pacific Company shall be entitled to lease and shall lease pending such full completion, from the commissioners the said portion and portions so constructed from a point at or near Winnipeg to such points of junction, at and subject to a rental, payable half-yearly equal to 3 per cent per annum, upon the cost of construction of the said portion or portions so leased, and subject also to such reasonable and usual conditions as may be agreed between the commissioners and


Samuel Barker: Cannot charge them less than nothing. No, they cannot charge them more than nothing-the terms are not to be more onerous than those of a lease that calls for no rent for seven years. Suppose we take the winter section, as you may call it, the section from Winnipeg to North Bay, which can be used after navigation has closed. That is the line, Mr. Plays told the shareholders of the Grand Trunk, over which they will bring all the merchandise and fat-paying traffic of Ontario and Quebec for the great west. That traffic which he has been groaning over having to give to competitors, such as the Canadian Pacific Railway, he is going to get himself. That is the great connection of the Grand Trunk to complete the continuity of the present

system, with the prairie country. And they will have the whole of that line, about 900 miles, without paying a cent of rent until the rest of the 1,900 miles is finished. Suppose that the surveys of the other part of the line takes two or three years, its completion cannot be looked for in less than seven years. They will have this Winnipeg-North Bay line during that time for nothing, and it will always be the most valuable part of the whole 1,900 miles to the Grand Trunk. Now, is there an hon. gentleman here who supposes that that will not be the first portion of the line constructed ? The Grand Trunk knows its value. Without waiting for the government to provide one dollar, they have been surveying the line for months past. They have had gangs of men over the whole route. The right hon. Prime Minister tells us that no understanding has been arrived at between them and the company as to whether the government is ever to repay the company for that. You may depend upon it, Mr. Chairman, that it is a valuable line for the Grand Trunk, or they would not have these gangs of men out for nearly a year surveying the route. They know the importance of getting that through early. They want to be ready so that as soon as navigation opens in 1905, or the following year, they may have that connection with Bake Superior finished .
If they do they will have the whole season's traffic from the Northwest over a line built by the government at the expense of the country and without paying a dollar for its use. That is the position they are in under this arrangement. They can go on during that season completing the section to the North Bay junction, and in the winter they will have their line open and their traffic will go from Winnipeg to North Bay, and again they will not pay one dollar for the use of the line. Even according to the figures read by the hon. the Minister of the Interior (Mr. Sifton) that 900 miles will cost, at the very lowest estimate that has been given us, $30,000 a mile, which will amount to something like $27,000,000 of money that will be expended by this government, and the use of that money will be handed over to the Grand Trunk for seven years if necessary, at all events for such time as will elapse until the whole 1,900 miles is completed. And that is the agreement, Mr. Chairman, that the right horn gentleman assured this House with the utmost gravity he expected us to accept without a word : not a word of cavil did he expect, except from our natural cussedness which would prevent us from looking at anything reasonably. We would have to object just from sheer perversity, but for no reason could we object to it. I do not want to occupy the time of the House unnecessarily ; I have endeavoured to state as shortly as possible the position, and I have tried to make it as clear as I can. and I do think that unless the Minister of Jus-Mr. BARKER.
tice can show that under such an agreement as this he can enforce, through the commissioners, a proper rental, we ought to have this clause in, and I think that the least we can ask the Grand Trunk Pacific is 3 per cent. They could not borrow their money for construction at anything like that. It is a very reasonable rate, and the only point that can be urged, that I can think of, by hon. gentlemen opposite is, that if the Grand Trunk did build the line they would have expected some assistance from the country. Now as to that, I shall give the answer we have given before, that if the Grand Trunk Company had gone on with their original proposition to build from the Pacific ocean to North Bay that company would never have asked this country such aid as is being given for the western division. They would not have expected for the whole distance from the Pacific to North Bay the aid and subsidy we are giving on the western division. What are we giving ? We are guaranteeing the prairie section to the extent of $13,000 a mile. We are guaranteeing, not $30,000 a mile, but three-fourths of the whole cost of the mountain section. No company has ever obtained such assistance from this country since the Canadian Pacific Railway was built, and I do not suppose any person will seriously think there is to be any comparison between the terms allowed a railway to-day and the terms that
than guarantee this for the prairie section and the mountain section. We are undertaking to pay for seven years, without recourse, the whole interest upon that mountain section. We do not think of giving any such terms to any railway company to-day that I am aware of, and I repeat that if the Grand Trunk had been allowed to go "on last year with their own scheme which they introduced into this House, they would never have expected to get from us for their whole project such assistance as they are getting for this western division. The government is to give them extraordinary terms for the 1,500 miles. We are building the S00 or 900 miles of the eastern section which was part of their project, which must be immediately useful and indispensable to them, and I say it is only reasonable that they should pay 3 per cent upon the cost.
Mr. FITZPxYTRICK. The wish no doubt being father to the thought in this case, the hon. gentleman proceeds on the assumption that the Grand Trunk are to build this line from North Bay to Winnipeg, and that that is the only part of the line contemplated or ever to be constructed. That is the only part of the line he attempts to deal with in this amendment at all. I will endeavour to go over the points made- by my hon. friend the other night as briefly and as specifically as I can. By section 9 of the National Transcontinental Railway Act the construction of the eastern division and its operation until

completion is under the charge and the control of a commission. The eastern division extends from Winnipeg to Moncton. The effect of the amendment now proposed by the government is to entitle the company to lease from the commissioners such portion cf the eastern division as may be from time to time completed, but they have only the right to lease those portions subject to the paramount right of the commissioners, to use and to operate the same without any payment of tolls or other compensation for such purposes as they may deem necessary or expedient in the execution of the commission. The commissioners remain in control and they use the line to the extreme limit of their necessities, and whatever may be left after that they hand over to the Grand Trunk. The terms of the lease under the amendment are to be agreed upon between the company and the commissioners, but these terms are not to be more onerous than the lease of the whole division provided for by the contract. It is to be observed that the terms are not those of the original lease, but such terms as may be agreed upon, which terms so to be agreed upon are not to be more onerous than those of the whol-j original lease, not of any portion of it. Now, let us see the terms of the original contract. Section 6 provides that the company agrees to take a lease of, to maintain and to operate the eastern division. That is their obligation; they have to take a lease of, they have to maintain, they have to operate. Section 2 defines the eastern division as extending from Moncton to Winnipeg, 1,850 miles. Section 20 provides for the lease of the eastern division when completed and for its operation during a period of fifty years, and during that period the rental is to be payable as follows :-The first seven years subject to working expenditure as defined in paragraph 14. The working expenditure apparently is not to be taken into account in the argument of my hon. friend from Hamilton (Mr. Barker).


Samuel Barker: I said so.


Charles Fitzpatrick: For the next forty years they are to pay annually, by way of rental, an amount equal to 3 per cent on the cost of construction, provided that if for the first three years of such forty-three years the net earnings shall not amount to 3 pet cent, the difference between the net earnings and the 3 per cent are to be capitalized and to form part of the cost of construction. Section 22 provides for an equipment to the extent of 85,000,000. Section 23 provides for the maintenance of the whole eastern division and its equipment. Section 24 provides for running powers for any other company that desires to use the line. Section 25 provides for indemnity in respect of the working of the railway. The hon. member for Hamilton (Mr. Barker) argued that the company would be entitled to lease the completed parts for seven years free of charge.
I took his words from 'Hansard, 'free of charge.' I presume he intended to include also the working expenditure, but he does not say so.
This contention in my humble opinion is an error, and I would ask the legal men in the House who are not absolutely committed to one side or the other, to bear these facts in mind. Of necessity you must compare the lease of part of the road for an jindefinite period with the lease of the vhole eastern section for fifty years. The terms of the lease are not to be more onerous than for the 1,850 miles for the period of fifty years. The difficulty of comparing the terms of the original lease, which is for a fixed period, and for a defined road with a lease for a part of the whole for an indefinite period is apparent. You must also bear in mind that the part of the ro,\d to be leased for an indefinite period is subject to be used by the commissioners. The commissioners may use it to the extent of ninety per cent and if there is only ten per cent left the Grand Trunk Pacific have the right to it. It is on these conditions that the hon. gentleman says you must take the original lease and compare it with the lease of the part they take over, and under which they will be entitled to an exemption for seven years. In respect to the eastern section there will be fat and lean parts as well as on the whole road. There will be obligations arising under the lease of the whole which will attach from the very first day. I submit that the obligation to pay three per cent on the cost of construction for forty-three years will attach from the very first day that the lease is made.


Robert Laird Borden: I do not quite follow my hon. friend. Does he mean that the fifty years is to date from the lease of the portion ?


Charles Fitzpatrick: Not at all. I say that the whole onus or the obligation to pay three per cent on the cost of construction in respect to the original lease attaches from the moment the lease is signed. It is an obligation, under the original lease in respect of the first seven years-as well as the forty-three years. It is an obligation contingent but it is an obligation which results from the signing of the lease. The most that could be argued would be that pending the completion of the eastern division the company may lease any completed portion, pay working expenditure for seven fiftieths of the time and for the remainder of the period, three percent on the cost of construction. But, is that position even tenable ? And that is the only reasonable proposition that was submitted to the House. Is it not conceivable that with respect to certain of the completed portions, the obligation to pay even working expenditure when the paramount right of the commissioners is taken



into account would be more onerous, especially, if, as is contemplated, by the lease of the whole section, other roads had equal rights ? They only take that which is left after the commissioners have used the road for their own purposes. Assuming that the commissioners use part of the road to the extent of seventy-five per cent, of its carrying capacity, the simple obligation in respect to the 25 per cent to pay working expenditure would make that more onerous than the whole term of the original lease. The obligation would attach under any circumstances, according to the argument put forward by the hon. member for Hamilton. It seems to me that when we realize that the only right this company can get is to use the road after the commissioners have exhausted their rights and when these rights can only be used in common with other roads, we can understand how impossible it is to fix absolutely now the conditions of the lease. Does the use of the term in paragraph 3, necessarily include rental ? Is the determination of the amount of the rental to be paid not left by necessary implication, to be fixed in the agreement that is to be made ; and this more especially in view of the fact that one cannot now say what is to be the object on which the lease will will operate ? An interim lease of a portion at a substantial rental would not be necessarily more onerous than a lease of the whole at three per cent on cost of construction for forty-three, years. My opinion is that provisions 23, 24 and 25 of the original contract can properly be applied to the lease of a portion, while 20, 21 and 22, as clearly cannot be applied and that the rental can only be fixed when the conditions under which the completed portions of the road can be operated are determined, and then the question as to whether the term under which leases are to be granted are more onerous, must be considered iu respect to the whole lease of the completed section for the full term of fifty years. You do not know what the lease is going to operate on. You have to bear in mind the paramount right of the commissioners in respect to the completed parts of the railway, and you cannot say that the conditions are to be more or less onerous until you know the extent to which the lease is to operate in respect to the Grand Trunk Pacific Railway Company.


Robert Laird Borden: According to the argument of my hon. friend the Minister of Justice this clause is drawn in such vague terms that no one can know anything at all about it. Even if we accept that as a correct statement of the position, one would think that everything ought to be expressed in such plain and definite terms that we would know our rights and liabilities pretty distinctly. I do not think the opinion which my hon. friend has Mr. FITZPATRICK.
read takes into full consideration some of the objections to the clause as it stands at present which have been advanced by my hon. friend from Hamilton (Mr. Barker). Does not my hon. friend the Minister of Justice know that this particular line has been pointed out by the general manager of the Grand Trunk Railway as a portion of the line which would be highly remunerative to them? I am talking now about the portion of the line which was referred to by my hon. friend from Hamilton and which is specially referred to in the amendment which he has offered. The amendment defines it as follows :
That in the event of the completion of that portion of the eastern division which shall extend from a point at or near Winnipeg easterly to the point of junction with the Pacific Company's branch line to Lake Superior, or easterly to the point of junction with the Pacific Company's branch line at North Bay.
It does not seem useful to discuss the whole line in general terms as the hon. Minister Of Justice has done when the attention of the government, by this amendment, is directed to a particular portion of the line which must be of very great importance to the Grand Trunk Railway Company and which must be of very great value to them before the remainder of the line is completed. AVhat did the general managed of the Grand Trunk, Railway Company say in regard to that. I will read from the official report :
Now, gentlemen, the Grand Trunk Pacific is going to be In quite a different position from that of an ordinary new enterprise stretching across the territory I have explained to you. Here is the Grand Trunk, the parent company, standing with a large traffic ready to deliver it westbound. This traffic is now given to a competitor. It does not have to wait five, ten or fifteen years to build up a traffic ; it starts with a traffic right from the beginning, and that is of a most remunerative character-a high class traffic-consisting of agricultural machinery, dry goods, hoots and shoes and all that class of merchandise that a new and rapidly developing country requires.
The amendment of my hon. friend from Hamilton is dealing with that section of the road in the light of the declaration of the general manager of the Grand Trunk and he is simply asking this House to declare that if that highly remunerative road is handed, over to the Grand Trunk Railway Company before the completion of the remainder of the line, they shall pay to the people of this country an ordinary fair rental of three per cent on the cost of the line. That is not a position to be met by the reading of any legal opinion stating that you cannot tell one thing or another about it till you know the portion of the line which will be completed first. We are dealing here in this amendment with the proposed rental of that particular portion of the line to the Grand Trunk

Pacific Railway Company in the first instance. That is all we have to consider and these legal refinements which have been introduced by the hon. Minister of Justice do not seem to deal with the question from the broad standpoint of public policy and it is from that point surely that the government ought to deal with it.
If the government completes that line from Winnipeg to North Bay, and if as declared by the general manager of the Grand Trunk Railway that line is of vital importance to that railway and will carry traffic of a highly remunerative character, why should the people of this country be without interest for seven years, or for that matter, any number of years, upon so valuable an asset.	The Minister of
Justice seems to take issue, in some way not very distinct, with the proposition that under the contract as it stands, the Grand Trunk Pacific will be entitled to a lease for seven years without rent. Let us assume, although I do not agree with it, that you have to compare a term of not more than seven years with the whole term of fifty ; it will nevertheless follow that for some portion of that term this company will be entitled to have the lease without rental if it receives that lease upon terms not more onerous than those contained in the original lease. I do not think the Minister of Justice will venture to deny that proposition. The Minister of Justice endeavoured to base an argument on the consideration, that the commissioners may operate this road. So they may, but surely the Minister of, Justice does not fail to attach some importance to the words 1 in the execution of their commission.' Surely he has paid sufficient attention to this amendment to know, that it provides that an allowance must be made out of the proposed rental of three per cent for any user which the commissioners may make of that line in the execution of their commission. Why should the government spend $30,000,000 or $35,000,000 in the construction of 900 miles of a remunerative railroad from North Bay to Winnipeg, and hand it over to the company for any period of years whatever, free of rental.
Sir WILFRID LAURIE It. It must not be forgotten that the hon. gentleman from Hamilton based his whole argument on a purely technical and legal basis, and it was his argument which the Minister of Justice answered. The hon. gentleman (Mr. Barker) came to the conclusion, from which I would not dissent, that the section between Winnipeg and North Bay ought to pay a rental of three per cent when leased to the Grand Trunk. It seems to me, that we have only to look at the terms of the agreement to convince my hon. friend (Mr. Barker), that he is in error in saying that under the terms of the contract the government cannot exact any rent from the Grand Trunk Railway for that section. It is ad-1
mitted that on this section from Moncton to Winnipeg, all parts will not be equally remunerative, and undoubtedly the section between Winnipeg and North Bay will be amongst the most remunerative. The amended contract contemplates that, because it says : ' That any section of the line which is contemplated can be leased to the company upon terms to be agree4d upon.' These words must have some meaning, and I quite conceive that if we were to rent this section from North-Bay to Winnipeg, the terms agreed upon would be different from those which might be agreed upon to the line between Abitibi and Quebec. My hon. friend (Mr. Barker) says that it would be no use to agree upon terms, because the only terms we could agree upon would be to exact no rental at all. That is. an erroneous conception. The contract provides in general, that the lease shall be for a term of fifty years at a rental of three per cent on the cost of construction. This line between North Bay and Winnipeg will be built in two or three years, and the lease would be for four or five years, and it is not to be expected that the abatement of interest which is to run on the contract for fifty years, would not also apply to that part of the contract for four or five years.


Samuel Barker: Why don't you say so ?


Wilfrid Laurier: The lease says that the terms are not to be more onerous than those of the lease of the whole division by the said contract provided for. And, because it is provided in the main lease of fifty years that for seven years there will be an abatement of the rent, the hon. gentleman concludes that for a contract of five years there should be no rental at all charged. This is a consequence which does not at all follow from the proposal. If it means anything, it means that we could not rent for more than 3 per cent of the cost. For my part, I think it would be reasonable that the Grand Trunk Company would have to pay on portions of the line 3 per cent, on other portions less than 3 per cent, and on other portions still less, perhaps 1 per cent. That would be altogether a matter of agreement between the government and the company. The government must have discretion in the matter, and it is because we claim to have some discretion that we have taken the precaution to say that any portion of the line which the company shall lease shall be leased only on terms to be agreed upon between the government and the company. If we cannot agree upon the terms, then there shall be no lease.


Samuel Barker: As I follow the right hon. gentleman, he assumes that this third clause of the supplemental contract means that when a portion of the line is completed and a lease of it made, the fifty years' lease as to that portion will begin from that date.


Wilfrid Laurier: Not at all.


Samuel Barker: Tlie Minister of Justice got as near as possible to that.


Charles Fitzpatrick: I never had anything of the kind in my mind.


Samuel Barker: I say the hon. gentleman's argument got as near as possible to that. I would like to know how you are going to settle the terms of rental under the interim lease. It would be impossible on the data which the Minister of Justice has given to arrive at a conclusion. How can you judge of the rental to be charged on 900 miles from Winnipeg to North Bay for an unknown period ? The interim lease must cease when the whole road is completed, say in five or six or seven years. How are you going to arrive at an interim rental that will depend on the fifty years' rental for the whole line, with seven years free. How are you going to calculate what will be the proper rental of a particular section, a paying section, as against the terms for the whole including non-paying sections ? It is an utter impossibility. If that were the idea, is it to be supposed for a moment that it would be expressed in these terms ? If the gentleman who drew that clause had in his mind what the Minister of Justice and the right hon. leader of the government are contending for, does anybody suppose that it would be expressed in this way ? The proposition is simply this, that an option is given to the Grand Trunk. They can take any part. They might perhaps take the Abitibi section, though they are not likely to do so. If they took that, I could understand their saying : We will take it on terms even less onerous than those applicable to the whole line, because it will not pay the working expenses. But the maximum liability is that they must not pay more for any portion than they would for the whole line ; and for seven years on the whole line they pay nothing. They may pay less: the contract is in effect that for the best portion of the line the terms shall not be more onerous than those of the main lease ; the terms for the worst portion may be very much less onerous. I can quite conceive that if the Grand Trunk Company were called upon to operate this section from Lake Abitibi to Quebec before the completion of any other portion of the line, they would say :	We cannot afford to pay the
working expenses ; on that portion the government will have to pay the working expenses, and we will run it at their cost. But for the very best portion of the line, the government cannot get more than the terms of the main lease. The terms of the main lease are that the first seven years shall be given for nothing, and that is all you can ask. Let me say one word as to a remark made by the Minister of Justice. He refers to the right of the commissioners to use the leased portion in the execution of their commission. Does the Minister of Justice mean to contend, after reading clause 9 of the agreement, that the commissioners would have the Mr. BARKER.
right to operate as carriers, that section from Winnipeg to North Bay, during a temporary lease ?


Charles Fitzpatrick: Who argued any-think so preposterous as that ? They are limited to the purposes of their commission- for the construction of the road.


Samuel Barker: The hon. gentleman did not say that. Will the hon. gentleman tell me that they will want to use the section between Winnipeg and North Bay for the purpose of constructing the rest of the road ? They have nothing west of Winnipeg to construct.


Charles Fitzpatrick: Nothing east of Lake Abitibi ?


Samuel Barker: I am speaking now of the portion from North Bay Junction to Winnipeg. I ask for what purpose will the commissioners want to use that section ? I have put in the clause that if they should want to use it, they will be allowed compensation for that user. But the hon. gentleman thinks the right of the commission to go over that portion of the road is so burdensome to the lessees that it will absolutely destroy the value of that section. I think the Minister of Justice must be driven into a corner to find something to show how little value that 900 miles will be to the company. He was trying to belittle the value of that section from North Bay Junction to W'innipeg to the Grand Trunk Railway by pointing out the terrible position in which the Grand Trunk Railway would be because the commissioners would have the right to use it for the purposes of construction after the construction was completed. I really think that the Grand Trunk Railway would not hesitate to take the lease on that ground, especially after the praises of that section we know Mr. Hays gave to the shareholders of the Grand Trunk Railway. I do not think I need occupy any further time in answering that part of the argument of the right hon. gentleman or the Minister of Justice. It is perfectly patent to everybody that those who drew that clause, whether it was drawn by the Grand Trunk Railway or by the legal gentlemen employed by the government, had no other intention than that the Grand Trunk Railway might get a temporary lease of any constructed portion which they might require, and would not pay any more than the terms provided in the original lease ; and that the government overlooked entirely the fact that for seven years the original lease called for no rent whatever.


Haughton Lennox: It is not surprising that the Minister of Justice should have lost his temper to some extent at the suggestion that the commissioners would have to use this road for the purposes of construction. But the right hon. gentleman suggested that a very large user would still be required

by the commissioners. He said it might be very probable that the commissioners would use it to the extent of ninety per cent.


Wilfrid Laurier: I never said anything of the kind.


Haughton Lennox: If I am not mistaken the right hon. gentleman, in pointing out how unreasonable it would be to exact a rental of three per cent, said you could not gauge to what extent the commissioners would have to use this portion in the construction of the line, and that they might have to use it to the extent of ninety per cent.


Wilfrid Laurier: I never said anything of the kind.


Charles Fitzpatrick: I said it.


Haughton Lennox: I did not think It possible the Minister of Justice said it.


Charles Fitzpatrick: I am afraid it is.


Haughton Lennox: I am glad the hon. gentleman's temper is restored. We are losing I>retty nearly everything, including the temper of hon. members of the government, and I am glad to see harmony restored through my mistake.


Wilfrid Laurier: I do not object to the statement, but I want my hon. friend to be correct. He is attributing to me too much credit. The Minister of Justice made use of that argument, not I.


Haughton Lennox: I need not answer the Minister of Justice, because he has answered himself. He says it would be absurd to consider that there would be any considerable user of the line by the commissioners except for the purposes of construction ; and if the line were constructed from the extreme eastern end of the division down to North Bay. of course there could be no necessity for the commissioners using it between North Bay and Winnipeg.
Well. I must call attention to this sentence which appears in the speech of Sir Charles Rivers-Wilson to the shareholders in London. Speaking of Mr. Hays, he said :
You have only to contemplate the past history of the company during the last nine years to see what sort of a man Mr. Hays is. I assure you he seems to have put all his activity and energy into this particular negotiation, and I call upon you to concur with me in expressing your gratitude to him for the good work he has done for us.
Mr. Hays seems to be doing very good work for the company. Whatever the original agreement, may have (been, every concession granted since has been in favour of the company. We find that the government has surrendered everything the company asked for and got nothing in return. We find that the Grand Trunk Railway is given the right to lease any portion of the road pending the completion of the whole
line, but we do not find that the government have any corresponding right to compel the Grand Trunk Railway to take out a lease. The whole thing is one-sided. For instance, it is provided that a lease of the portion must not be more onerous than the terms of the lease of the whole, but they may be as much less onerous as the commissioners may see fit. It was not at all necessary for the government to provide that a lease of any portion of the line should not be less onerous than the lease in the original agreement, but it was considered necessary to protect the company by providing that it could not be more onerous. As I understand this matter, there is no room for argument as to what the new terms mean. We have in the original lease a provision that for seven years the company is not to pay any rent and for the following three years the company may have the road without paying anything, and the rental for the three years is then to be capitalized at three per cent.
Well, this new lease, if the commissioners execute it, is to be on terms not more onerous than the other. That is, if it is for seven years it will be without rent. I ask, is that fair and reasonable, having regard to existing conditions, as placed before the House ? We have, for instance, a description by the Minister of the Interior (Mr. Sifton) last session when the original contract was under consideration. Another phase of the question was being argued, and it was to the Minister of the Interior's interest, as he conceived it, to contrast this scheme with the building of the Canadian Pacific Railway, and he said :
I want to say a word or two in regard to the prospects of this enterprise from a financial standpoint ; and I speak as one who has had a considerable personal knowledge of the development of the western country, and of the differences that have been produced in the financial conditions of the railway companies owing to that development. The net profits of the Canadian Pacific Railway during the year ending the 30th of June, 1902, were $14,085,000, and last year its net profits were $15,000,000. The company have made of their railway enterprise a magnificent success, and if they were called upon to-morrow to incur the liability to pay back every cent of public subvention which they have received, and all the money which they have received for iands, notwithstanding that, the Canadian Pacific Railway Company would be a good, sound and solvent concern.
What does that mean ? It means this, as I understand it-that if you take every dollar of assistance from the Grand Trunk Pacific and let them build a road from North Bay to the Pacific coast without any subvention at all, it will be a good, sound, solvent, paying concern. I shall not proceed further to emphasize the contrast which the minister makes, showing how vastly superior he claims this enterprise is under the conditions which surround it to the Canadian Pacific Railway-and, as is remarked to me by an hon. friend, the aid to

ready referred should be rejected by the government. I do not think that anything can be said in favour of it which has not already been said in respect to the other and therefore I will content myself with moving it.


Charles Fitzpatrick: I understand that the argument here would be absolutely the same as that in respect of the other amend: ment respecting the rolling stock so we can take it that what was said on the other on both sides is said on this.
Amendment (Mr. R. L. Borden) negatived.


Robert Laird Borden: There is another amendment which has been suggested to section 1. My hon. friend from West Toronto (Mr. Clarke) will move it, but preparatory to his moving it I will say a few words about it. The amendment is as follows :
That all freight originating on the line of the Pacific Company's railway or upon the branch lines, not specifically routed otherwise by the shipper, shall, where destined for points in Canada, be carried entirely on Canadian territory or between Canadian inland ports, and that the rates for such carriage shall not be greater than the rates charged between the same points over any route not wholly Canadian which includes any part of the Grand Trunk Railway Company system.
The first branch of this is already covered by section 42 of the contract, which is simply repeated as introductory to the second part, which is as follows :
That the rates for such carriage shall not be greater than the rates charged between the same points over any route not wholly Canadian which includes any part of the Grand Trunk Railway Company system.
It is possible that the Grand Trunk Railway Company may have an all-Canadian route from Winnipeg to Montreal and that they may have a route from Winnipeg to Montreal which is not wholly Canadian and which embraces some portion of the system of the Grand Trunk Railway Company in the United States. The object of the amendment is to provide that the rates for such carriage shall not be greater by the Canadian route than the rates charged between the same points by a route not wholly Canadian, which includes any part of the Grand Trunk Railway Company's system. The reason for the amendment seems to be quite obvious and I have stated it thus briefly. My hon. friend who is to move the amendment, will, I have no doubt, give such further explanations as he deems necessary.


Edward Frederick Clarke: It seems to me that after the very lucid statement made by my hon. friend the leader of the opposition as to the object of this amendment, I need not take up the time of the committee at any great length in explaining it. Section 42 of the agreement of last year declares the conditions upon which aid was given to the Mr. R. L. BORDEN.
Grand Trunk Pacific. That section states that:
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 accept the aid on the conditions which I have here before me and which I have just recited.
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, o'r' between Canadian inland ports.
So far so good. Then the company obligates itself in the concluding sentence of section 42 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 United States ports, and that all such traffic, not specifically routed otherwise by the shipper, shall be carried to Canadian ocean ports.
I take it that this clause means that traffic originating in Winnipeg or any point in the west destined for Liverpool or any point across the ocean shall not be carried by the Grand Trunk via United States ports at a through rate less than would be given on the same class of goods if carried via Canadian ports to their destination. But there is no provision made against a discrimination of rates in regard to interprovincial traffic which may go over the new line. The object of the government in giving this aid as stated in the first part of section 42 is this :
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.
I opine that interprovincial trade will for many years to come be the great bulk of the trade which will be likely to be carried over this new road and it is eminently essential, as we desire this trade for this route, that there shall be no discrimination in rates. The object of the amendment is to prevent such discrimination and to provide that between such points as have already been mentioned by my hon. frieud the leader of the opposition there shall be no discrimination. It is to provide that if a consignment of freight is earied from Winnipeg to Hamilton, or Toronto, or Montreal over the all-rail Canadian route, the rate shall not be any greater than via Duluth and Chicago and thence to its destination at Hamilton, or Toronto, or Montreal. It seems

*to me that the reasonableness of this amendment must be apparent to hon. gentlemen opposite. I take it that it was an oversight in the drafting of the clause that this provision was not placed in the contract. The amendment deals, I say, with rates on interprovincial traffic. The section of last year only made provision against discrimination on through traffic destined for export. Internal traffic should be treated on the same favourable conditions as export traffic and the amendment which is now before me makes that provision. I think hon. gentlemen will see the propriety and reasonableness of accepting this amendment, because if it is accepted it will certainly promote the object which hon. gentlemen had in view ' in giving such enormous aid to the Grand Trunk Pacific Railway Company, as it will promote the carriage of Canadian goods by Canadian routes. I do not thiDk that I need take up the time of the committee in elaborating that point at any greater length.


William Stevens Fielding: The answer to this from the point of view of the government is that in regard to interprovincial traffic we have, under the Railway Commission, absolute and unlimited control of rates. We would not1 have that absolute and unlimited control of rates on export traffic because the through rate includes not only the rail rate but the ocean rate. On grain business, which is chiefly in mind,1 there is usually a through rate which is quoted say from Winnipeg to Liverpool. That wohld not be under the control of the Railway Commission because it would include the water rate. But, that would not apply to interprovincial traffic. Interprovincial traffic is without any limitation subject to the provisions of the Railway Act and the Railway Commissioners can meet any such difficulty as that which my hon. friend (Mr. Clarke) suggests. If it be found that there is an attempt to resort to unfair discrimination *as respects interprovincial traffic there is under the Railway Act the most full and ample machinery for protecting the public interest. This company is not the only one which might have connections through the United States and although I have not thought of that aspect of it so much, I think there might be something said to the effect that if any such provision is necessary it should apply to all railways and not to this one only. There would be no particular reason why one company should be discriminated against because they may have done this while another company would be permitted to do precisely the same thing. But, the chief ground we take is that as respects interprovincial traffic the provisions of the Railway Act give ample protection to the public interest.


Samuel Barker: Do I understand my hon. friend the Minister of Finance (Mr. Field-irg) to say that the board of Railway Commissioners can control rates by way of Chicago ?


William Stevens Fielding: No, but they can control rates over this road, and if it can be shown that this company by any roundabout way is giving more favourable rates otherwise, then the railway commissioners can insist that the Canadian rates shall be reduced.


Samuel Barker: What we say, is that the Grand Trunk Railway Company should be a party to this arrangement in controlling the Grand Trunk Pacific and if the Grand Trunk Railway by its Chicago route makes a rate between Winnipeg and Toronto, it ought to give as good a rate by the all-Canadian route between the same points. Why should the Grand Trunk, receiving all these benefits, be permitted to be a party to a lower rate by a route of which it forms a part through tiie United States, than it gives through Canada ? There may be a question as to whether the Grand Trunk might not reasonably object to be bound to compete with rates by any and every line in the United States.


William Stevens Fielding: Why not ?


Samuel Barker: For the reason that no corporation wants to be bound to any rate which another rival company may make. You could compel the Grand Trunk to meet a rate which it joined in making through the United States, but it might be a different thing if some other company were, for the purpose of hurting the Grand Trunk, to make a very low rate, in order to compel the Grand Trunk to follow it. There cannot be any objection to compelling the Grand Trunk to give the same rate to the all-Canadian route, that it joins with other companies in allowing by the United States route.


Edward Frederick Clarke: The Grand Trunk Railway accepts the aid upon the conditions stated in section 42 ; that it is for the express purpose of encouraging the development of Canadian trade by the transportation of goods through Canadian channels, and it also 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 be carried entirely on Canadian territory or between Canadian inland ports. The amendment proposes that there should be no descri-minating rate so far as the Grand Trunk Railway are concerned against the all-Canadian route as between points in Canada. Admitting all the Finance Minister has said as to the powers of the Railway Commission, would it not be much simpler that there should be a distinct statement made in this agreement that the Grand Trunk shall not be a party to making any discriminating rates against the all-Canadian route ? If the Grand Trunk Railway have entered into this contract in good faith and desire to
son

implement the intention of the government to develop Canadian trade in Canadian channels, surely it is not an unreasonable request that they shall not discriminate in the rates to be charged as between points in western Canada and eastern Canada ?
Ma FIELDING;. Last year my hon. friends did not value that clause as highly as they do now.


Samuel Barker: I moved this amendment last year.


William Stevens Fielding: My hon. friend is mistaken. What is proposed now is, that the clause of our original contract which has reference in part to inland traffic and in part to ocean traffic, shall now be specifically adapted to the inland traffic, and in their amendment they quote almost the very words of that poor despised and miserable clause which we proposed a year ago, and they take it as the chief corner stone of their argument.


Samuel Barker: I moved the same amendment last year, and the hon. gentleman voted it down.


William Stevens Fielding: I quite agree that when the Grand Trunk Pacific Company accepts the aid as set forth in this contract for the specific purpose of encouraging trade through Canadian channels, then if they did that which the hon. gentleman (Mr. Clarke) says they would do


Edward Frederick Clarke: I did not say they would do it.


William Stevens Fielding: The hon. gentleman said they might do it, and if there was not a possibility of their doing it the amendment is of no use. I quite agree that the doing of that thing would be a direct breach of that contract. I, as a layman, would not hesitate to say that it would be a gross breach of the whole spirit of the contract, and that being the case, the Railway Commission would not for a moment permit the Grand Trunk Pacific to do it. What my hon. friend desires to accomplish by his amendment is already provided for " most adequately by the Act constituting the Railway Commission.


Haughton Lennox: Would the Minister of Justice


Some hon. MEMBERS: Oh, oh.


Haughton Lennox: If hon. gentlemen try to adopt these tactics they will not succeed.


Some hon. MEMBERS: Oh.


Haughton Lennox: Some of these gentlemen think they are so exceedingly clever.


Some hon. MEMBERS: Hear, hear. Oh.


Haughton Lennox: They think they can give impertinence to members who are addressing the House. I know when to speak and when to be silent, and I do not get up for the purpose of talking.


Edward Frederick Clarke: 


Some hon. MEMBERS: Oh.


Mr. DEPUTY SPEAKER.: Order.


Haughton Lennox: I get up to speak on something I know something about, and when hon. gentlemen have been outside and come into the chamber they should be quiet.


Some hon. MEMBERS: Oh, oh.


Haughton Lennox: Now, Mr. Speaker, I ask you to keep order. The Minister of Justice said that this matter would be controlled by the Railway Commission. Let me point out that when specific provisions are made in this contract, the Railway Commission would be very liable to say that parliament having made special provisions it would not be proper for them to interfere. The Railway Act expressly provides that it does not interfere wTith any special legislation affecting any railway company, and here we have special legislation affecting this particular matter. It is questionable if the Railway Commission would interfere and we certainly should not leave the matter in this condition of doubt.


William Stevens Fielding: There is some special legislation on this subject, but unfortunately for the gentleman's argument it is special legislation the other way. It is special legislation in the contract of last year ratified by this House, and section 39 says :
The rates and toils to be levied and taken by the company upon any part of the said railway, shall be 'under the control of the Governor in Council, or of such authority, commission, or tribunal, as is designated or constituted under any Act of the parliament of Canada, for the regulation or control of the business of railways.
Therefore the matter is dealt with, not only by the general provisions of the Railway Act, but by the specific terms of the contract of last year.


Robert Laird Borden: Is that not rather an argument against the Minister of Finance than for him ? A little while ago he was suggesting that there should be no special provision, because all the necessary provisions were contained in the General Act. The same argument would eliminate from the agreement section 39, which he has just referred to. What is the office of that section if his argument of a moment ago was a valid one ?


Charles Fitzpatrick: Because when that Clause was drawn there was no railway commission, and the section of the contract provides for the Railway Commission which was in contemplation.


Robert Laird Borden: Does my hon. friend remember that the Act constituting the Railway Commission is declared to be a substitution for the former Railway Act, and the tribunal thex-eby created is declared to be a continuation of the former Railway Committee ?


Charles Fitzpatrick: With powers a hundred per cent greater.


Robert Laird Borden: Quite so, but the Act, applies in general terms to every railway in Canada.


Charles Fitzpatrick: The Railway Commission will not apply to a government owned road.


Robert Laird Borden: This is not a govern ment owned road.


Charles Fitzpatrick: Of course it is.


Robert Laird Borden: A large part of it is not. It is a government owned road as to the eastern division, but operated by a company.	-


Thomas Simpson Sproule: While this section provides that the rates shall be under the control of the Governor in Council, it does not provide that they can reduce rates. The provisions of the Crow's Nest Pass Bill were entirely different from this. That Bill not only put the rates under the control of the Governor in Council, but gave it power to reduce the rates. Under the old law the tolls were practically under the control of the Governor in Council, because if it did not consent to them, no railway company could charge them ; but it has always been contended that that did not give the Governor in Council the right to reduce the tolls. If that be so, under the present law, which I think has the same words, the Governor in Council could not compel a railway company to lower its tolls, though they might be too high. Therefore, it seems to me that it would be necessary to have some such provision as was put in the Crow's Nest Pass Bill to give the Governor in Council power to lower the tolls at any time if it thought them too high.


William Stevens Fielding: I suppose what my hon. friend refers to is the rule that where a maximum rate was fixed the companies were free to charge up to that amount. Of course, the Governor in Council could reduce the rates by fixing a lower maximum. Under the new Railway Act it is different. The Railway Commission does not fix a maximum tariff, but it can fix the exact rate to be charged on every article, _and nothing can be collected above that. The powers of the Governor in Council were broad before, but the powers of th'e Railway Commission are broader still. The effect of this section 39 is to carry the provisions of the Railway Act into this contract. Even without it, the provisions of the general law would apply, but we are making assurance doubly sure.


Robert Laird Borden: Is not that a good argument for carrying this into the special Act, instead of leaving it to the operations of the general law ?


William Stevens Fielding: If we undertook to change this contract, it would be necessary to have a meeting of the shareholders of the
Grand Trunk Company to ratify the change. Therefore, we say that unless it is necessary to make a change of great importance, we would not be justified in imperilling the whole contract by making changes. Everything the hon. gentleman asks is accomplished by general legislation in the strongest and fullest terms.


Robert Laird Borden: That is very frank on the part of my hon. friend. The situation appears to be that if the government had thought of it they would have put a clause in here similar to section 39 ; but, as they did not think of it, they do not do it, because, if they did it, it might result in some difficulty with the Grand Trunk Railway Company.


Thomas Simpson Sproule: The Minister of Justice said some of the clauses were improperly drawn and must be drawn over again. How is it he could change those clauses ?


William Stevens Fielding: The Minister of Justice did not speak of any change in the contract, but in the clauses of the Bill. These ^an be amended, and I am sure the Minister of Justice is always glad to accept suggestions ; but he cannot change the contract.


Mr. KEMP.: Did I understand the Minister of Justice to say that a government owned road does not come under the Railway Act ?
Mr, FITZPATRICK. The Railway Act does not apply to a government owned road ; but in order to set all questions at rest with regard to this railway, it is provided that the tolls and charges on the eastern division shall be subject to the approval of the Railway Commission.


Samuel Barker: In settling rates for Canada the Board of Railway Commissioners will have regard for what may be a reasonable rate to impose upon the railway company. But at times rates may be allowed via Chicago lower than the commissioners would impose on the Canadian route. The effect would be that traffic would be diverted from the Canadian line. Now, what we say is, that if the Grand Trunk join in any such low rate via Chicago it must give as good a rate through Canada even though lower than our commissioners impose. We say that that should be made a matter of contract here in consideration of the aid we are giving. The resolution we are moving now is almost in the very words of the resolution moved last year by the hon. member for Leeds (Mr. Taylor) to be found at page 12751 of ' Hansard ' :
That all freight originating on the line of the said railway or its branches, not specifically routed otherwise by the shipper, if destined for points in Canada, shall he carried entirely on Canadian territory or between Canadian inland ports, and that the rates for such carriage shall not be greater than the rate charged between the same points by any route not wholly

Canadian, and if any such freight be for export, it shall-
Then it goes on with the rest of the-clause as in section 42 of the agreement. I understood the hon. Minister of Finance to rather plume himself on having found something good in the contract of last year which we opposed. That is the amendment we moved last yea r, upon which the one we are now discussing is based.


William Stevens Fielding: Whether it was moved by the hon. gentleman himself or by the hon. member for Leeds (Mr. Taylor), the words were largely those in the clause of the original contract, and when that clause was brought up in its application to export traffic, my hon. friend and others argued that it did not amount to anything. Of course, if hon. gentlemen were glad to take it at the latter part of last session or if they desire to take it now, we are pleased to know that our efforts in that direction are appreciated.


Samuel Barker: The object of our amendment last year was to insert the words which my hon. friend from West Toronto is now moving to have inserted. We did not propose to strike out clause 42 of the agreement, but we pointed out where it was defective. As the hon. member for West Toronto has said, the government apparently overlooked the necessity of providing for rates on the inland traffic from point to point within Canada. My hon. friend from West Toronto is now moving to have a clause inserted similar to the one we proposed last year. The object of our motion last year was to make the hon. gentleman's clause effective.
Amendment negatived.


Peter Macdonald: Shall section 1 be adopted ?


Robert Laird Borden: There are some of these amendments which are not strictly speaking amendments to any special clause of the Bill. It may be convenient to introduce them between the various clauses or at the end.


Charles Fitzpatrick: I understood the arrangement to be that my hon. friend would be free to introduce them at any time he thought proper.
Section 1 agreed to.
Pi ogress reported.


Wilfrid Laurier: I beg to give notice that on Friday next, I shall move the following resolution :
Resolved, that it is expedient to amend section 9 of the National Transcontinental Railway Act so as to provide for the appointment of four commissioners of the Transcontinental Railway instead of three.
On motion of Sir Wilfrid Laurier, House adjourned at 11.50 p.m.


Samuel Barker: Fbiday, May 13, 1904.