1914-06-03

Mr. SPEAKER:: There are two Senate Bills on the Order Paper, but no one has been put in charge of them and no instructions have been given, consequently I can only allow' them to stand until some one is put in charge of them, or information is given as to who is to be responsible for them.



SENATE EMPLOYEES.

[Stage Direction]
Sir WILFRID LAURIER moved the first loading of Bill No. 225, to amend the Civil Service Amendment Act, 1908, as respects the Senate of Canada.
Mr. BORDEN:: Explain.


Sir WILFRID LAURIER:: I understand, Mr. Speaker, that this Bill is with regard to some rights which are claimed by the

Senate, which I do not pretend to he familiar \vith, and, therefore, cannot endorse; but the question is worth while giving attention to, and that is (the reason I move that the Bill be read.


Mr. PELLETIER:: I understand that this Bill aims to exclude Senate employees from the operation of the Civil Service Act.
Sir WILFRID LAURdER: I do not pretend to endorse it, but, as it has come from the Senate, we should give it consideration.


[Stage Direction]
Motion agreed to, and Bill read the first time.

Thomas Simpson Sproule: With regard to Bill No. 222, to amend the Secret Commissions Act, 1909, no one seems willing to take charge of it.


Wilfrid Laurier: With regard to this Bill, Senator Davis has left for home, and has not given instructions to anybody to Itake charge of it, so far .as I know. Under the circumstances it had better stand.


Thomas Simpson Sproule: Stands. We have no power to drop it.



QUESTIONS.

[Stage Direction]
(Questions answered orally are indicated by an .asterisk.)

Mr. GAUVREAU:: 1.	What was the total amount spent for the repairing: or reconstruction of the wharf at L'lle Verte, Temiscouata, during the summer of 191-3?
2.	Out of that amount what sum of money has been spent for the purchase of the wood necessary for such work?
3.	What are the full names and addresses of the parties entrusted by the department with the purchase of such wood?
4.	What is the full name and address of each of the parties who sold wood intended for such work?
5.	What quantity of wood did each of them sell?
6.	What price was paid per foot or otherwise to each of them for the said wood sold, and the total sum paid to each of them?
7.	Was such sum of money paid directly to the seller himself in every instance?
8.	If it was paid through a third party, what is the name and address of such third party?
9.	How many mooring posts have been delivered on said wharf while the work was in progress?
10.	What was the cost of each of these posts?
11.	What is the full name and address or each of the parties who sold such posts to the department?


Mr. ROGERS:: 1.	$4,500.59.
2.	$2,079.75.
3.	Under the control of district engineer, .1. A. Tremblay, Montmagny. and foreman, Joseph Collin, Isle Verte.
4.	5 and 6. Cyrille Duibe, Isle Verte: 605 feet spruce timber, 5 to 6 inches, at 5 cents, $30.25; Octave Boucher, Isle Verte: 355 feet spruce timber, 5 to 6 inches, at 5 cents, $17.75; Ernest Malenfant, Isle Verte: 350 feet spruce timber, 5 to 6 inches, at 5 cents, $17.50; Thomas Talbot, Isle Verte: 600 feet spruce timber, 5 to 6 inches, at 5 cenjts, $30, 977 feet spruce timber, 12 by 12, at 23 cents, $224.71, 859 feet spruce timber, 10 by 10, at 15 cents, $128.85-$383.56; Frangois Cour-bon. Isle Verte: 1,219 feet spruce timber, 5 to 6 inches, at 5 cents, $60.95; Alphe. Cote, fils de Johnny, Isle Verte: 3,500 feat spruce timber, 12 by 12, at 23 cents, $805, 3,136 feet spruce timber, 11 by 12, at 15 cents, $470.40, 886 feet spruce timber, 10 by 12, at 19 cents, $168.34, 7,000 feet spruce lumber, at $18, $126-$1,569.74. Total for timber, $2,079.75.
7 and 8. Yes.
9. 10 and 11. None.


LAPRAIRIE PUBLIC BUILDINGS.
[Stage Direction]
Mr. l.ANCTOT:
1.	Has Mr. Alphonse Durangeau, of La-prairie, done any work for the Government to the public buildings at the town of Laprairie, during the past year?
2.	If so, what -was the nature of such work, was it done by the day or by contract and what amount was paid for same?
Mr ROGERS:: 1.	Yes.
2.	Improvements to the sewage system,
$256, private agreement; minor repairs, $58; total, $314.90.	.


LA BANQUE INTERNATIONALE.
Mr. SINCLAIR:: 1.	At what date was license under the Bank Act issued to La Banque Internationale?
2.	On what date was the application for this license first made to the Department of Finance?
3.	Was the present Minister of Finance informed from any source that the late Minister of Finance, Mr. Fielding questioned In any way the regularity of this application?	,
4.	If so, did the Minister of Finance institute any inquiry before issuing the license.


Mr. W. T. WHITE:: 1.	October 17, 1911.
2.	May 23, 1911.

3.	The minute made on the 27th day of September, 1911, by the outgoing Treasury Board, of which the former Minister of Finance was chairman, with regard to the Banque Internationale's application for a certificate is as follows:
The board having had submitted to them the further papers in connection with the application of La Banque Internationale for a certificate under the provisions of the Bank Act to enable it to commence business, is of the opinion that the matter requires more consideration than can be given to it in the present state of affairs, when a change of administration is about to take place. The board, therefore, without expressing any opinion on the merits of the application, desire to leave the papers for the consideration of the new Treasury Board.
4.	Before granting the certificate the incoming Treasury Board gave full consideration to the application and the documentary evidence filed in support of it. All the provisions of the Bank Act having been fully and amply complied with, authority was given for the issue of the certificate.


HANTSPORT WHARF.
Mr. MACDONALD:: 1.	When was the contract let for the extension to Hantsport wharf, county of Hants?
2.	Who were the tenderers and what was the amount of each tender?
3.	Whose tender was accepted?
4.	When was the contract executed and when was the work to begin?"
5.	Has the construction of said wharf been started? If not, why not?
6.	What is the reason the work on the contract has not begun?
7.	Has the department extended the time for the beginning and completion of the contract?


Mr. ROGERS:: 1.	16th October, 1913.
2. Standard	Construction	Company,
Limited, $18,685; A. W. Girroir, $20,500; C. A. Huntley, $22,250.
3. Standard	Construction	Company,
Limited.
4.	16th October, 1913, immediately after the signing of the contract.
5.	Yes.
6.	After awarding the contract, the town council petitioned to build a slip between the old wharf and the new for the accommodation of small vessels, and build a straight front for the whole length with a square end so that vessels could lay at end of wharf.
7.	No.


INSURANCE COMPANY RIMOUSKI MUTUELLE.
Mr. BELAND:: 1. Was the Government made aware that the Insurance Company Rimouski Mutuelle had,
before its winding up, as alleged, given up a certain proportion of its policies to the York Fire Insurance Company of Toronto and to the Midland Fire Insurance Company of Brandon, Manitoba?
2.	Did the Government inspector report on these alleged facts?
3.	Is the Government aware that Company Rimouski Mutuelle is said to have received certain amounts paid by the above mentioned com- _ panies and intended to indemnify policy-holders; who had sustained losses through fire, and that these amounts have been retained by said company for two months at least previous to its being wound up?
4.	Is not inspection by the Government intended to prevent such irregularities?
5.	Is it the intention of the Government to appoint within a short time, a special inspector with instructions to investigate the management of the Companies Rimouski Mutuelle and Ontario Mutual?


Mr. W. T. WHITE:: The companies referred to are probably La Compagnie d'Assurance contre l'incendie de Rimouski and the Ontario Fire Insurance Company. Neither of these companies is a mutual company.
1.	No.
2.	No.
3.	No.
4.	One object of inspection is to discover and correct irregularities if they have occurred.
5.	No.


UNOPPOSED AND UNDISCUSSED MOTION.
[Stage Direction]
Mr. Lemieux.-For a return showing who secured the mail contract between Armagh station and Mailloux, county of Bellechasse, Quebec; how many tenders were received; and what the names of the tenderers and the amount of each tender are?

[Stage Direction]
Mr. ROCHE moved the following proposed resolution:
That the following Orders in Council made by His Royal Highness the Governor General or His Excellency the Administrator in Council in accordance with the regulations for the survey, administration, disposal and management of Dominion lands within the railway belt in the province of British Columbia, approved by Order in Council of the 17th September, 1889.
(1)	Order in Counoil P.C. No 234, dated 6th February, 1913, extending the provisions of clauses 19 and 20 of the Dominion Lands Act to similar cases affecting land in the railway-belt in the province of British Columbia
(2)	Order in Council P.C. No. 1384, dated 26th June, 1913, amending section 13 and rescinding sections 23, 24 and part of section 29 of the regulations for the survey, administration, disposal and management of Dominion lands in the railway belt in the province of British Columbia.
[Stage Direction]
(3) Order in Council P.C. No. 2959, dated 27th November, 1913, amending the regulations approved by Order in Council of 17th September, 1889, so as to provide that letters-patent issuing in the name of a deceased person such letters-patent shall not be void, but the title to the land shall become vested in the heirs or other legal representatives of such deceased person.
Copies of each of which Orders in Council were laid before this House on the 2nd day of February, 1914, for the approval of this House under the provisions of subsection (d) of section 38 of the regulations for the survey, administration, disposal and management of Dominion lands within the forty-mile railway belt in the province of British Columbia and the said Orders in Council are now so approved.
He said: According to the statute, the Minister of the Interior is supposed to lay upon the table, of the House within fifteen days after the opening of each session copies of all regulations passed by Order in Council during the recess. That procedure was followed last January, when I laid upon the table of the House all regulations that had been adopted by the Department of the Interior, which regulations, according to the statute, are supposed to be approved formally by Parliament. These regulations deal with a great many matters connected with the administration of the department. They refer to the leasing of school lands, to forest and park reserves, to clay deposits in townsites within park reserves, to purchased homesteads, to deceased homesteaders' rights, to the leasing of Dominion lands containing limestone, granite, marble, gravel, sand and building stone. Certain of the regulations make the same provisions in connection with coal mining rights on forest reserves as those which apply to Dominion lands generally. I think that this covers generally the regulations that have been passed during the recess. I had a talk with the hon. member for Edmonton yesterday, the ex-Minister of the Interior, and he said that he did not think it necessary to enter into any discussion of these Orders in Council. They have been on the table of the House since last January, and open to the inspection of members.
Wilfrid Laurier: My hon. friend is giving us no information except what we already have. We know that the statute requires that my hon. friend shall lay these Orders in Council upon the table of the House, and we know also what purports to be the nature of the Orders in Council. All these matters are very technical; but if the hon. member for Edmonton has looked at these Orders in Council and is satisfied, as he is the only gentleman on this side of the

House who is competent to deal with them, I shall be satisfied also.


Mr. OLIVER:: I am sorry that measures were not taken to have the orders which have been laid upon the table considered earlier in the session. Iam informed that they were laid on the table early in the session, buit I was not aware of that fact, and it was only when the notice appeared on the Order Paper that I knew that they were available. The date upon which we received information that they were laid upon the table was so very late in the session and the Orders in Council cover such a large ground that I do not think I would be warranted in delaying the House in order to consider them at this stage of the session.


Robert Laird Borden: There is no objection to their standing over to a later day in the session if the hon. member so desires.


Frank Oliver: It is in the hope that
there will not be many later days that I am wiling to forego discussion 'at the present time. I am aware of the importance of the matters involved, and I am aware of the desirability of Parliament being informed as to their nature and effect. I think it is rather a pity that there should not have been a fuller opportunity for their consideration, not for the purpose of antagonism or undue criticism. As most of these orders affect the West and as most of the western men have already gone home in the expectation that the session would have concluded by this time, we are not in a position either to give the House information or to get the information from the Government that would be desirable. On this particular occasion I am willing that the orders should pass, but I would ask that on future occasions when it becomes necessary to put such information before the House, means should be taken to let the House know that the orders have .been laid on the table and to bring them forward at a reasonably early date in the session, so that due consideration may be given to these very important matters.


Robert Laird Borden: As my hon. friend is
aware, the Orders were laid upon the table of the House four months ago. Of course, if it had occurred to us that that fact did not come to the attention of hon. gentlemen on the other side of the House, the matter would have been mentioned earlier, but neither my hon. friend the Minister

of th-e Interior nor I had the impression that they were not being considered. It may be worth while to make some more definite arrangement in future so that these matters will be brought to the attention of hon. gentlemen; but this is precisely what has occurred in many previous sessions, when these Orders were laid upon the table of the House early in the session and were not considered until nearly the conclusion.


[Stage Direction]
Motion agreed to.
Mr. ROCHE moved:: That the following Orders in Council made by His Royal Highness the Governor General or His Excellency the Administrator in Council under the provisions of section 77 of chapter 20, 7-8 Edward VII 'The Dominion Lands Act' on the dates hereinafter mentioned, that is to say:
(1.) Order in Council P.C. No. 2917 dated 19th October, 1912, establishing regulations for the leasing and administration of school lands for the purpose of extracting fire-clay therefrom.
(2.) Order in Council P.C. No. 3257 dated 21st November, 1912, amending the regulations established by Order in Council of the 13th May, 1910, and amending Orders in Council, for the leasing and administration of Dominion lands containing limestone, granite, slate, marble, gypsum, marl, gravel, sand or any building stone so as to include the leasing of Dominion land containing deposits of clay.
(3.) Order in Council P.C. No. 3373 dated 4th December, 1912, rescinding the Order in Council of the 4th March, 1911, in accordance with the provisions of subsection (k) of section 76 of the Dominion Lands Act.
(4.) Order in Council P.C. No. 243 dated 6th February, 1913, amending the coal mining regulations established by Order in Council of the 20th of April, 1910, and amending Orders in Council, in regard to the maximum area of a coal mining location.
(5.) Order in Council P.C. No. 245 dated 6th February, 1913, prescribing regulations governing the sale of lands for irrigation purposes within certain defined limits as provided by section 34 of the Dominion Lands Act.
(6.) Order in Council P.C. No. 351 dated 17th February, 1913, amending the regulations for the leasing and administration of school lands for the purpose of extracting fire-clay therefrom as established by Order in Council of the 19th October, 1912.
(7.) Order	in	Council P.C.	No.	446 dated27th February, 1913, amending clause 'P' of the regulations governing the granting of yearly licenses and permits to cut timber on Dominion lands, established by Order in Council of the 1st July, 1898,	and subsequent	Orders in
Council.
(8.) Order	in	Council P.C.	No.	592 dated19th March,	1913, amending	the	regulations
for the leasing and administration of lands containing limestone, granite, slate, marble, gypsurh, marl, gravel, sand or any building stone, approved by Order in Council of the 13 th May, 1910, and amending Orders in Council.
(9.) Order in Council P.C. No. 775 dated 7th
April, 1913, amending the regulations governing the sale of coal mining lands in the Yukon Territory approved by Order in Council dated 21st January, 1901, by granting exemption from the payment of royalty for .a period of five years.
(10.) Order in Council P.C. No. 1101 dated 14th May, 1913, re-establishing regulations for the leasing of school lands in Manitoba, Saskatchewan and Alberta for petroleum and natural gas rights.
(11.) Order in Council P.C. No. 2587 dated 16th October, 1913, rescinding section 5 of the regulations for the disposal of petroleum and natural gas rights, established by Order in Council of the 11th March, 1910, amending Orders in Council, and substituting another section (5) in lieu thereof.
Copies of each of which Orders in Council were laid before this House on the 2nd day of February, 1914, for the approval of this House under the provisions of section 77, chapter 20, 7-8 Edward VII, and the same are now so approved.


[Stage Direction]
Motion agreed to.
William Roche: That the following Orders in Council made by His Royal Highness the Governor General or His Excellency the Administrator in Council in accordance with the provisions of chapter 10, 1-2 George V, 'The Dominion Forest Reserves and Parks' Act' that is to say:
(1.) Order in Council P.C. No. 981 dated 30th April, 1913, extending and making applicable to lands within the forest reserves and parks, except, Elk park within the Cooking Lake Forest Reserve and the Buffalo Park Reserve, in the province of Alberta, the quarrying regulations and clay regulations established by Orders in Council dated 13th May, 1910, and 21st November, 1912.
(2.) Order in Council P.C. No. 1803 dated 19th July, 1913, amending clause (3) of the regulations governing the use of motor vehicles in the Rocky Mountains Park approved by Order in Council of the 8th April, 1911.
(3.) Order in Council P.C. No. 1943 dated 2nd August, 1913, amending the water-power regulations in accordance with the provisions of subsection 2 of section 35 of the Dominion Lands Act and subsection b, of section 17 of 'The Dominion Forest Reserves and Parks Act.'
(4.) Order in Council P.C. No. 2028 dated 8th August, 1913, rescinding the regulations established by Orders in Council of the 13th January, 1908, and 19th October, 1910, in accordance with the provisions of section 17 of The Dominion Forest Reserves and Parks Act, and substituting in lieu thereof.
(5.) Order in Council P.C. No. 2349 dated 24th September, 1913, rescinding section 75 of the regulations relating to forest reserves established by Order in Council of the 8th August, 1913, and substituting another section (75) in lieu thereof.
(6.) Order in Council P.C. No. 2875 dated 27th November, 1913, establishing regulations respecting buildings in Dominion parks, in accordance with the provisions of section 18 of 'The Dominion Forest Reserves and Parks Act.'
Copies of each of which Orders in Council were laid before this House on the 2nd day of February, 1914, for the approval of this House under the provisions of section 19 of 'The

Dominion Forest Reserves and Parks Act,' are now so approved.


[Stage Direction]
Motion agreed to.

[Stage Direction]
On the Orders of the Day being called:
Louis-Philippe Pelletier: Yesterday the hon.
member for Carleton, N.B., (Mr. G'arvell) called attention to a news item published in the Ottawa Journal in which it was stated that the Marconi operator on the Lady Evelyn, post office boat at Rimouski, had refused to send marconigrams offered by persons who had been rescued at the time of the sinking of the Empress of Ireland. I promised to make inquiry about this, and I said I hoped that the statement was not true. I wired to Captain J. B. Pouliot, w7ho is in charge of the Lady Evelyn, and this is the answer which I received :
Rimouski, Que., June 1.
R. M. Coulter,
Ottawa, Ont.
Wireless operator appointed for Lady Evelyn by Postmaster General not arrived yet; had no wireless operator when we went to the rescue of the Empress of Ireland. After our arrival there inquired if there was a wireless operator saved; one was found and put in charge of our wireless to notify the station agent at Rimouski to have cars and clothes ready on wharf for the rescued and to send other messages required. He was not told to ask payment for messages sent I was told that his name was Ferguson.
Captain J. B. Pouliot.
This shows that to a certain extent the news published was perhaps true, but that our officers on board the steamer did not act in the way reported. I am very glad that is the case.


ELECTRIC RAILWAYS.
[Stage Direction]
On the Orders of the Day being called:
Mr. McCOIG:: Might I ask the Government if they have decided on any policy in reply to the large deputation that waited on them some weeks ago asking for Government assistance for the extension of hydroelectric lines throughout Ontario. I have had a number of inquiries from constituents and from citizens throughout the province asking if anything will be done. Have the Government decided on any policy?


Robert Laird Borden: The matter is still under consideration, but there will be no legislation introduced on the subject this session.


EMPRESS OF IRELAND INVESTIGATION.
[Stage Direction]
On the Orders of the Day being called-
Hon. J. D. HAZEN (Minister of Marine and Fisheries):: I wish to take the opportunity to inform the House that Lord Mersey has consented to act as one of the commissioners to inquire into the recent unfortunate disaster on the river St. Lawrence, and we are informed that he will probably sail on the Mauretania on Saturday of this week. I might also inform the House that I have communicated with Chief Justice McLeod, of New Brunswick, who is also the local judge in Admiralty for that province, and Sir Adolph Routhier, exChief Justice of Quebec, who is the local judge in Admiralty of the Quebec district, informing them that, with their consent, it was my intention to appoint them members of the commission, with Lord Mersey. 1 have a reply from the Chief Justice of New Brunswick saying that he will act if it is the desire of the Government, and I expect a reply from the ex-Chief Justice of Quebec during the day. In addition to the three members of the Board of Inquiry it has been decided, after communication with the Board of Trade in Great Britain, to appoint four assessors. Two of them will be gentlemen with special knowledge of nautical matters, one a naval architect, and the fourth a marine engineer. It has not yet been decided what gentlemen shall be appointed assessors, but it has been decided that they shall be of the callings mentioned. I think that by to-morrow or the next day we shall be able to announce the names of the assessors. The date of the investigation will not be determined until the representative of the Board of Trade, Mr. Vaux, now on his way to Canada, arrives. The place of meeting will also be discussed on his arrival. It is our intention to ask Lord Mersey to act as chairman of the commission.


Wilfrid Laurier: This statement is very satisfactory as far as it goes. May I ask for some information as to a matter which appeared yesterday in the press to the effect that Captain Demers was holding a preliminary investigation with a view to weeding out unnecessary evidence? Captain Demers is certainly a very competent officer, but it is a very delicate matter that he should attempt to weed out any evidence which perhaps might be needed afterwards. It might be that there would be a conflict

of judgment between Captain Demers and the commission.


John Douglas Hazen: If the statement mentioned Captain Demers, it was in error. It was not Captain Demers, but Captain Lindsay, the superintendent of pilots. This action was taken at the suggestion of the British Board of Trade, who thought it very desirable, before the formal investigation was held, that depositions should be obtained from different witnesses and facts ascertained as to witnesses whom it would be desirable to call before the commission. My hon. friend is aware that in the Canada Shipping Act provision is made for preliminary inquiries into shipping casualties. It is under the provisions of that Act that this preliminary investigation is being held, not with the intention of weeding out anything, because everybody feels that the investigation must be of the most thorough and complete character; but it is for the purpose of expediting the work of the commission when they meet by having information that will enable them more readily to get down to work.


Wilfrid Laurier: That is quite a difference.


IMMIGRATION OF HINDUS.
[Stage Direction]
On the Orders of the Day being called:
Frank Oliver: Has the Minister of the Interior any further information with regard to the difficulties at Vancouver with respect to Hindu immigration?


William Roche: I made inquiry this morning for any fresh information, and was informed that there was none except what appeared in the press this morning, and we have not had any official -Confirmation of -that.


LOAN COMPANIES.
[Stage Direction]
The House proceeded to consider amendments made by the Senate to Bill No. 83, respecting loan companies.
Wilfrid Laurier: What are the amendments?


William Thomas White: There are six amendments in all, none of them being of serious consequence. The first is an amendment to subsection 2 of section 3, which doee not in any way change the meaning of the subsection but makes it more clear. The name of the Bill is changed from the 'Loan Companies Act' to the 'Loan Companies Act of 1914.' Section 16, which relates to the election of
directors, is modified so as to provide that, in the event of an election of its directors not taking place at the proper time, the company shall not be held to be thereby dissolved, but that such election may take place at any general meeting of the company duly called for that purpose, and the retiring directors shall continue in office until their successors are elected. That is not an unusual clause in company legislation. iSection 30 is changed so as to provide that, in the event of a forfeiture of shares through a failure of a shareholder to pay any call or instalment, the holder of such shares at the time of the forfeiture shall continue liable to the creditors of the company at such time for the full payment payable on the shares at the time of forfeiture, less any sums which are subsequently received by the company in respect thereof. There is also a verbal amendment to section 68, which makes the intention of the section more clear. Section 90 is also amended by changing the word 'the' to 'this.' On the whole, I see no objection to the amendments proposed by the Senate, and move that the House do concur therein.
S:r WILFRID LAURIER:	-Has any
change been made with regard to the retroactivity of this Bill?


William Thomas White: No. Perhaps that was in connection with the Bill relating to trust companies.


Mr. NESBITT:: If we proposed any
amendments in this House now, I suppose it might delay the passage of the Bill this session; otherwise, I .should have liked to draw my hon. friend's attention to some amendments that have been proposed to section 63 by the Loan Companies Association, to prevent loan companies from investing in the stock or debentures of any company whose chief business is buying and selling vacant land.


Thomas Simpson Sproule: It would be quite out
of order to propose amendments to the Bill at this stage, as we are now dealing with the amendments sent to us by the Senate.


Edward Walter Nesbitt: I am only bringing this matter to the attention of the Minister of Finance, as I think the amendments are very valuable. I will send them over to him so that he may understand them better.


William Thomas White: I think it inadvisable that we should consider any further changes in the Bill now. The Bill received very full con.-

sideration by the Banking and Commerce Committee, and like any otheir Ant this may be changed at any time by an amending measure if that is deemed advisable. As the Bill has received very careful consideration on the part of the Commons and apparently also on the part of the Senate, and having regard to the fact that the session is so far advanced, I should not like the passage of this Bill to be jeopardized by taking into consideration any further amendments at this stage.
Amendments concurred in.


THE FARMERS BANK.
[Stage Direction]
Consideration of the proposed motion of Hon. W. T. White (Minister of Finance) for the second reading of Bill No. 185, for the relief of the depositors of the Farmers Bank of Canada, and the proposed amendment thereto, of Mr. A. K. Maclean, resumed from June 2.
Mr. MORPHY:: Mr. Speaker, in the
early hours of this morning I was dealing with the endorsements on the writ sent by Mr. Leighton McCarthy to the ex-Minister of Finance. I have not exhausted this phase; but, as the endorsements already appear in the proceedings. I will content myself with saying that they embrace charges of deceit, illegality, unlawful practices, fraudulent conduct, false pretenses, and similar charges against Mr. Travers, the man who was asking the Finance Minister of the day for a certificate to allow him to commence business. There is one feature in the evidence which is worthy of comment, and that is the letter of the hon. member for London (Mr. Beattie) objecting to the unwarrantable use of his name as one of the provisional directors. The Finance Minister of the day had only to take a step across the floor to make inquiries of the hon. member for London, which would have disclosed the facts, but that was not done. I shall endeavour to abridge my remarks on account of the lateness of the session, but there are a few things which I would like, as briefly as possible, to put on the record. In the first place, the evidence states that Mr. Fielding was only suspicious of. this particular bank. He said that he did not like the name, and so forth. At page 456 of the evidence he speaks as follows:
From the beginning I disliked, I do not think the word is too strong, I disliked the movement, because I was afraid a number of farmers were going into a business they did not like and un-

dertaking responsibilities which they did not appreciate.
Again, he says:
I looked upon the application for a further extension as an evidence of weakness.
Again:
I always viewed the incorporation with anxiety, because I understood it was an effort to get farmers, as the name implied, and I thought it was the line of business that probably they were not the best capable of going into.
Again, on page 457:
My mind from the beginning was suspicious; my mind was rather unfriendly to the movement from the beginning; that kind of gossip might emphasize it a little, but from the inception of the movement I looked upon it with a little anxiety.
Again, on page 458 Mr. Fielding is asked the following question:
Q. Under the Act I think the duty is cast on the Treasury Board itself and not on the Minister of Finance individually? A. That is true, though naturally he would have chief responsibility and his colleagues would look to him largely for advice and guidance.
On page 459 he says:
I think no doubt he was to the department before that and saw some of my officials, but I am pretty clear in my recollection that I saw Mr. Travers only once and that was the 30th November, and that was the date the certificate was issued.
After all the warnings and charges of fraud, deceit, false pretenses, and illegal practices that Mr. Fielding had received, it might appear to the casual observer that he should have seen Mr. Travers more than once, and that after the information he got from Sir Edmund Osier, Mr. Henderson and Mr. Leighton McCarthy, it was incumbent on a man in Mr. Fielding's position to see the person charged with these malpractices. According to both Mr. Fielding and Mr. Travers, their interview lasted only twenty minutes, and it is very peculiar that in that interview Mr. Fielding did not tell Travers that he had received this writ from Leighton McCarthy, and the warnings from Mr. Henderson and Sir Edmund Osier. There is no evidence that he mentioned these things, but merely the statement that he told Travers what people were saying about him, and Travers denied it. Then Mr. Fielding said: 'Write me a letter to that effect.' The junior member for Halifax (Mr. A. K. Maclean) has argued that these charges did not sink into the mind of Mr. Fielding. If that is so, how is it he told Travers what the people were saying about him. It is obvious from that, that the charges from Mr. Henderson and Sir Ed-

round Osier and Mr. Leighton McCarthy had sunk into the mind of the Finance Minister, and that he was conscious that they were serious charges which called for inquiry. Mr. E. S. Clouston, then president of the Canadian Bankers' Association, used the following language in a letter to the deputy Minister of Finance, dated November 30, 1906:
Permit me to request that, if only for the protection of the public, the Treasury Board will exercise its right to refuse to issue a certificate if it thinks best so to do, until a thorough investigation has been made into the circumstances stated herein.
That was the language of a man whose word stands as high as that of any man in banking circles in this country, a man well and favourably known to the Finance Minister of that day. The letter was warning the minister against an abuse that might be perpetrated on the public, and asking for the stay of his hand. Mr. Fielding's answer was, ' I gave the certificate yesterday.' He sat back in his chair, folded his arms, and allowed Travers who had been charged with every species of fraud in the calendar to get a certificate and go out like a firebrand into the country armed with the seal of this Dominion. Mr. Fielding took not one step to put himself into possession of the facts supporting the warnings against Travers. Some have said that Mr. Fielding was guilty of an error of judgment, but I say that it was a case of not doing his duty because he did not ascertain the facts which would have enabled him to form judgment upon the charges made. He was Minister of Finance, the master of the Treasury Board, he had had notice of fraud, he had had plenty of warning, and he had had verba1 charges of improper practices against the very man to whom he gave the certificate after an interview of only twenty minutes.


Mr. DEVLIN:: The hon. gentleman states that it was notorious that Travers was dishonest at the time the certificate was issued. Might I ask if there is any truth in that?


Hugh Boulton Morphy: The hon. gentleman will understand me. I am referring to the endorsements on the writ sent by McCarthy. Every kind of fraud in the calendar was charged against this man Travers. Mr. Fielding had evidence from Mr. Henderson that the bank under this man's administration was doing improper business. Mr. Fielding had information from Sir Edmund Osier that the money
was improperly and illegally borrowed. Mr. Fielding knew all this, and if he had made the inquiry that was incumbent upon him to make he would have discovered what kind of a man Travers was and turned out to be. A minister is human like any other man, but he owes a duty to himself and to his country, and we have evidence that Mr. Fielding failed to do his duty. He was guilty of negligence. To make myself clear I would just like to give two short definitionsofnegligencefrom the legal point of view, though I maintain that this question should not be discussed from the legal point of view but from the point of view of what is right and just. It should be discussed on the higher ground that the State owes a duty to the public, and should be discussed without any legal hairsplitting. A minister is chargeable with knowledge of what a reasonable inspection would disclose, and in this case Travers's perjury and the improper discounting of the notes to raise the money for the deposit would have been fully disclosed if Mr. Fielding had made further inquiries. His failure to act was a breach of duty or worse 

gross negligence. Negligence has been well defined as:
The want or absence of ordinary care; that is, just such care as a reasonably prudent and cautious man would exercise under similar circumstances.
Another definition is:
A failure to do what a reasonable and prudent person would ordinarily have done under the circumstances, and the honest endeavour to use the means reasonably necessary to avoid injury to others.
After all the warnings and notices of fraudulent transactions I say that no more fitting and pregnant language could be used in describing this case, than is found in the two terse definitions I have just quoted. Mr. Fielding was a man of splendid attainments. He had had his warnings and there is no excuse for his lack of knowledge. He knew his duty but he failed to do it. He said that when he got Mr. Clouston's letter it was too late because the certificate had already been issued. I dispute that. It is true there was no legal machinery at his hand to recall the certificate, but there is an old adage that there are a good many ways of killing a cat besides drowning, and information could easily have found its way to the public after Mr. Fielding had discovered that he had made a mistake. But no, he sat still. And why? Nobody knows why, but we do know that Travers was introduced by Mr. Calvert and the

mystery of that certificate being issued lies there. It does not do to impute motives, but the attitude of the Finance Minister on that occasion -was absolutely out of keeping with his well-known ability, assiduity, and industry. In this case he did what he was never known to have done before. He had himself admitted that he was suspicious of the institution and that he would like to stop it, but he did not stop it. And why did he not? There is not a sufficient reason, and the disaster came through his lack of action.
Sir William Meredith has dealt with this question at very great length. I need not repeat much of it, but I would just like to quote a sentence or two. On page 8 of Sessional Paper 153a the commissioner says:
My conclusion on this branch of the inquiry is that the Treasury Board was induced to give its certificate by false and fraudulent representations on the part of Travers, and that if the facts I have mentioned as to the way in which the $250,000 was made up had been disclosed, the certificate of the Treasury Board would not have been given.
Mr. Fielding had express notice of fraud, because the facts were disclosed. If he had gone further, he would have had absolute proof. He failed to do that. If he had acted, there would have been no certificate, no bank deposits and no loss. The commissioner speaks about the efficient cause. I have already said in regard to that, and I say it again, that the word * efficient ' is not appropriate; I would call it the 'deficient * cause-the failure to act on the part of the Minister of Finance that brought about the loss in this case.
I pass over the findings at large of the commissioner, because they are all set out in the report, but I wish to make this point very clear. The commissioner says:
I do not suggest that the minister would have been justified because of the information conveyed to him in recommending that the certificate should not be granted, or that the Treasury Board because of it would not have been justified in refusing to grant it.
He is non-committal there.
But having received the information, it was in my opinion incumbent on the Treasury Board to have investigated the charges that had been made before coming to a conclusion as to whether or not the certificate should be given.
That language is express and clear. It carries its own condemnation of the inaction, the negligence, of which supporters of this Bill complain. The next paragraph in the report contains these words in regard to Mr. McCarthy's letter:

, Mr. McCarthy did not in any way intimate that the information he conveyed to the minister as to the way in which the $250,000 had been made up had been found to be incorrect.
- Therefore, it will not do to say that Mr. McCarthy withdrew his writ. The charges were there. They were never investigated, never proved untrue. The charges were never withdrawn, although the writ was. The commissioner further says:
It is true that, as Mr. Fielding stated in evidence, Travers, so far as he knew, was a reputable banker; but that was not, in my opinion, a sufficient reason for not having instituted an inquiry as to the matters which had been called to his attention.
Therefore my argument is in line with what the commissioner found:
Such an inquiry could easily have been made, and the delay occasioned by it would have been inconsiderable, and such an inquiry would, undoubtedly, have resulted in the discovery of the manner in which the $100,000 had been raised and in the refusal of the Treasury Board to give the certificate.
I do not wish to detain the House at any great length with regard to that kind of evidence. The case has been proved abundantly. In fact, it was easily seen by the attempt of the hon. junior member for Halifax (Mr. Maclean) last night how desperate a cause he had, and how utterly unable he was to withstand the salient points brought out by the hon. Minister of Finance.
I wish now to turn to another phase of the question for a moment. The right hon. the leader of the Opposition in the late Parliament, in answer to Mr. Henderson- I do not quote his exact words, as I am speaking from memory- said that this country in a case of this kind ought to be big enough to do justice to these unfortunate people, some of whom had their homes severed by death or by lunacy, and some of whom were reduced to poverty and despair. I know of men in my own constituency, old and gray, who had retired from a hard and arduous life, who had deposited their savings in this chartered bank, not for purposes of speculation, but for safe-keeping, and who were left penniless owing to these savings having been completely wiped out.
This country has in the past treated outsiders generously, as it has the power to do. I might mention the volcanic disaster in the West Indies in 1902; the sufferers in Japan in 1906, when this Government poured out its money; the San Francisco earthquake in 1906, when the Government and this country paid willingly; the Jamaica earthquake in 1907; the earthquake

in Italy in 1909; the floods in France; the Ottawa and Hull fire sufferers; the distress on the Liard and Dease rivers; the Vancouver riots; the Campbellton fire sufferers. There is a list four times as long as the one I have given, and I need not dwell further on the subject. Yet it is said, forsooth, that we should not compensate the sufferers in this disaster so widespread, affecting thousands, of whom some can bear the loss, some are suffering a great deal, and others are absolutely ruined-a disaster in which poverty and distress has fallen upon men and women, Liberals and Conservatives alike. Yet, for some unaccountable reason, where no member of this House would state, although it has been charged, that any attempt has been made to make party capital out of this matter, where nothing exists in the whole situation to warrant party feeling, the hon. junior member fcr Halifax (Mr. Maclean), last night, after condemning the Government for not acting sooner, said that they were now acting too late, and moved the six months' hoist.


Mr. A. K. MACLEAN:: I did not say so.


Hugh Boulton Morphy: That is exactly the
meaning that the hon. member conveyed to the House at about half-past twelve this morning. Under these cireum-
12 noon, stances, can any hon. gentleman tell this House and this country that there is in this whole affair anything but a pitiable tale of woe and distress that should be dealt with and relieved? I have letters in my possession from hon. gentlemen opposite. I have . one from the right hon, the leader of the Opposition, but I do not wish to put it on record. I have copies of letters from the hon. member for South Renfrew (Mr. Graham), the hon. member for Russell (Mr. Murphy) and other hon. members opposite, expressing their deep sorrow and regret at this great loss, and promising to do their best, and wanting to see this Government do its best, in the matter. There is nothing in the opposition to this Bill except perversity. There are hon. gentlemen opposite who are anxious to vote for this Bill. It is not a political question; it is a great financial disaster to a great many worthy and deserving people, of all political stripes, who come to this Parliament, not as a matter of right, not as a matter of law, but as a matter of grace, supplicating this Parliament to relieve them, many of them in their declining
years, from the poverty and despair which have visited their homes. We have always been generous in giving in case of need to people in foreign countries where we have neither kith nor kin; and it would be a fitting tribute to the generosity of this House and of the Upper Chamber to say that, under all these circumstances, especially owing to the fact that there was negligence on the part of the late Government, we should come to the aid of these people. No hon. member on this side desires to attack the personality of any one who was on the Treasury Board at that time. We put this question upon the high plane that all men are human, that a mistake was made, -and that people suffered by that mistake. If men suffer for their own negligence, their own lack of care, so must governments. Let us put the matter on an equitable basis, without any legal hairsplitting. Let us come together, and not have any talk about Conservatives in the Senate lobbying to kill this Bill. I repudiate that; I throw it back with scorn to the hon. gentleman that there ever was a lobby in the Senate bj Conservatives. 'There are gentlemen in the Senate who have their individual feelings, and it is their right to act as they like. It was reported in the Liberal press that there was such a lobby, and I investigated the matter, and found that there is not one jot or tittle of truth in it. As far as I know, speaking generally for this side of the House, we are practically unanimous upon this measure. There may be some opposed to it; if so, that is a tribute to the freedom of opinion in this House. And I would ask hon. gentlemen opposite to side with their colleagues from Middlesex (Mr. Ross) and North Oxford (Mr. Nesbitt) and rise above partisan feelings, which too often actuate parties in this House, and let us get together and put it through unanimously.
As to precedents, let them take care of themselves. Somebody says that similar failures have happened heretofore. If so, I would be magnanimous enough to say that those losses should be paid too. But I do not think that anything that has happened in this country has been quite of the same kind. There may have been other cases. If there have been, the country ought to be big enough to right the wrong done by its own officers for lack of care. We can pour out millions for the Canadian Northern; we can lose $7,000,000 in the Quebec bridge; we can waste millions on the transcontinental. But, with our growing and expanding rev-

enues, let us do something for the farmers and other people of this country; let them have a little show on this particular Bill, to which I have great pleasure indeed in giving my warmest and most conscientious support.


Emmanuel Berchmans Devlin: The question which is before the House for consideration is, perhaps, one of the most important questions that we have had to discuss in recent years, not on account of the amount involved, $1,200,000, but because of the principle involved in this Bill, and because of the effect which its passing will have upon future legislation. If it could be shown me, assuming the facts which have been stated by hon. gentlemen opposite, notably by the Minister of Finance, that any negligence upon the part of the Treasury Board was a contributing cause to the failure of the bank, entailing upon the depositors a loss, I would then feel in conscience bound to vote in favour of the Bill. For that purpose I have listened very carefully to the speeches delivered so far by the Finance Minister (Mr. W. T. White) and the hon. member for North Perth (Mr. Morphy). The hon. member for Perth wound up his remarks by saying that the depositors ought to be recouped, not as a matter of right, not as a matter of law, but as a matter of grace.


Hugh Boulton Morphy: I know the hon. gentleman would not want to misquote me. I corrected myself with regard to the right. I admit that I used the words, but immediately corrected myself.


Emmanuel Berchmans Devlin: As a matter of right P


Hugh Boulton Morphy: Absolutely.


Emmanuel Berchmans Devlin: And a matter of law ?


Hugh Boulton Morphy: I did not say it was a matter of law, and I did not say it was not.


Emmanuel Berchmans Devlin: I want to be just as fair in this discussion as hon. gentlemen opposite, because I can understand the degree of feeling which they have upon this question, and I have given it myself as deep consideration as possible. All my sympathy went out to the depositors who had lost their savings, and I tried as hard as I could to find out, either as a matter of right or as a matter of law, why the Government should recoup the depositors. I would be very glad if the hon. member for Perth, or any other hon. gentleman, would correct me if I misstate any of the facts. But the hon. member for North Perth added, using the words of the hon. member

for Halton (Mr. Henderson), ' This country is rich enough, big enough and generous enough to recoup the depositors '; and he went on to say that, if any loss had been incurred through acts of officials of the department which entailed losses to other parties in similar cases, the Government ought to recoup them as well. I think 1 am quoting the sense of my hon. friend's words correctly. We on this side look upon this measure as being unfair, inasmuch as it singles out one particular bank for consideration, when it is well known that in the past there have been a number of banks which have failed, presumably through the dishonesty of officials connected with them; and the Government, speaking through the Minister of Finance yesterday, gave us the assurance that no consideration would be given to any other bank, because this one was a special case on account of the facts connected with the application for incorporation and the issuance of the certificate. We come then to this point, that, given the facts which have been placed before the House by the Minister of Finance, can we, as the trustees of the people's money, say that there is, on account of certain acts connected with the application for the incorporation of the Farmers Bank, a moral responsibility attaching to the people, and that therefore we would be authorized as their representatives in using $1,200,000 of their money to recoup the depositors of that bank ?
What are the facts ? The bank was incorporated in the year 1904 by 4 Edward VII, chapter 77. The applicants for the Act were James Gallagher, of the village of Teeswater, John Watson, of the town of Listowel, John Ferguson and Alexander Fraser, of the city of Toronto, and Alexander Shepherd Lown, of the village of Drayton; and they are named in the Act as the provisional directors of the bank. I call attention to the fact that these gentlemen were known to be reputable citizens of their respective communities, having every right under the law and every right under the Bank Act to make application for an Act to incorporate themselves into a bank. The bank did not begin operations under that particular Act and in 1905 another Act, 4-5 Edward VII, chapter 92, provided that the Treasury Board, notwithstanding anything contained in the Bank Act or in chapter 77 of the statutes of 1904 incorporating the Farmers Bank of Canada, might within two years from the 18th of July, 1904, give to the bank the certificate required by

section 14 of the Bank Act and it was further provided that if the bank did not obtain the certificate within that time, the rights, powers and privileges conferred on the bank by the Act of incorporation and by the Act of 1905 should thereupon cease and determine, but otherwise should remain in full force and effect notwithstanding section 16 of the Bank Act. Up. to this point the provisional directors were not able to get the fluids necessary to deposit with the Minister of Finance in order to obtain the certificate of the Treasury Board which would permit them to commence business. They came to Parliament and by another Act passed in 1906, 6 Edward VII, chapter 94, the time for obtaining the certificate of the Treasury Board was extended for six months from the 18th of July, 1906, and this Act contained a provision similar to that contained in the Act of 1905 as to the consequence of failure to obtain the certificate within that time and as to the Act remaining in force notwithstanding section 16 of the Bank Act. I desire to call attention to the fact, which was brought out in the evidence and in the debates of the House, that Mr. Fielding objected to the term of one year being allowed; he wished to have the term shortened to six months. I simply note that fact in passing, in justice to Mr. Fielding, if you will, though I consider it to be unimportant for the purposes of this discussion. We have, therefore, the bank incorporated. Section 13 of the Bank Act provides:
So soon as a sum not less than five hundred thousand dollars of the capital stock of the bank has been bona fide subscribed, and a sum not less than two hundred and fifty thousand dollars thereof has been paid to the minister, the provisional directors may, by public notice published for at least four weeks, call a meeting of the subscribers to the said stock, to be held in the place named in the Act of incor-poratioft as the chief place of business of the bank, at such time and such place therein as set forth in the said notice.
Section 14 provides that the bank shall not issue notes or commence the business of banking until it has obtained from the Treasury Board a certificate permitting it to do so, and that no application for such certificate shall be made until directors have been elected by the subscribers to the stock in the manner provided. This is section 15:
No certificate shall be given by the Treasury Board until it has been shown to the satisfaction of the board, by affidavit or otherwise, that all the requirements of this Act and of the special Act of incorporation of the bank, as to the payment required to be made to the minister, the election of directors, deposit for
security for note issue, or other preliminaries, have been complied with, and that the sum so paid is then held by the minister. No such certificate shall be given except within one year from the passing of the Act of incorporation of the bank applying for the said certificate.
It is not necessary for me to quote all the evidence. It has been stated in this debate that the deposit of $250,000 was made up in part out of a personal loan from the Toronto Trusts and Guarantee Corporation of the sum of $80,000. Mr. W. K. Travers, who was appointed general manager at a subsequent meeting of the provisional directors, gave as security for this personal loan notes of the subscribers to the extent of $100,000. $211,000 had been subscribed in cash and out of that amount, as the evidence shows, $41,000 had been paid in commissions and expenses, leaving a balance of $170,000 actually subscribed in cash. Mr. Travers then went to the Toronto Trusts and Guarantee Corporation, got the $80,000, which made, with the $170,000 remaining, the full amount required by section 13 of the Bank Act, deposited it in the Bank of Montreal, got his receipt, and that receipt he gave to the Minister of Finance. Section 15 of the Act does not require that the minister shall receive evidence by affidavit that all the requirements of the Act have been fulfilled. From a careful reading of the section it is apparent that the Treasury Board must be convinced that all the requirements of the Act have been fulfilled; they may be satisfied that these requirements have been fulfilled by the testimony of the Minister of Finance. In this ease what happened? Mr. Fielding was a very busy man, as most Ministers of Finance in this country are. Mr. Travers waited around the city of Ottawa, tried to see Mr. Fielding and could not get an interview with him until a short time before the meeting of the Treasury Board. Mr. Fielding got the opinion from the Deputy Minister of Justice that all the requirements of the Act were fulfilled and that a certificate might issue. The certificate issued in due course and the bank commenced business. I may, perhaps, be permitted to say here that the deposit of $250,000 is not, as it would seem to be understood generally, made as a security for the depositors. The giving of the deposit of $250,000 is simply an assurance that the bank will begin business. To use the words of my hon. friend the Minister of Trade and Commerce (Mr. Foster), who introduced the Bank Act of 1890, it is to prevent unscrupulous promoters from dangling a

bank charter before the eyes of the public. The only security out of the $250,000 which the public have is the $5,000 which is retained under section 17 in order to guarantee the note circulation. Section 17 of the Bank Act reads:
Upon the Issue of the certificate in manner hereinbefore provided, the minister shall forthwith pay to the bank the amount of money so deposited with him as aforesaid, without interest, after deducting therefrom, the sum of five thousand dollars required to be deposited under the provisions of this Act for the securing of the notes issued by the bank.
The $5,000 was retained by the Government as a security for the note issue. The $245,000 was returned to the banks, as in all cases it is returned. Perhaps I might be permitted to say that in 1870, by legislation enacted in this House, the banks, under the Bank Act, were required to have an amount of $200,000 of capital paid up and there was absolutely nothing left them of this deposit. In 1871 a change was effected in the law in that banks had to have a capital of $500,000 subscribed with $100,000 paid up within two years of commencing business. In 1890 the amount was raised from $100,000 and $100,000 within two years to $250,000. This change was effected by the present Minister of Trade and Commerce. At that time Mr. Blake, one of the ablest parliamentarians who ever sat in this House, and Sir Richard Cartwright warned the present Minister of Trade and Commerce that the giving of the $250,000 as it was provided under the Bank Act offered absolutely no guarantee. Mr. Foster answered that, and perhaps in justice to him I might quote that part of the debate which refers to him. It will be found in the ' Hansard ' of the session of 1890, volume 4, page 2243. During the debate upon this point Mr. Foster said:
Mr. Foster: With the exception that the payment is to be a bona fide payment.
Sir Richard Cartwright: It was to have been a bona fide payment before, although there have been cases, and not a few, in which that wholesome provision has been evaded.
Sir John A .Macdonald: It has been done by discount.
Sir Richard Cartwright: That has been done, and it is the duty of the Finance Minister. I suppose, if possible, in this Bill to see that there is no chance of that being done.
The .Minister of Trade and Commerce knew of the possibility of a discounting of notes. It was his duty in 1890, when introducing the actual disposition of the law on which, if there is any case for the Government, they must rest it, to see that that
[Mr. Devlin. 1
provision was so worded that there could not possibly be an evasion of the law. But Mr. Foster says that it is not necessary, that the giving of $250,000 is no guarantee to the depositor, absolutely no guarantee to the depositor, that the only object of the giving of the $250,000 is to ensure the commencement of business of the bank. In view of that I do not see why hon. gentlemen opposite should lay such stress on the fact that the subscription of $250,000 had been made up in part of a loan. Whether that deposit had or had not been made with the Treasury Board, if this bank had been acting upder the law prior to the requirements of a deposit, is there a man in this House who can say, in view o<f the facts as we have them stated now, that the bank would not have failed, that there would not have been a crash? I do not think it is reasonable to hold that such is the case.
I should like to go on further. In 1910-11 in the whole debate the members of the present Government and members to your right insisted on having a Royal Commission. For what purpose? The Royal Commission was asked for solely in order to establish at whose door the fault was to be laid for the failure of the Farmers Bank of Canada. I submit thaA if the Royal Commission had not been appointed and if Chief Justice Meredith had not reported, the Government would have had a much stronger case on which to base their request foT the refunding to the depositors of this lamounlt of $1,200,000 than they have to-day after the report of Chief Justice Meredith. The only question that might have been asked of the Royal Commission was:	What was the cause of the suspension and failure of the hank. The Government knew all the other fadt3 in 1910 and 1911 when my right hon. friend the leader of the Opposition stated that no Royal Commission was necessary, that we had all the facts relating to the incorporation tthen before us, we had all the evidence in connection with the application for incorporation, we had all the letters which passed between Mr. Leighton McCarthy and the Government, we had the statements of Mr. Henderson, we had the statement of Sir Edmund Osier, that there was nothing else to inquire into. Hon. gentlemen opposite stated: We want a Royal Commission, because we have other evidence to bring before this commission which will prove where the fault Lies, and I quite well re-

member being in (the House at the time. Hon. gentlemen opposite who sat in the House .at the time remember that the present Minister of Trade and Commerce said: We want the commission in order to find out whose fault it was thaJt the bank failed, in order that we may place the blame where the blame properly lies. That being the case and the request for the Royal Commission being for that purpose, the Government must of necessilty accept the finding of the Royal Commission. But the Government in< the appointment of the Royal Commission went out of its way; it asked other questions: first, for an investigation into all material and relevant facts ini relation to the incorporation by Act of Parliament of the Farmers Bank of Canada, of the organization thereof, the .application for, and the giving by the Treasury Board of, a certificate prior to permitting the bank to issue notes and commence the business of banking; the conduct and operation of the business of the bank; the amount of capital stock supplied and paid up; the causes of the suspension and failure and the extent of. liabilities and the value of the assets thereof.
Counsel for the Government went even further Ithan that. It seems to me they went a little outside of the scope of their powers. At page 10 of the report they ask the commission to find:
That there was neglect of duty on the part of the Finance Department after the receipt of the letter of the 17th April, 1907, from G. Van-koughnet, manager of the hank at Milton, addressed to the Minister of Finance, exhibit 5, page 29, and informing him that promissory notes given in payment for shares were being discounted at the bank's branches and the proceeds credited to the head office, which included them in its returns as paid up capital and issued circulation accordingly.
The commissioner answered:
I am unable to find that in this there was any neglect of duty on the part of the department.
The commissioner went further. He said he had been asked to find out the causes of suspension and failure and that he had proceeded to inquire into those causes. The Government had asked the commissioner: Was the failure not possibly due to the action of the Treasury Board in issuing the certificate. In effect the commissioner said: No, the most I can charge against the Treasury Board is an error of judgment. Now what is the error of judgment based upon? Is it based upon the fact 298
that the $250,000 was made up in part of notes discounted, or is it based upon the fact that the members of the Treasury Board should have known of the dishonesty of Travers? It must be based upon either one or the other. It is not to be presumed that the error of judgment could possibly be based upon the fact that the Treasury Board should have known of the dishonesty of Travers, and it must therefore, be the fact that the Treasury Board should have found out in some way or other whether the amount of $250,000 was partly made up of discounted notes. In introducing the Act Mr. Foster said that the deposit was absolutely no guarantee to the depositors, that it was simply an assurance that the bank would begin business, and that had there been no deposit of $250,000 at all with the Treasury Board the bank might have begun business just the same. Would anybody in this House maintain that the depositors have a right to come before this Government and ask to be recouped because forsooth there was a moral responsibility attaching to the Government on account of $80,000 having been borrowed by Travers from the Toronto Trust and Guarantee Company in order to make the deposit up to the full amount of $250,000! I do not want to unnecessarily delay the House in repeating statements or evidence that are already on <-e record. Chief Justice Meredith was appointed a Royal Commissioner to inquire into the conduct and operation of the business of the bank, the amount of capital subscribed and paid for, the causes of the suspension and failure, the extent of the liabilities and the value of the assets of this bank, and he makes this emphatic answer:
Notwithstanding the irregularities on the part of Travers and his misconduct in connection with the application for the certificate, which I have mentioned, the evidence satisfies me that if the bank had been prudently and honestly managed there is no reason why it should not have succeeded. The promissory notes that had been given to subscribers were for the most part good and were subsequently paid, and while it is true that if the certificate of the Treasury Board had not been granted the money of the shareholders and depositors would not have been lost, the efficient cause of that loss was the recklessness and fraud of those entrusted with the management of the bank, and not the granting of the certificate.
Let me ask my right hon. friend was he or was he not serious when he asked that a commissioner be appointed for the purpose of inquiring into the causes of the sus-



pension and failure of the Farmers Bank? Had he faith in his commissioner and was he going to be bound by his finding? If he is, the efficient cause of this loss to the depositors, according to the commissioner, was recklessness and fraud on the part of those entrusted with the management of the bank, and not the granting of the certificate. What is the efficient cause? The efficient cause is the cause which produced the failure of the bank. That being so, I ask hon. gentlemen opposite whether we can in fairness to the people of this country hold them responsible for the dishonesty of Travers and the officials of the bank. If we do it in this case, shall we not have to do it in the case of every bank that fails in this country? Hon. gentlemen say that if a certificate had not been issued there would have been no bank, and consequently no loss to the depositors. The Minister of Finance made that statement. Whilst listening to him, there was running in my head the thought of the recent calamity which has affected the whole Canadian nation, the sinking of the Empress of Ireland. I asked myself whether the Minister of Finance would use the same argument in connection with that disaster. Would he claim that the builders of the Empress of Ireland should be responsible for the loss of life in that disaster, for the reason that they had built the ship and set it afloat? It seems to me the two cases are exactly on a par, and I cannot see any more reason why he should hold the people of this country responsible in the case of the Farmers Bank than that he should hold the builders of the Empress of Ireland responsible for the loss of life incurred in the Empress disaster.
After studying this case as I have studied it, I see absolutely no reason in the argument that there is any more responsibility attaching to the Government for the loss of the sum of $1,200,000 incurred by the depositors in the failure of the Farmers Bank.


Hon. T. W. CROTHERS (Minister of Labour):: In the session of 1910 and 1911, on a motion made by my hon. friend from Halton (Mr. Henderson) for the appointment of a Royal Commission to inquire into the affairs of the Farmers Bank, I expressed the conviction that Parliament should do something for the depositors whose moneys had been misappropriated and squandered by the manager of that bank. On further consideration I reached the conclusion that relief should be given to the full extent of

their loss, and I have had no reason since then to warrant a change of mind in that respect. I desire now to say a few words, and only a few, in support of that conclusion, and in justification of the Bill now before us providing for that full measure of relief. I regret very much that the exMinister of Finance will not have an opportunity of presenting his views before the House in regard to this Bill.


Mr. LEMIEUX:: He presented his views before the commissioner.


Thomas Wilson Crothers: That does not interfere with my regrets that he will not have an opportunity of expressing his views in this House, and in answer to what may be said from this side of the House. I apprehend, however, that his absence does not warrant our witholding from this House and the people of the country the facts of the case fairly and moderately expressed. As the manager of the Farmers Bank. Travers was in substance the Farmers Bank, and the Finance Minister was in substance the Treasury Board, I may refer to these two officials rather than to the respective bodies which they represented. I do not propose to delay the House by going into all the evidence upon which my argument later on will rest, because my hon. colleague the Minister of Finance and my hon. friend from North Perth (Mr. Morphy) have already gone into the facts very fully. L will therefore call the attention of this House to one or two points which I think perhaps have been overlooked. The foundation of this claim, as it strikes me, is the dishonesty of the manager of the Farmers Bank. I propose to contend that it was his dishonesty that caused the loss to the depositors, and that it was a breach of trust on the part of the Finance Minister to allow a man whom he knew to be dishonest to become manager of that bank, and that his granting of the certificate to a dishonest man and placing him in control of trust funds was the real cause of the losses which the depositors have sustained.


Mr. McKENZIE:: 
Thomas Wilson Crothers: I do not think so, but I do not think it makes any difference. At the top of page 8, the learned commissioner, the Chief Justice of the Court of Appeal for the province of Ontario, whose name carries with it large capacity, admirable in-

dustry, and unimpeachable integrity finds as follows:
My conclusion on this branch of the inquiry is that the Treasury Board was induced to give its certificate by false and fraudulent representations on the part of Travers, and that if the facts I have mentioned as to the way in which the $250,000 was made up had been disclosed, the certificate of the Treasury Board would not have been given.
I would like hon. gentlemen to bear in mind that the commissioner finds Travers guilty of false and fraudulent representations, and he might have added ' perjury ' because as every hon. member who has taken sufficient interest in this case to read the affidavit which Travers made to the Department of Finance knows, Travers made a false statement in almost every paragraph of that affidavit. Bear in mind then that at the very outset you have Travers proved to have been guilty of fraud, perjury and deceit. The next paragraph on the same page is as follows:
It is plain from the letter of the Finance Minister to Travers, of 30th November, 1906, that the minister understood that section 13 of the Bank Act would not have been complied with if the $250,000 was made up wholly or in part of money raised on promissory notes given by subscribers for shares to the provisional directors and that he would have felt It his duty to recommend that the certificate should not be granted if he had known that part of the money had been raised in that way.
That that information had been given to the minister before the certificate was - issued appears from the testimony of Sir Edmund Osier and Mr. David Henderson.
And in the next paragraph the commissioner says:
That the verbal information I have mentioned was conveyed to Mr. Fielding was not denied.
It is established therefore by the finding of the commissioner that the Finance Minister had received information from Sir Edmund Osier and, from my hon. friend from Halton that the $250,000 had not been paid in in cash. It is not necessary, therefore, for me to read any portion of the evidence of the two hon. gentlemen of this House who gave that information to Mr. Fielding. The commissioner finds that these two gentlemen of standing, whose word would be accepted by every one who knows them, informed Mr. Fielding of the fact that the $250,000 had not been paid in in cash. In addition to the warning given by these' -two gentlemen, there is the letter of Mr. Leighton McCarthy which has already been read two or three times. Who was Leighton McCarthy? He was a gentleman who had sat in this House for many 298t
years as a supporter of the Liberal party, a man of integrity and standing. On the 8th October, he wrote a letter to Mr. Fielding which has already been quoted several times. But I will repeat it again:
I have been consulted on behalf of a number of subscribers to the shares of the Farmers Bank, and from the instructions I have received a number of subscribers will dispute the bona fide character of the subscriptions. I have not time to-night to give a full statement of the grounds of this request to you,-
In the next phrase he states something, not as hearsay, but as a fact:
-but I beg to assure you that grave conditions have arisen which will require careful consideration before the Treasury Board would grant any certificate for the organization of this bank.
He makes that statement upon his own lesponsibility. He is a man well-known to the ex-Minister of Finance, a reputable member of this House and a distinguished member of the legal profession. We shall see, before I sit down, whether those grave considerations did receive that careful consideration to which they were entitled. So urgent and so important did this matter appear to Mr. Leighton McCarthy that he wired the Minister of Finance on the 11th day of October:
Please wire me assurance in reference to stay of certificate of Treasury Board mentioned in my letter of Monday night.
The Minister of Finance received that letter and that telegram, as appears from a letter written over his own signature that very day in these words:
My dear Mr. McCarthy:
I have your letter of the 8th instant, and your telegram to-day on the subject of the Farmers Bank.
Therefore there is no question about his having received that letter and that telegram. He received both of them. Then we have Mr. McCarthy, on the 9th of October, sending to the Minister of Finance a copy of the writ to be issued and a copy of the special endorsement upon that writ, which have been read by my hon. friend from North Perth (Mr. Morphy) and by my hon. colleague the Minister of Finance (Mr. White). I do not intend to go into those particulars again. I want, however, to add a little to what has already appeared. When this writ was issned, a motion was made for an injunction to restrain these people from further negotiating the promissory notes or from acting any further in the matter. Upon that motion was an affidavit made by William Laidlaw, K.C., of

Toronto, one of the most distinguished lawyers in. that city, in which he corroborated Itbe charges of fraud endorsed upon that writ. When that motion came before the judge in Toronto, what happened? It transpired in the meantime that these men, who were charged with fraud, had gone to the county of Halton by night and returned to the plaintiffs the notes they had given and the money they had advanced. When the matter came up before the judge, the counsel for the defendant informed him that the plaintiffs were out of court; that they had no further complaint to make, and that their notes and the money they had advanced had been returned to them. Therefore that motion fell to the ground.
At one o'clock the House took recess.
The House resumed at three o'clock.


Thomas Wilson Crothers: When the House rose
at one o'clock I was about to read a few paragraphs from the affidavit made by Wm. Laidlaw, K.C., of Toronto, verifying the charges set forth in the endorsement on the writ of summons referred to by other speakers during this debate. The affidavit lias the same title as the writ of summon' '
I Wm Laidlaw, of the city of Toronto, in the' county of York, the solicitor for the plaintiffs, make oath and say :;
1. This action is brought by the plaintiffs on their own behalf and on behalf of all other alleged shareholders of the Farmers Bank of Canada who may desire to be joined as plaintiffs. And the plaintiffs' claim is:
(1) For the rescission of alleged contracts to take shares of the capital stock of the Farmers Bank of Canada; (2) For an accounting for the money an promissory notes received-or alleged to have been received-in the name and on behalf of the provisional directors of the hank; (3) for an injunction; (4) for a receiver.
I do not propose to read the whole of this affidavit, which contains some twenty rather lengthy paragraphs. I will only read a few of them, commencing with subclause 1 of paragraph 8:
That the agents and solicitors in procuring subscriptions for shares falsely reported that persons had subscribed for a larger number of shares than they had in fact subscribed for, and the following are examples of such false representations, namely: (a) that Robert Noble whose name is entered in the prospectus as one of those who had consented to be a director, had subscribed for shares to the amount of $10,000, whereas he had in fact only subscribed for shares to the amount of $3,000; (b) that John Sproat had subscribed for shares to the amount of $10,000, whereas he had in fact only intended to subscribe for shares to the amount of $1,000, and that he was induced to sign an application in the belief that it was filled up for $1,000 and that

the general manager afterwards claimed that it was a subscription for $10,000, and the said John Sproat then repudiated the entire subscription ;	(d) that James Murray had subscribed for shares to the amount of $10,000, whereas he had in fact only subscribed for shares to the amount of $1,000 ;	(e) that Dr.
Stewart was subscribing for shares to the amount of $10,000, whereas he was not in fact subscribing for any shares; and other false representations of a similar character in reference to alleged subscriptions of other persons.
(2) That Major Thomas Beattie, represented by the prospectus to have consented to act as a director, had not subscribed to any shares, and refused to he a director, and refused to allow his name to be used in any way in connection with the bank; and the plaintiffs allege that the names of other persons were represented by the prospectus to have consented to act as directors had not subscribed to any shares or given any authority for any such publication.
9.	That I attended meetings of the alleged subscribers for shares and have met the plaintiffs-or almost all the plaintiffs-in consultation, and they have stated to me, and I verily believe:
(1) That the agents and solicitors in the course of soliciting subscriptions had falsely reported that other persons who lived in the same district of country, and who were known to he prosperous men, had subscribed for a larger number of shares than they had in fact subscribed for.
10.	That I have also consulted with Major Thomas Beattie, one of the persons named as consenting to be a director, and he stated to me, and I verily believe, that he refused to subscribe for shares-that he refused to he a director-and refused to allow his name to he used in any way in connection with the bank; and although I have no positive information I have grave doubt, whether the persons professing to act in the name of the bank had authority from the other persons whose names are mentioned in the prospectus as consenting to become directors.
11.	The list which is now produced and marked ' B ' is a copy of a list of subscribers for shares which I received from Robert Noble, one of the persons named in the prospectus, and who is at present absent from the province, and almost all these persons reside in the county of Halton.
15. I have been informed by alleged subscribers and from other sources, and verily believe, that sums of money amounting to one hundred and fifty thousand dollars, more or less, have been paid by alleged subscribers, and that promissory notes for large amounts have been signed by them, and that the persons acting in the name and under the professed authority of the Act of incorporation have been endeavouring to discount or procure a loan by the transfer of the said notes.
I intended to state a little earlier that the Farmers Bank was incorporated by a special Act in the year 1904. That incorporation was good for but one year, unless in the meantime the bank became organized and a certificate from the Treasury Board issued. Not having secured that certificate during the year, application was made in 1905 for a renewal of the charter for another year.

Again, in July, 1906, the certificate not having been secured in the meantime, another application was made for a further extension of a year. The Minister of Finance objected to any further extension, and finally a compromise was effected, and an extension was allowed or given for six months. The Finance Minister, in discussing this matter in the House in March, 1911, was good enough to tell us why he objected to any further extension of the charter. These are his words, at page 5308 of 'Hansard' of March 15 of that year:
My view was that the fact that they had not been able to organize promptly, indicated that they were having difficulty.
They obtained their charter in 1904, and after two years they were unable to get the subscriptions required by section 13 of the Act, or the cash payment of $250,000. And at that time the Minister of Finance expressed his suspicion of the business capacity of the men behind the Farmers Bank, and gives that as a reason why the charter hould not be extended any further.
It is true that these papers were returned to Mr. McCarthy on the 2nd November, 1906. Mr. McCarthy wrote the Finance Minister in these words:
Dear Sir,-Referring to my letters of the 8th and 9th instant with reference to the application for a certificate made on behalf of the Farmers Bank, I am advised by those who are instructing me that the claims made by them in the action brought have been settled by their subscriptions being taken up by some parties interested in the bank and refunding the money paid by the individuals or returning the notes which had been given. The objections which I made on their behalf to the issue of the certificates are therefore withdrawn. Would you mind, therefore, returning to me the papers which I forwarded to you.
On November 7 the deputy Minister of Finance wrote Mr. McCarthy in these words:
Referring to your letter of the 2nd instant, in the matter of an application of the Farmers Bank of Canada for a certificate to commence business, I beg to enclose herewith the papers forwarded with your letter of the 19th October.
On the 7th of November the Finance Department returned to Mr. McCarthy the copy of the writ of summons and endorsement thereon and the affidavit of William Laidlaw, K.C., verifying the charges of fraud set forth in the endorsement on the writ of summons, which charged eighteen different frauds. These papers were never submitted to the Treasury Board, because the Treasury Board did not meet to consider the matter until November 30, while
on November 7 these very important documents were sent back to Toronto by the Finance Department.


Mr. PROULX:: Had not the action been withdrawn at the time of the meeting of the Treasury Board ?


Thomas Wilson Crothers: Yes. It is said that because Mr. McCarthy withdrew any objections that he had to the issuing of the certificate, the statement made by him in the writ of summons should have no further consideration. If hon. gentlemen will refer to the letter written by Mr. McCarthy, in which he asked for the return of these papers, they will see that the matter was settled by the subscriptions being taken up by some parties interested in the bank, the refunding of the money paid by individuals and the returning of the notes which had been given. As was stated yesterday, the facts are that some of the defendants went out to Halton at night, paid to the plaintiffs the money that they had paid in and returned to them the notes. In that way the action was settled. But that does not help the ex-Minister of Finance; it is the very strongest evidence that the charges of fraud were not empty charges. Eighteen charges of fraud were set forth in the writ of summons and verified by the affidavit of one of the leading lawyers in the city of Toronto. If the hon. member for Prescott were charged with eighteen different frauds, the document containing which charges was on the public files of the court in the city of Toronto or in any other city, would he, being innocent of those charges, go and settle with the men who made them ? No; not if he had a particle of self-respect. No man-having any regard for his own reputation, would settle a case in which he was charged with eighteen separate and distinct frauds, if he were innocent of the charge. He would say: There is nothing in the charges; I will have the judgment of the court exonerate me; I will have the libel filed against me in the courts of this country set aside by judgment of the court. So that that letter, instead of inducing the Finance Minister to drop the whole matter, should have induced him to pursue it still further. If these men were innocent, why did they give back these notes and pay back this money ? That circumstance is the strongest evidence that those who were charged with these frauds were guilty. And what does the Finance Minister do ? That is set forth in Mr. Boville's letter to Mr. Clouston, dated December 3, 1906. After mentioning the fact that the Finance Minister had an


Mr. SINCLAIR:: I find, from an answer that was placed on the table this morning, that within six days from the time that the administration of which the Minister of Labour is a member came into office, they issued a license to the International Bank, and I also find that the Treasury Board of the Liberal Government left a memorandum for the incoming Government containing the statement that the application required further consideration. I understand that this bank has also come to trouble since it was licensed. I would like the Minister of Labour to state to the House what investigation the Government of which he is a member made in regard to the application of the International Bank for a license.


Thomas Wilson Crothers: I am bound to admit that I am not familiar with the matter to which my hon. friend refers; it has nothing whatever to do with the question before the House.


Rodolphe Lemieux: Did not the Minister
of Labour promise at a meeting at Kirwood, Ontario, during the last campaign, that not only the depositors would be reimbursed but the shareholders as well, and interest would be paid to them.


Thomas Wilson Crothers: In 1911, I expressed the conviction in this House that Parliament

should do something towards the relief of the depositors, and afterwards, and on further consideration, I reached the conclusion that that relief should extend to the full extent of their loss.


John Howard Sinclair: Including the shareholders.


Thomas Wilson Crothers: I did not say that; I am speaking about the depositors. Speaking to my constituents I told them very distinctly what my views were, and I promised them very definitely that if reelected I would do all in my power to secure that their losses should be paid in full, I made that statement without saying anything about what anybody else's views were on the matter. I was charged afterwards in certain sections of the _press of this country with having undertaken to pledge my party. I never did anything of the kind. I know very well that it was reported that I had said at one or two meetings which .1 had attended something which seemed to indicate that I was speaking for the party, but that is not so. I spoke for myself only and every one who heard me understood I was speuking for myself only. Every member in this House can quite understand that the report of a speech continuing over an hour and a half, boiled down to three or four inches in a newspaper, does not convey, four times out of five, the meaning that the speaker intended to convey. I may say here that when this same section of the press to which I have referred made an attack on me after we came into power, I received, unsolicited, a letter from a leading Liberal who attended one of these meetings where I was reported to have pledged my party, and he said in that letter:	I have always voted against
you and I voted against you the last time, but I like fair play; I am one of the victims of the Farmers Bank; I attended that meeting; I attended purposely to see what you might have to say about it; you pledged yourself only and you said nothing about any one else, and on my way home I said to a friend who was with me: we did not get much help from him; he simply promised what he himself would do. I am stating this because there has been some reference made to the matter here and in other places.


John Howard Sinclair: The statement which
the hon. gentleman has jusit miade to the House does not correspond to the statement made to the House by the Prime Minister in the session of 1912.


Thomas Wilson Crothers: Yes it does exactly,
read it.


John Howard Sinclair: I refer to page 714,
volume I of ' Hansard,' 1911-12, where the hon. gentleman will find that the member for Russell asked a question and the Prime Minister answered it as follows:
Mr. Murphy: 1. Was any promise made by the present Minister of Labour, or other Government supporters, in the province of Ontario during the recent election campaign, to the effect that if the Conservative party were returned to power all those who lost money through failure of the Farmers Bank, would be reimbursed by the Government?
Mr. Borden: 1. No such promise was made by the Minister of Labour. The Government has no information as to promises made by other Government supporters.
Will the minister explain how it comes that the statement he has made just now differs from the statement made by "the Prime Minister?


Thomas Wilson Crothers: It does not differ at
all; the very answer that my hon. friend has read from the Prime Minister says that the Minister of Labour did not make any promise for the party.


An hon. MEMBER:: Read it again.


Thomas Wilson Crothers: The Prime Minister
siays he does not know what anybody else promised.


John Howard Sinclair: That is no explanation at all.


Thomas Wilson Crothers: Why, it does not require any explanation. In the answer the hon. gentleman has read the Prime Minister said nothing differently from what I have said. Why, the hon. gentleman has just read that the Prime Minister said that the Minister o.f Labour did not make any such promise for the party.


John Howard Sinclair: You said that if the
Conservative party were returned to power those who had lost money by the failure of the Farmers Bank would be reimbursed.


Thomas Wilson Crothers: That is not what 1
said.


John Howard Sinclair: And the answer is that you made no such promise.


Thomas Wilson Crothers: I made no such promise for the party.


John Howard Sinclair: Well, if you are satisfied with that it is all right.


Thomas Wilson Crothers: The hon. gentleman
purports to read an answer from the Prime

Minister convicting me of having made a promise, which the Prime Minister says, in so many words, I did not make.


John Howard Sinclair: The hon. gentleman
says he did make the promise.


Thomas Wilson Crothers: funds, and they are lost, they are stolen. I am prepared to express the opinion that in a private transaction the ex-Minister of Finance would, by a court of law be ordered to Teeoup these depositors for every dollar they lost because of his breach of trust in putting a man in control of hundreds of thousands of dollars, whom he knew, in law, to be dishonest.
Now, Mr. Speaker, what would be thought by the hon. members of this House if the ex-Minister of Finance actually knew what the facts were? Supposing the ex-Minister of Finance actually knew that Travers was guilty of fraud, and deceit, and perjury, and had, notwithstanding that actual knowledge, put him in control of hundreds of thousands of dollars belonging to these depositors, is there a man in this House who would not say: we are morally bound to recoup the depositors; we are in natural right and justice bound to recoup them every dollar they have lost? I venture to say my hon. friend from Rou-ville (Mr. Lemieux) would accept that proposition. I am assuming now that the ex-Minister of Finance actually knew the character of the man he was putting in control of this money. Would my hon. friend from South Renfrew (Mr. Graham) stand up here and say that we should not recoup these people every cent they lost if the fact was that the ex-Minister of Finance actually knew what Travers was guilty of and the character of the man? No. The hon. member for South Renfrew would not take that stand; no member of this House would take that stand. Then, if he would not take that stand, suppose the ex-Minister of Finance actually knew, he is just as liable in law because he ought to have known and he would have known if he had taken the course that an ordinary prudent man in dealing with his own affairs would have taken. So'that I reach the conclusion that the gross negligence and gross breach of trust of the ex-Minister of Finance -was the direct cause of this loss, not the remote cause but the direct cause, and the courts of law every day are administering the law in similar cases against trustees.
My hon. friend from Wright (Mr. Devlin) referred to the opinion of the Department of Justice, il really have never been able to ascertain why this matter was referred to the Department of Justice at all. It is not a case for the opinion of the Justice Department. The statute says: If the Minister of Finance is satisfied by affidavit

or otherwise that the various provisions of the Bank Act have been complied with, then he is to issue a certificate. It is not a legal question; it is one of common sense. I cannot understand why it was referred to the Department of Justice; but hon. gentlemen opposite can find no comfort from the letter written by the Deputy Minister of Justice. This is what he says:
I have the honour to acknowledge receipt of your letter of the 2Sth instant, and of the inclosed papers, being the application from the Farmers Bank of Canada for a certificate to commence business, under sections 13-17 of the Bank Act, and papers in support thereof.
Not any of the papers that were against it, but papers in support of it. The former papers were not in the possession of the Minister of Finance at the time, because he had sent them down to Toronto on the 7th day of November, and this was the 28th. Therefore these papers were never submitted to the deputy Minister of Justice. Why should they have been submitted to him at all? It was not a matter of legal opinion. There is no evidence that any papers opposing the granting of this certificate were submitted to the deputy Minister of Justice. He says further:
You ask me to advise you if on the papers submitted such certificate may legally issue.
We do not know what the papers submitted were.
In reply, I beg to state that the statements in the statutory declaration-
And that appears to be the only paper submitted to him.
In reply, I beg to state that the statements in the statutory declaration of Mr. Walter R. Travers are sufficient, if they are accepted, to show compliance with the statutory provisions and that the evidence thus afforded is such as the Treasury Board may lawfully accept under the Act, and thereupon issue to the bank a certificate under section 14 of the Act.
Papers returned herewith.
E. L,. Newcombe,
Deputy Minister of Justice.
If accepted. Therefore hon. gentlemen opposite get no comfort from the deputy Minister of Justice. He says: I know nothing about Travers; if you believe him, there is enough set forth in his declaration to warrant you in issuing a certificate. But there was no evidence submitted to Mr. Newcombe, deputy Minister of Justice; nothing that the hon. member for Halton (Mr. Henderson) had said, nor that Sir Edmund Osier had said, nor that Mr. Leighton McCarthy had written. I have

no doubt that if charges had been submitted to the deputy Minister of Justice that he -would at once have said: You had better inquire into these things. But he says: if you accept Travers' statement- and that seems to be the only statement that was before him-you may legally issue the certificate.
It is said that there are other causes. My hon. friend the member for Wright (Mr. Devlin) says-and it is a fair argument-that the learned commissioner found that it was not the issuing of the certificate that was the efficient cause of the loss, but the subsequent mismanagement of the manager. I have seen no evidence to show that the aspect of the case that I have just presented to the House was submitted to the learned commissioner at all, and I do not believe it was.


Daniel Duncan McKenzie: What aspect ?


Thomas Wilson Crothers: The aspect of the case that the Minister of Finance knew in law that Travers was a dishonest man, and that his authorization to Travers to handle these funds was the direct cause of the loss. I do not believe that aspect of the case was submitted to the learned commissioner at all.


Daniel Duncan McKenzie: If the minister will read the minutes of the evidence, he will find that every phase of the case was submitted to the commissioner.


Thomas Wilson Crothers: Was that particular one ?


Daniel Duncan McKenzie: Certainly.


Thomas Wilson Crothers: I have not seen it, although it may have been. If it were submitted to him and he found it was not the direct cause, I do not agree with him. If a trustee gives trust funds to a 4 p.m. dishonest solicitor, not knowing .	that he is dishonest, although
he believes he is an honest man, he is held liable in the courts of this country. That has been held over and over again. Possibly some of the hon. members present have examined a case decided in England in 1901, namely, that of De la Bere versus Pearson, Limited. The defendants, Pearson, Limited, were newspaper proprietors in London and advertised that their city editor would answer inquiries for financial advice. The plaintiff invited a recommendation from him for a good stock broker, and the editor recommended one who transacted stock exchange business, although he was not a member of the stock
exchange. He had been advising the editor in financial affairs, and there was no evidence to indicate that the editor had any ground to suspect dishonesty. The plaintiff acted upon the recommendation of the editor and gave money to the trust broker for investment, and he appropriated the money to his own use. The man sued Pearson, the proprietor of the newspaper, and it was held by the highest court in England, except the Judicial Committee of the Privy Council, that Pearson was liable, although the financial editor believed the stock broker to be an honest man. In the case of the Farmers Bank, the Minister of Finance knew in law that Travers was a dishonest man and did not believe that he was an honest man. He should have known that he was dishonest; that he was guilty of fraud, that he was guilty of perjury. He would have known all these things if he had taken the course which it was his duty to take. Therefore, if the Minister of Finance were before a court in this country to-day, I venture the opinion that he would be ordered to refund every dollar that these depositors have lost in the Farmers Bank. We may not be in a position to enforce the law here.


Daniel Duncan McKenzie: The hon. minister has presented a ease which he says is a similar one; but here is the condition presented to Mr. Fielding.


Thomas Wilson Crothers: I thought you were
just going to ask a question


Daniel Duncan McKenzie: If this element were
present in the case that my hon. friend quoted, would he consider it a case in point? Three or four hundred intelligent men at a properly constituted meeting of the shareholders of the bank appointed Mr. Travers to go to Mr. Fielding to get a certificate. Is it a similar case when Travers came there clothed with authority from the people who were starting the bank?


Thomas Wilson Crothers: The facts I believe
were that these people did not send Mr. Travers to Mr. Fielding to get a certificate; that the charter was sold to Mr. Travers by the provisional directors.


Daniel Duncan McKenzie: No.


Thomas Wilson Crothers: That is the evidence. If my hon. friend will read over the evidence, he will find that. That is the judgment of the commissioner who inquired into the matter, who says at page 5:

It appears clear from these agreements and resolutions that what was intended was to sell the charter of the bank to Travers and to put him in control of its organization and business, and that the provisional directors should abdicate their functions and act in accordance with his directions, and that is what followed.
So that my hon. friend from North Cape Breton (Mr. McKenzie) is mistaken *when he says that Travers had authority from the stockholders.


Daniel Duncan McKenzie: He certainly did; that is recorded in the report of the commissioner.


Thomas Wilson Crothers: I am going by the
findings of the commissioner; and Mr. Fielding would have discovered all that if he had acted as a man of ordinary prudence would have done in dealing with his own private affairs. I know the ex-Minister of Finance well enough to know that had he been dealing with his own affairs he would not have acted as he did in this matter. So that I say-and let me recapitulate just for a moment-I think it would have been an important discovery, had he made reasonable investigation, to have found out that $100,000 of the $250,000 had not been paid in by the subscribers; and a still more important discovery to have found that the man he was dealing with was dishonest, had been guilty of fraud, deceit, and perjury, and not to bg trusted with the handling of other people's money. Having failed to make reasonable inquiry, the law imputes to him knowledge of what he ought to have known. Therefore, knowing that Travers was a dishonest man, he gives him a certificate, licensing him to go out to misappropriate and squander the money of the widow and the fatherless, of the aged no longer able to earn, of the middle-aged man who had tried to save something to enable him to buy a home. Mr. Speaker, I am not appealing to this House as a matter of charity for the widow and the fatherless, the aged, or the industrious man who had some money on deposit, I am pleading as a matter of right and justice, and I- am applying to the official of this House the principle that our courts of law administer every day in the week as against trustees.
It is said that there are other banks in Quebec, or somewhere else, where, through the mismanagement or fraud of the manager, depositors and creditors have lost money. If that be all, there is no analogy between such a case and this case; and I am prepared to say that if any case can be brought before this House where the

trustee appointed by this House as Finance Minister acted as the Finance Minister did in this case, I will hold up both hands to reimburse every dollar lost. That is my position. As I said I am not asking for charity for these people. The junior member for Halifax (Mr. Maclean) last night thought it was monstrous that we should pay public money under these circumstances. I can say that I never supported a measure in this House with a clearer conviction that I was discharging my duty and doing what was right and just than this; and I appeal to every man in this House, Liberal and Conservative, to come forward and reimburse these people who lost their money through the gross negligence and gross breach of trust of the trustee that Parliament appointed. I do not think, Mr. Speaker, that these words are too harsh. I have already said that I do not blame the ex-Finauce Minister with intentional wrongdoing; but I do say that he would not have acted as he did if he were dealing with his own personal affairs, and there is not an hon. member who believes that the ex-Finance Minister would have acted so in regard to his own personal affairs, and I do not believe that a man in this House would have acted in his own affairs as the Finance Minister did in this case.
Mr. J. DEMERS (St. John and Iberville) Mr. Speaker, the honourable minister of Labour (Mr. Crothers) seems to have had some little hesitation in deciding to speak, and had he waited a few moments more there would have been no further discussion before the question was put. It strikes me that the debate could not have been complete if he whom I shall call the champion of the depositors of the Farmers Bank had taken no part in' it, and it would have been a matter of general surprise that the minister should have refrained from so doing under the circumstances, for he was bound so to do by the promises which he made in 1911. I read then and rince then, in different papers, but especially in the London Free Press and the St. Thomas Times, the words uttered by the hon. minister at Kenwood and at Fingan, during the electoral campaign of 1911. I see that he was very explicit at the time and that he promised the electors in his county and in the neighbouring counties where he was called upon to address meetings, that if the Conservative party were returned to power he would do his very best to have the depositors of the Farmers Bank reimbursed out of the public

treasury. Those papers lead us to believe by the way his speeches are reported therein, that he spoke not only lor himself but for the Conservative party at large. In fact, he said: We propose to see that whoever has sustained a loss owing to the collapse of the Farmers Bank is reimbursed. The hon. gentleman asserts that he only spoke for himself. I accept his statement as I am bound to accept it, but I regret that he has not thought it proper to repudiate such utterances as were attributed to him by the newspapers, at a time when they were supposed to do good or wrong, according to the standpoint from which one would consider this matter, for it appears that whenever this argument was resorted to, it had a magical effect in the counties where interested parties were to be found.
Tire minister was the one who should be pointed out to take part in this debate and contribute his piece of oratory.
I do not intend to reply very particularly to what he said this afternoon, but I was glad to hear him say that he would raise both hands in favour of other banks which ha'd failed if it could be demontrafed to the Government that the circumstances were about the same as in the case of the Farmers Bank. However, I am sorry to see that, in spite of all his sincerity, he will be unable to do the depositors of other banks that justice, because the Minister of Finance himself thinks quite differently from him as to other banks, for hardly three or four weeks ago, the hon. member for Laprairie (Mr. Lanctot) or the hon. member for Rou-Ville (Mr. Lemieux)-I. fail to remember exactly which of the two-asked the Minister of Finance whether it was the intention of the Government to act in the same way towards the depositors of other banks which had failed, and the hon. Minister of Finance answered explicitly: No.


Louis-Philippe Pelletier: Would the hon. member quote the question and the answer given by the Minister?


Mr. DEMERS:: A friend will hunt them up for me as I have not the Official Report with me here, and I shall quote them textually. I am sorry, also, that the right hon. Prime Minister answered a question of the hon. member for Laprairie (Mr. Lanctot) in 1913 the way he did. Here is the question :


Mr. ROCH LANCTOT:: Mr. Chairman, is it the intention of the Prime Minister to answer my question of the 5th instant, concerning the Farmers Bank?


Robert Laird Borden: the said institution continued to prey on the public, without giving any guarantee in return.
The failure of the Farmers Bank is the result of fraudulent management; that of the Bank of St. John was the result of a wrong make up at the very outset. Which of the two cases appeals more strongly for relief on behalf of the Government?


Mr. SEVIGNY (Translation):: Will the
hon. gentleman state whether he ever called upon the Government to grant an inquiry into the business of the Bank of St. John?


Marie Joseph Demers: In answer
to the question of the hon. member for Dorchester, I may say that no such policy had been launched at the time. However, since the case of the E'armers Bank has come up, we have filed our application.
I stated that there had been carelessness shown on the part of the Government, from the start, in the case of the Bank of St. John, and what are my grounds for saying so? Take the first monthly report made by the Bank of St. John's and forwarded to the Finance Department of Cpnada. I refer specially to the Bank of St. Johns, because I am satisfied there is no case wherein the depositors are entitled to more sympathy and relief. In order to secure the certificate which enabled it to start business, the Bank of St. John had been called upon to show that 20 per cent of the capital subscribed (that is, in the case of the Bank of St. John, $108,000) had been paid up in specie or cash. It was shown in the most clear way that this has never been done. Vide the case of the Bank of St. John's, in liquidation, Tancrede Bien-venue, liquidator, vs. A. R. Lapierre, contributor, No. 47, S. C., Iberville, especially the report of Mr. George Gonthier,_ expert accountant, filed in the said case, and a number of statements made under oath in connection with the same matter.
But was the Government at the time, that is when the certificate was issued, in a position to ascertain the truth? I submit that they were. The certificate is dated October 30,	1873. On October 31,	1873,
that is the next day, the bank submitted its first report, and what do we find? We find that the amount of $108,000 which, according to the statements handed to the Department of Finance, were supposed to have been paid in cash, do not appear in that monthly statement among the assets of the bank. The following is what the report has to say concerning the assets of the bank:

1873, October 31.
Specie	$	23 91
Dominion notes	 350 00
Notes or cheques on other banks. .	305 00
Bal. due from other banks in Canada	 30,000 00
Notes and bills discounted and current		81,301 54
Total	$112,980 45


Louis-Philippe Pelletier: What
is the hon. gentleman quoting from?


Marie Joseph Demers: I am quoting from the Extra of the Official Gazette of Canada, forming part of an exhibit filed in the case I have just referred to. That report is addressed to the Department of Finance, and it is an easy matter to ascertain whether the figures are correct or not.
What has become of the $108,000 which were supposed to have been paid up? If the then Government had given some attention to that report,, as it was their duty to do, would not such an omission have struck them? Would they not have been puzzled at finding that on the first day on which the bank started business, an amount of $81,301.54 in the shape of notes had been discounted? Would not the necessary inference from such data have been that this amount of notes discounted represented the payment by the shareholders of the instalments due on their shares? And was that report prima facia evidence, to say the least, that false representations had been resorted to with a view to securing the issuing of the certificate, previous to the bank doing the least particle of business? And if that fact had been disclosed, that is to say, if they had gone to the pains of reading that first report, it seems quite evident that the business activities of the Bank of St. John's would have been of short duration.	.
I say that is clear evidence of the gross carelessness of the Government in the case of the Bank of St. John, which should be sufficient to render it liable for the losses undergone as a consequence of the failure, if the Government can be held liable in such cases.
The principle laid down by the Government in the case of the Farmers Bank is hurtful and dangerous, but most certainly, if this Government grants relief to the depositors of this bank without stating that they intend to grant similar relief to those who suffered from the failure of other banking institutions, this House should rise in condemnation of such an arbitrary stand;
1 and in any case it will be incumbent on the Administration which succeeds this one to

deal in the same manner with depositors of other banks.
I am opposed to the passing of this Bill,
(1)	because it has not been shown that the Government is legally or morally responsible for the failure of the Farmers Bank;
(2)	because such legislation has an exceptional chstracter which nothing justifies, and because no general policy is provided towards granting relief to all those who may have suffered losses through the failure of the bank; (3) because the Government, through the mouth of the Prime Minister, has already stated that this legislation should not be considered as constituting a precedent; (4) Because the Government stated that a similar course would not be taken in connection with the failure of the Bank of St. John and other banks; (5) and lastly, because the reasons which have prompted this legislation are shameful.
Mr. PELLETIER (Translation.) I wish to say a few words in reply to the remarks just made by the hon. member for St. Johns and to refute, at the same time the arguments which are resorted to in a more explicit manner outside of this House, and which were alluded to by my hon. friend. I also wish to point out the fact that the hon. member for St. John alluded to the hon. Minister of Finance as having answered a question of the hon. member for Laprairie by the word ' No,' with no other word to qualify his answer. I asked the hon. member to quote the answer of the hon. Minister of Finance in its full wording. He replied that he had not that text with him, but he was sure of what he asserted, and he would give the text before resuming his seat. . . . Well, the hon. member resumed his seat without reading the text in question.
I have before me the answer of my hon. colleague, it is on page 4039 of this year's 'Hansard', and it is easy to see that the hon. member was mistaken. In fact, the minister did not merely answer 'No', but he qualified his answer. Here is the answer:
No, there are no grounds which would jus-* tify such action on the part of the Government.


Marie Joseph Demers: (Translation.) I rise to a question of privilege. The hon. minister just said that I made a false assertion. I was perfectly right in saying what I did say, and the proof of this is to be found on page 3331 of 'Hansard'. I stated a moment ago that I was not positive as to whether the question has been asked by the 299
hon. member for Laprairie or by the hon. member for Rouville; but I now find that it was asked by the latter, on the 4th of May last. Here it is:
Mr. Lemieux: Is it the intention of the Government to reimburse the depositors of the Ville Marie Bank, the Banque de St. Jean and the Banque du Peuple?


Louis-Philippe Pelletier: (Translation.) The hon. members on the other side are cheering. If they are satisfied with this, it takes but a trifle to satisfy them. The hon. member for St. Johns now says that the question was asked by the bon. member for Rouville, and he stated a moment ago that the member for Laprairie is the man who did ask it. Now, as there were two questions, is it not fair and strictly loyal that the hon. member should have said so? And as there were also two answers it was not enough for the hon. member for St. Johns to deal with the one and pass over the other in silence.


Marie Joseph Demers: (Translation.) Would
the hon. minister allow me to interrupt
him?


Louis-Philippe Pelletier: (Translation.) Let
the hon. member bear his misfortune patiently. I am giving facts as my answer to the hon. member who wished to leave the House under the impression that the Minister of Finance had answered but once, and had merely said ' No.' I am quoting tor him the text of an answer which contradicts his assertion, though he asserted that he was sure of what he said.
Mr. DEMEiRS:	(Translation.) Mr. Speaker, I rise to a question of privilege. The hon. minister claims that I have led him into error. I never intended to do so.
I have proven whatever assertion I have made. I went so far as to say that it was either the member for Rouville or the mem-er for Laprairie who asked the question. Therefore, I never intended to deceive the House.


Louis-Philippe Pelletier: (Translation.) That is not a question of privilege at all, but a means for the hon. member of beginning his speech over again. I did not say, mark you, that he had deceived the House knowingly, but I did say that I bad caught him in the very act of mistaking, and I point this out to the House and to the country.


Marie Joseph Demers: (Translation.) I submit with pleasure. The country will judge between us two.	*


Louis-Philippe Pelletier: (Translation.) The
cheers of our hon. friends on the other side are not the very best kind of arguments. The hon. member for Richmond and Wolfe (Mr. Tobin) excels in clapping hard on his desk; that is his only means of reasoning. Let our hon. friends to the left keep cool and bear their misfortune patiently.


Mr. GAUVREAU:: (Translation.) Keep
ccol yourself and do not insult others, it shall be better for you.


Louis-Philippe Pelletier: (Translation). Have patience and keep cool. I understand that it is not so very agreeable for our hon. friends to see this little combination fall to the ground and that they must feel greatly disappointed.
Now, Sir, let us consider the position taken by the hon. member for St. John and by his friends outside of this House. The hon. member finds [DOT]'*hat this legislation-I shall quote his own words so as to give him no chance to rise to a question of privilege-he finds that this legislation is daring, extravagant and immoral. He informs us, moreover, that he will vote against the Bill. Such is the principle which he lays down, such is appreciation of this legislation, and, at the same time he asks us to treat the depositors of La Banque de Saint-Jean likewise. It follows that he wants us to have a daring, extravagant and immoral legislation voted in behalf of those same depositors. That is' the position he takes in this Hous.r a representative of the people. Or the hon. member is sincere in his wishes to the effect that those depositors should be reimbursed also, and therefore he should not come here and say that we must not reimburse the depositors of the Farmers Bank, because it would be daring and immoral, since he wants us to do this very same thing ini favour of the depositors of La banque de Saint-Jean, or else he is not Sincere in his request.
The hon. member declared that he would vote in favour of a six months' hoist with respect to this legislation. Therefore, he finds that the depositors of La Banque de Saint-Jean should not be reimbursed bv the Government, and he will have to tell his electors that he, their representative, declared that he was against the idea of giving back to the depositors of that bank the amount of their deposits. Or the hon, member was serious and sincere whan he asked for that, and I believe he was, or he did not stop to think that it would ibe hardly possible for him to vote in favour of a 
Bill to the effect of reimbursing those depositors when that very piece of legislation was immoral according to his own admission.


Marie Joseph Demers: (Translation.) Not immoral in itself, but owing to what happened in 1911, since it is resorted to as a means of fulfilling promises made during the elections.


Louis-Philippe Pelletier: (Translation.) But
before considering those promises, the hon. member studied the law and declared that this legislation was daring, extravagant and immoral, and now he not only tells his Liberal friends, but the whole House, that the depositors of La Banque de Saint-Jean should he reimbursed also. He is voicing the real wish of his electors, I am sure, but he takes a position 'quite contrary to their wish when he declares that it is immoral to reimburse the depositors of a bank. He said that he had received petitions asking that the depositors of La Banque de Saint-Jean be reimbursed. He added, even, that the Minister of Finance should take his utterances for a notice of what was prayed for in those petitions. How, then, can it be possible to conciliate such position with what he said previously?


Marie Joseph Demers: 
Marie Joseph Demers: The certificate was correct but it was obtained under false pretense.


Louis-Philippe Pelletier: I would like to remind the hon. member that La Banque de Saint-Jean got its certificate from the Treasury Board in 1873, under the Liberal rule.


Rodolphe Lemieux: Under the Macdonald Government.


Louis-Philippe Pelletier: The Macdonald Government was defeated in 1873. At all events, it matters not whether if was under a Conservative Government or under .a Liberal Government. We shall find that, in 1909, a request wais made to the Minister of Finance and to the Minister of Justice. I have before me the report which was made by Mr. Newcombe, the Deputy Minister of Justice.


Rodolphe Lemieux: What is the date ?


Louis-Philippe Pelletier: It was in 1909. I quote this report in English, because I do not wish to run the risk of making mistakes in the translation:
299J
The petitioner relies mainly upon the alleged failure of the subscribers of the capital stock of the bank to pay 20 per cent or $100,000 on account of the stock subscribed previously to the bank beginning business and it is claimed that the Treasury Board was misled in the issue of its certificate.
The Treasury Board did, however, in fact issue the certificate required by section 7 of the Bank Act (34 V., c. 5) and this was done as appears from the records of the Treasury Board, with considerable deliberations since the matter was before the board from July, 1873, to the following October, and was the subject of two resolutions.
As you see, it is exactly the case quoted here. Mr. Newcombe answers:
It would, therefore, seem to be inexpedient and contrary to sound policy that the existence of the bank should at this late date be permitted to be called into question.
These observations are in accord with the view which impressed itself upon the undersigned at the hearing, and it would seem therefore that, if the granting of this application be discretionary with the Attorney General, his discretion ought not to be exercised favourably to the prayer of the petition.
This report is signed by Mr. E. L. Newcombe, Deputy Minister of Justice, and I find the following words at the foot of it:
I approve.
6th November, 1909.
(Sgd) A. B. Aylesworth.
So, as the hon. member will see, they applied to the Minister of Justice, under a Liberal Government, as early as 1909; they alleged the facts which I have just quoted, and the minister declared that there was no ground for granting the request. I quote those facts in order that, when the hon. member goes to meet his electors, he will not forget to tell them that if the present Government did not include the depositors of La Banque de Saint-Jean in this measure, the Liberal Government which he supported refused to consider the question. And if he forgets to state those facts, his electors will know, through some other channel, that he had, nevertheless, been made aware of them, that they were pointed out to him by me and that I was, thereby, doing my duty.
Did the hon. member before he declared this legislation to be immoral, scandalous and tremendous, ever think of taking steps with the Government to the effect of securing a reimbursement in behalf of those of his electors who lost money owing to the failure of La Banque de Saint-Jean? I am satisfied that he never took any steps in that direction. No wonder those depositors were not reimbursed.


Marie Joseph Demers: Not before 1911; but I
have asked questions about this, since that time.


Louis-Philippe Pelletier: I would like the hon. member to tell me whether he took the least step with the Government, even after 1911?


Marie Joseph Demers: I gave the hon. member ior Dorchester my answer: it was not our policy.


Louis-Philippe Pelletier: The hon. member did nothing before 1911 because it was not the policy of his party to come to the rescue of depositors of a bank which had become bankrupt, and those gentlemen would have no other policy if they came back to power, since they are against the present legislation.


Marie Joseph Demers: If this legislation is
adopted, it will be a precedent.


Louis-Philippe Pelletier: But if you adopt a law similar to this one, it will be just as immoral, since you say that this one is immoral.


Marie Joseph Demers: Your legislation is immoral because it is resorted to as a means of fulfilling promises made during the elections.


Louis-Philippe Pelletier: The hon. member has alluded but very lightly, before the House, to the fact that the depositors of an English bank were reimbursed whereas the depositors of the French banks are not. But at the public meetings there will be less hesitation. Owing to a habit and to principles which have prevailed for a long time with our hon. friends to the left, we may well anticipate that somebody will cry out to us that we have reimbursed the depositors of an English bank and done nothing of the kind in behalf of the depositors of the French banks. The hon. member has passed lightly over this point. Mortals, pass over, pass over, do not hang on. But a time will come when the hon. member shall pass over no more.
The hon. member for Berthier asked a question which has been answered, and I wish to have both the question and the answer reproduced in ' Hansard,' so that they may be of some use to those who will claim that the English depositors are being reimbursed whereas the depositors of the French banks are overlooked. Here is the question:
Mr. Barrette: Besides La Banque Ville Marie, La Banque du Peuple, La Banque Saint-Jean, are there any other Canadian banks that have failed

without the depositors thereof being refunded their losses? If so, what are the names of those banks?
Mr. W. T. White:	Yes. Bank of Acadia,
Mechanics Bank of Montreal, Bank of Liverpool, Bank of Prince Edward Island, Exchange Bank of Canada, Maritime Bank of Dominion of Canada, and Central Bank of Canada.
I have before me a statement concerning all the banks which have become bankrupt since Confederation. There are twenty-four. The statement shows in what cases the depositors were fully or partially reimbursed. The English banks are more numerous. I shall give a list of those banks. I mention but the banks the depositors of which were not reimbursed in full: The first is the Bank of Acadia, of Liverpool, Nova Scotia. Then we had the Mechanics Bank, of Montreal; the Bank of Liverpool, Liverpool, Nova Scotia; the Bank of Prince Edward Island, of Charlottetown; the Exchange Bank of Canada, of Montreal; the Maritime Bank of the Dominion of Canada, of St. John, N.B.; the Central Bank of Canada, of Toronto. This makes a total of seven banks. But there are three banks, La Banque du Peuple, La Banque de Saint-Jean and La Banque Ville-Marie, which were not alluded to by the hon. members of Laprairie, Rouville and St. Johns, and they are the only ones which were left unmentioned by those hon. members. What was the object of the gentlemen who passed over them in silence, and why did the newspapers supporting their party not allude, in their turn, to those three banks?


Rodolphe Lemieux: True it is that I mentioned La Banque Ville Marie, owing to the fact that it caused depositors in my county to sustain heavy losses; hut I did not do so because it was a French bank, for everybody knows that it was an English bank, having nothing of a French bank but the name.


Louis-Philippe Pelletier: Yes, but the majority of the depositors were French-Canadians.


Rodolphe Lemieux: That is true.


Louis-Philippe Pelletier: The strength of my argument remains unimpaired, and the hon. gentlemen must have had an object in view when they passed over the other banks in silence. I do not reproach them with having done so; they may think that this was fair means. But the people must know that a distinction was made, so that it might be said that under the Government of the great French-Canadian the French banks would have been made the

object of a better treatment. Fortunately, the facts shall be known, and those appeals smelling demagogism shall have no result. I shall not go so far as to say that such means was resorted to by members of this House, for everybody knows that there is not a Liberal member who would make appeals of that kind. The hon. member for Laprairie does not seem to approve what I am now stating. His' conscience may not happen to feel altogether at ease in this connection.


Roch Lanctôt: When you came to La-prairie in 1886 you were far from preaching the doctrine which you preach to-day.


Louis-Philippe Pelletier: You are far from the Farmers Bank, but if you wish to go back to the past, I am ready to follow you.


Roch Lanctôt: I am reminding you of 1886.


Louis-Philippe Pelletier: If my hon. friend
wishes to go as far 'back as 1886 he will know whom to speak to.
Now, there is a bank to which I desire to call the attention of the House, it is the Bank of Acadia. It does not bear a French-Canadian name, and it has a particular and an eloquent history. It lived just three months and twenty-six days, it re-opened its doors for a few days and redeemed for a few thousand dollars' worth of its notes. This lasted but a day or two and the rest of the people who were holding notes, with the exception of the Government, got nothing. The federal Government got twenty-five cents on the dollar out of many thousands of dollars which they had deposited.
Here is a bank which ought to be considered at least on the same footing as those mentioned by the Opposition. The question was not raised and it cannot be raised because the case is not the same. I think my hon. friends of the Opposition will admit with me that there is, from a certain standpoint, an enormous difference which is surely important to note, and it is this: The depositors of the Farmers Bank are entreating the Government, by means of petitions; delegations have come here again and again to explain their case and to ask for the justice which, to their mind, should be meted out to them. Up to this date, neither La Banque de Saint-Jean nor La Banque Ville-Marie nor La Banque du Peuple have taken the least step to show the Government that their depositors ought to be reimbursed. Will the Opposition claim that, in the absence of any request on the part of those depositors, the Government should have told them that they were to be reimbursed, and should have acknowledged their case as being fair and legitimate; that the Government, in short, should offer those depositors to reimburse them without a petition being made by them to that effect? Evidently no.
The depositors of the Farmers Bank, rightly or wrongly, have entreated us, through their lawyers and through numerous delegations, to reimburse they. They said: Here are the facts as we understand them, and they justify our request to the effect of being reimbursed. Considering those representations, should we not give the petitioners the benefit of the doubt? The other banks did not even make a request. Are we not forced, by the same process of reasoning, to the conclusion that if they made no request it was because they did not think they were entitled to reimbursement.
Let us proceed further. To those who, in the province of Quebec, would go and say that the depositors of La Banque de Saint-Jean, La Banque Ville Marie and La Banque du Peuple are not treated like the depositors of the Farmers Bank-and the hon. member for St. John has, in a very clever way, given to understand that any step would be useless, since, he said, the Minister of Finance had explicitly replied 'no' to the questions which he was asked-I shall answer that we have made an inquiry after refusing thus far to grant fhe request which was addressed to us, and that we are to-day taking action on the report of that inquiry.
Mr. Speaker, this Government does not propose to mete out a different treatment to the depositors of any bank which has become bankrupt, be it English or French or be they Protestants or Catholics. And if the same condition of things is evidenced in behalf of any other bank in the country, the same measure of justice shall be given to all concerned, no matter what province or nationality the depositors may belong to.
The depositors of La Banque de Saint-Jean did not get anything, so far, but we are informed by the receiver that they are to get from twenty to thirty cents on their deposits.
The depositors of La Banque du Peuple got 75J cents on the dollar, and the depositors of La Banque Ville Marie 17J cents.
The depositors of the Farmers Bank shall not get a cent out of the winding up; but this does not mean that the same principle should not apply in the case where

the depositors have received a partial reimbursement, as I have just said.
The case of the Farmers Bank is absolutely exceptional in the history of our banks, aside from the case of the Bank of Acadia, the depositors of which have not received a cent.- The Farmers Bank gets the treatment of justice involved' in the Bill now before the House. The case of the bank is not the same, and if it were true, iis is said in the Liberal papers of the -province of Quebec, that Toronto always gives the Government the word of command, we could have refunded to the depositors of the Bank of Acadia the meagre sum of $17,950-which was the total amount of the deposits made at that bank. If, as it is claimed, it is a principle to reimburse the English banks and to slight the French banks, it would have -been an easy thing to refund to the depositors of the Bank of Acadia such a Small sum, which was but a trifle owing to the High figure of our revenue.
The hon. member- for St. Johns said that La Banque de Saint-Jean should never have opened its doors. That bank has had thirty-three or thirty-four years of existence. I appeal to the spirit of justice of the hon. member. If he could throw off his political barnacles for a moment, would he not see that there is a difference to make between a bank the certificate of which jias just been issued or was issued two or three years ago and a bank which received its certificate in 1873, and has been in existence during thirty-four years. The case of the other banks is the same, or about the same, and the record of the Farmers Bank contains the report of facts unknown in the case of any of those other banks. However, if it can be -shown that there are exceptional facts in the ease of those banks-, the Government is ready to consider them with the sam-e spirit of justice and equity with which it did consider the facts relating to the ease of the Farmers Bank.
But what have we before us? Nothing has been submitted to the Government, so far. The hon. member alluded to the officials of the Finance Department and of the Treasury Board. He expatiated at length to establish that if those employees were at fault as regards the issuing of a certificate to the Farmers Bank, they ought to be dismissed. My hon. friend has committed an error, for those employees are not responsible, and it would not be fair to make them suffer on account of

this legislation, when the fact is that they are honest and respectable and have served faithfully under both Governments. It is not the officials of the Treasury Board or of the Finance Department who are at fault, it is the members of the former Administration who composed the Treasury Board. They -are the responsible parties, for it must be borne in mind that there is no official of the Finance Department at the service of the Treasury Board. This board is composed of "a certain number of ministers, and is called upon to examine and to -grant the certificate which the law requires, and no bank can begin to do business without having first obtained this certificate. The error in the case of the Farmers Bank was committed by the members of the former Administration who composed the Treasury Board.
Travers, the wretched man who is now suffering for his faults-I should say for his crimes-tried to make an immense speculation by means of the Bank Act. He came here and applied for the certificate required. The Minister of Finance, chairman of the Treasury Board, had been warned to the effect that this certificate should not be issued. That fact cannot be denied, although Mr. Fielding denied it before the House, and whatever assertions have been made by the hon. member for H-alton (Mr. Henderson) and by Sir Edmund Osier, of East Toronto. And Sir William Meredith, the commissioner appointed to hold an inquiry into this matter, had to come to the conclusion that he had faith in the evidence given before him to show that the ex-Minister of Finance had been warned. Moreover, Mr. Leighton McCarthy, one of the most distinguished lawyers in the land, had sent the Minister of Finance, Mr. Fielding, a letter to the effect that there was some fraud, and he added: Here is a duplicate of the judicial procedure by which it appears that Travers and the others are perpetrating an injustice and a fraud at the expense of the public. Considering those circumstances, considering the warnings of Mr. Osier and of Mr. Henderson, two members of this House, and the judicial documents transmitted by Mr. McCarthy, will anybody claim that Mr. Fielding should not have stopped and made an inquiry in order to ascertain as to whether those charges were well founded? Mr. Fielding himself admitted that he should have done so when he said, in view of his own justification, that it is very much easier to he a prophet after than

before the fact. He had to acknowledge that an error had been committed. That error has been acknowledged, and the report made by Judge Meredith testifies to that fact in indelible letters.
What was the result? The farmers of the neighbouring counties, depending upon the guarantee that the law gave them, depending upon the certificate issued, a certificate which is granted but after all the formalities have been complied with in the regular way; depending also upon the fact that the Treasury Board had opened the doors of that bank, said to themselves: The Farmers Bank has been incorporated by Parliament; the Treasury Board has examined everything and issued its certificate, but it did not make it known to us that it 'had been warned that there was error and fraud. Then the farmers went with the greatest security in the world and deposited their money at that bank. Can it be claimed to-day that bad management was the only cause of the failure of that bank? Bad management was but a link of the chain wrought by Mr. Fielding the day he gave his authorization.
If those farmers had been told that the certificate was granted, but that Mr. McCarthy had warned the minister that there was fraud, do you think they would have fetched their money to that bank? It is true that Mr. McCarthy withdrew his opposition afterwards, because owing to the proceedings taken, his clients were disinterested. But were there not facts serious enough to open the eyes of Mr. Fielding?
Upon being made aware of the judicial proceedings, Travers hastened to reimburse Mr. McCarthy's clients, because he had succeeded in shearing other sheep. Why did Mr. Fielding fail to say that to the public? If the farmers of Ontario had known what Mr. Fielding did know, who will claim that any one of them would have deposited a dollar at that bank?
Sir Edward Clouston, manager of the Bank of Montreal, president of the Bankers' Association, wrote Mr. Fielding: You have made an error, and you should withdraw this certificate at once. Did Mr. Fielding, after he was supplied with this warning, take the least step to cancel the certificate and put the public on their guard)? No. And I call the attention of the House to the fact that even if Mr. Fielding had not succeeded in withdrawing this certificate, there was a proceeding provided by the law; the Minister of
Justice in his capacity as Attorney General of Canada could have taken at once a writ of privilege to have the certificate cancelled. My hon. friends from Rouville and St, Johns know that proceeding and they will say nothing to the contrary. I assert that one can plead error on the issuing of the certificate, and every one will admit that. I claim that a politician who committed an error of that kind must acknowledge it and try to redress it, and if this had been done, $1,200,000 would not have been absorbed by the thefts and fraudulent speculations of Travers.
We are told to-day that the collapse of this bank was due to bad management and to frauds committed by Travers. I have no hesitation in saying that the former Administration led those people into error by granting the certificate-although I do not deny that they may have acted in good faith-and that those same people lost their money for that reason. And we would be told that the Government is not doing its solemn duty by reimbursing them? One cannot have it admitted that the Government is not acting correctly in this matter and in such a way as to deserve the hearty and entire support of both sides of this House.
Taking the circumstances into consideration, I understand how repugnant it is for the hon. gentlemen to the left to vote in favour of this measure, as the error in question was made by the Minister of Finance of their own Government. iSuch a vote would be tantamount to scourging their own minister. But the least I can say is that they should not come and charge this Government with doling something immoral, because it is trying to redress the error in question. By taking in the treasury the amount which is necessary to reimburse those who have sustained losses originating from the fault of the Government we are Tendering to Ceasar what is due to 'Caesar and to the farmers what is due to the farmers. Whatever may be the charges made against us, we are satisfied that we are fulfilling a duty which may be disagreeable, but which is at the same time, an imperative duty. Surely, there is nothing agreeable in taking over a million dollars to reimburse the depositors of a certain bank, when we have so many other needs for which we could make use of this money. But when a country has a revenue of $175,000,000 to $200,000,000, it would look very bad on their part to indulge in parsimony and refuse to redress a

grievance resulting from an error because false charges were dreaded. We have risen above such considerations, and the same measure of justice will be meted out to those to whom justice is 'due.


Rodolphe Lemieux: Mr. Speaker, my hon. friend has displayed so much warmth during his special plea that I expect he has a very bad case-and it is a bad case indeed. I approve unreservedly the statement made by the hon. member for St. Johns and Iberville (Mr. Demers) that this is an immoral piece of legislation. The Postmaster General stated a moment ago that this was the view taken by the Liberal party in this House because, forsooth, the Liberal party could not stand to repair an injustice committed by the late Minister of Finance, Hon. William Stevens Fielding. Let me quote from the book of books, from the most respectable Conservative paper in the land, the Montreal Gazette, published, one might say, at the very threshold of the biggest financial institution of the country, the Bank of Montreal; inspired in its financial columns by the best minds of the country. Let me read the opinion of the Montreal Gazette on this piece of legislation. On Tnursday, May 28, the Montreal Gazette said:
The demand in the case of the Quebec banks named is based on the action promised for the relief of the losers by the collapse of the Farmers Bank of Toronto. The unwisdom of such action was shown when it was first suggested. The present position only makes it more plain. It foreshadows a situation in which the Government and Parliament will be called upon to make good the losses of every failed bank. Indeed, some have regarded the action with complacency as the beginning of a Government guarantee of bank deposits, a thing that would encourage every reckless man in charge of a bank and make the national treasury a reserve fund for the incapable to draw upon for their natural losses. There is one reply that the Government can make to those who are seeking compensation for their business losses through the failure of banks in this province. It can only be made effectively and so as to cause the ministers and their party no harm after the proposal to pay the losses of Farmers Bank depositors has been abandoned. The proposal that Parliament shall vote money in aid of the Farmers Bank creditors has hurt the Government with the business community To press the measure-
Even in this House, and we all know that it will be killed by the Senate and by Conservative Senators.
To press the measure will hurt it further wherever there is a man who has lost through the failure of other banks and who will feel that he is being discriminated against. And, even in the face of a weakened opposition,

the Government is not in a position to invite hurt throughout the country for the sake of a few men-
Is the Minister of Labour in his seat? Yes, he is.
-who made unwise pledges during an election and then organized a raid to force their fulfilment.
Thus in a few terse sentences the Gazette has put the case as plainly as it can be put before the people of this country. This is obnoxious legislation and it invites reprisals. My hon. friend stated a moment ago that we on this side, the members who represent constituencies in Quebec, would ot fail in future to draw a comparison between the attitude of the Minister of Finance with respect to banks that have failed in Ontario and banks that have failed in Quebec. My hon. friend stated that we wanted to arouse the prejudices of our electors. But let me tell my hon. friend that the Banque Ville Marie, to which I shall refer in a moment, was an English bank with a French name. Therefore it is not a question of nationality and my hon. friend is enough of a business man to know that money has no nationality and deposits no sentiment. Let me refer my hon. friend to the language used in this House, not by a member belonging to the Liberal party but by an lion, gentleman who represents the Conservative traditions of the old city of Kingston, I refer to my friend Mr. Nickle. He was the first one who was generous and broad minded enough a few days ago to appeal to my hon. friend the Minister of Finance and to tell him that if he reimbursed the depositors of banks that have failed in one province he should have the courage to also reimburse the depositors of banks that have failed in other provinces. What did he say? On May the 11th my hon. friend from Kingston said:
Then we are running Into another difficulty. If recklessness and fraud were the efficient cause that led to the failure of this bank, I cannot see how we can make a distinction between a French-Canadian bank and an Ontario bank. What is law for Ontario-
Sir, the question of province was not raised by any of the French-Canadian members of this House, but it was raised very	generously by the hon. gentleman
who	represents Kingston (Mr. Nickle).
The reimbursement of the depositors in the case of La Banque de Saint-Jean, in the case of La Banque Ville Marie is not claimed as a matter of right because reimbursement of the depositors by the national treasury is not provided for in

the Bank Act. We all know that, it is the a b c of banking. But we say that if that principle is admitted in one case it should be also admitted in other cases, that if you discriminate in the case of the Farmers Bank you should extend that discrimination to the poor depositors of the Ville Marie Bank of the Bank of Saint-Jean; to my electors and the electors represented by the member for St. Johns and Iberville. I placed on the Order Paper a question with reference to the banks of our province and my hon. friend the Postmaster General finds fault with that. Why, he said you should have also mentioned all the banks that have failed in this country. I, Sir, do not represent the whole country. I represent nay electors from Rouville and from one parish alone, the parish of Marieville. 1 received petitions the other day with over one hundred signatures of depositors of the defunct Ville Marie Bank. I stand first for my electors; the hon. member for St. Johns stands first for his electors. And if the Government will undertake to say that in future the Government will reimburse depositors of other 'banks that have failed, I will stand for that principle not only for the depositors who have lost in my county but for the defrauded depositors all over the country as well.


Mr. BURNHAM:: Is that a fair statement of the case?


Rodolphe Lemieux: My hon. friend the Minister of Finance does not intend to apply that principal equally to all the provinces and to the banks of the various provinces. I charge him with having stated in this House that he intended to deliberately discriminate in favour of the Farmers Bank. On the 4th of May I asked:
Is it the intention of the Government to reimburse the depositors of the Ville Marie Bank, the Bank of St. Jean and the Banque du Peuple?
My hon. friend the Minister of Finance answered plainly and bluntly: No.


William Thomas White: I ask my hon. friend on what ground.


Rodolphe Lemieux: On what ground?


William Thomas White: Yes.


Rodolphe Lemieux: I shall prove to my hon. friend at once that if there is one scintilla of reason and justification to reimburse the depositors of the Farmers Bank, there is the same justification to reimburse the depositors of the Bank Ville Marie. I will
come to that point presently. I have here letters addressed during many years from 1892 until 1900, to the Minister of Finance by the Deputy Minister of Finance. They constitute the evidence that my hon. friend the Minister of Trade and Commerce when he was Minister of Finance of this country knew that the Ville marie Bank was a rotten institution, and I will show my hon. friend that if-


William Thomas White: What year was the Bank Ville Marie incorporated?


Rodolphe Lemieux: In 1874.


William Thomas White: My hon. friend knows
that the ground of this legislation is that the certificate of the Treasury Board should not have been issued to this bank.


Mr. GRAHAM:: Such ground does not
exist.


Rodolphe Lemieux: My hon. friend knows
perfectly well-


William Thomas White: This bank should never
have been allowed to remain in business.


Rodolphe Lemieux: Or the other bank either, and I shall establish it to the satisfaction of my hon. friend. I shall come to that in a moment. I say that this legislation is immoral because it serves only mean political motives and nothing else. The hon. gentleman cannot find a banker of repute in Canada who will approve of this legislation. I would have cited to him the name of Sir Edward Clouston, but unfortunately he has passed away. But his immediate successor, Mr. Angus, would not approve of this. Take the president of the Bank of Montreal, take the president of the Bank of Commerce and if my hon. friend can show this House that he approves of this legislation I shall vote for this Bill now before the House. I say not one banker of repute in the country favours this legislation.


William Thomas White: Does my non. friend think this House should be bound by the opinion of any individual man?


Rodolphe Lemieux: That is a very lame answer on the part of an able gentleman like the Minister of Finance. I shall go further. We have not yet heard from the Minister of Trade and Commerce. I hope we shall hear from him before this debate is over. I believe in my soul and conscience, that had he occupied the position of my hon. friend on the Treasury benches he would never have promoted this mischievous legislation. I say it and I believe

it. Sir, this is a populist piece of legislation. *We have not reached in Canada that point where just to cater to a little popularity in a few constituencies Parliament will trample upon the banking and the 'business traditions of the country. I repeat, let my hon. friend take the opinion of Sir Edmund Byron Walker, that of Sir Frederick Taylor of the Bank of Montreal, of the president of the Royal Bank of Canada and if they favour this legislation I shall accept their verdict. Not only that, but I say that the very motive which animates the hon. gentlemen in promoting this legislation is an unworthy one. It is evident that this $1,200,000 is only a tip paid to the electors of a few constituencies who were promised at the last general election that if they supported the Tory party they would get this reimbursement. Let me read quietly, while the Minister of Trade and Commerce is in this House, the petition which was sent to this Government a few months after they reached office :
At this meeting of depositors of the Farmers Bank of Canada at Pontypool, assembled, upon a motion of Mr. Thomas Hill and seconded by Mr. Geo. Douglas, it is hereby unanimously resolved after hearing read the speeches made in Parliament in March, 1911, on the Farmers Bank question by the Bight Hon. R. L. Borden, Hon. Messrs. Foster, Crothers and Hughes, and by Messrs. Armstrong, Blain, Beattie, Boyce, Donnelly, Henderson, Edwards, Porter, North-rup, Sharpe, Thornton and Taylor and others, and as in the election which was held in September last the Conservative party continued to take the attitude assumed by them in Parliament in the previous March;
And whereas promises were made that justice would be done the depositors in the event of the Conservative party being elected;
And whereas literature was circulated during the election on behalf of the Conservative party ;
And whereas the Conservative party was returned to power, the public being fully cognizant of its attitude upon the Farmers Bank question, and as nothing appears to havo been done up to the present time by the Conservative party:
Now, therefore, this meeting assembled hereby respectfully requests the Government of this country to carry out the policy on this question, upon which they were returned to power.
It is hereby requested that a copy of this resolution be forwarded to the Right Hon. R. L. Borden, and to the hon. Minister of Finance, and to C. J. Thornton, Esq., M.P.
(Sgd) M. H. Minore,
Chairman.
There we have the origin, the causa causans of this legislation. My hon. friend, so long as he speaks in English, and he speaks it beautifully, captivates and captures. But beware of him when he speaks Latin! He spoke yesterday of the causa causans. It is fine casuistry.

Last night my hon. friend the Minister of Finance was distinguishing between the efficient cause and the other causes, and he told my hon. friend from Wright (Mr. Devlin) that he should know what is in law the causa causans. Well, I hold in my hand the causa causans, and it is the petition forwarded by the Ontario voters just after the last election and mentioning the pledges given by the Conservative members to their constituents.


William Thomas White: Quote what the commissioner said.


Rodolphe Lemieux: Here is what the commissioner said:
Notwithstanding the irregularities on the part of Travers and his misconduct in connection with the application for the certificate, which I have mentioned, the evidence satisfies me that if the bank had been prudently and honestly managed there is no reason why it should not have succeeded. The promissory notes that had been given by subscribers were for the most part good and were subsequently paid, and while it is true that if the certificate of the Treasury Board had not been granted the money of the shareholders and depositors would not have been lost, the efficient cause of that loss was the recklessness and fraud of those entrusted with the management of the bank, and not the granting of the certificate.
The Postmaster General stated a moment ago that he was very sorry that Mr. Fielding was morally responsible for the failure of the bank; it was, he said, the certificate which he granted which was the invitation to so many depositors, and the first dollar deposited in that bank was deposited there because indeed Mr. Fielding bad issued the certificate. Well, it is just six o'clock, but let me tell the hon. gentleman that the farmers who deposited their money in the bank did so, not because of the certificate, but because Mr. Beattie Nesbitt, the Tory boss of Toronto, was running the whole business and doing the advertising.
At six o'clock, the House took recess.
The House resumed at eight o'clock.


Rodolphe Lemieux: Mr. Speaker, just before recess I was explaining to the House that this legislation was in my judgment, and in the judgment of unbiased people in the community, immoral, obnoxious and insidious, and if it is adopted-I hope it will never be-it will invite for the future other raids on the treasury of Canada. The duty of a minister of finance was well defined to-day by the Minister of Labour. Certainly, the Minister of Finance is the

trustee of the moneys of the people, and therefore the paramount duty of the Minister of Finance is above all to resist raids on the treasury. I said before dinner that this legislation smacks of populism, and it does. The Minister of Finance should never forget that he is the Hon. Thomas White, Minister of Finance of Canada, and that he should not leave himself open to be compared with General Coxey leading his band of raiders on the Washington treasury. The hon. gentleman should never forget that this is Ottawa, the capital city of the brightest of the overseas dominions, the Washington of the North as it has been called by D'Arcy McGee and Sir Wilfrid Laurier; this is Ottawa, but the Minister of Finance seems to think it is Oklahoma. The Minister of Finance although well-built and of magnificent stature is singularly weak; he lacks firmness and resolution, and I will explain wdiy. It is because with his undoubted ability, and his standing, he has joined the Conservative party at the eleventh hour, and having reached the summit in one gigantic stride he must do something to be forgiven his rapid ascendancy in the ranks of that party. That is why he has yielded on many occasions and that is why he yields now to the clamours of the raiders. The Minister of Finance must not forget that in his exalted position he is a leader and not a follower of men. I know he is a bookworm, and I wonder if he ever Tead Balzac's work where one of the characters said: je suis leur chef done je les suis. (I 'am their leader, therefore I follow them.)
It is admitted that in the political game, in the heat of a political campaign wild promises are often made. If I had to redeem all the promissory notes that have been signed during the last campaign, by the gentlemen I see in front of me just now, it would take the very treasury of Canada. In the heat of a general election, I say, wild promises are made, but the Government and especially the Minister of Finance is certainly not obliged to redeem all of the unscrupulous pledges. After having read the petition sent to the Government by the Tories of Ontario after the last election, I say that this legislation is the result of a political compact made during that campaign. It is playing the political game at the expense of the treasury. See how well it has been staged-it was a political game from the inception of this movement in order to seduce
the fifteen or sixteen constituents involved, and it still savours of a political game. Yes, see how well it has been staged; first a wild promise was made during the heat of the campaign in 1911; in 1912 not a word was uttered in this House in favour of the depositors; in 1913 the session passed and we heard nothing of it except in the dying days of the session a mild and vague promise made by the right hon. the Prime Minister. But we reach the year of our Lord 1914, in the month of June, in the dying days of this protracted session, just before another political campaign in the province of Ontario, and suddenly here comes the legislation which will secure the votes of the constituencies involved in the Farmers Bank. We are unfortunately accustomed to that game on the part the hon. gentlemen who sit on the Treasury benches. What happens to-day for the Farmers Bank on the eve of a provincial election in Ontario happened last year when the provincial election took place in Saskatchewan. We then saw something which had never been dreamt of in the annals of this country before; we saw the Government, by Order in Council, cutting the duty on cement by one-half in order to seduce the electors of that province, and immediately after the election these duties were put up to where they were before. In Chateauguay, in the month of October last, three or four days before the bye election, the parish of Chateauguay was bribed with a sum of $3,638.84.
This money was distributed amongst twenty-five or thirty electors just on the eve of an election in order to seduce the electors.


Mr. ROGERS:: Will my hon. friend
* excuse me, because he is making a statement which he must know is absolutely incorrect? While a certain amount of money was spent in Chateauguay basin, it was spent in fulfilment of a promise made by the late Government, who deceived the people for years by not carrying out their pledges.


Rodolphe Lemieux: I thank my hon. friend for this admission. It is true that the late member for Chateauguay had promised certain works on the river Chateauguay, but he did not ask the Government to spend that money in the turmoil of a general election. The general election passed; but when the by-election came along, my hon. friend dipped into the treasury and took out nearly $4,000, which he spent as follows:

Jean Baptiste Chevreflls, foreman, period of employment, September 22 to December 31, $308.
That is one elector.


Alexander Kenneth Maclean: What was the date of the election?


Rodolphe Lemieux: I forget the exact date; but it was at the beginning of October.
Moi'se Durangeau, labourer, September 24 to November 19, $89.07 ; JSrSmie Lussier, labourer, September 24 to December 31, $96.63.
And I have a long list. I could name the whole parish. The money was spent just at the time when the election was being carried on.


William Thomas White: When was the money voted?


Rodolphe Lemieux: I do not think the money was even voted. The money was taken out of the general appropriations of the Department of Public Works-


William Thomas White: Then it must have been voted.	,


Rodolphe Lemieux: -and it was spent after a delegation from the county of Chateau-guay had approached my hon. friend the Minister of Public Works two weeks before the election. I have the thing very vividly in my memory. My hon. friend was at the Ritz Carlton hotel, where the delegation approached him. He is much more a leader in our province than the three representatives of the province of Quebec.


Louis-Philippe Pelletier: They are proud of
him.


Rodolphe Lemieux: And he is not proud of you. This delegation came to my hon. friend and made the application for that money during the election; and he told them: Certainly, if it is the wish of the people of Chateauguay, of course, you will get the money. They got the money, and the Conservatives carried the election.


Robert Rogers: I am sure my hon. friend does not wish to do me any injustice.


Rodolphe Lemieux: No.


Robert Rogers: I do not believe I ever
met a representative from the constituency of Chateauguay at the Ritz Carlton in my life.


Rodolphe Lemieux: Was it at the Windsor?


Robert Rogers: No.


Rodolphe Lemieux: Was it at the Conservative headquarters?


Robert Rogers: Perhaps it was.


Rodolphe Lemieux: I say that this is nothing less than corruption of the worst kind. In the case of the Farmers Bank, in the case of the reduction of duties just on the eve t,'f the election ir Saskatchewan, as in the minor case of the Chateauguay by-election, it is corruption and nothing else. And when my hon. friend from St. Johns and Iberville (Mr. Demers) says that this is immoral legislation, he is stating the whole truth and nothing but the truth.
My hon. friend says that an error of judgment was made, and the commissioner has found that the Hon. Mr. Fielding unfortunately made that error of judgment. You, Sir, as an old member of the House of Commons and the Parliament of Canada, will remember when, in the eighties, the Government of Sir John A. Malcdonald subsidized the famous enterprise known as the Chignecto Marine railway in the Maritime provinces. It was subsidized and I think even the bonds were guaranteed by the Government, although I am not sure as to that point.


Robert Rogers: No.


Rodolphe Lemieux: A company was formed in London. The capital was subscribed; the work was started, and suddenly the Government withdrew their subsidies from the company. Since that time, like the ghost of Banquo, we see in the lobbies of this House every year Mr. Provand. My hon. friend knows him. We have mqt him for the last fifteen years.


Robert Rogers: He is here yet.


Rodolphe Lemieux: He represents the old
company; and he insists now, as he has insisted for fifteen or sixteen years, on obtaining from the Government of Canada a reimbursement, the payment of a debt of honour, recognized as such by Sir Charles Tupper, for instance, and by other ministers. Has my hon. friend ever yielded to the clamour of the English capitalists who lost their money in that enterprise, guaranteed toy the Government of Canada?
Let us take the case of La Banque Internationale. The Hon. Mr. Fielding, Minister of Finance-I will not say ' had refused,' because I know my hon. friend would quibble again-had declined to issue a certificate for good and valid reasons, which were stated in the document which my hon. friend found when after the 21st of September, 1911, he was sworn as Minister of Finance of Canada. What happened? In

spite of that Tefusal on the part of the Hon. Mr. Fielding to issue that certificate for good and valid reasons, six days after my hon. friend had been in office, he issued a certificate.


William Thomas White: The Hon. Mr. Fielding did not refuse to issue the certificate.


Rodolphe Lemieux: I thought my hon.
friend would quibble again.


William Thomas White: He said that, in view of
the fact that there was a change of government, without passing any opinion upon the merits of the application, it should be left for the consideration of the incoming Administration. My hon. friend will find the minutes from the Treasury Board in the answer to a question which I handed in this morning. It is not true to say that Mr. Fielding refused the application of the bank.


Rodolphe Lemieux: My hon. friend is very unfortunate. I have the document with me, and I will give my hon. friend the reasons why Mr. Fielding declined to issue this certificate:
The board having submitted to them the further papers in connection with the application of La Banque Internationale for a certificate under the provisions of the Bank Act to enable it to commence business, is of the opinion that the matter requires more consideration than can be given to it in the present state of affairs, when a change of administration is about to take place.


Some hon. MEMBERS:: Hear, hear.


Rodolphe Lemieux: Have patience. Do not give your hear, hears now.
The board, therefore, without expressing- any opinion on the merit of the application, desire to leave the papers for the consideration of the new Treasury Board.


Some hon. MEMBERS:: Hear, hear.


Rodolphe Lemieux: But that is not all.
In taking this course it is desirable to state that apart from and in addition to the questions usually engaging the attention of the board in connection with an application for the granting of a certificate to a new bank to enable it to commence business, there are some matters which call for special consideration in connection with the present application.
Notice was served on the hon. gentleman to be very careful; there were special reasons for him to pause and to ponder before issuing the certificate. There is another feature.
While the amount of capital subscribed is much greater than the amount of subscribed capital in connection with any preceding application to the board, it also appears that, out of the total allotments of stock amounting to $9,239,400 made by the provincial directors, $7,156,000 thereof has been allotted to subscribers residing and domiciled in a foreign country. The amount of stock allotted to subscribers domiciled in Canada is $2,083,400. Foreign subscribers number 191; subscribers in Canada number 183.
The large amount and large proportion of . capital subscribed abroad in its relation to the provisions of the Bank Act, with regard to the enforcement of the double liability, is one of the matters referred to.
Still another feature, still another reason to specially consider whether the application should be granted.
There is another feature connected with the foreign subscriptions to which attention may here be drawn. One of these subscriptions is for 10,000 shares-$1,000,000 of the capital stock. The subscription is made in 1 trust.' The person or persons for whom the trust is held are not disclosed. In the absence of such disclosure the subscriber for this large amount, apparently in ordinary financial circumtsances (being in charge of the Paris office of Mr. R. Forget, the president of the bank), is alone responsible, so far as the records of the bank afford information as to persons liable, for the double liability should occasion arise for enforcing the provisions of the Act in regard thereto. There is a further subscription of $250,000 by the wife of the same party.
Here-are the additional reasons given in that document whether special consideration should be given to that application.


William Thomas White: Will my hon. friend permit me to ask him a few questions ? Does he know any provision of the Bank Act under which foreign subscriptions are barred ? That is the first question. The second is: Is he not aware that, after all the foreign subscriptions are excluded, there were sufficient subscriptions of Canadian subscribers to comply with the requirements of the Bank Act ? And, further, does he know that instead of $250,000 required to be paid up by the Bank Act, a sum of nearly $1,000,000 was paid up in connection with La Banque Internationale ? And does he know, as a matter of fact, that in the case of no certificate ever issued to a bank in Canada were the provisions more strictly complied with and more amply fulfilled than in the case of this bank ?


Rodolphe Lemieux: That only confirms what I have already said about the Farmers Bank, that Mr. Fielding took every precaution which a man of judgment could take in the circumstances. If. on the other hand my hon. friend had paused for a moment when he reached the Treasury Benches, six days after he had been sworn in as minister, and

asked Mr. Fielding: How is it that you have left that document at the Treasury Board; axe there reasons why you doubt the validity of the stock which has been subscribed?-perhaps my hon. friend would have learned that at that moment it was known on the street that there was a pooling arrangement by which Canadian subscribers to the stock would not be called upon to pay more than ten per cent, but that European subscribers would pay one hundred per cent. I quoted that pooling arrangement in the House last year, and it was well known at the time my hon. friend issued the certificate. It would not have been wrong for him to have called on Mr. Fielding; he could have said to him: Mr. Fielding, you are no longer Minister of Finance it is true, but I have enough confidence in your loyalty to put some questions to you before I put my imprimatur on this certificate; why did you refuse to issue this certificate, because it is a serious matter to refuse this when apparently all of the procedure has been complied with? Here is, Sir, the pooling arrangement:
Whereas it has been deemed advisable to form a syndicate for the resale in a. proper and suitable manner of the shares of the Banque Internationale du Canada held by the shareholders of said bank who wish at a later date to dispose of all or part of their holdings. Whereas it is imperative that such operation be conducted by a manager of experience. Now, therefore, agreement witnesseth:
1.	The shareholder agrees to be a member of the syndicate formed by the present for the resale of the shares of the Banque Internationale du Canada now standing in his name.
2.	Those shares will stand pooled for the purpose of said syndicate for an irrevocable period of eighteen months.
3.	The manager will have the right and will use it in his own discretion to dispose of the pooled shares,-
Which is a huge speculation-

in all or in part at any time during the above-named period, to the best interest of the shareholders providing that a net profit of at least ten dollars a share be obtained for said shareholders.
4.	The manager will render account to the shareholders from time to time of the sales made for the syndicate account and same shall always be made pro rata to the shares of all shareholders.
5.	Any shareholders will have the privilege at any time to withdraw from sale the part of his shares which would not have then been disposed of, but said part of his shares will stand pooled until the liquidation of the syndicate and shall not be sold or disposed of by said shareholder during the life of the syndicate under penalty of having his shares forfeited for the benefit of the members of the syndicate.

Now comes the important paragraph:
6.	The manager binds and obliges himself during the life of this agreement to advance in the name and for the account of the members of the syndicate all and every call, except the first one already paid, which might be made by the Banque Internationale du Canada on the shares pooled in virtue of the present.


William Thomas White: Is the agreement illegal or unlawful and a contravention of the Bank
Act?


Rodolphe Lemieux: Without having the Bank Act under my hand, I say this was an immoral agreement, because it was transforming a legitimate banking organization with foreigners-which is still worse the majority of the capital coming from France-into a gambling speculation. Air. Speaker, I do not say that my hon. friend is guilty. In that case he made an error of judgment. Is he responsible? Shall we hold him and the Government responsible for the lose sustained by the French and the Canadian investors? Does my hon. friend know that a million dollars which was paid up was reduced to $500,000, and that to-day the name of Canada in France, one of the great lending nations of the world, is blemished? Does he not know that, since that time, no one in France will invest money in Canada? However, I am pleased to say that my hon. friend is not guilty. He made an error of judgment. If he had paused a little and consulted Mr. Fielding, La Banque Internationale would never have been organized, $500,000 would never have been lost by the subscribers to the stock in that bank, and the name of Canada would never have been besmirched. I say that errors of judgment are made even by my hon. friend; were made even by great financiers like Sir Charles Tupper and Sir -Leonard Tilley in the case of the Chignecto Alarine Railway. Sir, at the opening of the session I brought to the attention of the House the case of one Fatsari, in respect of whom a judicial error was made by one of the judges in the province of Quebec whereby that poor Italian was convicted for manslaughter and sent to penitentiary for fifteen years. Five years afterwards the judge who had convicted him discovered his error, reported to the Minister of Justice, and Fatsari was released on the eve of Christmas. Fatsari's only consolation was the partaking of his Christmas dinner in the police station at Montreal with the policeman who had arrested him five years before. He had no roof to re-

ceive him; no family to welcome him. Sir, the Government of Canada, who appointed that judge, was responsible for that conviction. The logic of the hon. gentleman is: no certificate, no bank; no bank, no failure; no failure, no reimbursement. I say: no government, no judge; no judge, no judicial error; no judicial error, no penitentiary. My hon. friend has too much common sense and ability to countenance such logic.


Mr. MIDDLEBRO:: Did the hon. member for Rouville not bring to the attention of this House the unfortunate case of the Italian whom he mentioned and ask this House if they would not do something for him because of an error of judgment?


Rodolphe Lemieux: Certainly. According to the logic of my hon. friend the Minister of Finance, any act of negligence in this country can be traced to the door of the Cabinet. Take the case of an accident on the river St. Lawrence. The pilotage system is under the benevolent eye of my hon. friend the Minister of Marine and Fisheries. Three accidents have taken place in the river St. Lawrence since the opening of navigation, due in two cases to the pilot. The companies have suffered heavy damages; they have been obliged to put their steamers in the docks at Montreal for repairs. The pilots cannot pay, but the Government can pay, and, accepting the logic of my hon. friend in respect of the Farmers Bank, any company could come to my genial friend the Minister of Marine and Fisheries and say: you buoy the river St. Lawrence; you appoint the pilots; the pilotage system is under your control; an accident happened because the pilot did not do his duty, because he was drunk or because he was blind; therefore you should reimburse the company the damages they have suffered.


John Douglas Hazen: My hon. friend would have to have them go to the pilot corporation; they control the qualification of pilots.


Rodolphe Lemieux: The pilot corporation
controls only the moneys with which the pilots are paid; they do not pay damages. Take the case of a registered letter. Suppose my hon. friend the Postmaster General, who is a prodigal, sends a registered letter to his brother or to a friend in Quebec county, containing $50 or $100. The money disappears because one of his letter carriers pilfered the letter. What recourse has the addressor against the letter carrier? He can send him to penitentiary for three years, but if he warts to get his
money back will the Postmaster General tell his deputy to refund him the money? Certainly he cannot do that.


William Thomas White: Is he supposed to
have had any notice of the dishonesty of the post office carrier?


Rodolphe Lemieux: I can tell my hon. friend that since September 21, 1911. all sorts of letter carriers have been appointed and the complaint in Montreal, Winnipeg, Quebec, Toronto and other large cities is that many letters disappear. But the point I wish to make is that the Government is not obliged to recoup the addressor of a registered letter, who nevertheless pays an .additional five cents in order to ensure safety.
Take my hon. friend the Minister of Inland Revenue. With all due regard to his apparent innocence, I say that in my judgment he stands before me to-night as a Criminal. Two years ago, when he had been in office for six months, a young nurse at Kingston gave what she supposed to be patent medicine to one of the patients at the hospital. The bottle was wrongly labelled; instead of containing patent medicine, it contained poison, and the man died. The nurse was not responsible; she administered the medicine in good faith. The bottle was labelled as being regular patent medicine and was approved by the inspector of the Government. The inspector having been appointed by the Department of Inland Revenue and the appointment having been sanctioned by my hon. friend the minister, I say that he is a criminal, that he ought to be arrested and sent to jail as the causa causans. No minister, no poison. I always suspected, Sir, that there was some poisonous substance in the outfit, to use the favourite and courteous expression of my hon. friend the Minister of Militia. Last year the Bank Act was under consideration in the committee room upstairs, and at each and every meeting	I was pleased to
see my hon.	friend the minister,
in spite of his many duties elsewhere. We amended the Bank Act and made some new provisions. There ihad been a clamour in certain parts of the country that the Government should guarantee the deposits made in the banks and should be responsible, at all events, to the depositors. My hon. friend combatted that principle and I joined with him. I am conservative enough to stand for common sense. We have no paternalism in this country. We

must distinguish as between public institutions and private institutions, and banks are private institutions of a quasi-public nature. What did my hon. friend do ? What he did I am bound to say received my support in this House. My hon. friend agreed that the list of auditors should be submitted to the Department of Finance for its imprimatur, for its approval, before their appointment. That was a very wise piece of legislation. Some representatives of the people thought that did not go far enough. For myself I dare say that this was wise and sound legislation, and 1 heartily concurred in it. This is a sound principle, but does it obligate the Government to reimburse the depositors in case of errors of judgment on the part of its officers say, if auditors are appointed by them who are not qualified? No, Mr. Speaker. But I say that by the precedent he is creating to-day, by this legislation my hon. friend is taking a leap in the dark. There will be other errors of judgment, there will be other bank failures, especially if this Government is to remain two years more in office; and the depositors will come with a vengeance and say: If you had one justice for the province of Ontario you must have a similar justice for the other provinces of the Dominion. I say that as the Bank Act reads to-day there is no reimbursement provided by law. That is the language I held when I was appealed to-yes, and if I speak with some warmth upon this subject it is because I have been appealed to by my electors in the county of Eouville, where many orphans and widows were ruined by the failure of the Ville Marie bank. That is the language I held. I said to them: No, the Government does not reimburse depositors. That is what Mr. Fielding said when Mr. Monk, the late member for Jacques Cartier, appealed to him to obtain the reimbursement of the depositors of the banque Ville Marie. This is the language which I am sure the hon. Minister of Trade and Commerce would have held if he had been the Minister of Finance when the Farmers Bank depositors appealed to my hon. friend. I am sorry the Minister of Finance was not in the House when his colleague the Postmaster General spoke this afternoon; did my hon. friend follow well what the Postmaster General said this afternoon ? The Postmaster General seized the weakness of the position taken by the Government in this case. He knows that in his own province depositors of the Banque du Peuple, the Banque Ville 
Marie and of the Banque St. Jean, and if there are survivors amongst the victims of the Mechanics Bank and other old institutions that failed in the past, he knows that they will appeal to him and that they will say: As you have paid depositors of the Farmers Bank who were the victims of fraud and recklessness on the part of Travers and his associates, so you will reimburse us who were victims of Bousquet of the Banque du Peuple, of Weir of the Banque Ville Marie. What did the Postmaster General promise? This afternoon he said in so many words that there had been no petitions, but that if they petitioned the Government, they would examine very closely their case. They would grant an investigation, and if it was proved that they were defrauded they would reimburse them as they now do with the Farmers Bank depositors. Did my hon. friend accept that principle as laid down by his colleague? Does he know that this will happen as sure as the sun will rise to-morrow morning? The Postmaster General asked; did the depositors of these defunct banks ever .appeal to the Government ? As he is new in this House I can forgive him his ignorance. As a matter of fact, in my knowledge, during the last seventeen years, I and other members have placed on the table of this House petitions from depositors in those three .banks; yes, many of the members on both sides of the House who. have been here since 1896 and before that have laid such petitions on the table. But what was the answer made by Mr. Fielding? What was his answer to our late colleague, Mr. Monk, when in 1900 Mr. Monk argued as my hon. friend, the Minister of Labour, argued this afternoon, as my hon. friend from North Ontario (Mr. Sharpe) will argue in a few moments, what was the answer made by the then Minister of Finance? He did not yield to pressure brought upon him by either his opponents or his own political friends. I myself approached Mr. Fielding and I said to him:	There has 'been fraud, there
has been recklessness in the administration oif the Banque Ville-Marie, the Government ought to reimburse the depositors. What was the answer made by Mr. Fielding, to all these requests? The Government was all powerful, it had a large majority behind it; everything was plain sailing. It was in the year 1900 and we were just fresh from a general election. Mr. Fielding answered as follows

' It is necessary to remember that a bank is only a private corporation doing business with the public. True, it is a corporation around which the Government throws more than the usual guards and checks and the public gets the benefit of these guards and cheeks; but surely it is not to be assumed that because an effort is made by the Government to ' throw around the banks additional guards and checks of unusual character, the Government becomes responsible for the whole business.' That was the attitude of a fearless statesman, of one who had the courage to stand in front of both friend and foe and to hold that dignified language. Mr. Speaker, the depositors of the Banque Ville Marie, of the Banque du Peuple, of the Banque St. Jean petitioned the Government and Mr. Fielding answered; No, this is not the business of the Government. Now with this legislation they can come again, they can again petition the Government. If you had read the petition I hold in my hand, Mr. Speaker, you would realize that its language is quite different from that of former years. The depositors now take their hint from the dangerous legislation, the perfidious, obnoxious legislation introduced by my hon. friend the present Minister of Finance. Three or four hundred people w'ere utterly ruined in my county by the failure of the bank Ville Marie, and they have signed this petition,:
We the undersigned depositors in La Banque Ville Marie pray you to present such legislation during this session of Parliament that we may be reimbursed of the deposits made by us in the said bank.
And, listen to this paragraph:
We believe that we are entitled to respectfully insist that this reimbursement should be made because of the legislation introduced by you reimbursing the depositors of the Farmers Bank.
Shall I read the names, Mr. Speaker, of the old and the young, of the widows and orphans, who were ruined in the county of Rouville by the mismanagement of La Banque Ville Marie-mismanagement which was known to the hon. Minister of Trade and Commerce (Mr. Foster) when he was Finance Minister of Canada, as I shall prove in a minute?
What is the history of La Banque Ville-Marie? When t'he failure happened the bank had over 3,000 depositors, all farmers or labourers, in the district of Montreal. They were, as we say in French, belonging to la petite bourgeoisie. The bank was organized in 1874 with a capital of 300


REVISED
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$1,000,000. There were two issues of stock: the first for $<600,000, and the second for $400,000, which completed the $1,000,000. In 1881, the directors found it necessary to reduce the stock to half a million dollars, and even then all the shares were not held by bona fide stockholders. Though apparently the bank had that much paid up capital, it appears, and it is a fact, that only $300,000 was fully paid up. The failure of the bank was caused by clear dereliction of duty within and outside the bank, and, what is worse, the Government knew of the mismanagement during all those years. The late Mr. Monk, then member for Jacques Cartier, brought this matter up in the House, after having moved for a return of the correspondence and papers exchanged between the Department of Finance and the directors and officials of La Banque Ville Marie since January 1, 1890. The first letter, dated March 3, 1892, is addressed by
9 p.m. Mr. Courteney, then deputy Minister of Finance, to Robert Sedge-wick, K.C., deputy Minister of Justice, who later on became one of the judges of the Supreme Court of Canada. I am sorry to weary the House by reading these letters, but I am making a case for the depositors of La Banque Ville Marie in my constituency. The letter reads as follows:
Sir,-I have the honour to call your attention to section 51 of the Bank Act, under which banks may issue notes for circulation to the extent of their unimpaired paid-up capital, and to say that the Banque Ville Marie has under the provisions of the Act issued notes varying since last July from $330,500 to $470,115. The bank makes a return of a subscribed capital of $500,000, and a paid-up capital of $479,250. The difference between the subscribed and paid-up capital appears from the return just received of shareholders of the bank on the 31st December last to be caused by the cancellations of shares on which no payments had been made and in a few cases from his shares not being fully paid up.
He adds that:
Thirty shares of this bank were sold on Monday last on the Montreal market at 85. I have therefore to ask whether, seeing the position of the bank as evidenced by this quotation and the fact that a great portion of its stock is held in suspense and in trust, the Government, under the Act, should take any action in the matter and if so in what direction. I shall be glad to be generally advised on the subject at your earliest convenience.
He then writes to Mr. Weir, the president of the bank, who answers that he is not well but will be in Ottawa in a few days, and will then explain. On the 29th July, Mr. Court-

[Stage Direction]
ney writes to the Deputy Minister of Justice as follows:
Sir,-I have the honour to call your attention to my letter of the 3rd March last in reference to the position of the Bank Ville Marie, in which I ask to be informed whether in view of such position, the Government should under the Act take any action in the matter and in what direction. I have not yet received a reply to my letter of the 3rd March and I should be glad to be advised on the subject at your very earliest convenience.
Notice was given by the Deputy Minister of Finance that the bank was violating the law. Mr. Courtney writes to Mr. Weir on the 29th July as follows:
Sir,-I have the honour to call your attention to the fact that in the last returns from your bank the subscribed capital is stated at $370,500 in place of $500,000 in previous returns.
I beg also to call your attention to section 28 of the Bank Act which provides for reductions of capital stock only on approval of the Treasury Board, and as no such approval has been given, I shall be obliged if you will kindly explain your action in the matter. I shall be glad to hear from you at your earliest convenience.
Mr. SAM. SHARPE: What year was that?
Rodolphe Lemieux: 1892. The mismanagement of the bank was known to the old Conservative Administration, as I shall prove in a minute. Later on, Mr. Weir agrees to reduce the capital of the bank, and Mr. Courtney, the deputy minister, writes to Mr. Weir on the 2nd August, 1892, as follows:
Dear Sir,-I am in receipt of your letter of the 1st inst., respecting the reduction of the capital stock of your bank. I will have to make a report on the subject to the Minister of Finance, but as he is now absent from Ottawa X presume nothing will be done until after his return.
The affairs of the bank were going from bad to worse, and the state of affairs was known to the public. Mr. Courtney, in the following letter, dated September 21, 1892, gives notice of the mismanagement to the Finance Minister:
Hon. Geo.* E. Foster,
Minister of Finance,
Ottawa.
Dear Mr. Foster,-I enclose a memo, respecting the Banque Ville Marie to which I beg to call your early and careful attention. Practically the bank has scarcely any capital and is trading on its note circulation and deposits. The Montreal Gazette quotes the stock as buyers 77J, sellers 90. I think the concern should be closed up.
This letter was dated the 21st of September, 1892, and the bank was allowed to continue its reckless existence until 1900 when thousands of people were ruined because there was no capital. Yet, Mr. Courtney, watch-
[Mr. Lemleux.j
dog of thb treasury, had notified Mr. Foster, then Minister of Finances. Mr. Courtney sends a memorandum; evidently he was somewhat nervous at the news he received every day about the condition of the bank; and the conclusion of- that memorandum, dated 21st September, 1892, read as follows:
The undersigned, in view of all the circumstances detailed above, begs to recommend that a special return be asked for from the bank, under section 86 of the Bank Act, and that in addition to the information suggested by the Deputy Minister of Justice, the hank he asked to give details of the item under the head of assets, '21 other assets not included under the foregoing heads'-the amount under this head being for the month of August last, $196,852.60, out of total assets amounting to $1,495,636.05.
With reference to the withdrawal of the Dominion Government account amounting to about $19,000, the undersigned recommends that the same be withdrawn and the account closed.
He also recommends that the bank be compelled to comply with the provisions of the Bank Act, and ask the Treasury Board for its sanction to reduce the capital stock.
Respectfully submitted,
J. M. Courtney, Deputy Minister of Finance.
Sir, was not the Minister of Finance of that day made aware of the mismanagement oif this, bank and of the fraud which was perpetrated? The deputy minister asked authority from the minister to close the bank, and he asked also that the Government deposit of $19,000 in the bank be withdrawn.


William Thomas White: Under what provision of
the Bank Act had the minister any power to close the bank or interfere with its management; iwhat authority under the Bank Act had he except to call for a special return, and where was the negligence?


Rodolphe Lemieux: My friend knows that there aTe ways that are dark and tricks that are mean, and a man can apparently be clothed with all the authority of law and be a pure scoundrel, as was the manager of the Ville Marie Bank. Mr. Weir presented returns every month, that appeared very clear and very honest, but notwithstanding all these returns Mr. Courtney knew what was taking place and he was advising his minister all the time to close the bank and withdraw the Government deposit.


William Thomas White: What authority was there to close the bank?


Rodolphe Lemieux: The authority of common sense.


William Thomas White: What provision was there in the Bank Act, enabling the minister to

interfere with the management of the bank? What could the minister do under the Act except to call for a special return.


Rodolphe Lemieux: The best answer I can
give to my hon. friend is that on receiving that letter the Minister of Finance gave orders to Mr. Courtney to withdraw the Government deposit.


William Thomas White: That is not closing the
bank.


Rodolphe Lemieux: Mr. Courtney said it
should be closed and Mr. Foster, then Minister of Finance, was expressly notified. Mr. Fielding was told by the member for Halton (Mr. Henderson) and by others, that there seemed to be something very strange about the organization of the Farmers Bank. Mr. Fielding's answer was that the provisional directors had complied with the law, as they had. Sir, if you pay the depositors in one ease, assigning as a reason that Mr. Fielding was forewarned, so must you pay the depositors in the case of the Ville Marie Bank because o:f negligence and error of judgment on the part of the then Minister of Finance in not closing the bank when so warned by his deputy. My hon. friend cannot get ou't of it.


William Thomas White: There was no authority to close the bank.


Rodolphe Lemieux: If my hon. friend had, with respect to the Farmers Bank, a case against the Hon. Mr. Fielding as strong as the case presented here against the Minister of Finance in the Conservative Government in connection with the Ville Marie Bank, I would not speak this evening; I would be ashamed to mention the matter at all. But let us compare the two cases. Mr. Courtney notified Mr. Weir on the 22nd of September, 1892, as follows:
Sir,-X have the honour to inform you that I have duly submitted to the Minister of Finance the recent correspondence between ourselves relating: to the reduction of the capital stock of the Banque Ville Marie, and I am directed to inform you that the Minister of Finance is advised that the reduction of capital must be duly sanctioned by the Treasury Board under section 28 of the Banking Act.
I must ask you to take immediate steps to comply with the Act inasmuch as there is a time limit imposed in the section quoted.
J. M. Courtney.


William Thomas White: Where was there any negligence in that?


Rodolphe Lemieux: This letter says to the manager of the Ville Marie Bank:	You
must do something within a certain time,
and if you forego doing it you violate the 300i
law. Let us go a little farther, there is something still worse. Mr. Courtney writes to Mr. Weir on September 28, 1892:
Mr. Weir will immediately take steps to bring about a reduction of capital to $300,000.
Mind you, at that time the circulation of the bank exceeded1 the capital by something like $200,000.
He will reduce his circulation at once to that limit. He has promised to keep the assets in a shape to satisfy the Treasury Board. The Government balance to be reduced to $5,000, and not to be increased.
A fine institution that, which is not deemed strong enough to receive a deposit of $5,000 by the Government. The correspondence is a long series of notices and signal dangers.


An hon. MEMBER:: Danger signals.


Rodolphe Lemieux: Yes, danger signals; I put the cart before the oxen, as the Minister of Finance has done in the case of the legislation now before us. Mr. Sedgewick, the Deputy Minister of Justice, on the 20th of October, 1892, answered the letter dated July, 1892. With all due respect to the memory of the late Justice Sedgewick, and he was a splendid man and an excellent judge and a gentleman of courtly manners, but as the Prime Minister knows, he was slow at times before answering letters. In October, 1892, Mr. Sedgewick, Deputy Minister of Justice, wrote to the secretary of the Finance Department:
Sir,-I have the honour to acknowledge the receipt of your letter of the 18th instant, stating that prior to June last the Bank Ville Marie stated in its monthly returns that the subscribed capital was $500,000 and the paid-up capital $479,250, and that in the returns for June and subsequent months the subscribed capital was given at $370,500 and. the paid up capital at $350,000 ; and stating further that no application had been made to the Treasury Board for sanction of the by-law providing for the reduction of capital; and you ask three questions, which by direction of the Minister of Justice I beg to answer as follows:
(1)	Whether the reduction of the capital can be made without the sanction of the Treasury Board? A. It cannot.
(2)	Whether the by-law authorizing this reduction is absolutely void, or merely voidable as would seem to be the view of the legal advisers of the bank? A. The by-law in question was a mere step in the proceedings necessary under the ' Bank Act ' to lawfully make a reduction of the bank's capital. The by-law itself could have no operation until approved by the Treasury Board, but more than three months having elapsed since it was passed it is now absolutely void and inoperative for any purpose under section 28 of ' the Bank Act
In the opinion of the Minister of Justice, the advice given to the bank by its legal adviser, as stated in the president's letter of the

14th instant, cannot be supported, and the action of the bank in changing their books and making other returns as if the by-law had been approved is illegal.
(3)	Whether the officials of the bank, who sign the returns to the Government in the present shape are liable to the penalties prescribed under section 99 of 'The Bank Act?' A. From the facts as they appear in the papers they are not liable. The offence there specified is the making of any wilfully false or deceptive statements, whereas, the action of the bank officials in the present case appears to be rather the result of a mistaken opinion or judgment upon a matter of law upon which they have consulted their legal adviser.
(Sgd) Robert Sedgewick.
Deputy Minister of Justice.
This is all very tedious, yet illuminating at the same time, because we have there the evidence that the bank was violating the law; that the Government was advised of it; that the monthly statements were not made by the president of the bank. By this return I see that nearly every month the Deputy Minister of Finance had to wire Mr. Weir to send in his monthly statement.


William Thomas White: Was that negligence on the part of the Department of Finance? Was not the circulation, during the latter part of that particular year in question, in which he says: ' The consent of the Treasury Board was not obtained to the reduction in note circulation ' kept, as a matter of fact, within $350,000? I have information that it was. I should think the Deputy Minister of Finance was very diligent.


Rodolphe Lemieux: Yes, he was very diligent.	;


William Thomas White: Then what are you complaining about?


Rodolphe Lemieux: Suppose that I was the president of the bank and that every month, owing to the violation of the law by me, my hon. friend was obliged to wire me to send in my monthly return? What would he think of me? Would he not have a vague suspicion that I was not only violating the law, but defrauding the public doing business with me? In answer to my hon. friend's second question as regards the circulation my hon. friend will get a Roland for an Oliver here because this is tne very gist of the case. As I stated a moment ago, it had been agreed that Mr. Weir should reduce the note circulation of the bank to the amount of the capital stock, which was $300,000. Let us see:
1893, month of July, circulation, $326,150.
Violation of the law.

August 31, circulation, $316,595.
Violation of the law.
September 30, circulation, $306,790.
Violation of the law.
October 31, circulation, $346,185.
Violation of the law.
November 30, circulation $320,070.
Violation of the law.
December 31.
Another violation of the law.
1894, September 30, circulation $339,390.
Another violation of the law.


William Thomas White: What was the paid-up
capital as reduced by the by-law in June, 1902? Was it not $350,000?


Rodolphe Lemieux: That does not appear by this.


William Thomas White: It is a fact.


Rodolphe Lemieux: Mr. Courtney does not say so. He complains all along that Mr. Weir goes beyond the capital stock of the bank, and 'besides Mr. Courtney forced Mr. Weir to explain some of the assets of the bank and to wipe them out. Mr. Weir, when arrested-I remember his trial, $nd the Postmaster General knows about it-was sent to jail precisely because he violated the law, by representing as assets what were liabilities-


William Thomas White: Where is the negligence on the part of Mr. Courtney?


Rodolphe Lemieux: There is no negligence.


William Thomas White: If there is no negligence on the part of Mr. Courtney, my hon. friend's argument is absurd.


Rodolphe Lemieux: My hon. friend is making my case. I do not say that Mr. Courtney is guilty of negligence; but I say that if Mr. Courtney, during all those years, notified the then Minister of Finance, the Hon. Mr. Foster, that Mr. Weir and the directors of La Banque Ville Marie, were violating the law, should not the Government be held responsible for the failure of that bank? You to-day hold the late Government as responsible for the failure of the Farmers Bank, because the certificate was issued by the Hon. Mr. Fielding. Well, of the two cases, if there is one where the Government should reimburse the depositors, I say it is the case of La Banque Ville Marie. I am not a populist; I am not a demagogue; I do not wish to defeat the provisions of the Bank Act. I voted with my

hon. friend last year, and I stood by him when he said that the Government should supervise the appointment of proper auditors; but when my hon. friend refused to listen to the appeals of my hon. friend from North Ontario (Mr. Sharpe) and some other hon. members, who asked that the Government should guarantee the depositors against all losses, I stood against this proposition. Let my hon. friend understand me; I am still with him; but my hon. friend is without the law; I am within the law. My hon. friend ignores his own child. He wishes to reimburse the depositors of the Farmers Bank, when he himself last year refused to amend the Bank Act in that direction. If my hon. friend reimburses the Farmers Bank depositors I protest against it. I say lit is not wise policy, it is a discrimination. If my hon. friend discriminates for the depositors in the Farmers Bank, he will do it for the depositors of La Banque Ville Marie. I represent them; as my hon. friend the Minister of Labour, as my hon. friend from North Ontario, as fifteen other hon. members on the other side of the House represent the depositors in the Farmers Bank. But if my hon. friend does not proceed with this legislation, I agree to return to my electors in Rouville and say: Gentlemen, I stand to-day where I stood many years ago when you urged us to make a pressure on Mr. Fielding and to get from him a reimbursement. Surely, Sir, there must .be one law for every province, and not one la.w for Ontario and another for Quebec. Equal justice, equal rights. My hon. friend knows the value of equal rights. I am an equal rightist. My hon. friend will not, I hope, surrender to the clamours of political gamesters, and I will undertake not to make any pressure upon this Government or upon any other government for the depositors of La Banque Ville Marie. But I say, if you do yield to the clamour of your political friends in order to secure some constituencies in Ontario, be fair, be just, and equally open the treasury to the poor depositors of the Ville Marie Bank, the widows and orphans who are in a similar or worst position.


William Thomas White: Where is your negligence?


Rodolphe Lemieux: Mountains of evidence, Mr. Speaker.


William Thomas White: Absolutely no negligence
at -all.


Rodolphe Lemieux: For ten years the watchdog of the treasury, Mr. Cburtney, notified the then Minister of Finance that Mr. Weir was violating the law openly, in fact, he violated it every month in 1893 and 1894. The circulation of the bank exceeded the paid-up capital. What happened? The bank was doing no other business except to make hauls at the expense of depositors. A system was adopted by this bank of pilfering innocent, and in many cases ignorant people both in the country parts and in the city of Montreal. We find that by this confidence game it got -an immense -amount of money in places where you would not think it possible they could get so much. In fact, it was proven, when the case came before the court of King's Bench im Montreal, that Mir. Weir was giving increases of salary to the young bank clerks o.f his 'bank inasmuch as they would, increase the amount of deposits in their respective districts and decrease- the loans and the discount business of the bank. In Mais-on-neuve, for instance, they opened a branch in 1899; they took in deposits $17,000 and they only did a business of $12,000. In 1898 they opened a branch at Sit. Loui-s du Mile End, a suburb of Montreal; the deposits were $31,000, land only $4,000 of business; all the rest was sent into Montreal. At Ormstown, they opened -a branch in 1898, they had deposits of $30,000 and $8,000 of business. In May 1898. they opened a branch in Ch-aboillez Square, in the division of my hon. friend the Minister of Justice (Mr. Doherty). Here they made a tremendous haul; they got $44,500 in deposits, and did a business of $4,000, not enough to pay one smiall employee of the bank. But all this money was sent into the head office. At Marieville, in my county, a branch was opened in June, 1897; they had deposits of $70,000 and $4,000 of business. At Longueuil a branch was opened in 1897; they had $43,000 of deposits, $2,000 of business, and $41,000 was shipped into Montreal. At Chia-mbly, a branch was opened in December, 1896; they had $39,000 of deposits, and $9,000 of business. At Papineauville, in the county of Labelle, a branch was opened in 1896. They took $70,000 of deposits and did a business of only $10,000 of discounts. I know, as a matter of fact, that a very distinguished family, well known in this House, one of whose members was one of the most prominent members of this House, was practically ruined by the failure. In Nicolet they took nearly $70,000, and the discounts were $30,000. At L'Epiphanie they had deposits

to the extent of $98,000 and only $16,000 under discount. At Lachine, they had nearly $60,000 of deposits and $35,000 of business. At St. Laurent, Jacques Cartier county, the deposits were $65,000, and they did $35,000 business. That is the way the Ville Marie Bank managed its affairs with the knowledge of the Finance Minister of the day.
One fact which is very striking appears in one of the letters that Mr. Weir wrote, insisting on getting deposits from the Government.


George Perry Graham: The Farmers Bank did that too.


Rodolphe Lemieux: Yes, from the Ontario Government, through Mr. Beattie Nesbitt, who had many friends. Mr. Weir was a friend of the Government of the day. Under date of November 7, 1894, he says:
The reduction of our circulation will, of course, affect our earning power, and when, in addition to this, you reduce your deposit with us from the old average of $20,000, to about $5,000, you are placing us at a considerable disadvantage. I notice that the Hochelaga and Jacques Cartier Banks continue to hold an average of from $18,000 to $20,000 of your deposits, and I think the work we do is equal, at least to that of the former. At no time in the history of the bank has its position been equal to what it is to-day, and I cannot conceive why you should apparently discriminate against us.
And here is the typical answer of honest Mr. Courtney to Mr. Weir:
T have your letter of yesterday, in which, after treating of your note issue, you compare the balances due to the Government and held by the Hochelaga and Jacques Cartier Banks as against the balance held by the Ville Marie.
I presume depositors in controlling their bank balances take other matters into consideration besides the amount of work performed-in the case of the two banks to which you refer there is no shareholders' stock in suspense.
Does my hon. friend not see the irony of the Deputy Minister of Finance ? Mr. Weir is pleading and praying for larger Government deposits in his bank, and Mr. Courtney says: Well, my dear friend, ' depositors in controlling their bank balances take other matters into consideration besides the amount of work performed-in the case of the two banks to which you refer there is no shareholders' stock in suspense.' In other words, Mr. Foster was advised, if not. daily, at least weekly, by his faithful watchdog, honest Mr. Courtney, that this bank was mismanaged and was violating the law. Mr. Foster let matters drift and a few years afterwards the failure of the bank occurred, ruining, as I said, at

least three thousand depositors, not to speak of the bona fide shareholders. The duty of the Finance Minister of the day was to see that the law was carried out. In 1892 from sworn returns sent to the department, the bank was at fault.
Then, as regards the diminution of stock, the agreement with the Department of Finance had been violated, and the Government knew of its continuous violation. During that year the bank was dilatory in sending in its monthly statements. Letter after letter and telegram after telegram were sent to M(r. Weir, the president of the bank, from whom more or less lame excuses were always given. The quotations on the Montreal stock market showed that the shares of the bank when listed were sold at seventy-seven on the dollar; and finally none amongst the stock brokers would attempt to sell one of that bank's shares.


Robert Laird Borden: Does my hon. friend suggest that that is just ground for closing the bank ?
iMr. LEMIEUX: Oh, no. But my hon.
friend has listened to what I have read before, and I appeal to him now, whether, if he had been Minister of Finance and had been told by Mr. Courtney that such conditions existed, the bank should have been closed? If Mr. Courtney had told my hon. friend that, according to the monthly statements of the president and directors of the bank, the circulation exceeded their paid-up capital, in violation of the law, would my hon. friend have maintained that institution? Would he not have followed the advice given by Mr. Courtney, closed the bank, if need be, or, at all events, have taken some drastic action to protect the public?


Robert Laird Borden: I affirm that under the law at that time, and under the law at the present time, the Government has not the power to close a bank; a bank can be put in liquidation only in one way, and that is in the manner prescribed in the Bank Act. I challenge my hon. friend to produce a provision which enables the Government to do otherwise.


Rodolphe Lemieux: Could not the Government have taken criminal proceedings when Mr. Weir was violating the Bank Act, when Mr. Foster had to withdraw the funds of the Government from the bank, and when Mr. Courtney was plainly telling Mr. Weir: You want to 'get our deposits, *but there are other considerations than

those adduced toy you in your report. We should close your bank.


Robert Laird Borden: I do not believe that there is a legal bank in Canada that had not, during the past ten years, permitted circulation at one time or other to exceed the limit prescribed by law.


Rodolphe Lemieux: False returns have never been allowed. No, Mr. Speaker, the duty of the Government was to see that the law was carried out as regards the stock issue and as regards circulation. My hon. friend is, I will not say too good a banker, but he is too interested a stockholder in reliable and safe banks not to believe that. He would not invest his money in a bank administered as the Ville Marie Bank was at that time. There is no question as to what the Minister of Finance would say if he were asked: Where will you put your personal savings, in La Banque Ville Marie, which Mr. Courtney denounced as violating the law, or in the Bank of Montreal, the Royal Bank, the Bank of Commerce, or in any of the other banking institutions which are operated according to the Bank Act? This was the contention of our late friend and colleague, Mr. Monk. In his opinion, the Attorney General should have taken proceedings against the bank for unobservance of the 'law. The bank might have been deprived of its charter by writ of scire facias. At all events, Sir, the Government should have investigated, and the public being thus warned the bank would have ceased to open branches in order to make the great hauls which it made on the savings of the poor people. When the bank failed1 the circulation was $515,000, and the bank redeemed over $200,000 of illegal circulation. It was proved that the bank manager speculated with the funds of the bank, and I am told this evening that there was nothing under the law to compel that bank to stop its illegalities, its mismanagement and its fraud. Sir, I am no demagogue; I am no populist; I say that I am satisfied with the law as it stands, with the safeguards and the protection that is provided by the Bank Act, which was promoted by my hon. friend the present Minister of Finance. I do say, however, to my hon. friend that he must have one law for al'l Canadians, not one law for one class of people and another law for another class. I repeat that this legislation is obnoxious and perfidious, and that it is condemned by the best minds not only
in the Liberal party but in the Conservative party as well. My hon. friend knows that and I challenge him once more to produce oefore this debate is over one single opinion of one single financier or 'banker of repute in Canada favouring this legislation. The hon. gentleman cannot do it; he cannot accept the challenge. Nay, more, I know as a fact that my hon. friend from the moment that he intimated that he would introduce this measure received letter after letter protesting against this legislation.


William Thomas White: I desire to say to my hon. friend that I had not one single communication from anybody protesting against this legislation. Although I have not discussed the matter with more than one or two bankers, one of the most distinguished bankers in this country, a man who is at the head of one of the greatest institutions in Canada, has given his opinion that this Government is morally bound to reimburse the depositors of the Farmers Bank.


Rodolphe Lemieux: Well, that banker- is
more of a Tory heeler than he is a banker.


William Thomas White: He is not a Tory heeler; he occupies one of the most distinguished positions in the banking fraternity.


Rodolphe Lemieux: Is it a written opinion? It is not a written opinion, no banker would dare affix his signature to such an opinion.


William Thomas White: Does my hon. friend think that I would ask the written opinion of anybody as to what legislation I should introduce into this House? This Government is quite confident, if I may be permitted to say so, to judge of the legislation which it introduced here without obtaining the opinion of bankers in the matter, no matter how eminent they may be.


Rodolphe Lemieux: I say that that one
opinion is the exception which proves tne rule. My hon. friend has received the opinion of one gentleman-


William Thomas White: And none against.


Rodolphe Lemieux: Let my hon. friend canvass the banking fraternity with regard to this matter. They are, under the control of my hon. friend; he is at the head of the banking interests ot this country; he is the fountain of all the finances of Canada. Has my hon. friend read the Montreal Gazette and the Star?


William Thomas White: Oh, yes.


Rodolphe Lemieux: The Montreal Gazette
says that this is obnoxious legislation; the financial press of this country condemns it. I point out again that my hon. friend will not find one banker of repute who will openly stand up for this legislation. He may receive the whispering opinion of a sycophant; some one may whisper to him: Mr. White, you are doing exceedingly, marvellously well; by the way. cannot you give some government deposits to my bank? I defy him, however, to get the opinion of Sir Edmund Byron Walker, of the Bank of Commerce, that of Sir William Taylor, of Mr. Meredith both of the Bank of Montreal, that of Mr. Angus, or that of the president of the Royal Bank in support of this Bill. I challenge my hon. friend to show that any of these distinguished financiers will ever say that the Government of Canada should on the one hand reimburse for political purposes some depositors in the province of Ontario while ignoring in Quebec the other unfortunate depositors who through fraud and recklessness, as in the present instance, have been deprived of their savings and have been ruined thereby.


Mr. SAMUEL SHARPE (North Ontario):: This House has been in session upwards of five months and I have trespassed upon its time only for a couple of hours during the whole of the session; consequently 1 do not think that it is necessary for me to offer any apology to the House for occupying .a few moments in discussing this legislation, which is of importance to the constituency which I have the honour to represent. I listened with a great deal of interest to the vehement and savage attack which the hon. member for Rouville (Mr. Lemieux) made upon this legislation.


Rodolphe Lemieux: Not savage.


Samuel Simpson Sharpe: ested, so I make no apology for discussing this legislation respecting the most appalling financial disaster in the province of Ontario -appalling not so much for the amount involved as for the great number of poor people engulfed in the disaster. Ruin and desolation and even hunger face many hundreds of these depositors, and the Minister of Finance and the Government ought to be commended for their action, founded as it is upon sufficient and justifiabje grounds, in bringing forward this legislation and implementing the policy of the Conservative party when in opposition. In my opinion, the responsibility for this loss to the depositors rests upon the shoulders primarily of one man, and one man alone, and that is the ex-Minister of Finance, Mr. Fielding. The certificate was obtained by fraud. That, is found by Sir William R. Meredith. Notice that the fraud which was being perpetrated on the department was given to the exMinister of Finance, but he did nothing. I am not going to recapitulate the history of all the notices that were served upon the Minister of Finance as to the fraud that was being perpetrated on his department. Our esteemed and respected friend the hon. member for Halton (Mr. Henderson), the hon. member for West Toronto (Sir	Edmund	Osier),	SirEdward Clouston, and Mr. Leighton McCarthy, an ex-member of this House, sent warning after	warning	to
the department of the most serious nature saying that fraud was being perpetrated. It was proven that perjury had been committed by Travers, and had the minister followed up the notices he had received he would have seen that the warnings given him by these gentlemen were well founded. Not only did the ex-Minister of Finance receive notices before the certificate was issued, but shortly after the bank started operations he received confirmation of the previous warnings from Mr. Van-coughnet of the Farmers Bank at Milton. The letter which Mr. Vancoughnet wrote to the department is on file and confirms all the warnings that Mr. Fielding had received, and if the department was not satisfied with the notices it had received prior to the issue of the certificate, there should have been no hesitation whatever in accepting the letter of Mr. Vancoughnet, who was in the employ of the Farmers Bank and who gave facts within his own knowledge to the Department of Finance. Having received notice prior to and after the certificate had been issued, what was the duty 
of the department? Primarily, it was to see that the provisions of the Bank Act were carried out. The provisions of the Bank Act were violated entirely and the department should never have issued the certificate. AfteT the certificate had been issued it was the duty of the department to recall it upon receiving notices that the same had been, obtained by fraud and on that point I differ from Sir William Meredith, who finds that there: was no provision or power to recall the certificate. I think the arm of the law is sufficiently long to reach out and draw back a certificate that has been obtained by fraud, and in my opinion the Government of the day would have had no difficulty in issuing a writ and securing an order restraining Travers from acting upon the certificate. They should have refused the certificate in the first place, but, having granted it they should have withdrawn it. If they felt that they had no legal authority to withdraw the certificate, they should have had Travers arrested for perjury, thereby giving notice to the whole world that Travers was a perjurer and was not worthy of confidence, and then no business would have been transacted by the bank. The least they should have done was to warn the public against doing business with a bank manager who had obtained his certificate by fraud, but the Department of Finance was apparently paralyzed and could not act. It was speechless apparently, and could not warn the public in a matter of this kind. It gave this riotous concern authority to go out on its wild career to commit depredations in the rich agricultural sections of Ontario. Three men were primarily responsible for this, and if the veil could be withdrawn from the secrets that are hidden behind this whole transaction, if the light of day were thrown upon it, the disclosures would shock the whole Dominion of Canada. The late member for West Peterboro was one of the men primarily responsible for this disaster. Through the instrumentality of his loan company and his money Travers illegally made a deposit of $250,000. The next man that was responsible for this certificate being obtained was W. S. Calvert, then chief Libetal whip, and there was a very peculiar and significant intimacy between Calvert and Travers. The evidence shows conclusively that W. S. Calvert, who in influence and authority in this House was next to a Cabinet Minister, secured large loans from

Travers. The evidence shows that from $3,000 to $5,000 had been paid to somebody in Ottawa for securing this certificate. We all know that there was a cheque with a 'C' marked upon it. Mr. Travers seems to have mesmerized the chief Liberal whip on that occasion. We find that the intimacy was so great that in addition to lending him large sums of money, Travers offered Calvert a directorship in the bank. I do not know why Mr. Calvert should have been offered a directorship except that he was influential in the Liberal party and it might have been expected that if there was any difficulty in securing the certificate, he would use his influence, and it has been conclusively proved that his influence was used in that direction. Notwithstanding the repeated warnings to the department, Travers got his certificate clothing him with authority to transact the important business of banking in the province of Ontario.


Daniel Duncan McKenzie: It is only fair as Mr. Calvert was once a member of this House and is not a member now that we should defend him as far as we can. Where does the hon. member find the evidence 10 p.m. against Mr. Calvert that justifies him in the statements he has made?


Samuel Simpson Sharpe: I have hot the evidence. It is a peculiar and significant fact that any member who asks for a copy of the evidence cannot get it. I understood that a great many copies were ordered to be printed. I have sent up repeatedly to the Distribution office for a copy, but the evidence is so damaging that it seems to have mysteriously disappeared. I have only been able to get two copies so far.


Daniel Duncan McKenzie: I have read Mr. Calvert's evidence under the most severe cross-examination by the Government's lawyer, and there is not a scintilla of evidence to justify the charges made against him by the hon. member.


Samuel Simpson Sharpe: I do not, expect that Mr. Calvert admitted these things, because it would have most seriously reflected on him if he had. In addition to securing large loans through Mr. Travers from this defunct and bankrupt bank, which should never have been allowed to do business, Mr. Calvert wrote to the Customs Departs ment in Mr. Travers' favour, so that a magnificent yacht that was presented to Travers by some millionaire in Detroit was allowed to come in through the Canadian customs at one-tenth of its valuation. That
was another significant fact. Another significant fact is that Mr. Calvert, the Liberal party whip, takes it upon himself to suggest that the picture of Sir Wilfrid Laurier might be placed upon the bills of the Farmers Bank. I say that the intimacy between Mr. Calvert and Mr. Travers was most significant.


Alexander Kenneth Maclean: Did he get the consent of Sir James Whitney to put his picture on the bills?


Samuel Simpson Sharpe: I will read the letter if the hon. member has the curiosity to hear what it is?


Alexander Kenneth Maclean: Answer my question.


Samuel Simpson Sharpe: It would have been something of a political asset to the Liberal party, no doubt, if the picture of their leader had been placed on the bills of the Farmers Bank and scattered all over the Dominion. It was stated in this House, and it has been stated since, that Mr. Travers, because of the gratitude in his bosom for this certificate and for all the favours he received, made a large contribution to the $100,000 testimonal which the ex-Minister of Finance received. That has never been denied.


Edmond Proulx: Where is the evidence of that?


Samuel Simpson Sharpe: Where is the contradiction of that fact? The hon. member for Algoma moved in this House that a list of the subscribers to the Fielding testimonial be placed on the table of the House, so that the public would know who subscribed, but that motion was voted down by the Liberals then in power.
There were three members of this House at the time primarily responsible for the issue of that illegal certificate, namely, the ex-member for West Peterborough, Mr. Stratton, the ex-member for West Middlesex, Mr. Calvert, chief whip of the Liberal party, and the Hon. Mr. Fielding, who granted it in face of all the warnings he received. I do not wish to impute any improper motives to Mr. Fielding, but I say that in view of all the suspicious circumstances the lid should be lifted off this whole transaction, and the full light of day let in. There is only one justification for this legislation, and that justification is to be found in the negligence and laches of tne Finance Department under Mr. Fielding. Any hon. member who votes for this Bill must vote in condemnation of the

Finance Department and of the ex-Minister of Finance. The member for West Middlesex (Mr. Ross), the member for North Oxford (Mr. Nesbitt), and every other hon. gentleman who votes for this Bill must vote for it upon that ground and upon that ground alone. The members who support this legislation are not coming here asking for alms from this Government; we are not asking for mercy or for generosity for the sufferers, we are asking for mere justice on account of the negligence, the default, the delinquency of the ex-Minister of Finance and his department. The hon. gentlemen who votes for this Bill must vote in condemnation of the ex-Minister of Finance. You can sugar-coat the pill as you like, but that is the dose hon. gentlemen on the other side must swallow, who vote for this Bill. The hon. member for Middlesex swallowed the pill with a gulp and a grimace, and the hon. member for North Oxford (Mr. Nesbitt) will ha/ve to do the same thing. I say that had the ex-Minister of Finance been alert and diligent in the discharge of his duties, there would have been no certificate issued to permit this man to go out on the highways and byways of the great province of Ontario and defraud the people out of thousands and thousands of dollars.
Some hon. gentlemen opposite have told us that they want some legal justification for this legislation and they have asked upon what legal grounds are we seeking restitution to the sufferers. I am not sure that the Liberal party, in its long history, nor yet the Conservative party, in voting money, have always acted strictly on legal grounds. But I have legal analogy for this legislation. There is the case of Ryiands vs. Fletcher, a leading case in, English law familiar to all lawyers, and that lays down the principle that where a man has a dangerous thing under his control and through his negligence he allows it to escape and it does damage to his neighbour, he is responsible for all consequential damages. If a man starts a fire on his premises, and through his negligence he allows the fire to escape and to do damage to the property of his neighbour, he is responsible for the damage done.


Edmond Proulx: The case you cited was
a water case.


Samuel Simpson Sharpe: Yes, the defendant owned a reservoir, and through his negligence the reservoir broke and the water flooded the property of his neighbour, and the owner of the reservoir was held responsible. In

this case we had a dangerous man who could be controlled by the Finance Department, clothed by that department with authority to go out and do a banking business, when he never should have been allowed to do it, and on this legal analogy which I have cited the Finance Department is responsible for consequential damages. There is another case which affords legal analogy for this. I have in my hand a copy of the Washington Treaty of 1871, in connection with the Alabama claims, on account of which England had to pay $15,500,000.


Daniel Duncan McKenzie: Far-fetched.


Samuel Simpson Sharpe: I will read the finding of the arbitrators, and I do not think the hon. member will then say it is far-fetched. Everybody is familiar with the Alabama case in which England was found guilty of negligence in allowing the steamer Alabama to be equipped in her harbours and sail from them, after notice from the Government of the United States


Rodolphe Lemieux: This is the King's birthday, and it is a good day for a patriotic speech.


Samuel Simpson Sharpe: We have heard a great deal in this debate about what is the efficient cause, and what is the proximate cause, and what is the causa causans, but no person can draw sufficiently on his imagination to say that the proximate cause, or the efficient cause of damages in the Alabama affair was the equipment of the ship and the sailing of the ship from an English harbour. The proximate cause was the depredation that was committed by the Alabama when she got on the high seas.


Daniel Duncan McKenzie: The Alabama case is always regarded as bad international lav/.


Samuel Simpson Sharpe: The distinguished arbitrators who made the findings should scarcely be charged as being bad lawyers even by such an eminent and distinguished authority as the hon. member (Mr. McKenzie), who descended from the dizzy heights of a county court judgeship to become a member of this House.


Mr. G. E. FOSTER:: Oh, what a fall!


Samuel Simpson Sharpe: With all due respect to the hon. member for North Cape Breton,
I would prefer the authority of the distinguished men who sat on the Alabama claims, to his. At all events England was held responsible by these arbitrators for allowing the Alabama to be fitted out in her harbours, and, after due

notice from the United States, to set sail. The fitting out of the ship was not the efficient cause or the proximate cause or the causa causans of the damage that was done to United States commerce. It was the depredation done by the ship after she got out of port on the high sea. That is identically the case here. Mr. Travers was a dangerous character, a man whose character and reputation was well known to the ex-Minister of Finance. He was clothed with authority in the shape of a bank certificate; he organized his bank, and he went through the province of Ontario, with the result that his bank failed on account of his mismanagement. Let me read part of the findings in the case of the Alabama:
And especially that it omitted-
That is, the British Government.
-notwithstanding the warnings and official representations made by the diplomatic agents of the United States during the construction of the said number 290, to take in due time any effective measures of prevention, and that those orders which it did give at last, for the detention of the vessel, were issued so late that their execution was not practicable;
And whereas, after the escape of that vessel, the measures taken for its pursuit and arrest were so imperfect as to lead to no result, and therefore cannot be considered sufficient to release Great Britain from the responsibility already incurred ;
And whereas the Government of Her Britannic Majesty cannot justify itself for a failure in due diligence on the plea of the insufficiency of the legal means of action which it possessed.
Four of the arbitrators for these reasons found against Great Britain, and Great Britain paid $15,000,000 in connection with these claims.
I would refer also to the debate in the British House of Commons in regard to this matter. I think that even the hon. member for North Cape Breton (Mr. McKenzie) will not dispute such an eminent authority as John Stuart Mill. He was quite favourable to having this matter submitted to arbitration. On page 1194, under date of March 6, 1868, in the debate in the British House of Commons, John Stuart Mill made this observation:
It would have in fact to ascertain the real damage which the commerce of the United States had received from this act of negligence on our part in letting the Alabama leave our ports.
It was an act of negligence in allowing the ship to leave port. The fitting out of the ship was not the proximate cause of the damage done to United States commerce; it was the allowing of the ship to go out of port on the high sea.


Mr. WILLIAM CHISHOLM:: Is it not
a fact that the court held that, because the Alabama was fitted out for what was in law an illegal purpose, she was held to be responsible for any damage she caused? In the case of Travers he was not fitted out for any illegal purpose, but for a legal purpose. The analogy does not hold good.


Samuel Simpson Sharpe: I presume that international law is founded not only upon equity and justice, but upon common sense, and we are asking that the question under discussion be treated in the same way. The Minister of Finance, knowing Mr. Travers' character, clothes him with authority to go throughout the province and do damage to a great many of the electors. Consequently the Government is morally responsible. Hon. members speak about legal responsibility. Every one knows that, no matter how negligent a minister may be in discharging the duties of his office, there is no legal liability.


Daniel Duncan McKenzie: I am sure the hon.
member is anxious to be fair. He made the statement that the certificate was given to Mr. Travers in spite of the evidence that he was a rascal. Where is that evidence?


Samuel Simpson Sharpe: Mr. Leighton McCarthy's letter. I have not had time to read it, but it has been read over and over again in this House. It sets out a list of six+een or seventeen frauds perpetrated upon the shareholders of the Farmers Bank. Those charges were verified by an affidavit of Mr. William Laidlaw, K.C., an eminent counsel of the city of Toronto. What further evidence would the minister require?
Referring to the debate in the British House of Commons, I want to point out what the late Right Hon. William E. Gladstone said:
The question of whether any what may fairly be called laches can be charged against us in the case, I take to be the very question which ' is to be referred.
Both John Stuart Mill and the Right Hon. William E. Gladstone were speaking in favour of referring this to arbitration, and saying it was wholly a question to be decided whether the Government had been negligent in allowing this vessel to be fitted out in her port and in allowing it to leave her port, after the United States had given notice that it should not be allowed to do so. The ex-Minister of Finance, however, knowing that Mr. Travers had perjured himself,

knowing that he had falsified his statements repeatedly, gave him, so to speak, letters of marque to go out upon the high seas of finance of the province of Ontario and secure deposits from amongst the poor people throughout the length and breadth of the land. This is an analogous case so far as liability is concerned; but in the case of a Government, we are not permitted to issue writs, we are not permitted to sue, and consequently we appear relying upon our just moral claims and upon the legal analogy of this case.
As I said before, the considerations which move governments are not always legal considerations. The hon. member for North Perth (Mr. Morphy) showed that the Liberal Government had paid out large sums of money at different times for worthy objects. There is plenty of justification for this legislation. We are appealing upon our rights, on the ground alone of the negligence of a responsible minister of the Crown in issuing a certificate to a notorious character, after having received notice that he was a notorious character. There is far more justification for us to pay these claims arising out of the negligence on the part of the Minister of Finance than for the Liberals to pay the losses in respect of the Quebec bridge. The Hon. Mr. Fielding, in reply to the hon. member for Hatton, some years ago, said:
In the judgment of the Government, it would he contrary to public policy to recoup the losses of any class of investors from the public treasury.
That was the ground upon wihich he based his refusal to reimburse the depositors of the Farmers Bank. Were not these losses in respect to the Quebec bridge recouped? Who were the responsible men in connection with the Quebec Bridge Company? Political friends of the leader of the Opposition, for instance, the Hon. Mr. Parent, Prime Minister of the province of Quebec, mayor of Quebec, and chairman of the Transcontinental. These men had only invested some $15,400 in this enterprise, and the Liberal Government paid them, not only the money they had put into that enterprise, but the par value of their stock, $265,000, plus interest at 5 per cent to December, 1908, with ten per cent bonus on their money, after the institution was bankrupt, a total of $555,279. Is not that recouping the losses of investors in connection with private investments of this character? The Liberal Government paid to the Bank of Montreal interest on

the bank's loans and interest on interest in arrears, a total of $75,673. The total loss resulting to the country from the Liberal Government recouping the losses of their political friends was upwards of $7,000,000. The rich directors of the Quebec Bridge Company appealed to the hon. member for Rouville (Mr. Lemieux) and his political friends, and got relief, but the poor farmers of the province of Ontario or any other farmers appealed in vain to the Liberal Government. The rich directors put $15,000 into an enterprise and take out $555,279, and they aie relieved' from their liability to pay up the balance due on their stock. Is not that recouping the losses of investors? Is that in consonance with the principle enunciated by the hon. ex-Minister of Finance when he gave his answer to the hon. member for Halton9 But, what was worse still, the Libera] Government paid back $300,000 of a subsidy to Quebec city. Was that paid back because Quebec city had invested in a speculative enterprise along with ex-Mayor Parent, Premier of Quebec, or was it paid back because the present leader of the Opposition was representing one of the constituencies in the city of Quebec? And they attack in a most vicious and savage manner a matter of $1,200,000, grounded as it is upon a just claim owing to the negligence of a responsible minister of the Government. It is more just to pay these claims than to have paid those caused by the loss of the Quebec bridge, or to have handed over millions of dollars in timber limits, grazing leases and water-powers to party favorites, or to have squandered $40,000,000 on the Transcontinental, or to have payed three-quarters of a million to political contractors like M. P. and J. T. Davis in connection with their two contracts on the Transcontinental which they had received notice should be cancelled. It is far more justifiable to pay this sum than it was for the ex-Minister of Public Works-I regret he is not now in his place -after the defeat of his Government to sell the Chats Falls for $13,000 or $15,000 to certain of his friends, for which they are now demanding three million dollars from the Hydro-Electric. It is more justifiable to give $1,200,000 to the depositors of the Farmers Bank, than to squander a million dollars in the constituency of Newmarket for the purpose of holding it to the political leanings of the Liberal party. It is more Justifiable to pass this legislation than it is to squander $3,000,000 in connec-

tion with the Transcona shops. There was no scintilla of justification in expending $3,000,000 in excess of the $1,500,000 which the commissioners arranged to spend on those shops. Why add to the list? We could go on and add to it ad infinitum, because the Liberal party's record has been one of reckless extravagance all through its history. But I do. not wish to occupy the time of the House. I do desire to say that we rest our case absolutely and entirely upon the report of the commissioner. There is plenty of justification-we are not asking for alms or generosity from this Government-in the findings of the chief commissioner, Sir William Meredith. I want to read at page 8 from his report:
My conclusion on this branch of the inquiry is that the Treasury Board was induced to give its certificate by false and fraudulent representations on the part of Travers.
Further on he says:
The officials of the Department of Finance appear to have treated Mr. McCarthy's letter as if it had never existed, and in my opinion, in that they erred.
He says further:
That Travers' letter did not contain the assurances for which the minister had asked.
If it did contain such assurances, it should not have been relied upon by the minister in view of the notices from gentlemen of standing without an inquiry.
And this is the crux of the whole situation :
Such an inquiry could easily have been made and the delay occasioned by it would have been inconsiderable, and such an inquiry would undoubtedly have resulted in the discovery of the manner in which the $100,000 had been raised and in the refusal of the Treasury Board to give the certificate.
The certificate was obtained by fraud, warnings of which had been repeatedly served upon the Finance Department; and I say that there is a strong contrast in the treatment meted out to the people by the Reform party and the Liberal-Conservative party on this matter. Deputation after deputation waited upon the ex-Premier and his Minister of Finance, who turned deaf ears to their entreaties, because they could not vote this money without condemning the Finance Department and its minister. The very vote would have been a condemnation, consequently how could the right hon. the leader of the Opposition, then Prime Minister, justify a vote to recoup the losses? They could not do it.
Then we have two resolutions proposed by the Liberal-Conservative party. Our policy was placed on the records of ' Hansard.' The first resolution was moved by the hon. member for Halton (Mr. Henderson) on March 15, 1911, as follows:
That all the words after the word 'that ' in the proposed motion be omitted and the following substituted therefor:
This House is of opinion that a Royal Commission should forthwith issue to inquire into and investigate the incorporation and organization of the Farmers Bank of Canada, and the granting of a certificate by the Treasury Board permitting said bank to issue notes and transact business, and all the circumstances connected therewith; and generally to inquire into and investigate the operation and efficiency of the Bank Act in relation to the affairs and transactions of said bank.
That resolution merely asked for an investigation, and the vote was 62 for and 97 against; and the hon. members for West Middlesex (Mr. Ross) and North Oxford (Mr. Nesbitt) voted against even an investigation. Yet now they come forward, when they know the Bill will pass, and try to get on the band wagon and shout in favour of the Bill, so that they can go back to their constituents and tell how they voted for this Bill. In that respect they resemble the hon. members for Nova Scotia who for years voted against a resolution looking towards recognizing the claims of the Fenian Raid veterans, hut as soon as a bounty Bill was brought down by the Conservative party we find them climbing on the band wagon and voting for the legislation. Then we have the motion by the former member for South Simcoe (Mr. Lennox) on May 2, 1911, which was as follows:
That all the words after the word 'that ' in the proposed motion be omitted and the following substituted therefor:
This House regrets that in permitting the Farmers Bank of Canada to commence and to continue business, the Minister of Finance and the Treasury Board failed to exercise such proper care and to take such reasonable precautions as were necessary to prevent evasion of the law and to protect the public interest.
I can say that these resolutions frankly, fairly and succinctly placed the policy of the Conservative party before the people, and if the Conservative party had done less than they have done to-day they would have been recreant to the promises made and policy adopted when in opposition.
The ex-Minister of Finance stated succinctly what the position of the Reform party was. He said to the hon. member for Halton:
There is no need of the appointment of a Royal Commission. Should anything arise later

to indicate that the investigation is insufficient, the question can be further considered.
Replying to the latter part of the hon. gentleman's question, the Government deeply regret that a number of people who are not well able to bear the loss are likely to suffer from the failure of he bank, but in the judgment of the Government it would be contrary to public policy to recoup the losses of any class of investors from the public treasury.
We have the junior member for Halifax (Mr. A. K. Maclean) two sessions ago making this statement of his position that:
The appointment of such commission will be both useless and mischievous and that it is to be regretted that the Government ever appointed such a commission for such a purpose.
I say there is a strong contrast between the treatment meted out to these depositors by the Liberal party and that accorded to them by the Liberal-Conservative party. When we came into power we immediately appointed a commission to investigate. Hon. gentlemen say that there has been delay in connection with this matter; that if the depositors have a moral claim upon the Government, we were a long time implementing our obligations and working out a method of relief.


An hon. MEMBER:: Hear, hear.


Samuel Simpson Sharpe: I want to tell the hon.
gentleman who said ' hear, hear,' that the Conservative party came into power in the fall of 1911 and on February 12, 1912, a commission was appointed to investigate the circumstances connected with the failure of the Farmers Bank.
I most emphatically deny that I ever promised my electors that those who had suffered in connection with the failure of the bank would receive any relief if the Conservative party were returned to power. In June, before there was any cloud on the political horizon and before an election was even anticipated, the bank failed. A meeting was held in the village of Zephyr, where there was a branch of this bank, and I addressed the electors there and tried to assist in any way I could those who were affected by this financial disaster. I told these electors then that in my humble opinion, if the Conservative party came into power, they would get no relief fur the simple reason that- the banking institutions and millionaires to whom the hon. member for Rouville referred as being apposed to this legislation would oppose such a course, and that no party would be strong enough to resist that influence. I am glad to say, however, that the Liberal-Conservative party has risen above that influence. In 1908 at Zephyr my majority was eleven; in 1911,

when the Farmers Bank question was supposed to be an issue, my majority was only seven. I made no promises in the matter; I simply assisted the electors and tried to alleviate to the extent of my ability their losses, telling them what procedure to follow in order to recover, if possible, some of the moneys which they had lost.


Edmond Proulx: That is what the hon.
member said in June; what did he say in September?


Samuel Simpson Sharpe: At a meeting which I
held there ini September the hall was crowded; people came to hear the question of reciprocity discussed and I never mentioned the Farmers Bank. Mr. James Arnold, ex-reeve of the township of scott and president of the township of Scott Reform Association, will corroborate everything I say in this regard. He said to me afterward. Sharpe, you did not lead us into any hope that relief would be granted even if the Conservative party came 'into power. Conservatives in this House have been maligned by the press and by hon. gentlemen opposite in connection with our alleged attitude in regard to this matter.


John Howard Sinclair: Does my hon. friend
suggest that it would be improper for a candidate to promise that if he were elected he would vote for the payment of these claims?


Samuel Simpson Sharpe: I intend to discuss that
phase of the matter in a moment. The township of Scott deposited in the Farmers Bank some few days before the failure $6,000 or $7,000 in taxes. My majority in the township of Scott in 1908 was 42 and in 1911 it was increased by 16, but my whole majority in the Tiding increased from 200 to 558, so that the increase in that township could not in any way be attributed to my attitude in regard to the Farmers Bank. I submit, however, that I would have been justified in going to the people of my constituency and saying: our policy is upon the pages of ' Hansard ' ;we purpose carrying it out. We will appoint a commission to investigate the matter and if the finding of the commission justifies relief, we will grant it. When a Conservative makes a promise of that kind, it is bribery, but when a Liberal makes such a promise it is euphemistically termed a declaration of policy. The leader of the Opposition in 1904 went all over the West promising the Grand Trunk

Pacific railway; election after election he promised the Hudson Bay railway. That is euphemistically termed a declaration of policy, but if the same promises were made by hon. gentlemen on this side they would be charged with bribing the electors. The National Transcontinental railway was held out as bait to the electors of the provinces of Ontario and Quebec and the Maritime provinces by the present leader of the Opposition; that was a declaration of policy on the part of the Reform party, but if a member on this side did that, it would be bribery. A post office was promised to the village of Uxbridge. On the eve of the election a man was sent from the Public Works Department to take an option on all the vacant lots in the town. That was not bribery; that was a declaration of policy that if the Liberal party came into power they would build the post office. When Sir Allen Ayles-worth occupied the important judicial position of Minister of Justice, a telegram was sent to Hon. Mr. Harty, of Kingston, on the eve of the election of 1911 asserting that the wages of the guards in the penitentiary would be increased if the Liberal party were returned to power. That was a declaration of policy, but if it were done by a Conservative it would be bribery. In the city of Ottawa, where there are five or six thousand civil servants, on the eve of the election the leader of the Opposition promised the civil servants relief from certain conditions and increase of salaries. That was a declaration of policy on the part of the Liberals, but would be bribery on the part of Conservatives. It would be bribery for the Liberal-Conservative party to go to their constituents and say, in connection with the Farmers Bank: We will promise you an investigation and if the findings of the commissioner justify it, we will grant you relief; but if this were done by the Liberals it would be termed a declaration of policy.	-
I regret that the hon. member for Kingston (Mr. Nickle) is not in his seat. I have great respect for the opinions of the hon. member for Kingston; he and I are personal friends, and I have great admiration for his ability. The hon. gentleman has attained a wonderful degree of popularity among the Liberals of late. In the Reform paper in my constituency a long article, called the Ottawa letter, prepared by the Liberal organization of this city, is full of what the hon. member for Kingston said with regard to the Farmers Bank. He says that it is 301
pernicious and obnoxious legislation. Last year the hon. member for Kingston stated to more than one gentleman that he was willing to pay fifty or sixty per cent of the losses to the depositors of the Farmers Bank. If under this legislation we pay 100 per cent and the legislation is described as a pernicious and obnoxious precedent, what kind of precedent would it be if we paid fifty or sixty per cent? The hon. member for Kingston knows perfectly well that this legislation does not establish an obnoxious and pernicious precedent. The hon. member for Kingston was a member	of the	Banking	and	Commerce Committee and took an active part in its proceedings last session. He knows that the hon. Minister of Finance made certain amendments to the Bank Act which preclude the possibility of any failure occurring by reason of a certificate being illegally obtained from the department. If the present Bank Act precludes further possibility of failure under those circumstances, how can this legislation establish a pernicious and obnoxious precedent? It does not do so, because a failure similar to that of the Farmers Bank can never occur under the present law.
The most regrettable part of the speech of the hon. member for Kingston was the sectional appeal which he made. He said that this was discriminating legislation, and oh, howthe hon.member iforRouville rolled that sweet morsel around his tongue. But the hon. member for Kingston stirred up a sectional appeal in connection with this matter. I think there is enough sectional strife in this country without injecting it into a discussion of this kind. Many Ontario banks have failed besides the Farmers Bank and there is no intention on the part of the Government to recoup their losses. The Farmers Bank presents peculiar features and all other banks in Canada, if they present similar features and can establish a claim on the same basis as the Farmers Bank, should be entitled to relief. Many Ontario banks have failed and this Government are not recouping their losses.


Daniel Duncan McKenzie: Is this a declaration of policy or a promise?


Samuel Simpson Sharpe: I am not declaring the
policy, the hon. gentleman does me too much honour to think that I can annunciate a policy for the Liberal-Conservative party. I am asserting my own views. I say that many Ontario banks have failed besides the Farmers Bank. There have been regret-



table failures in Quebec. There is no parallel between the failures of these banks and the failure of the Farmers Bank. The Farmers Bank presents exceptional and peculiar features and I say it was unfair and regrettable on the part of the hon. member for Kingston to go out of his way to inject the sectional appeal and say there was discrimination against Quebec in favour of an Ontario institution.


Daniel Duncan McKenzie: He has been incorrigible lately.


Samuel Simpson Sharpe: the manager of a certain bank gave me as a reason to justify such refusal. I admit that there may he something true in this objection if the inspection were to have a result of that kind, but then, if the banks do not want an inspection which would bring full comfort to the public, they should accept to be responsible severally for the deposits of the public.
We know that our banks establish branch banks everywhere in our farming communities. There is even a competition beyond measure to that effect. For what purpose is that departure intended? For the benefit of the public in the localities where such branches are established? No, but merely for the purpose of draining the savings of those communities and of bringing them to the cities where they are made use of to promote the great financial interests of the big wigs who speculate in those cities, always to their own personal profit, and never to the advantage of the public. I pray you to believe it, Mr. Speaker, millions and millions have been sent over to the New York market in this same view. And what happens in the meantime? If a farmer who is worth $5,000, $ 10.000, $20,000 or even $50,000, wishes to borrow $50 or $100 on his own note, the managers of those branch banks are instructed to answer that they have no funds, and, moreover, that he is not in business and that the bank deals only with merchants and manufacturers. Nevertheless, this farmer offers a far better security than the speculator in the cities, whose credit rests entirely on hopes and not on realities. Is it not time that such a system should be reformed? For my part, I would like to see the law amended so as to remedy that condition of things which is so detrimental to the farmers, who supply such a large proportion of the deposits made at the banks. There lies an evil which the hon. Minister of Finance should study, in order to cure it.
It is true that the 'Government does not care much about the farmers. We had an instance of that no later than this year. A delegation of the western farmers, composed of two thousand men, came to Ottawa and asked the Government to allow their wheat to get into the United States duty free, and the Government refused, although this new arrangement would not have cost the country a single cent. At the same time, two railway magnates, Messrs. Mackenzie and Mann applied to the Government and obtained $45,OCO,000

right away. Why? Because the Government are not defeated by the farmers or by the workingmen, as they have not the -means to contribute millions to the election fund.
1 am not surprised, after that, to see that my name has been struck off the list of members composing the Committee on Banking and Commerce. I suppose it was thought that a farmer had nothing to do there or that I would insist for serious reforms in the administration of the great corporations and of the banks. I do not complain of that personally, but I find that the revision of the Bank Act, which was made last year, is far from giving satisfaction to the public. It was made in order to satisfy the big wigs of finance, but not in the interest of the mass of the people, and yet, the funds are supplied by the people. See what happens in France, for instance. Is it not a fact that the farmers by their savings painfully and slowly amassed in the wool stocking, form those millions which are added to the national wealth every year? So it is, to a great extent, in the province of Quebec. You would be surprised to see the amounts which are laid aside and locked up in almost every one of our houses out in the country. If the Government would put the banks under the solitary obligation of reimbursing the deposits of the public, all that money would be deposited in our banks and would mean so much more help to our trade, to our commerce and to our enterprises of all kinds.
Such a measure would be not only in the interest of the depositors but in tlie interest of the country at large. To show that the public has no confidence in the banks because they do not offer that guarantee, I ' may say that I have done business in my district for twenty years and that my cheques have often remained four or five and even twenty months unexchamged. Why? Because the farmers who did not need any money at that moment preferred to keep the cheques which I gave them, rather than to deposit those cheques at the bank. You could not imagine to what extent the farmers have become fearful since a few years, especially since the failure of the banks I have alluded to.
Reverting to the question of the Farmers Bank, I may say that the Montreal Gazette, a Conservative organ, has blamed this measure of Government. For my part, I would support this legislation if it applied to all the banks which have failed; but what

is unjust, to my mind, is the fact of reimbursing the depositors of a bank and of taking the money of the depositors who have sustained losses elsewhere, to do that favour, for the depositors in my county who have suffered from the failure of those banks will pay their share of those $1,200,000 given to the depositors of the Farmers Bank. I am not of the opinion of the Montreal Gazette, nor of the other papers which support this same view. I am broader than that, because I would like everybody to be reimbursed. I am glad to acknowledge that there is a man in this House who was frank, and it is the Minister of Labour (Mr. Crothers). In fact, he admitted having declared, during the campaign of 1911, that if he were elected and if his party came to power, he would see that the depositors of the Farmers Bank were reimbursed. I congratulate him for his frankness. I would like to know where were our French-Canadian ministers when the Minister of Labour asserted the rights of the depositors of the Farmers Bank, because, ministers, we also have some. We have the Postmaster General, the Minister of Inland Revenue, the Secretary of 'State and the Minister of Justice, the one who is so well paid. How is it that our four ministers from the province of Quebec could not find arguments strong enough to have the rights of the depositors in the province of Quebec acknowledged also? Judging of the Postmaster General by his conduct in this House, I think he is able to make himself heard in the council. Since he had such a success with his padlocks, as my neighbour says, why should he not have achieved a success in behalf of those depositors also, if he so desired?
I am sorry the Postmaster General is not present in his seat. Speaking this afternoon after my hon. friend from St. John (Mr. Demers), he said that we, the Liberals from the province of Quebec, were to resort to demagogy on this question; that because the Borden Government will reimburse the depositors of the Farmers Bank, we were to go and denounce this Government throughout the whole province, crying out that they pay the English-speaking people of Ontario, but that they do nothing for the Canadians of the province of Quebec. He added: ' You dare not do that in the House, but you will do it in the province, you are accustomed to that kind of thing.' The Postmaster General had changed his way of discussing, since a few years. I might say that I was first educated in politics at the
school of the Postmaster General, in the county of Laprairie, where I was born. It was in 1886-1887. The hon. minister dealt with politics in behalf of the national party of that time and he was one of those who knew best how to swing Riel's hanging rope and what to say of Sir John A. Macdonald, whom he called the old firebrand and the old Orangeman.
I think the hon. minister is known-all over the province of Quebec. He has changed to a great extent from 1886 to 1911. I should not go very far back, as I think the hon. members sitting around me have not forgotten the position he took in 1911. Several of those who support him in this House have also changed their opinion to a great extent. They were all opposed to the present Prime Minister. They had other chiefs, they were against all contribution. Nothing should be done, they said, before the people had been consulted. If the Postmaster General wants a self-examination to be made, let him examine his own self first.
The hon. member for North Ontario (Mr. Sharpe) did not dwell at very great length upon the question we are now dealing with; he rather spoke of the Quebec bridge and of the Transcontinental. He should have alluded, at least in a few words, to the Minister of Public Works (Mr. Rogers), who sold, at Prince Albert, for $10, a piece of land worth $375,000. He should have alluded also to his famous colonel, the Minister of Militia, who, as it was established before the Committee on Public Accounts, bought for military purposes, near Dorval, a piece of land called Bonni-Belair, from a certain party who realized thereby $100,000 profit in a few days.
I may say, in conclusion, that I am sorry the Government has brought in such a measure in the dying days of the session. This is no surprise to me, after all, for things have been done so under all governments.
Towards the end of the session, the sittings begin at eleven o'clock in the morning, and last till a very late hour of the night. Of course, this system is very tiresome for the members of the House, and if they complain of it they are told to go to bed and that the expedition of business will be going on without their help. By the fact, the questions of public interest cannot be given all the attention which they deserve, and then, the millions and the measures of the utmost importance are voted too rapidly. This is not reasonable

for the country nor for the members, and we should come back to a system of common sense.
If this measure coming to the rescue of the depositors had been more general and had included all the banks which have failed, I would have voted in favour of it, and gladly so. I am sorry I cannot give such a vote under the circumstances, for those depositors have all my sympathy. I say the Government's measure is but half a measure and that it will not satisfy the people. Therefore, I shall vote against this Bill because it is incomplete.


Mr. DAVID HENDERSON (Halton):: the bank there were four farmers from my county on the board of directors. It is needless to Say that the training of a farmer does not qualify him so well for the management of {in institution of that kind as does a business training, and in that way I felt . there was a danger in placing these gentlemen upon the board. The wily Travers, who secured control of the affairs of this bank, no doubt was very soon able to deceive these men and to use them as he thought fit, and I believe that the farmers were not responsible for the wreck of the bank, but rather the man who misled them. The donwfall of this bank began when the certificate of the Treasury Board was granted. Everything was safe before that. The money was paid in so far as it had been subscribed and collected; but when the certificate was given and Mr. Travers was enabled to open the doors of his various brandies, to solicit deposits, and to use the money of the bank for any such purpose as he wanted, then the downfall of the bank began. That is the regrettable part of the -whole matter. Had there been no certificate, as has been said here time and again, there would have been no bank. Had there been no bank, there would have been no deposits. Had there been no deposits, there would have been no losses. The inception of this trouble began with the granting of the certificate by the Treasury Board to enable Travers to open this bank, and I intend to direct myself to that point. That was the cause of the trouble, the crucial point. It was perfectly legitimate to secure subscriptions to the amount of $500,000 and to collect all the money due on those subscriptions; but unfortunately there was not sufficient money realized to make the deposit necessary to secure the certificate, and in order to do that, a large amount of money had to be borrowed. The investigation of Sir William Meredith shows that at least $100,000 was raised in other ways than the legitimate method of getting it from stock subscriptions in order to get the certificate to enable the bank to open its doors. I understood the hon. junior member for Halifax (Mr. Maclean), who spoke last night, to say that it was only a small matter even if the Bank Act had been evaded to the extent that it was; that it should not have been fatal; that it was one of those things which might have eventually cured itself. To my mind, it was an illegal transaction and it was the first downward step of the bank. In my opinion, the ex-Minister of Finance was respon-
sible for that, because he was the man to grant the certificate.
Mr. MeKENZIE:	Will the hon. member please tell me what he considers illegal -the giving of notes for subscriptions or the raising of money upon the notes after they were signed; or does he consider both illegal?


David Henderson: I consider the whole transaction of going outside of the Bank Act in order to raise money for the purpose of obtaining the certificate an illegal transaction. I am not going to say that it was illegal to take a man's note if he had not the money to pay for his stock, but I think it was certainly an illegal transaction to discount that note in a bank or a trust company to raise money in order to obtain the certificate necessary for the opening of the bank.
Mr. MeKENZIE: Would the hon. member be good enough to tell the House which section of the Bank Act provides against what was done?


David Henderson: I think the hon.
member for North Cape Breton is just as familiar with the Bank Act as I am-I dare say a good deal more so.
Mr. MeKENZIE: I cannot find the section.


David Henderson: 
Mr. GERMAN:: He withdrew it all.


David Henderson: He withdrew all but the essence. He withdrew his letter, but he left the impression upon the minister's mind. He did not withdraw one figment of what was conveyed to the Minister of Finance, that wrong had been done.


John Howard Sinclair: He not only withdrew it, but made the distinct statement that
subscriptions were taken up by other people.	.


David Henderson: Yes, I quite understand that. Subscriptions, I believe, were taken up by a gentleman named Lindsay, who went from Toronto to Milton and paid back the money that had been paid in, and returned the notes that had been taken up for the unpaid portion. No one denies that. I fail to see that that hexps the difficulty. That Leighton McCarthy asked for the papers to be returned in one instance didi not for one moment take away from the Minister of Finance and the officers of his department the knowledge that the Bank Act had been evaded; and in that fact alone I have every confidence and: assurance that the Department of Finance had knowledge of the attempt that was made to get this charter in an illegal way. The hon. member for West Toronto (Sir Edmund Osier) made it his business to go to the Finance Minister a short time before the certificate was granted and acquaint him with the fact that Travers was raising money by discounting notes for the purpose of making this deposit-another evidence of the illegality of the procedure to obtain the charter.


Daniel Duncan McKenzie: Does Sir William Meredith say it is illegal to raise money in that way?	-


David Henderson: I presume the hon. gentleman has read the evidence.


Daniel Duncan McKenzie: And he does not find that it is illegal.


David Henderson: No. Perhaps he was not asked to inquire into that.


Daniel Duncan McKenzie: He deals with that
point.


David Henderson: I understand from
the hon. gentleman that Sir William Meredith does not consider a transaction illegal if it evades the Bank Act?


Daniel Duncan McKenzie: He does not consider
it illegal to raise the money on notes.


David Henderson: But he does not say, so far as I remember, that you can use that money for the purpose of making a deposit to obtain a certificate.


Daniel Duncan McKenzie: That is what he does
say.


David Henderson: So I fail to see that Sir William Meredith has encouraged a practice of that kind. If he did I am very

much disappointed. It is possible he may have stated that there was no objection to discounting these notes. If he did, I say it is a surprise to me, because Parliament has enacted a law that twenty-five per cent of the stock should be paid in to the Receiver General out of money received from the sale of stock. It makes no provision that you can pay in $250,000 of borrowed money or of money Taised in any other way than by the sale of stock. I intended to have placed on the record a great many of Sir William Meredith's findings but as they have been time and again referred to, I decided that I would avoid repeating what others had already said. But Sir William Meredith says:
That in thus dealing with these notes the provisional directors and Travers Of a breach of trust does not, I think, admit
of doubt.
If the hon. member for North Cape Breton says that differs from what I read,
it surprises me.


Daniel Duncan McKenzie: That is not the point at all. What the commissioner deals with there is the transferring of the notes to Travers.


David Henderson: Let me read the whole
passage:
That in thus dealing with these notes the provisional directors and Travers were guilty of a breach of trust, does not, I think, admit of doubt, and for the manner in which the money borrowed was applied there was neither justification nor excuse.


Daniel Duncan McKenzie: My hon. friend does not understand what he has read. The commissioner says there was no justification for the payment of $21,000 to Travers.


David Henderson: Let me read it again and see if I can get it into the hon. gentleman's mind.


Daniel Duncan McKenzie: It will not do for the hon. gentleman to tear a few sentences from the whole context and read them.


David Henderson: I am reading the whole paragraph. I have often heard it said that it takes a hammer and chisel to get an idea into a Scotchman's head. It will take a sledge hammer, I think, to get this idea into my hon. friend's brain.


Daniel Duncan McKenzie: It would be well for the hon. gentleman to produce his idea, and we will see how I will take it.


David Henderson: I will produce it again. Sir William says there was no justi-
fication or excuse for using the money in that way.


Daniel Duncan McKenzie: In what way?


David Henderson: For the purpose of making a deposit or implementing it.


Daniel Duncan McKenzie: That is not what he says at all.


David Henderson: It is in plain English. Sir William there referred to the $100,000 that was already paid in.


Daniel Duncan McKenzie: Not at all.


David Henderson: I think I have read it sufficiently often to enable the hon. gentleman to get it into his mind.


Daniel Duncan McKenzie: I read the (whole of the report and I know what it means. My hon. friend had it put into his hands just now and he does not understand it.


David Henderson: I read this report some days ago.


Daniel Duncan McKenzie: With very poor results.


David Henderson: That is the opinion of the hon. gentleman. Allow ,me to say that I hold the same opinion with regard to him; I think that his reading of the report has not produced very good results. I do not think that he has learned much from his study of it if the idea which he throws out now is his conception of what Sir William Meredith meant. Sir William Meredith's statement is very plain; he who runs may read and may understand it if he wants to. There axe none so blind as those who will not see. I think we may leave that as a isettled question.


Daniel Duncan McKenzie: It is not settled.


David Henderson: I give the hon. gentleman up; he has an idea in hig min'd and he sticks to it.
It has been said more than once in this debate that I went to the late Minister of Finance .and informed him that it had come to my personal knowledge that Travers was taking and discounting the notes of subscribers for stock and was using the money for certain purposes. He had no right to use or lend any money; the only money he wanted was an amount sufficient to secure the certificate. I presumed that the proceeds of the notes which I saw in the hands of a solicitor after they had been returned when the case was withdrawn

and I had every right to presume it-were designed to

supplement the money which Travers had already raised for the purpose of obtaining the certificate. A good deal of controversy took place a year or two ago between Mr. Fielding and myself with regard to this matter. I came here on November 22, the day of the opening of the House in the year 1906; the certificate was granted to Mr. Travers on November 30. Between those dates, possibly not more than three days after I arrived in Ottawa, I went to Mr. Fielding and told him how the money was apparently being raised; told him that I had seen the notes in the hands of a solicitor; told him that I had seen the endorsements of the provincial directors upon those notes, presumably for the purpose of discounting. But Mr. Fielding made the assertion	that I
12 m. was mistaken. Well, I thought that my	memory
was just as good as that of the Hon. Mr. Fielding, and I still think so. I maintain that what I told the hon. gentleman was correct.	In discussing the matter in
March, 1911, Mr. Fielding repeatedly said that	I	was mistaken in the	statement
which I made -when I told the House that I went to the minister and acquainted him with the fact that I had seen those notes, and that it was my impression that certain things had taken place. During the course of his remarks Mr. Fielding said, 'the hon. gentleman is mistaken.' Later he said again, 'he is mistaken,' and at the end of a paragraph he says:
To the best of my recollection, he is entirely mistaken.
He was getting a little more emphatic every time. I want to submit a few facts to the House, and to ask hon. gentlemen who was in tlhe better position to judge as to whether ox not I was mistaken? I told the House that I came direct from a county in which a large amount of money had been subscribed in respect of this bank, and where I knew that there was going to be distress among the people if something was not done. I went to Mr. Fielding and had a conversation with him, feeling sure that I was correctly stating what took place. I had it vividly in mind at the time, and I gave as a reason why it was so vividly in my mind the fact that I was deeply impressed with the seriousness of the whole matter. In looking over 'Hansard' the other day, in order to find out just what Mr. Fielding said, I came across a letter from Mr. T.
C. Boville, the deputy minister, in which, addressing Mr. McCarthy, he said.
Dear Sir,-I beg to acknowledge the receipt of your letter of the 19th instant, to Mr. Fielding's address respecting the Farmers Bank of Canada.
When application is made by the Farmers Bank to the Treasury Board for a certificate to enable them to commence business, the representations contained in your letter with its enclosure will be laid before the board.
The member for North Toronto, Mr. Foster, spoke on that occasion, and I intend to read a portion of his remarks in order to bring out prominently the point I wish to make: He said:
Bear in mind that on October the 23 rd the application was in-
That was the application for the certificate; the money was deposited on October 23.
-in the shape of a deposit of $250,000 to my own credit.
This is Mr. Fielding's statement:
Now, I will put this question to the hon. minister. From the 23rd October, 1906, until the 27th of November, 1906, will the minister say that either he or his department took any step whatever to convince themselves of the bona fides of this application or made any inquiry as to the standing or actions of the men behind it? That is a simple question, but there is a good deal in it. I will go further. The information which Mr. McCarthy gave was to go before the Treasury Board. Let me ask the minister if the Treasury Board met to consider this matter before the 30th of November, the very day when the certificate was granted. And I will ask him if he ever put before that board the information which Mr. McCarthy gave him, and which he declared would be put before them. That can be very simply answered.
I am going to read Mr. Fielding's answer, which, I think, settles the whole question as to whether Mr. Fielding's recollection or mine was the better. I stated emphatically that I had a complete recollection of the conversation. Mr. Fielding, his attention having been drawn to what occurred between the 23rd of October, 1906, and the 27th of November, 1906, with regard to placing information before the Treasury Board to enable them to decide whether the certificate should be granted, said:
I cannot remember what exactly happened between these dates.
He admits without hesitation that he cannot exactly remember just what took place between the 23rd of October and the 27th of November. If the gentleman could not remember what took place, why did he contradict me and say that I was mistaken when I stated that I went to him

between the 22nd and 30th of the month of Novemoer of that same year and informed him of the facts that I have mentioned, that these people were discounting notes in order to raise money instead of getting it from the source the Bank Act implied it should be obtained, namely the sale of stock. Mr. Fielding settled the whole question firms answer. I do not ask the House to take my word, I leave it entirely for Mr. Fielding to decide and he settles it surely. He says:
I cannot remember exactly what happened between these date3.
An admission of his inability to say whether I was right or not, and yet he said I was mistaken.
I shall look into the evidence for a few moments on this point. I have read a good deal of this evidence. I confess there is much in it that is confusing but, familiar as I am with many of these transactions, I feel that I am competent to trace out and gather up the truthfulness of the answers that were given. Here is a question put to Mr. Fielding when he was under oath, by the commissioner:
That would have occurred between the meeting of Parliament on the 22nd and the granting of the certificate on the 30th?
A reference to our meeting together and the conversation we had. He replied:
No, it probably occurred before that, X do not remember discussing with him the propriety of granting the certificate at all.
Remember, he told us before this that he did not remember what took place between the 23rd of October and the 27th of November and he repeats it on oath here:
I do not remember discussing with him the propriety of granting the certificate at all. My conversation would be bearing on the extension of the charter, the getting of subscriptions, the whole movement. The conversation I spoke of with Mr. Henderson would not have reference to the granting of certificates particularly.
Mr. Fielding immediately goes off woolgathering, he drifts away on to something that the commissioner did not ask him about, trying, as it were, to cover up and avoid a direct answer. He said:
Mr. Henderson never waited on me on the subject in his life.
A straight denial.
We met upon the Parliament grounds and occasionally had conversations.
When this occurence had taken place he seemed to mix things up so badly that for my part I would be utterly unable to gather his meaning. But we do come to a

point here where we can find what he was at. Mr. Fielding then said, continuing his answer to Sir William Meredith:
I think the day the certificate was granted I think I ran across Mr. Henderson and I said.
Now when he gets down right to the question that I had raised, the statement I had made, that 1 met him in the lobby cf the House of Commons a few days after the certificate had been granted and that he told me that Mr. Travers had been down and that he had questioned him with regard to the wlay the money was obtained and he had given him a certificate. Then this is what Mr. Fielding says on oath:
I think the day the certificate was granted I think I ran across Mr. Henderson and I said: Well, I have had to give these people their certificate and I am sorry for it.
Why was he sorry for it? I do not know but that settles tire point. Mr. Fielding admits that he ran across Mr. Henderson and that he told him that he had given these people the certificate and that he was sorry for it. Mir. Fielding had always denied what I said when I told the House and the country that I had a conversation with him in the lobby, and slaiid I was mistaken. He admits in the evidence that during the month from the 23rd of October to the 27th of November he did not exactly remember what took place. Now he says:
I think the day the certificate was granted.
We know what day that was, the 30th of November.
I think I ran across Mr. Henderson and I said: Well I have had to give these people their certificate and I am sorry for it.
I submit this question:	Why dad Mr. Fielding come to me and tell me that he had the interview that I had with him in November? He had denied that I approached him and told him about their discounting these notes but he would not give me credit for making that statement. Now I say why did Mr. Fielding come to me just after this certificate was issued and tell me what he had done? Why did he not go to you, Mr. Speaker, and tell you? Why did he not go to some other hon. gentleman in this House and tell him? Why did he not go to the Minister of Labour, whom he knew very well, and tell him what he had done? No, he came to myself and told me what he had done. Is there any hon. gentleman in this House who will

not conclude at once that Mr. Fielding came to me on account of the conversations we had had before this? That is why he came to me, it verifies the whole thing and removes !a doubt that I believe many people in this country had with regard to the difference of opinion between myself .and Mr. Fielding, and that is why I am making this statement. I think the evidence is complete and convincing. This evidence was repeated a little later on when Mr. Fielding was undergoing examination before the commissioner. Referring to the time the certificate was granted, he said:
What happened was that meeting Mr. Henderson that evening-I have no recollection of the part of the House-it was probably in the House-I told Mr. Henderson, 1 Well, I have given these people the certificate, or the Treasury Board has given these people the certificate, but I am sorry to do it.'
Repeating in another form the very same thing. Why did he come to me? why did he not go to somebody else? He no doubt came to me and made that statement because he had had a conversation with me the week before, when he had promised me that the certificate would be withheld as long as possible.
In my own interest, in self protection, I wanted to produce the evidence in this House to establish the fact that I had approached Mr. Fielding at a certain time, and had made a statement to him, -which of course he denied, I have produced this evidence to show that Mr. Fielding himself practically admitted that I was right and he was wrong. I regret very much to have to make this statement; I regret very much that I am obliged in my own self-defence to use the name of Mr. Fielding, with whom I was intimately -acquainted; but it is a duty which I owe *to myself and to this House, because, by *producing this evidence and showing exactly what took place, I think I have removed the doubt which possibly was in the minds of' a great many people, and which I was anxious to have removed.
The right hon. gentleman who leads the Opposition a few days ago referred to that portion of the speech of the Minister of Finance in which he referred to what he *termed the neglect of Mr. Fielding. I wish to make a brief reference to that. We often say that those who live in glass houses should never throw stones. There *was a very strong objection taken to the Minister of Finance speaking of Mr. Fielding's conduct as a matter of neglect. I cannot think it- was anything but neglect. I think that the hon. ex-minister neglected his duty; but the right hon. gentleman who leads the Opposition thought it was unfair in his absence to refer to his neglect. As I say, those who live in glass houses should not throw stones, but I have noticed in reading the evidence that Mr. Fielding did not hesitate to accuse me of neglect; and I thought if it was wrong on the part of the hon. Minister of Finance to speak of Mr. Fielding's actions as negligence, Mr. Fielding had no right to make a reference to my actions as negligence. Mr. Fielding tried to make a point against me by saying that I should have brought this matter up in Parliament, that I knew the facts, that I knew that this money was improperly obtained, and that I should have had the whole thing ventilated in the House. I do not know any reason why I should have brought it up any more than Mr. Fielding himself. He knew the facts as well as I did, he had his information from Mr. McCarthy, from Sir Edmund Osier, and from myself. We could not have primed him any more fully with information that this money was obtained -I shall say illegally, for the purpose of the deposit, because, notwithstanding the statement of the hon. member for North Cape Breton, the money was not obtained in the proper way. Mr. Fielding charges me with negligence because I did not bring the matter up in the House in order to have it discussed. The evidence shows that Mr. Fielding was asked the following question by the commissioner:
He-Mr. Henderson-had the information from Mr. Laidlaw which the department had previously to that?-A. If the department neglected its duty that was no reason why he should neglect his.
There is one other point that I wish to refer to. The question has often been asked, why I did not put my objections in writing. That was referred to only last evening. I said then that I did not believe there were five hon. gentlemen in this House who would have taken the responsibility of putting in writing the information I gave to Mr. Fielding at that time. It was critical, it was dangerous, for me to interfere. The information I conveyed to Mr. Fielding was for Mr. Fielding himself; it was not for the House of Commons or for the country; it was to put Mr. Fielding on his guard as chairman of the board that the money that was deposited was not obtained in the way it should have been, and that

consequently the transaction was illegal. Why should I be asked to write a letter and make a public display of something that was only intended for Mr. Fielding himself, or at the most for the board, who could obtain it from Mr. Fielding? As I said, it was not intended for the House, and it was not intended for the country, therefore I contend that I was perfectly justified in making my representations verbally, and that they were just as effectual as if they had been put in writing. Mr. Speaker, you know as I and every other member of the House knows, that we an have confidential conversations with ministers of the Crown on matters that we would never think of putting in writing. Sometimes it would be dangerous to put these matters in writing; it is not always proper to put them in writing. I know I have done this myself hundreds of times, and there is not an hon. gentleman in this House who has not gone to a minister of the Crown and presented to to him verbally certain facts that he wished to acquaint him with, and nobody ever thought that was a crime until this thing occurred, when, in order to make an excuse, they say: Why did not Mr. Henderson put this in writing? I think I have made my reason very plain indeed. Discussing this point the other day with one of the most active members on the other side of the House, he said that I was perfectly right, and that I could not have been expected to put my statement in writing and let it go on the files of the department.
Surely after twenty-six sessions in Parliament I have some limited knowledge as to how this sort of thing is done. I think ministers and ex-ministers will agree with me that these things are not always put on file and that there are many things that are better not put on the file. I base my answer on this, that the information I gave to Mr. Fielding was not intended for the House, nor for the country; it was for him to make use of confidentially when he came to issue the certificate, and it ought to have put him on his guard. What more could I do? If I had put it in writing no advantage would have been gained; Mr. Leighton McCarthy put 'his warning in writing, and it had no effect. It is said that Mr. McCarthy withdrew his information. He asked for the return of the papers, but he did not withdraw the information. The information which he conveyed to Mr. Fielding was left on Mr. Fielding's mind just the same as if Mr. McCarthy had never withdrawn the papers. If Mr. Mc-
Carthy presented his objections in writing and that had no avail, how would my objections have prevailed even if I had presented them in writing. I thank you, Mr. Speaker, and the House for the attention you have given.


Edward Walter Nesbitt: After listening to the Minister of Finance and the other gentlemen opposite who have endeavoured to lay the blame on Mr. Fielding for the failure of the Farmers Bank, I cannot help thinking that they doth protest too much.	It struck me that the
Finance Minister when introducing the Bill was trying to atone for lack of facts and arguments by volume of words. At the time the certificate was issued the Bank Act said that certain things had to be done before the certificate could be issued,	and one of these
things was that the Minister of Finance was to be satisfied by affidavit or otherwise, that the deposit had been made, and the form of appointing directors gone through. The deposit receipt from the Bank of Montreal was in the hands of Mr. Fielding, the affidavits as to the bona fides of the subscription up to $500,000 were regular, so far as Mr. Fielding knew. The law says that the certificate ' may ' issue when the conditions are complied with, and ' may ' in this instance, I take it, means ' shall.' Mr. Fielding was asked for the certificate and he had no earthly right to refuse. He was simply acting in an administrative capacity and not in a legislative capacity. Bemember that this bank was conceived in iniquity. The name ' Farmers Bank ' was taken, so far as I can judge, for the purpose of deception. Mr. Fielding opposed an extension of time to acquire that certificate in the Banking and Commerce Committee, and that committee overruled him, as they should not have done, he being the Minister of Finance and head of the Finance Department. Since that time, the Banking and Commerce Committee have extended the time of charters for banks and other institutions, and they have done so this very session, when, in my judgment, they should not. If Mr. Fielding had refused that certificate there would have been a cry to high heaven throughout the land that he was standing in with the great moneyed corporations of Canada and refusing permission to the farmers to start a bank. I can imagine how the very men who have been loudest in condemnation of Mr. Fielding for the last couple of days would have shouted in condemnation of Mr. JUNE 3, 1914
Fielding had he refused to issue the Farmers Bank that certificate. These men who are so very loud in their condemnation and who are so very keen in their hindsight instead of in their foresight, would have been the very men to condemn Mr. Fielding if he had not issued the certificate. I do not agree that Mr. Fielding should not have issued the certificate and I do not agree with my hon. friend from Hatton that Mr. Fielding should have paid attention to the gossip that some one might pour into his ear in tihe lobbies of the House or in the walks around the grounds, especially when these people were afraid to put their gossip in writing. My hon. friend from Halton says there is no member in this House who has not gone to ministers and poured tales into their ears-, but he can look at me and see one member who never had any secrets with any minister, and who never had any tales to pour into their ears. Anything I have to say to a minister I am perfectly willing to put it in print and perfectly willing to stand on the floor of this House and repeat it, and that is what the hon. member for Halton should have done. I do not care who the busy man is, if you walk up the street and some fellow tells you some gossip, how long do you remember it? If I were to try to remember one-half the stuff that is told me verbally, I would go crazy in less than a week. The duty of a man who has anything worth while to report to a minister is to put it in writing before him, and he can easily mark it 'confidential,' and there is no man who would not trust Mr. Fielding to keep private any letter market 'confidential.' I am surprised at Sir Edmund Osier, who is a good business man, as everybody knows, prattling gossip that he was afraid to put in a letter to Mr. Fielding, and I can- say that for him, and to him so far as that is concerned. If Sir Edmund Osier knew anything that was wrong about the issuing of that certificate* it was his duty, as it was the duty of the hon. member for Halton, to put it before the Minister of Finance in writing and be prepared to stand by it. My hon. friend from Halton says he could not be expected to take the responsibility, but I say that, such being the case, the Minister of Finance had no right to take the responsibility on the say-so of the member for Halton, who was afraid to put his story in writing. Let me say that to my hon. friend.


David Henderson: It is not necessary; I appreciate what you say, but I do not think much of it.
Mr. NESBiITT: I do not care what you think; I am telling you what I think. When my hon. friend from Halton moved the resolution to which reference has been made, I said that I did not think the Government had any right to pay anything for any purpose outside of the ordinary expenditure of government, excepting perhaps on account of a calamity of some kind. I understand it was said by one hon. member to-night, when I was not present, that any one who voted for this measure voted against Mr. Fielding. If I thought that the people in my constituency would so construe a vote of mine in favour of this Bill, I certainly would vote against it. I do not believe, however, that the people in my constituency will think, even if I do vote for the Bill, that it is because Mr. Fielding was negligent or did not attend to his duties properly.
In the election of 1911, my right hon. friend the Premier and the Minister of Trade and Commerce attended a meeting in the town of Woodstock. I do not say that the Premier or the Minister of Trade and Commerce gave my opponent the authority; but the people in my constituency, who were vitally interested in this, told me after the meeting that he had said that, if the Conservative party were returned to power, they would repay the depositors in the Farmers Bank. Not one, not two, but several persons told me that my opponent went through the municipalities in the riding I have the honour to represent affected by the Farmers Bank, making that statement. I was, therefore, placed in rather an awkward position; but I followed my usual policy, and told my constituents frankly that I did not think any government had any more right to repay the depositors in the Farmers Bank than to repay the losses of any man engaged in any business. I fought the campaign on that basis. I told my constituents that frankly at all meetings, in places where the people were affected by the failure of the Farmers Bank. Several of the people in my constituency were at the meeting at Ingersoll, which the present Minister of Labour addressed. I was in the riding the next day, and they told me that he had said positively that, if the Conservative party were returned to power, they would repay the depositors in the Farmers

Bank. I told my constituents at the meeting at Kemptville, and the next night at the meeting at Kintore, that I did not think the Government had any right to repay the depositors, and that I could not make any promise that they would do so. Therefore, if I vote for this Bill, it is not because it is necessary for me to do so on account of the electors in my section of the country, because I have fought out this question with them before. In my constituency, however, the latter president of the Farmers Bank happened to be a gentleman who was the height of honour and integrity, namely, Colonel Munro, a man who represented that constituency for two parliaments in the Ontario House, a man who was not only highly respected but absolutely beloved by the people in that district. The fact that this bank that was conceived in iniquity seduced my friend Colonel Munro to be president of it, was the reason of the enormous deposits in my constituency. It was on account of the faith of the people in Colonel Munro that made them deposit their money with him. Some few of them might have been induced to make deposits on account of additional interest that the Farmers Bank was paying over and above what the other chartered banks were paying. A good many people in that section of the country thought, and still think, so far as I know, that any bank chartered by the Dominion Government is guaranteed by the Dominion Government. I found in the election campaign of 1911 that it was almost impossible to take out of the minds of the people the idea that a chartered bank is guaranteed by the Government. Since the election of 1911, this has become in my section of the country a public calamity. There have been three deaths directly traceable to the losses in this bank. I had a letter just the other day from an old lady, ninety years of age, whose husband is the same age. They cannot work; they had all their money deposited with Colonel Munro, and they are built up, like a great many others in my constituency, with the promises of my hon. friends and with the hopes held out by my hon. friends that they will repay these deposits; and Heaven only knows what will happen more than has already happened if this Bill does not go through. Therefore, I have a duty to perform to the people whom I represent.
I am sorry that so much has been said in trying to throw the blame of the failure of the Farmers Bank on the Hon. W. S.
Fielding. Man after man on the opposite side of the House has said that, if this certificate had not been issued, the bank could not have failed. If the sun did not shine, we could not have daylight. What an absurd thing to say. iEvery one knows that, if the certificate had not been issued, the bank could not have been organized, and it certainly could not have failed. The thing is so absurd and ridiculous that I am surprised .any human being, who has grown to manhood or babyhood, would make such a statement; but .my hon. friends have done so. If the certificate had not been issued, the bank certainly could not have failed, simply because it could not have started. I will not detain the House any longer, but I shall be forced, I am *afraid, to vote for this Bill.


Mr. DONALD SUTHERLAND (South Oxford):: Mr. Speaker, I desire to make
a few remarks in regard to the Bill now before the House. The riding that I represent has suffered a considerable loss through the failure of this bank. In the county of Oxford, I believe, there was on deposit at the time of the failure $148,622. The bulk of that deposit w.a3, however, in the north riding, represented by the hon. member who has just resumed his seat.
I want to take issue with the argument advanced by the last speaker, thlat no blame can be .attached to the late Minister of Finance for issuing the certificate to this hank. It is not necessary to refer to the report of the commissioner, who makes it quite clear that that is not the case. This matter liais been referred to by so many speakers that I would not mention it now were it not for the remarks that have been made by the hon. member for North Oxford. The commissioner says:
It is true that, as Mr. Fielding stated in evidence, Travers, so far as he knew, was a reputable hanker; but that was not, in my opinion, a sufficient reason for not having instituted an inquiry as to the matters which had been called to his attention. Such an inquiry could easily have been made, and the delay occasioned by it would have been inconsiderable, and such an inquiry would, undoubtedly, have resulted in the discovery of the manner in which the $100,000 had been raised and in the refusal of the Treasury Board to give the certificate.
That is so clear that I do not think it is necessary to make any further reference to it. The Minister of Finance was negligent in not properly discharging his duty and protecting the people, he being the trustee in that respect upon that occasion.

Now, I want to be very brief, and I am not going to deal with many things that otherwise I would like to have touched upon. But when an hon. gentleman gets up in this House and charges the Minister of (Labour with having made statements at Ingersoll in the riding I represent, a charge that has been repeatedly made by hon. gentlemen opposite and circulated by the Liberal press, and which has been repeatedly denied-I want to say here and now that in so far as my constituency is concerned he addressed no political meeting in the town of Ingersoll during the campaign of 1911. Yet he is charged here by the hon. member for North Oxford (Mr. Nesbitt) with having said that if the Conservative party were returned to power they would reimburse the depositors in the Farmers Bank. That is the kind of argument repeatedly advanced by hon. gentlemen opposite during this debate. They cannot possibly get away with a statement of that kind. I repeat again that the Minister of Labour did not address a political meeting in Ingersoll during that cam-ipaingn.
I want to state also, with reference to the attack made on the hon. member for Halton, that the commissioner also says that it was not material whether that hon. gentleman's objection was a verbal one or a formal one. It is claimed that the commissioner did not condemn the late Administration as severely as hon. gentlemen on this side contend, but the commissioner says that the verbal report of the hon. member for Halton was just as effective as if it had been put in writing, and was what one would naturally expect between two members of this House, well known to each other, with a mutual high regard. I think that is what gentlemen so situated would naturally do.
Reference has been made by the junior member for Halifax (Mr. Maclean) to fourteen or fifteen constituencies that were influenced in the last election by the Farmers Bank issue, but the insinuation has been made that there are members in this House who would not have been here had it not been for the promises they made in connection with this matter. I want to say that in so far as I am concerned-and possibly some of them may have had in mind the constituency I represent, as I happen to be the first Conservative ever elected from that constituency, -I made no promise nor pledge regarding this matter. I discussed it on several 302
occasions and pointed out where I thought the late Government and the Treasury Board were negligent, but in so far as making a pledge or promise is concerned I did nothing of the kind. I may say that the hon. member for the North riding (Mr. Nesbitt) took a different attitude. He claims that the Minister of Labour did these things in the South riding at Inger-sull and that he made use of them in his own riding. I may say that I admire consistency, and the old saying is true: consistency thou art a rare jewel, and his lack of consistency is apparent when you compare the statements he made here to-night with those he made in 1911, when he opposed the appointment of a commissioner to investigate the charges then made that there had been negligence by the Treasury Board. I am just going to *make a reference or two to hie statements upon that occasion. He said:
I also have a large number of people in the riding that I have the honour of representing in this House who have been severely punished.
We all know that when a person is punished it is for committing an offence. What was the offence these sufferers in that constituency, who had lost $106,000 had committed? They had not deposited their money in the Post Office Savings Bank, but had put it instead in a bank that had been incorporated by Act of Parliament and which had received a certificate to do business from the Government of Canada. Yet the hon. gentleman says they have been punished for not depositing their money in the Post Office Savings Bank. And a little further on in the debate, he says:
Nobody sympathizes with these losers more than I do, but I do not see why we should be asked to take money out of the public treasury to reimburse them. They deposited their money in the Farmers'Bank with their eyes wide open, when they had, as I have said, other places where they could have deposited it with absolute safety, guaranteed by the Government itself.


Mr. WILCOX:: Who said that?


Donald Sutherland: The hon. member for North Oxford (Mr. Nesbitt) in a debate in this House.
Mr. NESBITT; I told them that on the platform.


Donald Sutherland: I am just coming to that. The statement has been made that the Farmers Bank question exercised a great influence in electing certain members to this House at the last election. I want to point out that in the election of



1906 the hon. member for North Oxford had a majority of 124 and. in 1911 his majority wae increased to 295. You do not find that the people were swayed very much by the arguments upon that occasion. In 1908 I was defeated by 93 votes, and in 1911 I was elected by a majority of 24, not a very great change. I made no use of these arguments; I believe that there are very few members in this House, ae the hon. member for North Ontario (Mr. Sharpe) has pointed out, as a result of any influence exerted by the Farmers Bank question.. And I believe that is a fact in the county from which I come. There was an issue that overshadowed every other so far as people of that county were concerned and that was reciprocity.
I am not going to take up the time of the House any further. I wish to state, however, that I am glad to have an opportunity of placing myself on record here to-night to show where I stand with regard to the people who have suffered through the lack of attention-or if I am not permitted to use a harsher term,- through the failure of the trustee to see that the management of this bank were not permitted to defraud the people of Canada to the extent to which they were defrauded. This bank should never have been permitted to be incorporated under the name The Farmers Bank of Canada unless there was an absolute guarantee that they would carry out the business which they claimed it was their intention to carry out. They established branches in small places throughout the country where there were no banks and in this way endeavoured to lead the farmers of the various counties to believe that their institution was to be for the benefit of the farmers. It was well known in the industrial centres and I believe that it was well known by the Banker's Association before the collapse came that the Farmers .Bank was in a most deplorable. condition. It will be observed that very little or no money was lost by the depositors in the towns and cities; the greatest losses were sustained by depositors in small places who had been led to believe that this institution was for their own special benefit.
I shall have the greatest pleasure in supporting this measure. I do not know that I would have spoken at this late hour had it not 'been for the deliberate attempt on the part of the hon. member for North Oxford (Mr. Nesbitt) to misrepresent the attitude of the hon. Minister of Labour, whose

arguments in defence of this measure are, unanswerable. Hon. gentlemen opposite talk in a general way around the subject, but I have failed to observe any arguments put up by them which successfully answered those advanced by the Minister of Labour.
Permit me to conclude by saying that in the few remarks which I have made I have attempted to discharge the duty that I owe to the people of my constituency, which I feel I would owe to them in the same measure if not a dollar had been deposited in this bank by persons in my county.


Daniel Duncan McKenzie: The facts in connection with the very important measure that is now before the House have been dealt with at considerable length, and I would not undertake to address you, Sir, were it not 'for the fact that I hold very strong views upon this subject, and	that	I do not careto pass a	silent vote	upon a
question involving such far-reaching principles as are involved in the one now under consideration.
The hon. member who has just taken his seat (Mr. Sutherland) addressed himself to the circumstances surrounding the failure of the Farmers Bank in his own
1 a. m. riding. I have no particular objection to take to anything which the hon. gentleman said. I have the greatest sympathy with any hon. member who represents electors who were unfavourably affected by the failure of this bank. I am not going to make any assertion as to what my attitude might possibly be if some of my constituents were similarly circumstanced ; but whatever my position might be, I do not for a moment contend that any change of attitude from the one which I now propose to take would he justified by the law or by the facts here presented.
I submit that public moneys should be used in the interest of the public; I make that statement boldly and broadly. We are here as a public body, as the highest court in this land, to deal with the money of the people and to deal with it in a manner that will be for the advantage of the country at large. No matter how sympathetic we may be in respect of the peonle who met with losses by reason of this failure, I submit that the way to remedy or remove the difficulty which has arisen is by the use of our private fortunes and not by giving away moneys which do not belong to us. If any person wants to be a philanthropist, he has a perfect right to carry out his philanthropic ideas by the use of his own private means;

but the carrying out of his philanthrophy by using the money of other people when he has no warrant or authority for doing so is a different matter. There is an old story, related, I think, by Mark Twain, that an enterprising gentleman once said that he was willing on certain occasions to sacrifice all his wife s relations for certain purposes. It is, perhaps, an easy matter for one to sacrifice, without any twinge of conscience, his wife s relatione, 'and it is, perhaps, easy for some persons to be generous with other people's money. One of the chief objections I have to this legislation is that we are applying public moneys to private pur-[DOT] poses and there is no justification whatever for such application.
It has been said that because we on this side of the House venture to express our opposition to this measure, we do not sympathize with the people who lost their money. We can not always carry out our sympathies in matters of this bind. There are public duties which men have to perform and which they carry out irrespective of whether or not their private sympathies are in line with their action. Speaking for myself, if this legislation, were a mere matter of sympathy, a mere matter of helping out the people who lost money through the failure of the Farmers Bank, I should be very glad to support it; but this legislation is establishing a dangerous policy which cannot by any possibility be universally applied, and that being the case, I cannot vote for it.
Something has been igaid by the hon. member for Halton (Mr. Henderson) about an attack made upon him by the junior member for Halifax (Mr. A. K. Maclean). It is a new experience that the hon. member for Halifax should be charged with having made an attack upon anybody. The hon. gentleman has been in this House for quite a number of years, and I really thought that his weaknesses were in the other direction ; that if an attack were really necessary the hon. member for Halifax was the last man who should be chosen to make it.
I listened to his speech last night and heard all he said in reference to the hon. member for Halton (Mr. Henderson), and I am pleased to say I cannot find anything in it which would in any way constitute an attack upon the conduct or otherwise of that hon. gentleman. It is true that the junior member for Halifax said that the hon. member for Halton was the author of this trouble which this country is put to in regard to the Farmers Bank. It is 302i
perfectly true that this political agitation which was started in this House some four years ago was started by the hon. member for Halton. It is true and he has stated himself that he did not formulate the shape in which that attack was to be made that he was simply the spokesman of the party; that is what he says, and that he carried forward their views. There is no person on this side who was supporting Hon. Mr. Fielding's party at the time who has any doubt as to what was the purpose of that attack. That attack was made for political purposes; in the first instance to make a political attack on Mr. Fielding who was a strong man in his party. It was hoped that by making this attack on him, by impugning his capacity and integrity as a minister of the Crown he would be weakened in the country generally. That was one of the reasons; the other was the holding out of a bribe generally to the many people in Ontario and elsewhere who were involved and who had lost their money. Therefore there was a double purpose and thait purpose is carried on to the present day. The attack upon the late Minister of Finance is not now 'So strong before the minds of hon. gentlemen as they confess. This matter is now on a bribery basis. I submit to you that when one is running an election in a county where some of the electors have lost money in an institution such as this bank, if the person who is running the election will stand up on the platform and say:	If I am returned to power and the
party to which I belong is returned, and we are in a position to form a Government and so get charge of the Treasury Benches and have charge of the consolidated revenues of this country, we will pay you men the money that is coming to you. I submit to you that, as I understand the election laws in this country, that is bribery, that is an offer held out, an inducement held out to the electors pure and simple to vote a certain way and if the voter votes that way and his vote is successful he will be paid back his money. That, as I submit to you, is a corrupt act and this Bill, which is to enable the Government to get hold of a certain amount of the consolidated revenue of this country and to dole it out to these voters, is nothing short of promising them a bribe and then implementing that promise by doling out the public money of this country. That is the view I have of the situation and I think that is the view that any court of the country would have of it if the ease was really tried upon its merits. If the

*hon. junior member for Halifax (Mr. Maclean) made any statement with reference to the hon. member for Halton that could be construed into an attack, it was the bald and bare simple statement of those	circumstances of	the facts
which are apparent that the failure <of the Farmers Bank was made, an implement first, for an attack on Mr. Fielding and, secondly, with t'he intention of bribing *the electors oi this country. The simple [DOT]-expedient is resorted to now of paying that money out of the pockets of the people of Canada generally. If that is an attack I admit that the hon. member for Halifax has made an attack, but I do not think any one has the right to complain if the simple facts in respect to his conduct as a public man are brought plainly and simply before This country and before Parliament.
A great deal has been said in regard to the conduct of Mr. Fielding and the Treasury Board in granting this certificate. The hon. member for South Oxford (Mr. Sutherland), put forward the strong assertion a moment ago that none of us on this side had attempted to answer the argument of the Minister of Labour in the case that he put forward with respect to the connection of the Hon. Mr. Fielding with the transaction of issuing the certificate. It is easy to make a strong statement if one gets the premises that just suit him; and if he takes the wrong premises, that is wrong as far as the facts are concerned and lays down a foundation just to suit himself, knowing what he is going to build upon that foundation and argues on arguments that are not borne out by the facts, it is easy to make an argument that will have some shape and colour to it. The Minister of Labour argued from start to finish that Mr. Fielding was a trustee. I submit to you that there is not a scintilla of law, facts or evidence, that shows that Mr. Fielding was a trustee, and the hon. gentleman who was making his argument, if he was familiar with the fact, must have known that the evidence did not sustain the position which he took; and when he argued throughout that Mr. Fielding was a trustee he was arguing along lines that were not borne out by the facts. The Hon. Mr. Fielding or the Treasury Board were merely officials made by statute to perform statutory functions which were defined by the statute. As far as I can see they had very little judicial function to discharge, hardly any function of a judicial character. Their position was almost entirely administrative. When you go to a registrar of deeds to get a deed recorded you 
go before a magistrate and the witness swears to it and you have it ready to register. In Nova Scotia you produce a deed to the registrar, it is properly signed before the magistrate showing that the witness s;gned it, and sworn to before the magistrate. That registrar of deeds is bound to accept that document and put it on the record; he has merely the mechanical functions of receiving that document and putting it on the official record. He has no judicial functions in the matter at all. If the statute is complied with, if there is a witness to the document, and if that witness is sworn before a proper officer who has authority to receive an oath or affidavit, the registrar must put that document on the record.
That is a sample of the functions of the Treasury Board. The statute prescribes certain simple regulations, and, wlien they are complied with, whether the board likes it or not, or whether they have anything to say about the personnel of the manager or officials of the bank or not, they have no discretion in the matter whatever. I submit-and this is perhaps one of the things that has not been brought out as strongly as it ought to be-that the personnel of the manager is a matter on which the Treasury Board has nothing to say. I submit that the matter of appointing the directors and secretary of a company-a bank is merely a company-is entirely for the subscribers and shareholders. It is their business, and is it to be said that the seven hundred odd of intelligent people of the province of Ontario who were subscribers to this institution, had not the capacity to appoint a manager? I have here a list of the subscribers. It would be rather criminal to inflict upon the House the reading of it, but I find that it contains 620 names, ranging all over the towns of the fair province of Ontario-two or three in some towns, as high as ten in others, and many from the larger cities. These people undertook to enter into the semi-private business of running a bank. I submit that those men are not in need of a guardian; they are not in need of some one to take off their clothes and put them to bed at night and to wash and dress them in the morning; they are not infants, but grownup people of the premier province of Canada, whose people boast of their education, of their business ability and capacity. Seven hundred of these men banded themselves together for the purpose of

carrying on a bank. Is it to be said to you, Mr. Speaker, or to the country or to the Parliament of Canada, that those 700 people, representing in the vicinity of $600,000 of the money of the people of Ontario, were absolutely unable to appoint a manager to look after their business, and that, forsooth, the Hon. Mr. Fielding had to step out .of his way to do it for them, and to find out what they were doing?-for that is what it amounts to. We are told that the responsibility of selecting this manager was entirely and altogether on the shoulders of Mr. Fielding, and that because he did not tell them how to appoint a manager he is entirely liable and responsible for whatever may have happened in connection with this business.
There seems to be an idea that this iBank Act contains a great many things which it does not contain. There is an old saying that any man who professes to be a lawyer and will give an opinion on a statute without reading it, is a fool; whereas the man who would not give an opinion on common law is not much good as a lawyer. I submit that a person, particularly a layman, who undertakes to say what the requirements of the Bank Act are without ever reading it is taking some responsibility. What powers had Mr. Fielding under this Act? They are laid down very concisely. He had to carry out the provisions as they are laid down. He could do no more; he did no less. The sections having reference to what we are discussing are four: Nos. 12, 13, 14 and 15. Section 12 says:
For the purpose of organizing the hank, the provisional directors may, after giving ten days' public notice thereof, cause stock books to be opened, in which shall be recorded the subscriptions of such persons as desire to become shareholders in the bank.
2.	Such books shall be open at the place where the chief office of the bank is to be situate and elsewhere, in the discretion of the provisional directors.
3.	Such stock hooks may be kept open for such time as the provisional directors deem necessary.
Section 13 says:
So soon as a sum not less than five hundred thousand dollars of the capital stock of the bank has been bona fide subscribed and a sum not less than two hundred and fifty thousand dollars thereof has been paid to the minister the provisional directors may, by public notice, published for at least four weeks, call a meeting of the subscribers to the said stock, to be held in the place named in the Act of incoration as the chief place of business of the bank, at such time and at such place therein as set forth in the said notice.
2. The subscribers shall at such meeting,-
(a) determine the day upon which the annual general meeting of the bank is to be held; and,
(b) elect such number of directors, duly qualified under this Act, not less than five, as they think necessary.
3.	Such directors shall hold office until the annual general meeting in the year next succeeding their election.
4.	Upon the election of directors as aforesaid the functions of the provisional directors shall cease.
Section 14 says:
The bank shall not issue notes or commence the business of banking until it has obtained from the Treasury Board a certificate permitting it to do so.
2. No application for such certificate shall be made until directors have been elected by the subscribers to the stock in the manner hereinbefore provided.
I now come to the last section I am going to quote, and I wish hon. gentlemen to note what authority the board has under this section:
No certificate shall be given by the Treasury Board until it has been shown to the satisfaction of the board, by affidavit or otherwise, that all the requirements of this Act and of the special Act of incorporation of the bank, as to the payment required to be made to the minister, the election of directors, deposit for security for note issue, or other preliminaries, have been complied with, and that the sum so paid is then held by the minister.
2. No such certificate shall be given except within one year- from the passing of the Act of incorporation of the bank applying for the said certificate.
All that Mr. Fielding could inquire into was: Did they subscribe the stock; was the money paid into his credit as the Receiver General; were the directors appointed; Those were the only three things that he could inquire into. The affidavit of Mr. Travers was filed in the office of Mr. Fielding at that time, setting forth all these facts. All the necessary papers accompanying that affidavit were there, and those papers were submitted to the experienced eye of the deputy Minister of Justice, who was asked to express his opinion as to whether the necessary papers were there, and if the necessary facts had been submitted to the department.
The Deputy Minister of Justice replied that everything was done that in his judgment was necessary, if they believed the affidavit of Travers, and be it remembered that at that time there was not one word abroad that would in the slightest degree reflect upon the character and standing of Mr. Travers. These six or seven hundred men were called together in the city of Toronto on the 26th of October, 1906, by regular notice inserted for thirty consecu-

five days in the Toronto Globe and in the Mail and Empire, and after four publications in the Royal Gazette, as the law required. This was ample notice for everybody to see that his interests in the bank were safeguarded. These notices were issued and this meeting was held after this action was instituted and discontinued or thrown out of court, and if the men who attended this general meeting of shareholders had any fears about the appointment of Travers, they had ample opportunity of finding out all about him, and that was the time and the place to dispense with his services if they so wished. However, every act of Travers was unanimously confirmed by this meeting, and his appointment as manager of the bank was also confirmed, all of which appears from the report of Sir William Meredith. At that meeting a board of directors was appointed, and the names of these directors will no doubt appeal to hon. gentlemen who come from the province of Ontario, as those of very respectable men. The first name on the list as honorary president is that of a man whom I have heard about since I was a boy, the name of a gallant gentleman, Colonel R. R. McLennan, of Cornwall, Ontario, whom we knew with a great deal of pride as one of the first Scotchmen in this Dominion. Then comes the name of Colonel James Munro, of Embro, Ontario, a gentleman of whom my hon. friend from North Oxford has spoken so highly. Then follow the names of Allan Eaton, Esq., of Mount Nemo, Ontario; Robert Noble, Esq., of Norval, Ontario; W. G. Sinclair, Esq., of Zimmerman, Ontario; A. Groves, Esq., M.D., of Fergus, Ontario, and N. M. Devean, Esq., John Gilchrist, Esq., of Toronto, Ontario, and W. Beattie Nesbitt, M.D.
Need I tell the Conservative members from Ontario anything albout Dr. Beattie Nesbitt? Need II tell the Prime Minister anything albout this man, <who was his right arm for many years, and who was the head and front of the strength of the Conservative party in the great Tory city of Toronto? His name, of course, as a director would inspire them with confidence. These men were appointed directors, and as directors they immediately took hold of Travers and they sent him down next day armed with every document he required to make application for the certificate. He came to Mr. Fielding; he presented these papers; he presented this list of the six or seven hundred business men who were shareholders; he presented the affidavits necessary showing that every step

was complied with in the organization of the hank; and he was able to tell Mr. Fielding that this strong board of directors had appointed him general manager of the bank and commissioned him to ask for the certificate. He showed Mr. Fielding that the necessary money was paid in; he produced lists showing the neces^ry subscriptions and that everything was straight and above board and in order, so far as any human being could see, and he demanded that the Treasury Board give him what he was entitled to under the law of the country. I submit that in the circumstances neither the Minister of Finance nor the Treasury Board would be justified in refusing him that certificate. But still we are told that Mr. Fielding should go beyond the duties the Parliament otf Canada imposed on him and do something extraordinary which was never done before. I submit, Sir, that the practice which was followed in granting the certificate in this case, is the practice that has been followed ever since Confederation and ever since we had a Bank Act.
There is not the slightest scintilla of evidence-it cannot be found either in the debate or out of it-that any government, either Liberal or Conservative, has done anything except what was done in this particular case. Therefore there is not the slightest justification for putting forward the plea that Mr. Fielding and the Treasury Board should have gone outside of the well-beaten path on this occasion.
The point I want to show particularly, on which perhaps not very much has been said and not much is necessary, is that the appointment of this man, who afterwards turned out to be a disappointment and to be a bad man-to put it mildly- was not the responsibility of Mr. Fielding or of the Treasury Board: There is not one word in the Bank Act giving the Treasury Board power to inquire who the manager shall be. There is not the slightest difference between the organization of a life insurance company or a steamboat company or any other company, where a certificate is required in order to commence business, and this particular institution of a bank. You cannot carry on life insurance or fire insurance business without coming to the Department of Finance and getting a certificate; but whoever heard of the Finance minister inquiring as to who shall be the manager of a life insurance company or a fire insurance company. All that the Treasury Board has to do is to see that the requirements of the

Bank Act are complied with and then to issue the certificate.
A great deal has been said about the way in which the money was raised. It is said that the money was raised by taking notes from men and women who wanted to become subscribers for stock in this bank. In ordinary, every-day business, a man's note, if he is good and has property and is a man of his word, is perfectly good payment.
I take the responsibility of saying in the presence of eminent lawyers in this House, that a note is payment. As a matter of law, every note given to Mr. Travers, or whoever got it, in view of those stock allotments was a payment and, particularly in view of the finding of Sir William Meredith in this particular that the notes were met, an absolutely and good payment to which no exception can be taken. The idea was not new among those who had to do with this bank, that is, whether this is good payment or not or whether they had the right to accept these notes or not. The provisional directors thought proper to take legal advice on the point as to whether they had the right to take notes in payment of subscriptions. They took the advice of a firm of lawyers, reputable, so far as I know. There a-e a good many reputable lawyers in the city of Toronto whom I know; and I cannot conceive of a firm of lawyers, that is not fairly good and whose opinion is not to be treated with respect, being able to hold its shingle out in the great city of Toronto. Therefore I presume that this firm of Urquhart, Urquhart and MacGregor is a fairly good firm of lawyers, perhaps a first-class one. I am told by the hon. member for Welland (Mr. German) that they are a good reputable firm. They were asked their opinion on this very question as to whether it was lawful to take notes for this purpose, and they put their opinion in writing on the 26th of June, 1906, in a letter addressed to A. S. Lpwn, Esq., one of the provisional directors as follows:
Dear Sir,-We have considered the questions submitted by you to us regarding the power of the provisional directors of the Farmers Bank of Canada, to accept stock subscriptions where the parties have given notes in payment of the stock in place of, or in addition to giving their subscriptions in the usual manner, the notes maturing at a time different from the payments in the subscriptions. We have not gone into the question of whether there would he any liability under the subscription without reference to the notes or whether both would be read together, but we are of opinion that the provisional directors have the power to accept
stock subscriptions which are made in this way, it being a matter that would come within the reasonable discretion of the directors.
The provisional directors are, of course, simply trustees, and any money or promissory notes they may receive in connection with the organization of the bank are held by them in trust for the bank. If these subscriptions are not paid the allotment could and no doubt, under the bylaws, could be cancelled by the directors, to be elected, and the stock could then be resold. We consider the question one in which the directors should use their reasonable discretion.
It would appear to us that the promissory notes might be of advantage to the bank, in the event of any subscriber seeking to dispute his subscription but this scarcely comes within the question submitted to us.
Tours truly,
That settled the question so far as any doubt existed as to the propriety of accepting those notes. The commissioner himself, the Hon. 'Sir William Meredith dealt with the question, and he certainly did not take any exception to the opinion expressed by this firm of lawyers. At page 5 in the report he says:
Questions having arisen as to the legality of taking promissory notes in settlement of subscriptions for shares, and as to the payment of commissions on such subscriptions, at a meeting of the provisional directors held on the 23rd June, 1906, it was decided to take the option of Messrs. Urquhart, Urquhart and McGregor, a firm of Toronto solicitors, on the questions and to instruct Travers not to accept notes in lieu of cash and that the conditions set forth in the form of application should be adhered to 'on a cash basis unless otherwise specially authorized by the board.'
Apparently only the first question was submitted to the solicitors, and their opinion as to it was that the provisional directors had power to accept subscriptions where the applicant gives his promissory note in payment for the shares in place of cash.
Sir William Meredith does not a,ay that it is right or that it is wrong. If he thought it was wrong, he would have so expressed himself. The only comment he makes on this is:
I have no doubt that one reason, at all events, and probably the main one for accepting promissory notes was that Travers might be enabled by means of them to raise money to make up the cash deposit which had to be made as one of the conditions precedent to the issue of the certificate of the Treasury Board.
Be docs not say that there is anything wrong .'about it; and that being the case and the provisional directors and the manager having acted upon the -advice of this reputable firm of lawyers, there was nothing wrong in getting the money for the starting of the bank by the use or manipu-

lation, if you choose, of those notes which were perfectly good and of which the makers were substantial men, who, when the proper time came, paid for their notes. The commissioner finds, generally speaking, that these men paid their notes, and the money found its way into the hank, and that there is no fault to be found on that ground. He bases his finding on another phase which I will briefly deal with.
I want to connect the position of the Government on this question with the report of the commissioner. The position of the Prime Minister was given yesterday by the Minister of Finance as follows:
If returned to power we will make full inquiry by Royal Commission into circumstances connected with organization of Farmers Bank an 1 granting certificate by Government. Our action with respect to depositors will be governed by result of inquiry.
What was the inquiry for? I submit that, after all, it did not discover anything new, and the basis upon which they are placing their action to-day was well known before this commission was issued. They knew everything that took place in connection with the issuance of this certificate fully and absolutely, and so far as that is concerned there wa6 no necessity for a Royal Commission and its findings. The commissioner was appointed in the hope that he would place the blame on the head of Mr. Fielding. I find on page 10 of his report an extraordinary statement-I do not know exactly what it means-as follows:
I was asked by the representatives of the shareholders and the depositors to find neglect of duty on the part of the Finance Department.
' I was asked '-I do not know what that means. Surely no member of this House, or any one else, would dare approach this distinguished judge and tell him, apart from the evidence submitted publicly, to find anything except what the facts would sustain.


Hugh Boulton Morphy: That request was put forward in open court by counsel representing those interested.


Daniel Duncan McKenzie: Very good. I did not know that these men were represented by counsel. So far as I know, the department as such was not represented by counsel, that is, Mr. Fielding was not represented, and I understand the Government was represented by Mr. Hodgins. I do not know Mr. Hodgins, but I have followed his examination, and certainly, if it is any 
consolation to him, I give him credit for having worked hard to root up everything that could be reached and place it before the commissioner. But I was not aware that there was anything in the terms of the commission to the effect that any person would be represented by counsel, particularly any person who had not been accused. However, my hon. friend explains that the parties who lost money were represented and exercised the right of impressing their views upon the commissioner. After hearing all they had to say and after touching here and there lightly upon matters that he would like to have bad done slightly different, the commissioner strikes the nail on the head and gives his answer in a way not at all in line with that urged upon him by those who lost their money in the Farmers Bank. It is true that juries sometimes take many hours to reach a verdict. During those hours in a jury room many opinions are expressed which look as if the final verdict would not be what it turns out to be; but what counts most, and is conclusive and absolute, is the verdict they finally reach. And I submit that what counts after all, and the only use we have any right to make of these findings, is the decision of the commissioner. He says:
I am unable to find that in this there was any negleot of duty on the part of the department, or to see that anything more than was done could have been done, even if Mr. Van-koughnet's letter had stated, which it did not, that the promissory notes he referred to were notes that had been given in respect of shares included In the list furnished to the department when the application for the issue of the certificate of the Treasury Board was made.
Notwithstanding the irregularities on the part of Travers and his misconduct in connection with the application for the certificate, which I have mentioned, the evidence satisfies me that if the bank had been prudently and honestly managed there is no reason why it should not have succeeded. The promissory notes that had been given by subscribers were for the most part good and were subsequently paid, and while it is true that if the certificate of the Treasury Board had not been granted, the money of the shareholders and depositors would not have been lost, the efficient cause of that loss was the recklessness and fraud of those entrusted with the management of the bank, and not the granting of the certificate.
If anything is to be gathered from the Prime Minister's statement that his conduct would be governed by the finding of the commission, his conduct in this case would have to be that there was no fault at all on the part of the Finance Department, that no trouble resulted from whatever irregularities might have occurred in that do-

partment; and therefore that the country was not dn any way liable and that those unfortunate people will have to look for a remedy somewhere else than at the hands of the Government. That is the logical conclusion from the statement of the Prime Minister: ' I will be governed by the findings of the commission,' and the commission finds that there is no liability. We find that the Prime Minister and his Government go entirely outside of the finding and try to seek refuge elsewhere; and they are just as bare of defence from this commission, and more so, than if it never existed.
In conclusion, let me point out the unfairness of the Minister of Finance in presenting the case yesterday. Such unfairness would not be tolerated in any organized court. We have the evidence sworn to; it was printed at the expense of the country and was available to every member of the House; but, instead of evidence, the Finance Minister put before us loud-mouthed speeches made by rampant partisans in the House four years ago.
We and the people of this country are asked to pass judgment upon the conduct of Mr. Fielding by reading not the sworn testimony upon which a decision was reached by an eminent jurist of the province of Ontario, but speeches made by hot-headed partisans in this House who assumed no responsibility whatever for what they were saying. The Chief Justice of Ontario reached a certain conclusion, upon certain facts, and if the Government are not going to abide by that decision, they must reach a different conclusion from the same evidence, and ought to be able to say to the country that the Chief Justice was wrong. But the Minister of Finance takes the extraordinary course of refusing to accept the finding of the Chief Justice of Ontario, to whom they submitted this case, and makes a decision of his own upon absolutely different material which is not evidence at all.
I have nothing to say against the hon. member for Halton (Mr. Henderson), or against the hon. member for West Toronto (Sir Edmund Osier), but I will say that there never were during my time in this House two such hidebound partisans as they are. They made speeches in this House four years ago in condemnation of the Hon. Mr. Fielding, and held out bribes to the electors of Ontario for partisan purposes; and that stuff is submitted to us as evidence, to the exclusion of the sworn testimony that was given before the commissioner. I submit that this presentation of the case is most
unfair, most illogical, and without precedent in the annals of the courts of Canada.


William Thomas White: Will my hon. friend, as a reasonable man, state whether he would expect me to put thirty pages of Mr. Fielding's evidence upon ' Hansard '?


Daniel Duncan McKenzie: The hon. gentleman had before him the crystallized finding of the distinguished' jurist, the Chief Justice of this province, based upon sworn testimony heard before him. If the evidence was too voluminous for the hon. gentleman to submit to the House, why did he not say: upon this evidence I am satisfied to accept the finding of the Chief Justice of Ontario? Why did he not do this instead of going outside this evidence and putting upon 'Hansard' speeches which were made four years ago for the purpose of making party capital against a distinguished Minister of the Crown? I submit that that is not evidence at all, and that the hon. Minister will search in vain the records of any British parliament or of any court of responsible standing in this country for a precedent for what he has done in this instance. I am sure that eome day, when he is not carrying out the party purposes which he now has in view, it will appear to hian as a most extraordinary thing that he of all men should have taken this course. I could understand a layman doing it; I could understand a layman believing the stories told at the fireside or on the street and thinking that they were just as good as sworn testimony; but a jurist like my distinguished friend the Minister of Finance has no such excuse. The answer that he made yesterday was ample evidence of the fact that he fully understood the nature of the evidence which he was producing, because he said: ' What I am presenting to the House is not the best evidence.' The fact is that he left out the best evidence and has given us the worst evidence that he could possibly give.
A great deal has been said about the action that was brought on with which Leighton McCarthy had something to do. I want this House and the country and you, Sir, to appreciate the circumstances. There were only four or five people involved in that action. Their names 'are a matter of record; everybody knows who they were. When it came to the point of testing out their rights in court, they threw up the sponge. The records show that Mr. Travers made an affidavit before Mr. Justice

Anglin in which the whole -story is told. The evidence was put on record by Sir William Meredith; he accepted thie evidence, -and upon that evidence as submitted to Mr. Justice Angflitn the -action was dismissed as an abuse of the process of the courts, that is, issuing a writ and using the process of law for improper purposes. The judgment wherein Mr. Justice Anglin dismissed this action may be found of record in the courts in the province of Ontario. Mr. Fielding and others would cut -a sorry figure if they told the 700 business men in the province of Ontario who had worked up to the very 2 a.m. point where they were entitled to get tlhis certificate:	An
action was -brought by four of you for some purpose or other; that action has been dismissed; there was not a word of truth in the -statement of claim. Without any authority for doing so, I will take the responsibility for suspending the operations of this institution for which the Parliament of Canada issued a charter. It is true that you are authorized to do business by act of Parliament; it is true that you have complied with every provision of that act of Parliament, but I take your charter -away simply because, forsooth, some persons in Ontario got a little disgruntled and brought action. Th it is not the position any sane business man would take. Any unfavourable results which there were, had followed not from the granting of this certificate, but from the fact that dishonesty prevailed in the management.
A most extraordinary position is taken by our mild-mannered and capable friend, the Minister of Finance.
He plunges into a question of what I regard as theology, and if he were a Presbyterian like myself I would ask him to discuss with me the question of predestination and the freedom of the will and the sovereignty of Providence, the omniscience and omnipresence of the Great Being who governs and rules us all. His reasoning is: If this charter had not been granted, there would have been no failure

beautiful theology ! If no bank charter, subscriptions would not have been asked for all over the country; if subscriptions had not been obtained there would never have been a meeting of shareholders, and no directors would have 'been appointed, and no general manager. No certificate, no bank, no loss; that is the extraordinary theology applied to business, that is put forward by the diis-
IMr. McKenzie.]
tinguished gentleman who is the first man in financial circles in this country. This, applied to every day life, would result in this way: John Brown is the creation of God, because we -believe that all men are so created; John Brown has committed murder; if John Brown had not been created there would have been no murder; therefore the Creator of John Brown is responsible for the sin of murder. -My hon. friend will -see where his theology will lead -him. It will lead him to a doctrine of the origin of sin which I have never upheld, but to which some people adhere. According to the theology of my hon. -friend John Brown is a murderer, the Almighty created John Brown and therefore the Almighty is guilty of the sin of murder because he created John Brown. That is the theology of my hon. friend, and if his law is no better than his theology I would be sorry to -see this country following him very far.


Mr. A. W. CHISHOLM:: One word of explanation : I am one of the double victims of the unfortunate state of the Farmers Bank, -being a shareholder to a small extent. I am paired with the hon. member for Annapolis, and therefore will not be able to vote. I wish, however, to be put on record as saying that while perhaps my personal interest might be to vote for the Bill, after hearing the discussion and becoming seized of the facts, my duty as a representative of -the constituency I have the honour to sit for is to vote against this Bill and to vote against my giving away one and a quarter millions of the people's money for the purpose of redeeming pre-election promises.


Mr. P. E. LAMAROHE (Nicolet):: been diverted from the purpose for which they had been voted.
How did the Government ascertain that fact? Merely by setting at work two or three expert accountants from the Railway and Finance Departments. Those gentlemen were able, after fifteen days' inquiry, to tell us what was the financial condition of Mackenzie and Mann, and especially of the Canadian Northern. If the same gentlemen were able, after two weeks, to make a report on accounts as intricate as those were, I think it would have been easy for the Government to appoint the same experts to investigate the business of those banks. They could have gone to the receivers of La Banque de Saint-.!earn and of La Bamque Ville Marie and, moreover, they could have taken communication of certain documents now in the possession of the Treasury Board. I think that after a couple of days' work if we compare what was to be done with what was done in a fortnight in the case of the Canadian Northern, they could have given us a detailed and complete report which would have enabled the Government to put the depositors of those banks in the province of .Quebec on an equal footing with the depositors of the Farmers Bank. It was not thought proper to do .so, and it is for those reasons that I am against this Bill and in favour of the amendment asking a six months' hoist.


Edmond Proulx: I cannot see any good reason why this House should vote on this Bill even relying on the report of the commission appointed by the Government. The commissioner does not ascribe the wreck of the bank to the irregularities with regard to issuing the certificates, but to the mismanagement of the general manager.
He said that even if irregularities had preceded the issuing of the certificate he did not see why with good management the 'bank should not have been a success; and that is my own opinion. I think the Government is creating a very bad precedent in asking the House to vote this money, unless it wants to establish the policy that the Government should guarantee the deposits of all banks, and should reimburse the depositors of the banks which have already failed.
I have read an excellent opinion on this matter in a good Conservative paper. I find in the Montreal Star of this date the f blowing:
It is all very well to argue that the certificate should not have been issued to the Farmers

Bank without an inquiry, and that the failure to hold such an inquiry renders the country morally responsible for the losses which the wrecked bank inflicted upon its depositor-'; bui every man in Parliament must realize that it will be very easy to get up a fairly plausible case-probably on some other count-for any wrecked bank, and so justify the repayment of its depositors. A failure on the part of the Government to take any extraordlanry sted, which can always be suggested so easily after the disaster, would be quite sufficient to justify politicians in Implementing pre-election promises to recoup angry depositors.
Sir William Meredith, the Royal Commissioner who inquired into the case of the Farmers Bank, did not say that the certificate should not have been issued. All he said was that an inquiry should have preceded such a step-an inquiry justified by the warnings which reached the Finance Minister. This may be true; but it is a compelling ground on which to recoup depositors? The mischief will not be limited to the $1,200,000 voted. Our public men will find that this Act will have created a precedent which will end in compelling a practical Government guarantee of all hank deposits. And, if this latter is good public policy, It should be accepted openly on its face, and not as a by-product of quite another proposal.
I am entirely of this opinion.	If the
Government want to guarantee bank deposits they should make it their settled policy, and not do it as the by-product of another proposal. The hon. member for North Ontario (Mr. Sam. Sharpe) said that the efficient or proximate cause of the wrecking of the bank was the issuing of the certificate due to the negligence of the late Finance Minister. I take issue with that. I rather think that the wrecking of the bank was caused by the mismanagement of Travers, and by the mining speculations of the late Dr. Beattie Nesbitt. I think the Keely Mine was the causa eausans of the wrecking of the bank rather than the negligence of Mr. Fielding. I do not want to delay the House any longer, but I intend to vote against this Bill because I think the Government is not justified in voting the money.


Mr. J. J. MERNER (South Huron):: Representing a riding in which there are a great many depositors who lost their money in the failure of the Farmers Bank, I feel it my duty to say a few words in their behalf-not for political purposes, for I believe this question is too serious to be treated in that way. In the constituency which I represent there were two branches of the Farmers Bank with about 600 -depositors representing about $120,000 in deposits.
We are told by some hon. members that the depositors of the Farmers Bank do not deserve the sympathy of the people and

should therefore receive no consideration from this Parliament because they put their money into this bank in order to get the benefit of its higher rate of interest. I deny that. The banks that paid a low rate of interest in my riding had no other bank within six and nine miles of them, and it is only natural that the people should support their home bank. The Farmers Bank paid the same rate of interest, namely 3 per cent.
We have heard a great deal from hon. gentlemen opposite to the effect that we used this legislation as a bait in the campaign of 1911. I can certainly say that the gentleman I defeated at the last election held out this bait for political purposes. In the districts where the branches of the Farmers Bank had been doing business he pledged himself as strongly as he possibly could; he said that if returned to power he would do all he could to have the depositors reimbursed. Just to show the inconsistency of this gentleman I may point out that he voted against the resolution brought down in this House for the appointment of the Royal Commission to investigate the Farmers Bank, yet when he wants the votes of the electors he tells them that he will do everything he can to have the depositors reimbursed. He was not satisfied with going around amongst the people making these promises. A few nights before the election a special meeting was called of the depositors of the Farmers Bank. The gentleman who opposed me was there. I received no notice of the meeting or invitation, and I live only six miles from where it was held. The other gentleman's home is 20 miles away and certainly if the meeting was not called by him and he had received no invitation he must have had a very strong instinct.
Since the failure of the Farmers Bank several depositors of my riding have had to be sent to the House of Refuge, and unless some relief is quickly forthcoming a great many others will have to follow. This legislation applies only to the depositors of the Farmers Bank, and I hope the members of this House will not treat this Bill in a sectional or political way. Let us look at it from the national standpoint. The commissioner's report clearly shows, and it has been pointed out by the Finance Minister and other hon. members of this House, that the failure of this bank was due to the negligence of Mr. Fielding, the Finance Minister of that day. and I believe that is perfectly true. I believe it is the duty of the Government to
reimburse these depositors. I have a clipping here from the London Advertiser, one of the Liberal papers of western Ontario, which contains the following ridiculous statement under a scare heading:
Hopes to have the Senate kill the Farmers Bank Bill-Government urging Upper Chamber to Save it from Embarrassing Situation-Proposed Measure is merely one of Politics.
[Special to the Advertiser.]
Ottawa, May 13.-It begins to look as though the Borden Government was ' playing politics ' with its proposed measure to reimburse the defunct Farmers Bank. According to a well-defined rumour on Parliament Hill to-night, the Administration is planning to karikari its own offspring, and is seeking to ' quiet ' protest among its own ranks by assurances that the reimbursement Bill will be killed by the Senate.
There is no gainsaying the fact that the Government as a whole has no heart for the reimbursement legislation. Despite the definite preelection promises of Hon. T. W. Crothers and other Ontario Conservatives, who made reimbursement one of the definite planks in their election programme, the purpose was, up to the end of last session, to tell the depositors, in the words of one frank exponent of Government policy, to * go hang.'
It is disgraceful for any paper of any standing in the community to make such absurd and unfounded statements as I have read from this newspaper. If I thought that I was supporting a Government that was trying to hoodwink me and my people as this newspaper states, I would resign my seat. I have too much confidence in this Government to believe they would do any such thing. If there is any gentleman on the Liberal side of the House who can rise now and substantiate what this newspaper says, I would like to know it. I defy any of those hon. gentlemen to get up here and endorse the statement made by this newspaper.
This is my third session attending this Parliament, and as a business man I have been trying to figure out what the game of the Opposition in this House is. As a batter of fact I do not believe they are sincere in one-half of what they do in this House. They waste too much time altogether, and I have been unable to figure out in this particular case what the motive is that underlies their action for opposing this measure. I asked an hon. member the other day if he could tell me what the Liberals are up to, and he said: You are not enough of a politician to understand it; it's all politics, and not a matter of business.


Edmond Proulx: You were not here before 1911.


Jonathan Joseph Merner: I was not here before 1911, but my predecessor in the representation of the county was here, and my people realized that he got off such a lot of hot air they did not return him.


Edmond Proulx: Did thehon. member hear the statement made before the committee, that seventeen members on the Government side owe their election to this Bill.


Jonathan Joseph Merner: There is one thing I have noticed since I came to this Parliament, and that is that gentlemen on the opposite side of the House do not wish the Government to bring in good legislation. It is my opinion that they would rather see the Government introduce legislation which would ruin the country, in the hope that they might have a chance of getting into power again. Now, Mr. Speaker, the hour is very late, and I shall not detain the House further than to say that I shall have great pleasure in supporting the Bill.


Robert Laird Borden: This legislation is doubtless of a somewhat exceptional character, and it is desirable in every interest that it should be discussed fully, and that all possible objection to it should be made apparent, if there be any legitimate criticism to which it should be subjected. T therefore find no fault whatever with the length of the discussion. I would not trouble the House at this late hour were it not that the legislation is of a somewhat exceptional character, and that it is in fulfilment, to a certain extent, of a declaration which I made to this House in the concluding days of the session of 1912-13. I shall briefly allude to some of the salient points of this measure, and I trust that my remarks will not have as many conclusions as my hon. friend from North Cape Breton (Mr. McKenzie) found necessary.
My hon. friend who has just sat down (Mr. Merner) has alluded to certain observations which have been made in this House with respect to the action of the Senate with respect to this measure. I desire to say that if any gentleman inside, or outside this House, has stated or suggested that th^ Government has endeavoured to influence the action of the Senate in any way, against this Bill, or that the Government has sought in any way not to have it supported and passed in the Senate, he states that which is absolutely without foundation. No man in this House or outside of this House has

the slightest warrant for any such statement. I am not now alluding to the statement which I understand was made by my hon. friend from Rouville (Mr. Lemieux) that his friends in the Senate had determined to defeat this Bill.


Rodolphe Lemieux: I did not say that.


Robert Laird Borden: I did not hear my hon. friend say it, but I was informed that he had said it. Of course I accept his word at once. His friends are in the majority in the Senate and they can defeat the Bill if they see fit, but so far as the .Government is concerned it stands by this Bill as strongly in the Senate as it does in the House of Commons.
The Bill is in fulfilment of a declaration which I made last year and which I shall read because it will enable me to abbreviate very considerably the remarks which otherwise I would be obliged to address to the House. The statement I made on the occasion alluded to is as follows:
It appears from the report of the commissioner appointed to investigate the matter of the failure of the Farmers Bank (a) That the issue of the certificate of the Treasury Board authorizing the hank to commence business, was procured by false and fraudulent representations on the part of the promoter and subsequent general manager of the bank, W. R. Travers. (b) That in the commissioner's opinion it was incumbent upon the Treasury Board before issuing its certificate, to have investigated certain charges made to the Department of Finance that the amount required by the Bank Act to he paid in respect of subscriptions, had not in fact been so paid, and (c) That if the true facts had been disclosed, the certificate of the Treasury Board would not have been given, and thus the bank under the management of Travers would not have been authorized to commence business.
The case is of exceptional and indeed unique character, both with regard to the fraudulent means by which the certificate was procured and in respect of the results which followed, involving the ultimate loss of all moneys placed in the bank by the unfortunate depositors. The man who fraudulently procured the certificate in the name of the bank, was enabled to attract those deposits by the unwarranted assumption of powers in violation of plain statutory conditions. While the direct subsequent cause of the loss was the fraud and dishonesty of the hank manager in the administration 'of its affairs, there is nevertheless a certain connection between that loss and the power and status with which he became invested upon the granting of the certificate. Having regard to these considerations, the Government consider that the depositors are entitled to a reasonable measure of relief, which will be provided by legislation to be introduced at the next session of Parliament.
The case of the other banks mentioned, is in no wise similar, and the action which the Government proposes to take in the case of the

Farmers Bank will afford no warrant or precedent for reimbursing- their depositors.
It is perfectly clear that on ordinary principles of legal liability as accepted by the courts of the country, an action founded upon negligence must show that the loss is a direct and proximate result of the negligence upon which the action is based, and no one in this House has claimed .specifically that the action which the Government proposes on this occasion is precisely analogous to the judgment which a court pronounces in an action for negligence.
It is perfectly true that the .bad management of the bank was, in one respect at least, the direct and proximate cause of the loss; but it is equally true that, from the inception of the attempt to obtain a certificate permitting this bank to do business, a scheme was in progress which could have no result other than that which did obtain, because the whole sceme from the very first was a scheme to secure the sanction of the Government, which was necessary before the bank could receive deposits, for the purpose of enabling Travers to use and control the bank and its charter without regard to the provisions of the law, and because his attempt in that regard was based upon misstatements, upon absolutely false representations, upon deception practised upon the Government and upon the Treasury Board. It is equally true, as found by the commissioner who investigated this matter, that if the true facts had been disclosed to the Treasury Board, they never would have granted the certificate. It is equally true as well that, if the Treasury Board, acting for the Government and for the country in that regard, had performed the duty which the commissioner says it was incumbent upon them to perform, then they would have hlad notice of those facts and the certificate would never have been issued.
I am inclined to rest the action of the Government not so much upon the analogy of an act of negligence in the courts as upon the analogy of a trustee, who, acting honestly although erroneously, commits a breach of trust, and who is nevertheless liable although he acted honestly. Negligence on the part of a trustee may create a breach of trust in itself; and the ordinary, common 'law rules of contri'butary negligence and efficient cause are mot held, so far as I am aware, to affect the question of liability of the trustee in all such, cases. No one suggests that the ex-Minkter of. Finance did not act with perfect honesty;
but the claim is that he and the other members of the Treasury Board were appointed under the law to discharge a public duty, iby which it wlas necessary to maintain certain safeguards before any bank should be permitted to commence business, to issue circulation and to solicit deposits from the public; that in the discharge of this obligation, in which they had all necessary powers to perform that duty, under the law, it was brought to their notice that fraud and deception were being practised upon them and that, notwithstanding such notice, the members of the Treasury Board contented themselves with making inquiry of the very man who was accused of that fraud as to whether the statements made with regard to him were correct.
When my hon. friend the member for North Cape Breton (Mr. McKenzie) suggests to this House that the report of the commissioner does not set forth any default on the part of those appointed to safeguard the public interest in that respect, he surely forgets that there is a direct and specific statement in the report of the commissioner who finds that, having regard to the notice which had come to the members of the Treasury Board from various sources, it was incumbent upon them to make further effective inquiry, and that the result of such inquiry, if made, would have been to prevent the issuing of the certificate altogether. Under these circumstances, it seems to me that the criticism which has been put forward with respect to the action of the Government as now proposed is not well justified. It was incumbent upon those appointed by Parliament and by the people for the purpose, to take certain steps which would have prevented this bank from ever going into operation at all. Acting honestly but erroneously they failed to take these steps; and as a result of that, this man, in whose interest the whole organization of the bank was apparently undertaken, who promoted it for a particular purpose, which was not in consonance with the law of the land, was permitted to use the name of a bank and the apparent organization of a bank for the purpose of attracting deposits, when under the law of the land that bank was never properly constituted in the first instance. That seems to be the whole case; and if we take the analogy to which I have alluded, there seems to be very reasonable ground for the action of the Government as now proposed.

My hon. friend the Minister of Finance has gone in great detail and very thoroughly into the whole question, and I do not desire to take up the time of the House at this hour by repeating what he has said. My hon. friend the member for North Cape Breton and Victoria (Mr. McKenzie) accused him of unfairness in making his presentation of the case to the House. Nothing could have been fairer than the manner in which my hon. friend the Minister of Finance went into this case in detail and adduced from every source, from the report of the commission itself, all revelant considerations including those that might seem to tend against any action taken by the Government along the lines now proposed. What my hon. friend the member for North Cape Breton described as unfair was that the hon. Minister of Finance, for the sake of brevity in a speech which necessarily had to be somewhat lengthy, summarized the statements of two of the witnesses, the hon. member for Halton (Mr. Henderson), and the hon. member for West Toronto (Sir Edmund Osier) although my hon. friend knew at the same time, as every hon. member in this House knew, that the exact evidence in printed form was in the hands of every member of this House and that, if the Minister of Finance, in assuming that the accuracy of the summary which he gave to the House proved to be mistaken, he left himself open to be corrected by any hon. member. He gave his statement in that way for the sake of brevity; and he pointed out, as I now point out, that if there were any inaccuracy in the statements alluded to, it could be corrected by any hon. member.	.
What could the inquiry which has been suggested have led to? It could have led to the discovery by the late Minister of Finance in the first place that the amount required by the Bank Act to be paid by the subscribers had not been paid. What would be the result of that? It wou.ld be that the Treasury Board should not isme the certificate. My hon. colleague from Halifax (Mr. A. K. Maclean), when criticising this measure, said that there was only failure in a small degree to comply with the requirements of the Bank Act.
Why, it is an essential requirement of the Bank Act that $500,000 shall be subscribed and $250,000 thereof paid up. I shall come to some other failures to comply with the requirements of the Bank Act in a moment. But my hon friend from North Cape Breton (Mr. McKenzie) argues, so far as I

could follow him, that a bank can be lawfully established in this country without the subscribers paying up a single dollar; it is enough that they give promissory notes. And if promissory notes are enough, then the agreement to subscribe is enough, because that imposes upon those signing as strict a liability as the giving of promissory notes. If that is the law of the land, I must say that I am awaking to a new conception of what the Bank Act requires.


John Howard Sinclair: There is a phase of this question with which the Prime Minister is dealing now that I would like to have explained by him. I understand that all those notes were endorsed to the trust company without recourse to Travers or his associates, and that having done this, in the failure of the notes being paid at maturity, they could not come back on Travers and his associates for payment. Therefore at looks to me as if it was as good as cash so far as the carrying out of the banking law is concerned.


Robert Laird Borden: When the Bank Act declares that $500,000 must be subscribed and that $250,000 must be paid up, I presume it means exactly what it says.


John Howard Sinclair: He has the cash, and it cannot be taken from him.


Robert Laird Borden: Then my hon. friend
agrees with the hon. member for Cape Breton that that arrangement as good as payment in cash. That is not my conception of the law.


John Howard Sinclair: My view is it is quite as good as cash if you can find some one who will give you cash on notes without recourse.


Robert Laird Borden: That is not my conception of the law; and my hon. friend will be good enough to remember that this is only one incident, and that the commissioner, after describing how the cash was raised by the pledging of notes, says:
A certain form was gone through of crediting the proceeds of the loans raised upon the notes.
And he says:
That the balance of the loans were used to cover in part the expenses of organization which were not carried into the books of the bank until some months after it began business. $17,595 was placed to the credit of the subscribers other than those whose promissory notes had been used for the purpose of obtaining the loans, and who had actually paid nothing on account of their shares, and in many cases subscribers' notes for much larger sums than were placed to their credit were pledged for the loans.

If my hon. friend thinks that all these incidents connected with the taking of the notes were regular, then I desire to express my most absolute dissent with him. These were simply fraudulent incidents in a huge conspiracy to evade and misapply the banking law for a fraudulent purpose; and the inquiry, which the commissioner declares was incumbent upon the late Minister of Finance and the members of the Treasury Board, would have revealed the existence of that conspiracy, and would have prevented all that loss, waste and desolation which eventually did result from the granting of this certificate. That is my conception of it.
I was going on to allude to certain things which would have been dis-3 a.m. covered. It would have been discovered that Traver.s had made a false declaration for the purpose of misleading the Government and the Treasury Board and had attempted thereby to deceive the minister and the board. Is it conceivable that the certificate would have issued if that had been discovered? My hon. friend from North Cape Breton declared that all the Minister of Finance had to do was simply to look at the form of the papers. The statute does not say that. It says that no certificate shall be given by the Treasury Board until it has been shown to the satisfaction of the board, by affidavit or otherwise, that all the requirements of the Bank Act and of the special Act of Incorporation of the Bank, as to the payment required to be made to the minister, the election of directors, and the payment required to be made to the Minister of Finance and Receiver General and various other particulars, have been complied with. The action of the Treasury Board was. as the hon. member said, administrative, to a certain extent, but they were also the guardians and fiduciary protectors of the interests of the country according to the procedure and the principles established by the Bank Act. And it is the neglect of that duty, the unintentional neglect, I will concede, which brought about the unfortunate results in this case.
In the third place, they would have found that Travers had been guilty of a breach of trust in connection with his dealings with the promissory notes; they would have discovered that the meeting of subscribers had been irregularly called; they would have discovered an unlawful and invalid arrangement by which Travers 303
was to be general manager of the bank for a certain number of years. They would have discovered an arrangement which, according to the finding of the commissioner, practically meant that the provisional directors entirely abdicated their functions and were acting in accordance with Travers' directions, simply as - his tools. Does any one pretend that, under these circumstances, if the Treasury Board had discovered these facts, as it was bound to do according to the judgment of the commissioner, the certificate would have been granted? I venture to think not.
Under these circumstances the Government consider, having regard to all the conditions that have been discovered, having regard to the facts, which are not only exceptional but unique, that it is no more than just to bring relief to the depositors; and therefore we have introduced this Bill.
It has been alleged in this House that this Bill means a certain discrimination in favour of the province of Ontario and against other parts of the country. There have been a good many banks whose failure has resulted in loss to the depositors. There were the Merchants Bank of Montreal, the Liverpool Bank, the Bank of Prince Edward Island, the Exchange Bank of Canada, the Maritime Bank, whose head office was at St. John, the Central Bank with head office at Toronto; La Banque du Peuple, La Banque Ville Marie, La Banque St. Jean, and, last, the Farmers Bank. In no one of these other cases, so far as I am aware, was there any neglect or disregard of the precautions provided and imposed by the Bank Act on the part of the Government or any official of the Government. If, however, in any one of those cases it can be demonstrated to the satisfaction of the Government that it comes within the principle under which we are now acting, such a case shall receive precisely the same consideratin .as the depositors of the Farmers Bank are receiving in this case.
In view of all the circumstances we regard this case as unique and exceptional. We regard it as one which imposes a certain obligation upon Parliament and the people of Canada to right a definite wrong. In dealing with it in that way I think we disregard no known principle of good constitutional government, and I absolutely repudiate any statement from either one side of the House or the other that in making



this proposal the Government intends or desires to discriminate in favour of or against any province or community in this Dominion.


THE COMPANIES ACT AMENDMENT.
Mr. CODERRE moved:: That the House do disagree to the amendment made by the Senate to Bill 177, intituled an Act to amend the Company's Act, for the following reasons:
Because the said amendment nullifies the proper effect of the preceding clauses of the Bill and that the general policy of the measure requires the enactment of the clause cut out by the said amendment.


Alexander Kenneth Maclean: Wonld the hon. member explain?


Louis Coderre: There was a clause in the Bill, No. 3, that debenture stock which had been issued and hypothecated for the purposes of the company, and afterwards redeemed1 by the company, might be

re-issued to the public; that by paying the amount for which the debentures had been pledged, they would have a right to reissue these debentures to the public. This clause has been struck out by the Senate. I would like the Bill to be sent back to the Senate to have that clause re-inserted if possible.


[Stage Direction]
Motion agreed to.
On motion of Mr. Borden, the House adjourned at 3.30 a.m. Thursday.
Thursday, June 4, 1914.