The Northern Daily Times.
Liverpool, Merseyside, England, 1856-05-24 00:00:00

GRAND TRUNK RAILWAY,

Some time since we published some extracts from the
Canadian papers in reference to this railway, which rather
1 reflect-d upon the contractors, whom, it was alleged, had
1 broken faith with the Provincial Government. We subjoin
a letter from Mr. Brassey, from the Toronto Leader, which
throws a different light upon the affair, and in lefereeee to
which the Leader makes the following remarks :
" It is proper that in this p'ace we should draw attention to
the explicit statement Mr. Brassey has given of the relation
which his firm has sustained towards the province from the
period when they became contractors for the line from Toronto
to Montreal. As capitalists, Messrs. Brassey and Co.
undertook to furnish means towards the completion of that
work to the extent of £1,965,000; and that there has been
no failure in this part of their agreement, Mr. Brassey nial:es
apparent by drawing attention to the fact—which should
certainly constitute in itself an answer to every word which
has been uttered against the contractors—that under the new
covenants, extending the Grand Trunk line, ho and
his partners raised no less a sum than £4,950,900, of which
they hold themselves in shares and second class bonds of
£794,000. The extent of the provincial guarantee under the
present contract, Mr. Brassey also brings into notice ; and we
do think that no one who examines his figures can fail to see
how unjustly the contracting capitalists have been charged with
speculating on the credit of the province. While the entire
amount of the province guarantee to the Grand Trunk is
£3,111,500 ; £117,500 was voted to works with the con-
struction of which the present contractor: had nothing what-
ever to do ; and the additional sum of £900,000 voted last
year merely constituted an (quivalcnt for expenditures incurred
on the St. Lawrence and Atlantic road, and provided for out of
appropriations to other works. By the act which disturbed the
provincial guarantee over the whole of the company's works,
a still further sum of £291,000 was deducted from the
part of the line contracted for by Messrs. Brassey and Co.
So that the actual guarantee, upon the strength of which the
contracting capitalists were enabled to raise means in England
for the Grand Trunk, was only £1.203,000—an amount little
in excess of that which they now hold in the shape of shares
and second class company's bonds. Let us here draw attention
likewise to the distinct announcement of Mr. Brassey, that he
and his partners seek no relief from the covenants under which
they are bound. Although from the ex,raordinary pressure to
which the company has been subjected in England, during the
last two years, it has often been unable to meet its engage-
ments with the contractors—and although the amount which
has thus been overdue was sometimes nearly half a million—
a sum which would have sunk half a dozen of the
wealthiest contracting firtns on this continent—yet the works
have in no case been delayed, There has not even
been a temporary suspension. But Messrs. Brassey & Co.
bid fair to have their contract completed at least twelve months
in advance of the period to which their covenant hinds them.
It is characteristic of an English community to treat honesty
and fair-dealing like this with churlishness and abuse ? We
put the question to the sober and intelligent people of the
country. We appeal not to mere political gamblers, to charac-
terless ministers, nor eager expectants of office. But recog-
nising the truth of the dramatist's reflection, that the great
soul of the world is just—we appeal to those who have made
this country what it is, in spite of social intrigues and official
i misrule. By their verdict we are prepared to abide."
The following is a copy of Mr. Brassey's letter .
Toronto, 25th April, 1856.
THE HONOURABLE JOHN ROSS.

Sir,—The circumstances in which, on our arrival in this
country, we find the Grand Trunk Railway Company, and the
very important results that must flow from the decision to be
arrived at by the public and the government in regard to this
undertaking within the next few weeks, warrant us in address-
ing to you, for the purpose of publicity, certain statements
bearing upon our first connection with Canada, and upon our
present position and responsibilities implied and expressed
towards the province, and to the company over which you
preside.

We do not desire to occupy your attention with any unneces-
sary recital of facts—but in support of our own position, and as
evidence of our uniform and unwavering efforts to fulfil our
engagements, we must briefly sketch out the circumstances
which led to our connection with this province.
In the spring of 1852, whe❑ the Hon. Mr. Hincks was i❑
London on a mission connected with the proposed Inter-
national Railway from Quebec to Halifax. our firm was in
communication with the Directors of the Quebec and Rich-
mond Railway. Mr. Ilineks was thus brought into contact
with us, and subsequently when that gentleman believed that
no adequate support was to he given to the proposed national
work by the Imperial Government, he sought our aid with the
view of undertaking those works of international communica-
tion in Canada, required, in his opinion, to develope the grow.
ing wealth and resources of the province. We thus placed
ourselves in communication with the Premier and Finance
Minister of Canada, believing that further knowledge in
England of the increasing prosperity of the province was only
required to secure for its undertakings at least an equal support
to that given to American enterprises. We take no credit to
ourselves for an appreciation of Canadf, which was probably
first induced by a regard to our own interests ; but we may
fairly say, that whatever our original cause of interest in this
province, we ought not to be blamed it we have sought to find
here that which we could, without a doubt, have secured on
the Continent of Europe or from any of the Western Ameri-
can States. And if we may not be entitled to consideration,
we feel that it should not be charged against us that we selected
Canada, with any other view than that of thriving ourselves by

the prosperity of the province.
Our intercourse with Mr. Hincks resulted in our undertak-
ing to make an inspection of the line from Montreal to Toronto,
and, if satisfactoty, an offer to construct the same. This was
done, and, without troublingyou with details, it resulted in as
offer on our part to construct the road from Montreal to
Toronto, conditional on our receiving provincial aid to tbo
amount of £3,100 sterling per mile. Our proposal encountered
much opposition, and our partner, Mr. Jackson, finally I;ft this
country without any specific settlement of the disputes of the

contending parties.
On Mr. Jackson's departure, the difficulty of overcoming
the legal objections to the course proposed, and the belief of
the parties interested that the time had arrived for such a com-
bination of existing railway interests in Canada, as would
afford this country the advantages of one uniform railway
system, and an avoidance of the evils of general competition,
induced Mr. Hincks to agree to accept a relinquishment of the
previous charters, and to contemplate the construction of a
railway bridge at Montreal, with an amalgamation of the line
from Toronto to Montreal with the line from thence towards
Portland, which had already received provincial aid to the
amount of nearly half a million sterling.
You, sir, had then proceeded to England to complete the
arrangements with our firm, and advices were soon received
from Mr. Hincks of the nature of the misunderstanding come
to in Canada, and of his wish that we should consent to
modify our terms in conformity. This we bad no other hesi-
tation in doing, than in the fact, that we had partial engage-
ments to the Quebec and Richmond Company ; and, as we
had stated, to the Line from Montreal to Toronto, which
together involved as large ergagemonts as we wished to under
take. We also doubted the propriety of undertaking a work
so expensive as the Victoria Bridge upon an extent of mileage
no greater than the Toronto Road ; while we felt that to give
the scheme an acceptable character with the public, it must
hear, first, the assurance of being a complete work, connecting
the fertile and prolific regions of the West with the Ocean ;
and secondly, such a relatio❑ to the general interests of the
Provinces as would justify us in associating its prospects with
the growing prosperity and advance of the Country, and
also with the political connections of Canada with the Lower

Provinces.
We do not state these matters as subjects weighing on our
own minds, hut as facts known to you, when representing the
province in the arrangements referred to ; and we wish to
recall to your attention, that in considering the propriety of the
general amalgamation, your design was, at least, so much to
serve great public objects, as to place the project in a favoura-
ble light before the English public. You will, therefore,
remember that, at this period, the negociations broken off by
Mr. Hincks, were renewed by you with the colonial secretary,
and that we had every reason to believe that the British
government would furnish such aid as would complete, not
merely the line from Trois Pistoles to Frederick'on, but also
place the whole line to Halifax on a perfect footing, with such
arrangements with the Cunard mail service, as would have
ensured certain results to the more eastern section of the
streat Grand Trunk scheme, which, from Quebec to Trois
Pistoles, would not otherwise have bee❑ undertaken. The
negociations to which we refer were conducted by you, and we
think that you will hear out our statement that both you and
we had reason to believe the Imperial government would
adopt your views. We will only add that, while a conviction
of the necessity of immediate action, caused the anticipation of
their decision, by the issue of the Grand Trunk prospectus,
still nothing but the prospect of war prevented the completion
of the intention then held by the government of Great
Britain.

Under the view we have stated, of the importlnce attached
by Mr. Hincks to one uniform railway system throughout the
province, you are aware the promoters of the company con-
sented, in March, 1853, to accept the Toronto and Sarnia line,
as giving the Grand Trunk company a western connection ;
hut in the construction of this section we have never had any

interest whatever.
By these statements we bring down the position we held
towards the province to this—that our difinitive promise was
to raise means for completing the line from Toronto to Mon-
treal, on receiving aid to the amount of £3,000 per mile, and
that the other engneements entered into were not solely fraught
with profit to us, nor properly included in our original propo,,i.
tions. Taking the cost of the road from Toronto to Montreal

as undcr our contract
Lots provincial aid

.43,000,000
.. 1,082,000

We engage to raise
In ono form or another to fulfil our engagements.

L 1,965,000

We wish this point to be clearly understood, because, the
difficulties of the company are generally attributed to failure on
our part, rather than, as is really the case, to the introduction
of other schemes of importance to the province, hut yielding us
no positive advantage beyond that which we always regarded as
very great, of having the whole work looked upon as a national
undertaking.
We shall now proceed to show what we have ourselves done

in compt.etion of our engagements, and how far we have shared
with the province in the efforts necesslry to carry through an
undertaking with which we had identified ourselves.
As we have already shown, the amount of private capital
required for the original scheme was £1,965,000, the amount
raised has been £4,930,900, of which we now retain no less
than £794,000. If, therefore, the province have increased
their a d by £900,000, or less than one half their original
we, with the other shareholders, have raised nearly
thr?e times the Omani. we originally contemplated.
Under our original plan we were to build 345 miles of
railway. By the realised plan—there are contemplated, or
will be this year, 40 miles below Quebec, and 445 miles, froru
Montreal to Stratford, with a large expeudi!ure upon the Vic-
toria Bridge, as well as an outlay of £900,000 upon the line
fir:au Montreal to Portland. So. far, therefore, from there
being any just charge against us of having failed to fulfil our
promises to the province, we nr,y fairly take credit foe very
much more having been done than was originally intended,
and if disappointment have ensued, we, at least, equally share
in it.

We wish, now, to refer more particulary to our present rela-
tions with the Company under our contracts. We seek no
relief from those contracts; but we think, all things consid-
ered, justice requires that we should not be charged with a
failure in our engagements, either implied or express, towards
the Province of the Company, unless it can be clearly shown.
In entering upon this branch of the subject, we wish to recall
to the attention of the Public, that of the amount of Pro-
vncial aid given to the Grand Trunk
Railway, amounting in all to
The following amounts had been
granted previously to our connection
with the Government through Mr
Hincks, viz

£3,111,500

St. Lawrence and Atlantic Railroad.. £467,500

Quebec and Richmond
And the amount of aid gtanted last
Session, was not for works in whicli we
were in the sligh'est degree interesteil,
hut to replace capital originally intena.4
for our works,and abstracted to complete
necessary outlays on the line from Mon-
treal to Portland
By the Act distributing the Provincial
aid over the entire expenditure of the
Company (passed in November, 1834),
the guarantee originally granted for our
line to Trois Pistoles, was transferred to
the line from Toronto to Stratford, in
which we had no interest whatever.
Thus making a further diversion of
Provincial aid from our works of £3,000
per mile, on 97 miles, or

„ 250,000

900,000

291,000

1,903,500

Thus leaving only
of the entire aid provided by the province, which has really
been applicable to the following works embraced in our con-
tracts and which entitled the province to expect from us the
completion of forty miles below Quebec, and the line frnti
Montreal to Toronto. Of this amount of £1,203,000 no leig
than £546,000 was still in the hands of the province at lsi
April instant. Thus showing that while we had completed
the forty miles from Quebec to St. Thomas—expended about,
£320,000 on the Victoria Bridge, and so far corriplke4
the Montreal and Toronto line that only about £300,000,
of work remained to be done, the entire amount of
provincial aid which had been paid to the G,and Trunk
Company, in respect of these works, was only £657,000.
So ely under these circumstances we may boldly Mk nt the
hands of the Canadian public consideration and candid
discussion

We claim, so far as the province of Canada is coneertiedi
to have much more than fulfilled all ive ever iindertofilt
towards it, and if reference be had to the great change in
money matters in England, consequent on the war, as well
as to the enormous advance in the price of labour, Materials;
and every necessary of life in Canada, the public may form
some idea of the extent of the sacrifices we have made, 4
preserve intact our reputation for an honest fulfilment of our
engagements:

Our relations to the Grand Trunk Railway Company are
subjects with which, in reality, the Province has no direct
ooncern, co long as we cart show that they have in no respect
caused a failure on our part towards the province, but at these
relations are very greatly migtinderstciod, we desire in all
candour, to state the real position.
There can he no question that, with money worth only twq
per cent. in England, the parties representing the province arid
ourselves, foreseeing no outbreak of war, did not hesitate to
enter into mutual engagements which a different state of things
has made extremely onerous to all. We shared the confidence
expressed by yourself, Mr. Hincics, and the legislature of
Canada, in the future of this country. We thought it a fair
field for investment. And we consider it no subject for blame,
that we should have sought a fair and reasonable return for
services we believed it in our power to render. We did not
therefore hesitate at assuming responsibilities of a magnitude
we might have shrunk from, had we known the future ; and we
consented to the views of the agents of the province in the
terms of the original prospectus,' to an extent that has been
from that hour both injurious to us and very damaging to the
company. We allude to the engagements in the prospectus of
the Grand Trunk Company, whereby we undertook to pay the
interest upon the capital employed in our works, and also to
permit one-half the entire capital to be withheld from public
disposal, with a liability on our part to assume it at the end of
twelve months. We desire to state distinctly, as a fact within
our own knowledge, that so far from our desiring the reteriticni
of this large amount of capital (L 3,623,000) it was expressly
required by Messrs. Glynn and Baring, from their belief that
the whole amount could not be successfully floated,.and that
we hesitated for days in assuming this future liability. The
public may therefore ju ige how far this obligation has pressed
upon us, when, within the twelve months stipulated, war was
declared, and money rose from two to six and even eight per
cent.

The altered state of affairs so far affected even the stock
already issued to the public, that without any particular respect
of our wishes the London directors, with our concurrence,
determined to suspend a portion of the Grand Trunk works, in
order to relieve the shareholders. And finding the works on
the Montreal and Portland section had absorbed £900,000 of
the money intended for our works, the board applied to yottr
legislature for aid, which as before stated was obtained, to the
extent of £900,000, not as an additional loan to us, but solely
to enable the shareholders to fulfil their own engagements.
The company was then largely our debtors, and we might
have suspended our works, and thus relieved ourselves from
much embarrassment, had not other motives actuated us.

The effect of the terms of the act, granting additional aid,
passed in May, 1855, required a modification of our contracts
with the company, and this took place in Londsn in July last,
with the approval and aid of the inspector general, who was
then in England, with other members of the Canadian cabinet.
By this agreement, we pledged ourselves to proceed with and
complete the Montreal and Toronto, and Quebec and St.
Thomas sections, in all 335 miles, receiving a payment one-
half in cash, expected to be provided from the provincial
guarantee, one quarter in B. bonds of the company, and one
quarter in B. shares.
Under the supplementary contract we have pushed forward
the works nearly to completion, but we desire the public dis-
tinctly to know that since that date the company have never
been able promptly to meet their engagements with us, and,
from whatever cause arising, very large sums have constantly
been due to us even from the half which was promised to us in
cash.

_
It is, we find, generally supposed that our firm had engaged
to provide the interest on the Province Bonds, and bad failed
to do so. This impression we desire to correct. Our engage-
ment was solely to the company, and consisted in our pledge to
pay six per cent. interest on all the capital expended on out
works, reserving to the company the right of retaining this
interest from the amounts due to us for works done. As the
company has generally been in arrears to us, it must be.mani-
fest that we are in no way responsible for any difficulties on
this head. We have never, as contractors, received from the
province one single bond, our payments are promised to us by
the company, in money, and in their own securities.
We are also perfectly aware that it has been, and will be,
said that our firm is, in fact, the Company, and that we caisnot
therefore free ourselves from any censure that may fairly
attach to it. But on this point we earnestly entreat the
public to become disabused. We have never, from the day
the prospectus was issued, had any control over the affairs of
ethxepeCnodmitup
irenY had—
itspolicy had not been directed by us-- its
been great on works in which we had no
interest, and except in the extent of our engagements, as
respects the future acceptance of Shares and Bonds, we had
no other interest in the Company than Messrs Growski and
Co. in Canada. To those who know the character and position
of the gentlemen forming the London Direction, it is needless
to say that we could exert no improper influence upon the
Company; but to strangers it may be necessary to offer this
assurance. Our present stake in the Company, owing to the
arrangements of July last, is necessarily large and daily
increasing, and in this respect we cannot but share the anxiety
of the other Stockholders in wishing the Province to afford the
.Company the relief necessary for carrying out the entire scheme
in its integrity. Our relative interest in the undertaking may
be best shown by the statement that of the amount of private
capital brought in .... • ********* • •
We hold now, even under the operation of the
July agreement .

794,000

Held by general shareholders

£4,156,900

The Canadian people will thus clearly see that though our
interest is enormous in amount, and fully indicates our own
confidence, still by far the larger amount has been provided by
the British public generally.

We do not know what more we can say to dispel what we
feel to be misconceptions most seriously injurious both to our-
selves and the company ; but, while we hope this statement
m'y suffice, we shall, sir, at all times, hold ourselves ready to
afford you and the public any further information in our
power. I have the honour to be,

Your most obedient Servant,
For self and Parinent,
THOMAS BBASSEY.