MESSRS. BROGDEN’S CLAIMS.

New Zealand Times, Volume XXXIII, Issue 5322, 17 April 1878, Page 3

MESSRS. BROGDEN’S CLAIMS.

(From the Lyttelton Times, 12th inst.) We have observed with considerable surprise certain statements in two letters addressed to the New Zealand Times at Wellington by Mr. John Henderson, the agent in New Zealand of the Messrs. Brogden, on the subject of their railway contracts. Mr. Henderson’s first letter is published in the New Zealand Times of February 23 ; and his second letter appears in the Wellington Evening Post of April 2. Mr. Henderson states in his first letter that Messrs.'Brogden were entirely unaware of the passing of the Government Contractors Arbitration Act, 1872, which relates exclusively to the Brogden contracts, and which enables a Judge of the Supreme Court to act solely as arbitrator in case of disputes arising in connection with these contracts. Mr, Henderson further states that the Act in question “ opposed a complete barrier to the prosecution by Messrs. Brogden and Sons against the Government of ordinary legal proceedings before a jury.” He adds that “ Messrs, Brogden were advised that by the operation of that Act they would be forced to submit to the adjudication of the Supreme Court Judge, not only without the intervention of a jury, but without any right of appeal from his decision to any Court here, or in England.” He proceeds to say that “ there unfortunately exist many and weighty reasons why Messrs. Brogden, when enforcing these disputed claims, should avail themselves of the protection afforded by an unprejudiced jury.” Disclaiming any imputation against a Judge, he reiterates the objection to a sole Judge hearing and finally deciding these disputes. In his second letter, Mr. Henderson positively states that neither the Messrs. Brogden, nor he, as their agent, nor their solicitor at Wellington, were aware, until about a year ago, of the Act referred to; that he, Mr. Henderson, was astounded when he first heard of it; and that his principals at London on learning the news “ were, if possible, even more amazed and disgusted” than himself. He indirectly accuses the Government in 1872 of having smuggled the Bill through Parliament, and he describes the effect of the Act in the following high-falutin words : —“ The Courts are closed. Trial by jury is for Messrs. Brogden an impossibility. Appeal is cut away from them, and the Government Contractors. Arbitration Act amounts to an act of repudiation ” (the italics are his own) “as being utterly at variance with contracts entered into by the Government with Messrs. Brogden previous to the passing of the Act.’’ 1 It will be seen from what we have stated that the whole gravamen of Mr. Henderson’s complaint, expressed, we must say, in rather intemperate terms, is, that disputes arising out of the Brogden contract are to be submitted to the sole arbitrament of a Judge of the Supreme Court, and that in 1872, suddenly and without notice, an Act was passed to that effect at variance with and in derogation of the terras of the contracts themselves—an act, tantamount to repudiation. We have said that we .observed these statements with considerable surprise ; and- we think that our readers will share in that surprise when they learn the facts. The plain tale which we shall

give is no surmise, or conjecture, but.a simple transcript of Parliamentary;records of the time., The following extract is from a document laid before Parliament iu 1872 : “ Memorandum of heads of an agreement entered into by Messrs. Brogdeii and Co. and the Goverment, represented by Mr. Beeves, on the 10th April, 1872, the subject of the conference beiug the differences which arisen in respect ,to the general conditions hitherto in force with regard to the construction of railways iu New Zealand. “1, On the subject of arbitration it was decided that, iu case the Governor or Minister for Public Works, as the case may be, aud the contractors shall not agree, the matter shall be determined by arbitration; and every such matter as to which they shall not pute or difference, shall be settled by arbitration, to be conducted by reference to the sole decision of the Judge ot the Supreme Court iu New Zealand ■within whose district the cause of difference or dispute may have arisen. This submission to arbitration may be made a rule of the Supreme Court of New Zealand, or of any of the superior Courts of Westminster, as the case may be or required. The costs of aud attending the arbitration and award shall be iu the discretion of the arbitrators.”

On August 10, 1872, iu the presence of the Governor in Council, of Mr. Brogden, one of the firm, and of Mr. W. T. L. Travers, the Wellington solicitor ot the firm, six railway contracts with Messrs. Brogden were; duly approved aud executed. These contracts were for the Auckland and Mercer railway, the Napier to Paid Paki railway, the Wellington to Hutt railway, the Pioton to Blenheim railway, the Taieri portion of the Dunedin to Clutha railway, and the Invercargill to Mataura railway. One of the general conditions attached to each contract is as follows “Sh mid any dispute arise between the contractor and the engineer, or between the contractor aud the Minister of Public Works, or the Government, relative to the force, aud intent, aud meaning of the specifications, drawings, or conditions, or to the mode of carrying on the works, or the nature and quality of materials used or supplied to be used, or workmanship of work done, or as to the maintenance of the works, or as to the expense of additional works, or of alterations or deviations from the specifications of plans, or as to any other matter connected with the execution of the works, or with the contract, specifications, drawings, or conditions, or as to any matter which by this contract it is expressly provided is to be settled, ascertained, or determined by arbitration, such dispute shall be referred in writing to the sole determination, arbitrament, and award of the Jndge of the Supreme Court assigned to that judicial district of the Supreme Court within which the works relative to which the dispute shall have arisen have been, or are to be executed, whoso award shall be final, binding, and conclusive on all parties.” There is an express provision in each contract that all disputes arising thereout “ should be referred iu writing to the sole determination, arbitrament, and award of the Judge of the Supreme Court,” aud that his award shall be “ final, binding, and conclusive on all parties.” Mr. Henderson is angry and astounded without cause. Before any Act was passed, the contracts themselves shut out from Messrs. Brogden trial by jury aud appeal. They themselves, deliberately and with their eyes open, did this dreadful deed. For technical reasons an Act was necessary to give the Judges full power in this matter. Mr. Travers, the solicitor of Messrs. Brogden, admits in a letter which he has written to the New Zealand Times of April 4, that “Messrs, Brogden were informed by the Government in office when their contracts were entered into, that an Act would be requisite to give to the Judges of the Supreme Court authority to act as arbitrators under the contracts, and to provide for the course of procedure.” He says that he knew of the Act, but never read it untd he was obliged to do so in connection with claims of Messrs. Brogden against the Government. He asserts that the Government had introduced into the Act a set ot provisions which materially modified the rights under the contracts, aud had thus been guilty of a gross breach of faith. This is a singular illustration of the childlike simplicity and confidenceof contractors and lawyers. One of the Brogdens, we believe, was present in Wellington when the Act was passed ; certainly their solicitor and some representative of the firm were present. They knew that an Act was about to be passed exclusively relating to their contracts, which involved their interest iu altogether more than half a million sterling. The Act was debated at some length in both Houses. And yet the Brogdens and their solicitor never read the Bill, nor even the Act till about five years after it was passed. Mr. Travers does not specify the provisions in the Act inconsistent with the contracts. There appears to us that only one provision can be properly so characterised. It is the one which prescribes a limit of six months after the date of the dispute, within which the dispute can be heard. Bnt this provision can be waived with the consent of the other party ; and, certainly it appears to us that, under the circumstances, the Government should not insist on such, a provision. If the late Government did so, the present one should not follow their example. Otherwise, the Act seems to us faithfully to give practical effect to the provision in the contracts that all disputes should be settled solely and finally by a Judge of the Supreme Court. This is the provision which excites all the ire of Mr. Henderson, who, strange to say, forgets that it was a part of the then existing contract, and had been specially inserted therein at the express instance of Messrs. Brogden. It is ludicrous to read the debate on the Bill by the side of Mr. Henderson’s letter. Mr. Stafford under whose short administration the Bill was passed,— Mr. Fitzherbert, and Mr, Rolleaton almost with tears in his eyes, begged the House to pass the Bill as a marter of justice and good faith to Messrs. Brogden, on the very ground which now Mr. Henderson, on their behalf, characterises as injustice and repudiation.