Forty Years a Liberal

Sun (Auckland), Volume III, Issue 635, 11 April 1929, Page 2

Forty Years a Liberal

LIFE STORY OF SIR JOSEPH WARD

From Telegraph Messenger to Prime Minister

By

R. A. LOUGHNAN

(Copyright— Sun Feature Service) ENTERING Parliament in ISS7, Sir Joseph Ward is a veteran among contemporary statesmen and his career is traced and described in this series o£ articles by R. a. Loughnan for readers of The Sun.

No. XV L

The great West Coast Railway agitation of the Middle Island upset the fair course of naturally divided politics in the early “eighties” of the nineteenth century. In ISSS the agitation subsided, having borne the desired fruit, in the formation of the Midland Railway Company. The company set to work, and in due course started its railway. It had legislative authority behind it and popular favour. It enjoyed a grant of adjacent lands, it turned the first sod on the western side of the Southern Alps—in the middle of the Reefton-Bruimer-Greymouth-Hokitika district. There was on that "auspicious occasion” a great flourish of trumpets. Marvels were glibly predicted for the consequence of the completion of the line, the date fixed by contract being ten years later.

good deal of controversy on the subject, and he wished to give as much time as possible for the understanding of the matter. He then proceeded to give the full history of the Midland Railway project and of the company formed to carry it out. It will be well to give that history here in full. The contract with the Midland Rail, way Company for the construction 0 [ several lines of railway—from Spring, field in Canterbury to Brunnerton in Westland, and from Brunnerton to Belgrove in Nelson —wras entered into on August 3, ISSB. It referred to the original contract made with the Can-terbury-Nelson syndicate on Januarv 17, ISSS, and provided that the whole of the two railways contracted for should be completed within ten years from the date of the latter contract, that is. on or before January 17, 1895. As the works were not complete on the latter date, and indeed had com« to a standstill, the Government determined to exercise its rights under section 12S of the “Railways Construetion and Land Act 1881,” and take possession of the railway. Possession was accordingly taken on May 2n, 1595, and the line has since been held and w'orked by the Government, and construction works carried on by them. The contract provided that the only remedy in case of dispute was an appeal to arbitration, each party to appoint an arbitrator, and the two arbitrators to appoint an umpire. COMPANY DISSATISFIED

Before that date the company broke down, construction stopped, and according to the terms of the contract the line was taken possession of, forcibly, by the Government. The Government carried on the construction, merging the Midland Railway in the State Railway system. Some years later the Otira Tunnel boring five miles through the Southern Alps completed the long-desired connection between the East and West Coasts of the Middle Island. But that is another story. It was in 1902, the year In which Sir Joseph Ward was making his fine record as Acting-Premier, that the Midland Railway disappeared from the political atmosphere, the final stage of settlement of its problem being the Parliamentary sanction of a sum of £150,000 by way of compensation to the Midland Railway* Company and its debenture holders. Thus ended a dramatic episode of seventeen years.

The company being dissatisfied over the seizure, and also over the matter* previously in dispute with the Government, made certain very heavy claims against the Crown, and asked to have them referred to arbitration, and appointed Sir Bruce Burnside to be their arbitrator. The Crown appointed Sir Charles Lilly, and the two arbitrators appointed the Hon. Edward Blake. Q.C., as umpire. The arbitration was held in Wellington toward the end of 1895. The arbitrators disagreed on a point of jurisdiction at an early stage of the proceedings, and, in accordance with the provisions of the arbitration clause in the contract, the arbitrators withdrew' and left the decision entirely in the hands of the umpire. The umpire gave his awards (tw r o) on December 25, 1895, both being in favour of the Government. (Parliamentary Paper, D-40-1896.), The company having no remedy against the Crown other than arbitration was thus at the end of its legal resources. Not so the debenture holders, however. They contended that they were not parties to the arbitration proceedings, and that their claim was not before the arbitrator and that his award, therefore, was not binding on them. They accordingly instituted independent proceedings in the Supreme Court, but unsuccessful. They then appealed to the New Zealand Court of Appeal, and were again unsuccessful. (D.-5-1599.) They then took their case to the Privy Council and his Majesty’s Order-in-Counei; confirming the same will be found ic D.-5 of 1900. Both the company and the debenture holders having been defeated before all the tribunals it was possible to appeal to, Parliament was approached by petition in the session of 1900. A ROYAL COMMISSION The Public Accounts Committee, after hearing evidence at great length, came to the conclusion that it was desirable that a x Royal Commiss.o; should be set up during the recess t r obtain evidence as to the value as a going concern of those sections .of the railway which were completed at the time the Government took possession and that the further consideration of the position should be left over unu the following session. Accordingly, on January 31,1901, the Midland Railway Commission was appointed, and held meetings last’ ing over nearly five months in Wellington, Nelson, Reefton, GreymoutL and Christchurch. They also carefully inspected every yard of the railway that had been made by the com pany. The commission reported on June 21, 1901 (H.-2.-1901). The report was to the effect that the company and its debenture holQ ers had on the whole been very areii treated. They found that the tou expenditure of the company on the railway was £1,108.625, of which onl? £654,411 was expended on the actitt* construction and equipment railway, and the balance, £454,21*. c supervision, commission, salaries, cosof raising capital, interest charged capital account, and incidentals. The commission reported that t - final charges in connection with t undertaking were enormous, in parison with the work done, and * 2 the same paid for debenture interestshareholders’ interests, cost of raw - money on debentures, administrate*engineering and law costs, were out ■ all proportion to the amount expen ! on construction and equipment. They further reported that the** j ing value of the whole railway* j on the revenue earned, and alio* - ; for prospective increase for ten yea*was £192,828, and that the amonn- ! realised by the company fro ®r,cf ; Government land grant was £3i3. : or £250,195 in excess of the value. ! which the grant was debited to ! company. EXCESS OF VALUE They also found that the 6°*®? ment provided money toward the i struction of the railway to the a® of £38,439. , on iy It will thus he seen £6.*>4,411 was expended by u jp. pany on the construction and ment of the railway; and of this . the amount realised by the from the Government land formed nearly one-half, at the selling value of the . flli ; £192,828 (a report by the j and the amount realised land grant at £ 313,000, * be seen that no less a iHed bT | £120.227 has already been the colony in excess of in® ; value of the line. . (To be continued

SEIZURE OF THE LINE We look back upon it today noting with some wonder the vividness of its first agitation, the passion of the struggle for the construction, the despair of the breakdown, the astonishment at the seizure of the line, with warm interest in the arbitration, and legal proceedings incidental to that seizure, with amazement at the final payment of consolation money to the bankrupt company and its financial backers. Mr. Seddon, with Cabinet support, had made the seizure. In his absence —after the company had failed in its appeal to the law and to arbitration — it fell to Sir Joseph Ward, ActingPremier, to face Parliament with the proposal for the settlement of the moral claims of the unhappy company and its even less happy bondholders. who had expensively failed to obtain legal redress. Sir Joseph performed this duty with nice tact and conspicuous ability. Particularly noteworthy was liis handling, before the House of Representatives, of this moral claim to compensation for a company which had failed utterly to establish its case in the courts of law —the Supreme Court and Court of Appeal of New Zealand, and the Privy Council of the House of Lords and by arbitration as by law provided. There was a general opinion that the company deserved nothing, and this was freely expressed in the debate on the second r-eading of the Government measure for final adjustment. And when Sir Joseph came to his urge of a moral claim for the company which had failed before all three Courts, one member interjected about these bondholders of the company, “They have stopped your loan in London,” his answer was wise, as delicate as it was convincing. A DIFFICULT VENTURE Since the railway had been seized by the Government there had been litigation as above, and considerable discussion and negotiations throughout the colony. This had covered a period of six years —a rather eventful history of a considerable trouble. In this session of 1902 the Government got an opportunity to settle the trouble, and brought a Bill down to the House for that purpose. The Premier, who was on his way to England for the coronation of King Edward VII., had given his ideas, which in fact amounted to need for legislation to take advantage of the acceptance by the company of the terms offered to it. It fell to the lot of Sir Joseph Ward as Acting-Premier to finish the interesting and troubled episode by introducing and piloting through Parliament the Bill for the authorising of the payment of a sum of £150,00U to the debenture holders and shareholders of the company. The representative of these people in Wellington was Mr. James Coates, of the National Bank, and their solicitors here were Messrs. Findlay and Dalziel. The business before Sir Joseph was a difficult venture. It was known that there was strong opposition to the payment of anything to the company or the debenture holders. The Government had said in answer to repeated questions during the session that it had no intention of bringing down any Bill, and there was the Bill ] on the last day but one of the session j October 1, 1902. The strength of the opposition to the Bill was not known, hut its determination was obviously ' er Y strong, and the circumstances were favourable for a stonewall. The last refuge of an obstinate minority, f, capacity of the opponents of the Bill for stonewalling was known to be as resourceful as it was determined. However, the matter was ui gent, for the bondholders had intimated at the last moment their willingness to accept £150,000 if autliorA y ( - V ' obtained that session. The Acting-Premier faced the duty devolving on him with all his courage debating resource and intimate knowledge of the subject He began by placating the enemv second n V.!f , tha L he haU basoned the “®P° nd 1 eadm & from the afternoon because some of those who wanted to speak were then absent from the House. There had been, he said a