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11. I'he Governor has proceeded and is proceeding with the completion of the railway-line pursuant to the powers conferred upon him by " The Railways Construction and Land Act, 1881." 12. The Government of the oolony has decided, so far as the matter is one for the determination of the Executive, that, on behalf of Her Majesty, they refuse to consent to the transfer of a email but integral part of a main colonial line of railway to the permanent control and possession of private individuals, leaving the remainder of the line to be constructed, worked, and controlled by the Government. Eeverting to the arbitration before Mr. Blake, the nature of the claims made by the company in two several references to him appears from his awards, which are as follows : — The company claims as follows :— 1. That the undertaking of the company being work to be remunerated in part by land, as provided by clause 16 of the contract, the Queen, contrary to the provisions of the said contract, refused and prevented the exercise by the company of its rights of selection over large areas of land within the authorised area. 2. That if any lands were properly reserved under subclause (c) of clause 16, then the company was hindered and prevented in the exercise of its rights under clause 18 by being refused the right to the timber on such lands. 3. That the Queen has, in oontravention of the contract, permitted and authorised the destruction and the removal of timber on lands available for selection, and thereby depreciated the value of suoh lands. 4. That the Queen, in contravention of the contract, refused to give effect to the requests of the company under clause 33 to sell or let lands within the authorised area in the Nelson and Westland Land Districts, on the western side of the main range of mountains. 5. That, the remuneration of the company being to the extent of £1,250,000 " B 1 value " in land (as the work of construction should proceed), the Queen (by and through the Parliament of the colony), by greatly increased and graduated taxation on land, imposed subsequent to the date of the contract and without any exception in favour of the lands over which the company had the right of selection, materially reduced the consideration of the contract, and destroyed confidence in the undertaking of the company as a commercial enterprise. 6. That the Queen, by withholding for an unreasonable time consent to the deviation of the railway-line from the western to the eastern side of Lake Brunner, and to the substitution of the incline for the tunnel line at Arthur's Pass, delayed and prevented the company from proceeding with the works under the contract. 7. That the Queen, by further withholding for an unreasonable time consideration of the application of the company for an extension of time under clause 42 of the contract, prevented the company from raising the capital necessary to complete the railway and to perform its other obligations, and to realise the benefits and rights conferred on it by the contract. 8. That the Queen, in derogation of the contract, by and through the Executive of the colony, and particularly by the false and defamatory statements by the Miriister for Public Works in October, 1892, before a Select Committee of the House of Representatives (which statements became a part of the public records of the colony), made it impossible for the company to raise the capital necessary to complete the railway and to perform its other obligations, and to realise the benefits and rights conferred on it by the contraot. 9. That the company, being formed for the purpose of constructing a railway on the system of land-grants as provided by " The East and West Coast (Middle Island) and Nelson Railway and Railways Construction Aot, 1884," and as expressed in the contract between the parties, and being thus known to the Queen as a company which would have to raise money from time to time by share or debenture capital, or both, to enable it to carry out the contract, was by reason of the premisses prejudiced and prevented from raising the capital necessary to complete the railway and to perform its other obligations, and from realising the benefits and rights conferred on it by the contract. That by and in relation to the foregoing matters the credit of the company has been destroyed, and consequently it has been prevented from completing the railway, and that thereby it has lost the whole of the share capital subscribed, together with the profits reasonably to be expected thereon, and has lost the whole of the debenture capital raised and expended with interest thereon, and also other moneys and credits, amounting to the sum of £1,584,900, which sum the company accordingly claims to recover from the Queen. And whereas the said arbitrators disagreed finally respecting the matters comprised in the first reference, and on the 29th November, 1895, notified to mo such disagreement, whereby the matters so comprised came before me as umpire for award and determination : Now know ye that I, the said Edward Blake, having taken upon myself the burden of the first reference as umpire, and having been attended by the parties and their witnesses, and heard and considered the allegations and proofs of the parties, do make this my award and determination in writing of and concerning the premisses in manner following, that is to say:— (a ) I find and award that the oompany has not any claim against the Crown, or any right to recover any sum of money from the Crown in respect of the premisses : (6.) I award that each of the parties shall bear and pay their own oosts of the reference, and that as between themselves each of the parties shall bear and pay the fees and expenses of the arbitrator nominated by such party (which fees and expenses are included in the costs and charges of my umpirage and award); and that as between themselves each of the parties shall bear and pay one half of the remaining costs and charges of my umpirage and award. As witness my hand at Wellington, New Zealand, this 24th day of December, a.d. 1895. Edwabd Blakb. Signed and published on the day and year last above mentioned, in the presenoe of—S. O. Blake. The company claims as follows : — 1. That, the undertaking of the company being work to be remunerated in part by land, as provided by clause 16 of the contract, the Queen, contrary to the provisions of the said contraot, refused and prevented the exercise by the company of its rights of seleotion over large areas of land within the authorised area. 2. That the Queen has, in contravention of the contraot, permitted and authorised the destruction and removal of timber on lands available for seleotion, and thereby depreciated the value of suoh lands. 3. Tha.t, the company being entitled to select, under the provisions of the contraot, land to the amount of £19,304, and having given notice in that behalf, the Queen, by the Minister for Public Works, on or about the 20th day of April, 1895, lefused to allow the company to exercise its rights. 4. That, the company being entitled to select lands, the Queen, under agreement with the company, having sold certain such lands, being thoEe described in the Bl map as "Nelson Towns, Reefton " (196 sections in number), and having received the proceeds thereof (the particulars of which have been refused to the company), has, in oontravention of the contract, refused to pay over the same to the company. 5. That the Queen, on the 25th day of May, 1895, in oontravention of the contract, and without any due or proper cause, took possession and assumed the management of the railway, then in the possession of the company and wrongfully converted the same to her own use. That by and in relation to the foregoing matters the company has lost the entire benefit of the contract and all the expenditure thereunder. Wherefor the company claims to recover from the Queen the sum of £1,817,900, together with interest at 5 per cent, per annum upon £845,000 debenture capital from the 14th day of January, 1895, till the date of award. And whereas the said arbitrators disagreed finally respecting the matters comprised in the second reference, and on the 29th day of November, 1895, notified to me such disagreement, whereby the matters so comprised came before me as umpire for award and determination : And whereas I did, on the 2nd day of December, 1895, by writing signed by me, duly enlarge the time for making my award under the second reference until the 30th day of January, 1896: Now know ye that I, the said Edward Blake, having taken upon myself the burden of the seoond reference as