THE MIDLAND RAILWAY.

Auckland Star, Volume XXVI, Issue 14, 17 January 1895, Page 4

THE MIDLAND RAILWAY.

The period of the contract entered into by the Midland Railway Company ten years ago for the construction of a line of railway which, roughly speaking, waß to cross North Canterbury from easb to weßt coast and to connect with Nelson in the North, expires today. Since its initiation the railway has been a source of trouble to successive Parliaments, and now that the contract time is up without the work being anything liko completed it would appear that we are to have a great deal of additional trouble. It) will be remembered that last session a Bill was introduced into the House to provide for a new contract between the Government and the Company ; but the Bill was thrown oufc by a majority of six, As was anticipated, the Company has given notn cc of arbitration, and it h stated that it purts in a claim for damages against tbo colony, on points on which arbitration is demanded, to the amount of a million and a half. Mr Salb, the chairman of the Company, left England last week for New Zealand, to give evidence in the case.

We are curious to learn the grounds on which the Company base this remarkable claim. The contract entered into provided that the railway should be constructed in a given time on the alternate block-of-land Bystem. Thab is to say, thab the Company was allowed to selecb blocks of Jand at intervals all along the line and thab land was to be their inducement for mak.\ng the railway. Aboub six million acres cf public landß were reserved from sale for thin purpose. Later on ,tho Company was conceded the advantage of

selecting the land wherever they liked within a given area. This arrangement was considered to be to thoir advantage. As the construction of the line proceeded the company asked the Government for certain concessions. One was that the railway instead of pasßing on the west side of Lake Brunner, as had been arranged, should pass on the east side, and another that the Company should be allowed to cross the hills by means of the Abb system ab the Otira Gorge, instead of driving a tunnel. Both requests were granted, the result being an immense saving to the Company. When.the work had been completed aa far. as the point known as Jack, son's, the Company found themselves short of money, ond applied once more to the Government for a revision of the terms of the contract. Their demands, which were fully considered, by a Parliamentary Committee . the session before last, were looked on as excessive and could not be met. The Committee, however, made certain proposals which were that debentures instead of land grants should-bo offered, and the original contract proceeded with.' Laab session the. Company came forward with requests for further modifications. They asked to be relieved from the construction of the line from Motueka to Keefton, a distance of some eighty miles or so. The Government thereupon last session introduced a Bill authorising a new contract which conceded their demands almost; in their entirety. . . . • . ■ :

The Bill provided that within two years the Compsny should construct the porcioh 6f-;the Midland Railway from,its junction with the Government line near Belgrove to a point in the Motueka Valley and there leave it; In respoct to the uncompleted portion of the railway, between Springfield and Jackson, that is on the line between the east and west coast, the Company was to receive 3^ per cent, debentures to. the amount of £618,250. which were to enable the Company to pay interest on its proposed new i?Bue ot capital (£1,200,000). The time for the completion of the line between Springfield and Brunnerton was fixed at four-years, bub it was provided that the Governor might grant an extension of time under certain circumstances. The Bill was,,wo think, very properly thrown out, the result beinc that the Company was held responsible for the fulfilment of the original contract. Their nextstep, it eeeme, is the claim against the colony now announced and an appeal to arbitration. It remains to bo peen what success they will have. Sir Robert Stout, and other legal authorities declared, in the Houee that the colony had nothing to fear, but as Sir Seddon pointed out, litigation is always troublesome however it may turn ■ out, and in cases of. arbitration the Government too often come 3 off second best.