POSSESSION TAKEN BY THE GOVERNMENT.

Press, Volume LII, Issue 9126, 10 June 1895, Page 2

POSSESSION TAKEN BY THE GOVERNMENT.

WELLINGTON, May 26. At Greymouth, on Saturday afternoon, Mr Thompson, Resident Engineer, acting under instructions from the Government, and being armed with the Governor's warrant, proceeded to Stillwater, accompanied by Mr Blow. Under Secretary for Public Works, Mr Gully, Crown Solicitor, Mr Mcintosh, Railway Manager, and Mr Hannan, Crown Prosecutor, and took formal possession of the Midland railway there. Possession was taken in accordance with various provisions in the Railway Construction and Land Act, 1881. Section 23 provides that if there be unreasonable or inexcusable delay in the completion of the works, or if there be a breach of the contract, the Governor may take possession and assume the management of any railway belonging to a Company, and if h9 thinks fit and wise conduct - the traffic thereon, charging the Company with the expenditure which may be en tailed or expended, aud crediting the Company with all earnings and receipts. Accounts shall be taken at intervals of not longer than six months, and the balance, if any, paid over to the Company, or if there be a loss, payment may be demanded, aud it such payment be not forthcoming within twelve months from the due date, the Government have power to give three months' notice of their intention to assume the ownership of the railway ; and, failing payment within that period, the railway will vest in the Governor absolutely. Under section 24 tha Company have a right to apply to the Supreme Court, consisting of a Judge only, and his decision, given in a summary manner, is to be final. He, however, can only decide whether there has been unreasonable or inexcusable delay or wilful breach of contract. If he finds there has been either or both of those, the action of the Governor in taking possession cannot be interfered with; but such application will not prejudice any security given by the Company to the Government for the due performance of their contract. Mr Thompson was the instrument used to expedite the Governor's order, which is dated Auckland, 13th May, 1895, and arrived in Greymouth on Friday. The warrant sets forth at length that in the opinion of the Governor unreasonable and inexcusable delay has taken place and a wilful breach of the contract been committed. The contract expired on January 17th. The Government estimate that less than one-fifth in expenditure and one-fourth in mileage of the total amount has been expended and completed. Mr Thompson, accompanied by the gentlemen named, proceeded to Stillwater, and, producing the Governor's order, informed Mr Wallace of the proceedings, and then drove a peg n-arked with the broad arrow on the railway lice, declaring at the same time that the property became vested in the Governor. Mr Wallace and his staff were informed that their services would be required as usual, but the line would be under the control of Mr Mcintosh, District Railway Manager. The running of the trains on the line Will be exactly as heretofore. Application has been made to Mr Robert Wilson for all plans, specifications and document* coo*

nected with the Midland Railway lines and, if these are given over, it is generally understood that the extension of the Christchurch line will be proceeded with at ones by the Government. The Minister for Railways states that the action in connection with the Midland Railway was taken on legal advice, and that the Company have undoubtedly committed a breach of their contract.

THE PRESENT POSITION. "We understand that the Midlaud Railway Company are not at all likely to to law on any minor point of dispute between the Government and the Company. Matters in connection with the recent move of the Government will be left in abeyance until the arbitration case is heard in November. Mr R Wilson, the engineer of the Company, has received instructions not to part with the plans and documents the property of the Company.

WELLINGTON, May 28. The Post says —"The Midland Railway Company's representatives in the colony have, pending instructions from Home, given instruction, to all their employees on the line not to pay any attention to the seizure by the Government. They are preparing a formal protest against the action taken by the Ministers in seizing the line. If the seizure is persisted in, the Company, after protesting, will probably allow the question of right to remain in abeyance until the Arbitration Court is properly constituted and able to deal with the whole case ou its merits. It will not permit itself to be pinned down to a narrow legal point, irrespective of the broad equities involved in the case. Mr Harris, of Christchurch, tho solicitor of the Company, arrived here from Christchurch to-day, to confer with Mr George Hutchison, the Company's counsel.

WELLINGTON, June 7. It appears that the statement that has been published that the employees of the Midland Railway Company had refused to take any instructions from the Government as controllers of the Railway is inaccurate. I learn that, on the Saturday preceding the Queen s Birthday, Mr Blow, Under-Secre-tary for Public Works and Railways, personally intimated to the manager of the line that he would be required to act under his instructions, anil upon the Manager declining to do so, Mr Blow gave him twenty-four hours to decide, when, if he persisted in his refusal, he would be deposed from office. The Manager decided to comply with Mr Blow's demand, and all his brother officers followed his example. As to the General Manager's (Mr Wilson) refusal to surrender the plans and necessary records for the continuance of the construction of the works, 1 am informed that the Minister is prepared to proceed, if necessary, with fresh surveys, which it is claimed he is empowered by the terms of the contract to carry out.

The following letters have been handed to us for publication :— "Christchurnh, 30th May, 1895. ITo his Excellency the Earl of Glasgow,, G.C.M.G., Governor of New Zealand &c, &c, &c, Wellington. " May it please your Excellency—l have the honour to intimate that the act, on the date immediately following the anniversary of her Majesty's birthday, of taking possession and assuming the management of the railway constructed and then being managed by the Company, is one which the Company, with all deference to your Excellency, protests against as being oppressive, improper, and unjust. " Tne Company has not been guilty of any ' wilful breach ' of the contract as contemplated by Section 123 of * The Railways Construction and Land Act, 1881,' nor has any' wilful default or neglect' on the part of the Company occurred within the meaning of Clause 42 of the contract, so as to justify the step referred to, which I recoguiae, of course as taken on' the advice of your responsible advisers.

"It would ba out of place for mc to discuss with your Excellency the serious questiou thus raised, but I may bs permitted to point out that all disputes, differences, and questions touching the construction, meaning, or effect of the contract, or in any wise relating thereto, had previously been referred, in terms of the contract, to arbitration. One of the arbitrators is of your Excellency's own nomination, and as your Excellency's advisers - are well aware any delay that has occurred in the proceedings of the Arbitration Court has not been due to any wish or conduct on the part of the Company. "The Company desires to respect the Arbitration Court thus,set up ; and will, as soon as the opportunity offers, take the sense of the Court on the serious step to which your Excellency has been advised. "In the meanwhile the Company necessarily submits, but under protest, to the control imposed upon the Company by your Executive, in a step which cannot but redound to the discredit and damage of the

colony. "I have the honour to be your Excellency's most obedient and humble servant, " (Signed) Robert Wilson, ■' Engineer-in Chief and General Manager and Attorney for New Zealand Midland Railway Company, Limited.'' «'3oth May, 1895. "Hugh Gully, Esq., Crown Solicitor, Wellington. " Sir,—l have the honour to acknowledge the receipt of your letter of 25th instant, informing mc that, under warrant from his Excellency the Governor, possession has this day been taken of the several lines of railway mentioned and described in the Midland Railway contract, and that notices have been served upon Mr Wallace, the Company's Traffic Manager, and also informing mc that the Government intend at once to proceed with the construction of the works, and requeating mc to forward to the Minister for Public Works any plaus aud specifications whioh I may have relating to the uncon.tr ucted portions of the lines.

" With regard to your request that I shall forward to the Minister for Public Works any plans and specifications in my possession, you are no doubt aware that such plans and specifications are the result of the appointment and work, of persons selected specially for their professional skill in such matters, and are therefore valuable property of the Company, and it could not ba expected tbat I should part with the possession of them without the authority of my Directors. " I have the honour to be, Sir, ■• Your obedient servant, "(Signed) Robebt Wilson*."