MIDLAND RAILWAY ARBITRATION.

Press, Volume LII, Issue 9272, 25 November 1895, Page 3

MIDLAND RAILWAY ARBITRATION.

(By Teleobaph)

[fbom our special cobhkpoxdkst.] WELLINGTON. November 22. The Arbitration Court in connection with the dispute between the Midland Railway Company and the Government met at the Legislative Council Chamber this morning, Sir Charles Lilley and Sir Brace Bunmde constituting the Court. Messrs G. Hutchison (Wellington), Theo. Cooper (Auckland), and Jonea (Ureyinouth) appeared hs counsel for the Company, and Messrs Gully (Wellington), Stringer (Christchurch), and Dr. *mdlay (Wellington), on behalf of the Government. Mr Guily intimated that Sir Root. Stout would lead the case for the Crown. Tne Arbitrators said that they desired that the Hon. E. Blake, Q.C., AI.P., the Umpire selected, should sit with them aud hear the evidence. This course was agreed to. The Court then called upon counsel for the Company to proceed with its case. Mr George Hutchison asked to be allowed till to-morrow to file particulars, as conosel were noc aware that they would be called on to-day. This request was granted, aud after Mr Guliy had raised various points touching jurisdiction for subsequent consideration, the Court adjourned until 10 a.m. on Monday, the Arbitrator indicating that they would sit from 10 a.m. till 5 p.m. on each day, with an interval for luncheon. It is expected that the proceedings will last three months. The circumstances out of which the present proceedings have arisen are as follows;— In the Eist and West Coa3t Middle Island and Nelson Railway and Railways Construction Act was passed, offering various advantages to induce the construction of the railways referred to. Crown lands, lor a distance not exceeding fifteen miles on either side of the line were to ba withdrawn from sale and surveyed into rectangular blocks, the constructors to be allowed the choice of alternate blocks. Should there not be sufficient suitable land adjoining the line, other lands specially affected by the construction of the railway wero to be set apart for a similar purpose. The contractors were further to be entitled to any coal found on the land comprised in the endowments. Certain lands described in the schedules of the Westland and Nelson Goldfielde Administration Act of 1877, and lands then used or about to be used for mining purposes were not to be affected by the contract. The Act was passed in consequence of negotiations which had taken place between tne Government and certain gentlemen interested in the construction of the Hue, with whom a contract was entered into on the 17th of January, 1885, and subsequently ratified by Parliament, and on the 30th of April, 1686, the promoters transfer! Ed their contract to the Midland Railway Company, formed for the purpose of constructing the line. An amending Act was passed authorising the Governor to enter into a new contract with the Company, as some of the provisions of the original contract were found to be unworkable; and on the 3rd of August, 1888, the new contract was executed. It provided that the works were to be completed within ten years from the 17th of January, 1835, the date of the original contract, or such further time as might be allowed under the provisions of the contract. Iα 1889 the Company applied to the Government for permission to change the ronte of the line from the western to the eastern side of Lake Brunner, and this was given Legislative effect to in 1890, when other modifications were also made. Disputes arose from time to time between the Company and the Government as to the interpretation of certain sections of the contract and the work of the line generally. In 1892 the Company, without prejudice to its legal rights, petitioned for the appointment of a Committee to consider the position and report on its proposals for modification of the contract and the numerous grievances which had developed. The Committee had before it voluminous correspondence between the Company and the Government as to these things, and as to extension of time for the completion of the work. It recommended certain modifications of the conditions! With these the Company was dissatisfied, at.d last year a Select Committee was appointed to oonsider the position aud the correspondence subsequent to tha finding of the previous Committee. The result was a recommendation that a new contract sheuld be entered into materially modifyiatj the original scheme and its scop?. A Bill embodying the recommendations was brought in by the Premier aud tln'own out by the House, and the Company forthwith served tha Government with notice of its desire for arbitration, uuder section 47 of its contract, on the points at, issue. Sir Charles Inllev, late Chief Justice of Queensland, nod Sir Bruce Buinside, late Chief Jusiice of Ceylon, were subsequently appointed arbitrators by the Government and Company respectively, aud met in Wellington last April; but, as they were unable to agree upon an umpire, the time for i the making of their award was enlarged to the 30th of January next, a period which will no doubt have to be further eularged. Meantime the Government, acting on the advice of counsel, seized the line, under the provisions of the Railways Construction and Land Ace, 1881, on the 25th May last. The Company's [ claim will not be filed till to-morrow, but it is undeistood that it will mainly urge the delays to which it is claimed that it was subjected by the Government's action since 1892, in resuect of the applications for the extension of time, dealings in counection with the laud grants and various other matters, refusal of an extension of time, improper reservation of land grants for mining purposes, regulations made under 34 of the contract injuriously affecting the Company, and alterations iv the iucitlence of taxation detrimental to the Company's interests.