THE PUBLIC TRUST OFFICE.

Lyttelton Times, Volume LXXV, Issue 9445, 20 June 1891, Page 5

THE PUBLIC TRUST OFFICE.

REPORT OP THE COMMISSIONERS. [Pbe Pebbs Association, i WELLINGTON, Junb 19. The following is the report of the Public Trust Commissioners, laid on the table of the House to-day

We have the honour to report that having made full inquiry as to the following matters, so far as the time placed at our disposal would allow, we propose tb deal with them in the order set forth in your Excellency’s commission. Firstly business of the Public Trust Office in its several branches, whether at Wellington or elsewhere, by means of the permanent staff of the said office or by agents or otherwise.” Your Commissioners have gone most carefully into this portion of their duties, and it is with extreme regret they feel compelled to state that, so far as the head office is concerned, there has been an

1 ABSOLUTE WANT of any proper or regular system up to the present time in the conduct of its business. The books of the office have for years been kept in a careless and unfinished manner, particularly the ledgers and. rough cash-books. The number of books and classes of books in daily use by the Public Trust Office are far in excess of what would be necessary nnder a wellregulated mercantile or bank system, and the evidence discloses the fact that very many of these books are in daily use for money entries, of which the Public Trustee, the chief clerk and the Audit Department were entirely ignorant. . To give some idea of the number, style and uses of the books kept, your Commissioners have had returns and diagrams prepared showing the method of keeping them, and their respective places in the working of the business of the Public Trust office. Correspondence by the Public Trust office has been conducted in an unsatisfactory and irritating manner. Neither the Public Trustee nor his officers seemed to have acquired the habit of writing courteous and business-like letters that are customary in all well-regulated establishments, but have practised a system of sending formal memoranda and, as a rule giving very limited information to clients and the public who may have had occasion to correspond with the Public Trust Office. On the subject of rendering accounts by the Public Trustee in connection with many estates under his control, your Commissioners find that this duty has been carried out in a very irregular manner, so much so that the Public Trustee has rarely sent really true and faithful statements of accounts to a beneficiary, in cases where loss or prospective loss has been .made on a security. Secondly—" The powers, duties, and liabilities of the Public Trustee, and of the officers and agents of the said Public Trust Office, the mode of keeping, rendering, and auditing the accounts of the said office or estates, or the business therein, the charges made by the said office for business done by it, or its officers or agents thereof, the means adopted to avoid inconvenience or delay in winding up, dealing with, or managing estates or property placed in or managed by the said office, or in satisfying the claims of beneficiaries, creditors or persons entitled thereto or interested therein.” Your Commissioners are of opinion that the powers of the Public Trustee, or of the management of the Public Trust Office should be of an extensive character, in order to facilitate the conduct of its business management, and should be made absolutely free from any control by the Auditor-General’s Department, which hitherto has only served to cause delay in the transaction of business, without having been of the slightest use for purposes of management! The Public Trust Office, both in the interests of the Colony and of its clients, should have the SAME EXTENDED AND TRUSTED AUTHORITY as the head of a large mercantile and financial institution, with full and unrestricted powers to transact business with promptitude and readiness; and in the opinion of your Commissioners, unless the Public Trust Office be placed on such a footing, its business can never be carried on with advantage or satisfaction to any interests concerned. As to the liabilities of the Public Trustee, his officers and agents, they seem to your Commissioners to be entirely regulated by the capacity of the officers engaged in the conduct of the business of the Public Trust Office, and so far as the system of management has obtained up to the present time, your Commissioners offer no opinion on the probability of liability having been incurred nnder it, either by the Public Trustee or by the Colony. But, as to the mode of keeping, rendering and auditing the accounts of the. Public Trust Office, your Commissioners have something more definite to say. They were very much surprised when they discovered, during the Course of their investigation, that the system of Government audit practised in relation to the business of the Public Trust Office HAS BEEN IN REALITY A DELUSION. In proof of this, they would refer to evidence, not only to that adduced by the Auditor-General, but also to the testimony given by his several officers who were examined before your Commissioners. This evidence discloses the fact of the Audit Department having been ignorant of the existence of a large number of books in use by the officers of the Public Trustee in which money entries were made each day; the want of knowledge by the Audit Department of its responsibilities in connection with the real and personal effects that continually, and under view of a daily audit, came into the possession of the Public Trustee; the absence in the Public Trust Office of any complete inventories of personalty effects belonging to deceased men and women; the careless and perfunctory inspection made by the Audit Department of mortgage securities held in the interests of beneficiaries; that many of the said securities have been allowed by the Public Trustee to appear year after year in the annual balance-sheet as representing securities worth 20s in the £, and these securities have been certified to as correct by the Auditor-General, when he and his inspecting officers, had they faithfully performed their duty, should have known that some of the mortgages had long since been foreclosed by the Public Trustee, and, ipso facto, had ceased to exist; that securities had been exposed for sale by auction, and had been bought by the Public Trustee as the highest bidder for less than one-half, and even as low as one-eighth, of the money originally advanced upon them, and still they have been passed year after year by the audit, as representing the full amounts advanced for the purposes of the annual balancesheet presented by the Public Trustee, for the information of the Government and Parliament of the country. In addition to this

MISREPRESENTATION OF FACTS, a large amount of interest duo upon many of those mortgage securities has,“for several years, been in arrear, and has never been brought to account in the ledgers of the Public Trust Office?; yet the Audit Department has been, as it was supposed, discharging its duty withoufe discovering these facts. It was also within the knowledge of the Audit Department that early in the year 1889 the Colonial Treasurer took away from the supposed, profits of the Public Trust Office, as they appeared in the annual balance-sheet on Dec. 31, 1888, the sum of <£lß,ooo for the consolidated fund. It also appears that at that time, and previous to the transfer of the .£IB,OOO, it was known to the Public Trustee that the profits of the Public Trust Office had been improperly swollen by the amount of nearly .£3500, made lip of accrued interest on the credit of balances of a number of estates, such interest having been transferred from the credit of the said estates to the credit of expenses account, which is practically the profit and loss account of the Public Trust Office. When transfers of supposed profits like these took place, the Auuitor-Gencial, the Colonial Treasurer and the Trustee ought to have been led to inquire, hot only into the genuineness of the profits dJf-iho

pqblie Trust Office, but also u to the lona pUt% and values of mortgagee and securities held by the Public Trustee, I BUT HO PRUDENT OOU»SS o( that kind appears to have suggested itself to anyone of these high officers. In dealing with the charges made in reference to the business done by the Public Trust Office your Commissioners have to point out that these have been excessive. Up to the- end of the year 1889 ten per cent ■eems to have been the charge made for the"collection of rents, and where an agent Was employed he was allowed one halt' ’or equal to five per, cent. ’ Since the year 1889. seven and a half per cent has in many cases been charged, the agents, whenever employed, receiving two thirds or 8 per cent for collecting. The income charge has been 8 per cent, and where agents have been employed 2% per cent is paid to, them, bub in alloasea where.it has not. been necessary to employ agents, the Public Trust Office seems to have taken the full benefit of the maximum charge of commission made to clients. Agents, too, ace allowed to charge borrowers procureapplications for loans recommended by them for the; consideration of the Public Trust Office. This practice cannot but he productive op injury

tohusiness.as the agent in his anxiety to mtb procuration foes, which may on even one transaction exceed his whole annual commission from the head .office for general services, is apt to be tempted to over value the security, with the result,-as already proved in more than one case, of serious foes when the security had to be realiised. The charges of late made by the Public Trustee in respect to intestate estates bavo been 7per cent for the first J 3250 realised, and 8 per cent for all amounts, over that sum. For the collection of moneys in the posses»ion of Banks and Insurance Companies Involving neither risk nor trouble, the charge has been half of those rates. Since the beginning of October, 1890, there has been a new schedule of charges, which is fully set forth in the appendices. Your Commissioners believe that in tha interests, of the public the charges can be very much modified and lessened in such a manner as to increase the business of th,e Public -Trust Office. As to the means adopted for AVOIDING DELAY AND INCONVENIENCE

in managing the estates and properties falling into the hands of the Public Trustee, jour. Commissioners have come to the' conclusion that while the Audit Department has had much to do with the causes of complaint in respect to delay, the confused method of . book-keeping practised by tbe Public Trust Office has added to the evils of which complaints have been made. Tour Commissioners are of opinion that until a more simple and perfect system of keeping the books, papers and records of the Public Trust Office bo adopted, dissatisfaction will continue to be expressed by those who would be likely, under an improved condition of management, to place business with it. On the important point of satisfying the claims of beneficiaries, or persona who may be entitled to participate in estates, the Public Trustee has SELDOM DOJIS HIS DUTY EFFECTIVELY. Bo far as your Commissioners have been able to form an opinion, they feel justified in stating that immediately an estate is entrusted to the control of the Public Trustee little, if any, effort is made to find out the next of kin or beneficiarea entitled to participate therein; indeed, the evidence seems to point to b feeling that obtains in the Public Trust Office that possible beneficiarea ought to find out for themselves by some occult means whether moneys to which they might be entitled were in the hands of the Public Trustee. Nor has the Public Trustee apparently realised the importance of his duty to acknowledge Mui reply to letters in, reference to estates and effects that have fallen into his hands. Long periods of time have frequently passed away, during which THE PUBLIC TRUSTEE AND HIS SUPERIOR OFFICERS HAVE SLUMBERED over important letters of inquiry as to a deceased person’s estate that has been under the care of the, Public Trust Office. The result of this course of action has been that many of those interested beneficially in intestate estates-, through want of proper information or means, have been deprived Of , all benefit, the law as it exists compelling the Public Trustee to pay all moneys, the proceeds accrued from the personalty of intestate estates which have been unclaimed for sis years, into the consolidated fund. The consequence has been that many thousands of pounds whico, under a system, of careful inquiry would have been distributed to beneficiaries have been taken off by the Colony. Tour Commissioners desire to draw attention to A BUM OP OVER £30,000 which has been absorbed by the Colony from unclaimed funds and balances arising out of the administration of estates vested in’the Public Trustee. This sum is exclusive of the .£IB,OOO previously referred to. They strongly recommend that some earnest efforts of a systematic character should be made periodically by the Public Trust Office to find the owners or beneficiaries of unclaimed estates. Your Commissioners have examined into the circumstances connected with the administration of many estates wherein treatment by the Public Trustee of money and assets has proved to have been imprudent and unwise, and the result appears to show that in many cases the persons entitled to the benefits of such estates have been treated in a somewhat/ ARBITRARY AND -CRUEL MANNER q regret to say that the Public Trustee appears to have, displayed a total absence of capacity and knowledge of how these estates should have bean managed and controlled, and they have to ask attention to the evidence relating to many such estates, as shown in the statements accompanying this report, more especially to the sad history of the treatment by the Public . Trustee of the. estates of Mrs Dalton,! Hugh Wright '(a lunatic), the Mherint trust. Holmes (a lunatic). Parmen ter, Samuel Young, and, others. Also, t&TfcOte the manner df dealing by the Public Trustee with Mr W. P. Boss, who became the purchaser of a certain frontage of freehold land in Lambton Quay, Wei lihgton., A MOST, UNUSUAL AND PECULIAR METHOD has obtained with the Public Trust Office, perhaps legally, of keeping its profit and loss account under the heading or -Expenses Account,” to which all salaries and charges'during the currency of the financial year have been debited, while, at the same time, all commission, interests and fees have been credited to it, and the latter three items of credit being greater than the debit entries, the expenses account holds the anomalous position of always appearing in credit. Your Commissioners desue to indicate this as an example of the INEFFICIENT MODE OF BOOK -SEEPING. Your Commissioners have had a return prepared, showing in detail how each total amount that appears on the balance-sheet of Dec. 31 last is made up, and they recommend that similar rattens should be continued at .future annual or half-yearly balances. Had a regular system of this kind obtained hitherto, and the books *nd'file* «it jiaper been m proper order, “there .would have been no necessity for tbe eihployment by the Public Trustee of a large staff , of extra _ clerk* during the tedious investigation on which the Commissioners have been engaged. Thirdly—” The investment of trust ana other funds by the said office, whether under deed, will or other instrument, or my other manner authorised by Jaw, general or particular, and the class, terms or mode of investment in all or any of such cases/ 1 the investment op ponds under mortgage by the Public Trustee appears to require the sanction of a quorum of we Public Trust Board. Applications ■ for are entered in the Board's minute book, with the name of the applicant, and the amount of the loan applied for, but no particular description or locality o£_ securities has been entered on the minutes placed before the Board. 'The loans after consideration by the Board are either granted or declined, and such decision has been written in the minutes as each case has _occurred. Tour Commissioners ate of opinion that a ; proper description and full particulars of

every security offered for loan should be carefully and minutely described in the Board’s minute-book before being placed before the Board. Had this system been practiced hitherto.

MUCH TROUBLE WOULD HAVE BEEN AVOIDED in the investigation just made. The duties of the Public Trust Board do not seem to extend beyond the sanctioning of loans. For instance it does not appear to have been within the province of the Board to inquire into or know anything of securities after loans had been granted, not even to know whether a loan granted had been completed as a security, and whether the value of such security, had subsequently fluctuated. In the opinion of your Commissioners this is a most important duty, and ought to have been attended to by either the members of the Board or by the Audit Department, and any loan granted by the Board after its acceptance and completion by the mortgagor, should again have been reported in the minutes of the Board and the date of its completion recorded. The securities in which the Public Trustee is at present authorised to invest funds under his control are Government securities of the United Kingdom, the Colony of New Zealand, or of the Australasian Colonies, securities issued by a County Council, Borough Council, Harbour Board, Road Board or Town Board, mortgages on freehold lands, fixed deposits with any incorporated Bank carrying on business within the Colony, and in any way provided by a will or trust instrument. The Board of the Public Trust Office is bound by regulations not to advance on mortgage out of the general fund a larger sum than 50 per cent of the valuation of any property offered as a security, but in many instances the evidence discloses the fact that the Board has FAILED TO KEEP WITHIN THE REGULATIONS. Neither the Board nor the Public Trustees ever appear to have taken into consideration that they had two funds entirely distinct, out of which they could make advances, viz., the general funds of the office and the special funds arising out of trusts and wills, the first being subjoot to the regulation as to the fifty per cent margin, and the latter being controlled either by the specific trust or will, or being absolutely free of any restriction. The evidence of the Public Trustee and the returns furnished by him also show that, in several instances, moneys have been advanced on mortgages WITHOUT ANT VALUATION of the securities having been made. By way of mortgage securities the Public Trustee has chiefly dealt with what ate legally known as contributory mortgages, without having realised the risks and confusion that he might entail upon the Colony and himself. This plan of dealing with the balances at the credit of estates on such a class of security was apparently unknown to the members comprising Che Public Trust Board; The position will be recognised by assuming, as examples of the mortgages, that three applications for different loans on' different days had been placed for approval before the Public Trust Board, say for £IO,OOO, £3OOO and £IOOO. The several securities having been approved by the Board, the loans were granted and mortgages prepared in favour of the Public Trustee, who then paid to the mortgagors his cheques drawn on his general account. The Public Trustee takes from the credit balances of estates WITHOUT THE KNOWLEDGE AND CONSENT of beneficiaries or of the Board, unequal sums of money sufficient in the aggregate to make up each of the paid mortgages. If the securities turn out to be good, and the interest thereon is paid regularly for the benefit of the many estates involved in the loans, no question is likely to arise; but, on the other hand, if the securities become unsatisfactory and the beneficiaries make urgent and unavailing demands for unpaid interest and for loss of principal moneys, serious difficulty and complications are bound to ensue. Indeed, such an undesirable state of things already exists. Tour Commissioners, without expressing any opinion as to the legality of such mortgages, cannot refrain from pointing out their many difficult and inconvenient surroundings. In the first place, if an excellent inverfcmeat of the kind were made by the Public Trustee, bearing interest at seven pcr_ cent, or an even higher rate, there exists no stated or fair principle by which the Public Trustee should be obliged to give the preference to those balances or moneys that had stood unemployed for tho greatest length of time in his books, and therefore any contributory mortgagee would have good causa of complaint if he found hia money invested under that form of security, at a lower rate cf interest than that received by any other client of the Public Trust Office. The Public Trustee might quite unintentionally give great advantage to an estate only recently brought under his control, and overlook other estates that had been for years on the books of the Public Trust Office. Again, where a loss or losses had to be faced—ami there are many such —the plan of the Public Trustee is to distribute any loss proportionately among tho contributing estates from which he had taken the money for the original mortgage. But, as the various sums so taken have not been equal in amount, varying from £SO from one estate to many hundreds from another, it will easily bo realised how confusion, discontent, AND PERHAPS LITIGATION, may arise from such transactions. In several cases the Public Trustee has made allocations from estates that had come into his hands as contributions towards mortgages which had been executed and in his possession for many months, and subsequently, when losses had occurred in connection with tho latter securities, the Public Trustee charged the same to the former estate, on the pro rata principle, without tho knowledge of the beneficiaries as to the facts. Your Commissioners are therefore of opinion that contributory mortgages are NOT SATISFACTORY SECURITIES to deal with. The same power of investment can be obtained at a reduced but certain rate of interest, and without risk or inconvenience to any interests concerned, if the Colony were to guarantee 5 per cent per annum on the daily credit balance of the “ hotch-potch ” account in the name of the Public Trustee, to be called " general estates account,” and to be composed entirely of balances belonging to intestate estates. Then from this “ general estates account ” the Public Trustee, with the advice of his Board, could MOKE EASILY AND SAFELY advance any sum or sums of money at a marginal higher rata of interest, say from one to tvo per cent, and so provide for the guarantee and expenses. It would also he much more satisfactory to beneficiaries, particularly those intsrested in smaller intestacies, to know that their moneys were safely invested at 5 per cent, and that the half-yearly or annual income, clear of all deductions for legal charges, was secured to thsm and that their principal moneys were safe. Your Commissioners are further of opinion that all intestacies, whether of realty or of personalty, or oi both, that may be brought under the control of the Public Trustee should, as soon as convenient afterwards, BE SOLD BY PUBLIC AUCTION, and the proceeds placed in the general estates account, so as to produce 5 per cent to the beneficiaries. This course would save the Public Trustee much clerical labour and trouble, besides considerable risk, and lessen the unsatisfactory nature of carrying on tho business of an intestacy. Tho care of bouse property and vacant land, the repairs to houses, and the collection of rents, would become a thing of the past so far as this class of estates is concerned. In regard to testate estates, the position of the Public Trustee is different, as he is only called upon to follow the direction of the wills, dealing respectively with them. The same remark is applicable to estates placed in the Public Trust Office by deed.

Fourthly—" In what respects (if any) the scope of the powers and duties of the Public' Trustee could bo enlarged, or whether any class or classes of property now administered by the said office or its agents should cease to be so administered.”

Tour Commissioners, at tho earlier part of this report, have offered the opinion that the powers of tho Public Trustee should be

OF A VERT EXTENDED CHARACTER, and after further consideration they think that he should be authorised to manage estates for people either resident or nonresident in the Colony; that, in fact, he should be empowered to become the attorney for the conduct and management of any business pertaining to and within the Colony of New Zealand. So far as their investigation of the classes of property hitherto administered by the Public Trustee has assisted them to judge, they have come to the conclusion that the Public Trust Office of the Colony, under capable management, _ is the proper and responsible institution to take upon itself the care and control of all classes of property whether appertaining to realty or to personalty, and whether belonging to Europeans or to the Native race. Your Commissioners have been informed that it is the desire of the Public .Trustee to divest the Public Trust Office of all business in relation to Natives aud in connection with Native preserves, and it may be a matter of prudent policy or otherwise to withdraw such business from his control, but that is a quention of which your Excellency’s Ministers ought to be the proper j udges.

UNDER CAPABLE AND EXPERIENCED^ management the Public Trust Office might be made not only a bona tide revenue producing institution for the benefit of the colony, but a most economically useful one in the management and custodianship of both real and personal property of every kind. There also seems a good reasoni that the Public Trust Office should be authorised to receive moneys on fixed deposit at rates of interest varying with the term of the deposit. Moneys might also be received on deposit at call bearing interest at 2J per cent, provided that upon uny such deposit at call no interest shouldl be allowed if withdrawn within thirty d.aya after it had been first made. Conditions of this kind would prove very advantageous to the public, and become a profitable source of business to the Public Trust Office. Fifthly—" How the law affecting all or any of the several matters aforesaiid could or might be amended, altered, roenacted or regulated, and by what means and in what manner and form the sarnie should be done.” Your Commissioner® are of opinion that the

LAW SHOULD BE SO AMENDED as to provide the greatest facilities for the Public Trustee carrying on a general financial business, for the values and character of the properties that from time to time may come under his control are so different that one estate or property may require a totally distinct kind of management from another. The unfortunate system of contributory mortgages that has obtained with the currency of the ordinary business of the Public Trustee, is one which cannot be approved. When the difficulties in connection with their management had been made apparent your Commissioners felt so uneasy in respect to this class of security that they deemed it a prudent course to require the Public Trustee to obtain the opinion of leading counsel. This was done, but as the Public Trustee seemed to think the single opinion of one legal firm was sufficient to satisfy the doubt that had existed in their miada, and refused to take another opinion without the consent and approval of the Colonial Treasurer, your Commissioners took upon themselves the responsibility of procuring a second opinion upon the subject of the law regulating the Public Trustee on the mode of doing business, and also on the duties of the Audit Department in relation to the Public Trust Office. The two valuable opinions appear in the evidence, and there cannot be any doubt that the law should be altered as early as possible to give freedom to the transaction of all business that may be entrusted to the Public Trust Office, and new legislation should tend in that direction. Your Commissioners recommend that in connection with the sale for “Nonpayment of Rates Act, 1870,” and the subsequent Acts of 1876, 1879, 1832, 1885, 1887 and 1888, the Public Trustee should have THE TOWER TO LEASE, by public tender, any land for any term up to twenty-one years, and in the event of not finding a tenant after three months* notice, he should be empowered to sell by public auction without the intervention of the Registrar of the Supreme Court. Under the present Eating Acts the coats of selling property on which the rates are over due are exceedingly high. Sixthly—“ And generally into all or any matters or things incident to or arising out of your inquiries into the matters aforesaid, the intent and object hereof being that full inquiry should be made into all the business and operations of the sai d office.” A cause of dissatisfaction has arisen with the clients of the Public Trust Office in connection with PETTY CHARGES. No proper system of keeping an account of postage chargeable to each particular estate has ever obtained in the Public Trust Office, but estates have been at different periods charged according to the caprice'of the ledger-keepers. Attention ia directed to a return of postages debited to estates in the Public Trust Office during tbe annual periods of 1883,1889 and 1890, which shows respectively in round numbers .£230, £257 and .£165. The several sums point to overcharges. The annual amount paid by the Public Trust Office to tbe Postal Department has varied from £IOO to £l5O. Your Commissioners are of opinion that the commissions and fees charged by the Public Trust Office in the management of estates are sufficient to cover petty charges for postages, which of themselves when charged to estates direct are very apt to occasion irritation and discontent in the minds of beneficiaries and clients, and for that reason such a system should not be continued in the future, particularly as the rates of postage are shortly to become of a uniform low rate. In respect to telegrams, your Commissioners are of opinion that the cost of these should bo charged direct to the estate interested. Your Commissioners draw attention to an interesting return which forms one of tbe appendices, and relates to LAW CHARGES AND LEGAL EXPENSES incurred by the Public Trustee, and paid largely out of the profits of the Public Trust* Office. The total amount exceeds £13,000, A considerable part of these costs has been incurred notwithstanding the fact that a solicitor of experience, subordinate only to the Public Trustee, has been for some years a member of the official staff employed in the head office. Your Commissioners cannot help feeling that a considerable want of business tact and management is obvious from this fact alone, and they have little hesitation in stating that a largo proportion of such costs should never have been incurred. There are estates in the Public Trust Office that have eoffered most severely and injuriously in this respect. One especially, that of Hugh Wright, a lunatic, was greatly impoverished by heavy legal costs incurred at Christchurch. Your Commissioners, in examining the methods adopted by the Public Trust Office in tbe disposal of the personalty of intestate estates were very much STARTLED BY THE DISCLOSURES made in evidence. The revelations in connection with the purchases by officers in the highest position in the service of the Public Trust Office wore of the moat unexpected character. Your Commissioners cannot too strongly deprecate such conduct, not only as being improper and open to grave suspicion, but utterly indefeasible and illegal. Tour Commissioners, in their examination of various lunatic estates, have discovered that the provisions of “The Lunatics Act, 1882,” with respect to the maintenance of lunatics out of their estates, have not been given effect to. In several instances the greater part of the estate of the lunatic has been used for his maintenance in tbe asylum, very little consideration being f-ncr/n for the ' wants of bis wife and family. Your Commissioners are of opinion that the Public Trustee should, in every case where he has to control the estate of a lunatic, make provision for the requirements of the wife and family before disposing of

any moneys forthe lunatic’s maintenance in the asylum. The evidence also reveals the fact that considerable hardship has often been experienced by patients discharged from lunatic asylums without means, choir estates having been exhausted during their treatment in the asylum. In all such cases pecuniary assistance should be given, to patients when leaving. The Public Trustee has not acted with due consideration in reference to the releasing of a certain Native reserve on the west coast of the Middle Island. Some of the lessors, after offering fair rentals, have been compelled by the Public Trustee, without the consent of his Board, to submit to arbitration, and, as a result, have been saddled with considerable legal costs, which were incurred in consequence of unnessary arbitration. In a recent instance the expenses amounted to several times more than the sum in dispute. Your Commissioners are of opinion that tho Public Trust Office

SHOULD BE MANAGED by a Public Trustee and a Deputy-Trustee with powers almost co-equal, and that they should be men of large commercial and financial experience. The Trustees should have the assistance of an Advising Board, composed of two commercial men possessing special knowledge. It would be desirable that one of the Trustees and the Advising Board should meet twice each week in order to facilitate the despatch of important business. If the Public Trustee was assisted by a deputy in carrying ou the management of the Public Trust Office, it would be advisable that one of these officers should travel frequently through the Colony, with the object of acquiring information that would be of value in the interests of the Public Trust Office, and of overlooking the working of its many agencies, besides inspecting and judging of the values of any properties held as securities, and about which there might be uneasiness. Your Commissioners have learned that a feeling of dissatisfaction has existed in parts of the Colony among those who had desired to communicate personally with the Public Trustee, and who were unable to make the journey to Wellington for that purpose. On the question of the conversion of local agencies into distinct branch offices of the Public Trust, your Commissioners advise that for some time to come no change in that direction should be made, aud certainly not until the administration at the head office has been placed on a sound and satisfactory basis, and until the income of the Public Trust Office will allow of adequate salaries being paid to the officers appointed to manage and conduct the business of a branch office. Your Commissioners deem it their duty to point out the great inconvenience that exists owing to tho want of sufficient office and strong room accommodation at the head office. They recommend that no unnecessary delay should take place in providing ample office room with every necessary for conducting with facility the business of the Public Trust office. The real necessity for extensive fire-proof strong-room accommodation in such an institution as the Public Trust for the safe keeping of securities, deeds and other important documents, cannot bo questioned, and it is due alike to the clients and to the management that adequate provision should be made for the proper carrying on of the important business of so valuable a department of 'the State. Your Commissioners have 'been unable to fully investigate the papers and accounts connected with all the estates at the head office, nor have they been able to visit any branch or agency of the Public Trust Office, for the reason that your Excellency’s Ministers throughout the term of the investigation have deemed it advisable to confine the labours of your Commissioners within too limited a space of time, apparently not realising the heavy nature of tho task, nor tho laborious work Involved by its many difficult and technical intricacies. The investigation consequently has not been so thorough as your Commissioners would have desired.