THE MIDLAND RAILWAY.

Otago Daily Times, Issue 11253, 25 October 1898, Page 3

THE MIDLAND RAILWAY.

IMPORTANT STATEMENT BY THE PEEMIEK.

(Fkom Our Own Ooep.espo*mdest4 WELLINGTON, October 10. A deputation of Canterbury, Nelson, and Westland members . waited on the Premier this afternoon to ascertain the position in regard to the Midland railway and the intentions of the Government in regard to the present litigation and the prosecution of the work. Mr Guinness, as chairman of the recent meeting of members, explained the object of I the present interview. He said they ~ had heard of the pending litigation between the Government and the debeuture-holderd, a-nd |it was considered by many of the deputation that this litigation would have the effect of retarding and preventing settlement in their districts for years. He (Mr Guinness) considered that some immediate steps should be taken to 'secure the reservation which had been set aside for the Midland Company, and more than one method by which this should bo done had been mentioned. Ono was by coaling to an amicable arrangement with the debenture-holders, and then arranging for tho withdrawal of their right to the reservation, and if that could, not be'done, to ask tho Legislature—and he believed he stood almost alone in that idea—to pass an act declaring tiie reservation thrown open with a view to giving the company or debenture-holders the right of suing the Government and deciding tho matter ones and for all. The present state of stagnation was a great drawback to the progress and prosperity of the districts which the deputation represented. The necessity for pushing the railway on at a more vigorous rate than heretofore was, he thought, obvious. He thought he was voicing the opinion of the deputation when ho expressed the hope that justice would be done to the debenture-holders, and that terms would be made creditable and honourable to the colony, and at tho same time giving up nothing which we had not a right to give up. Several, members present objected to Mr Guinness expressing any views on the position. The deputation, they said," had agreed simply to come and ask for information; not to express any opinions of their own. Mr Seddon, in reply, spoke fof about threequarters of an hour, and made some important statements in regard to the position of'the company and the debenture-holders, and the attitude the Government were likely to assumo in regard to them. Tho Government, he said, were doing everything possible under tho contract, and were going on with the construction of the line. They were finding the capital which ought to Bo found by the company for the prosecution of the works. He thought that if anyone had a grievance it J was the colony. The company had made default, and were unable to complete the work; in fact, they had not done one-third of it. Yet, haying made that default, they took up the position of aggrieved parties, whilst, he said, the aggrieved party was the colony. As to how long the colony was going to maintain its present position on tho defensivo, he would tell them vary straight the mind of the Government and his own mind on the point. It was that the colony should' now go in and take action against the company for the damages they had suffered and which it must recovor against them. Aud at the time of suing for damages, ho thought they should ask the court to declare the lands looked up open for settlement. As to the colony in the present litigation filing as part of their defenco that the Crown could not be sued, he simply said that the Government had handed the matter over to the Crown solicitor, and ho, for his part, absolutely declined to interfere. They wanted a legal definition from the courts. The matter waa now before the ] courts, and there it must remain so far as he was concerned. The debenture-holders no j doubt were making a little cry about that plea, but no doubt they would try to get I round the point by going away from the ApI peal Court to the Supreme Court and asking for the right to sell. That would have to be met by the Government. Though he was no lawyer, his own opinion was that the property could not be sold as against tho Crown in possession. Not only that, but a railway made under an act of Parliament such as this could not be sold as a chattel or ordinary property. He therefore thought they had little to • fear in that respect. As to meeting out justice and equity the debenture-holders, he was quite in. accord with that as long as the same thing was applied to the colony. But he held the equities were with the Government. The line should have been finished 10 years ago, and there was not a third of it done yet. They, had had no benefit whatever in respect to it, and their lands were still locked up. As to giving them possession of the railway, he pointed out that several sections completed would then be held as private lines, and the connecting links to be made would be held by the Government, so that they would have a patchwork proprietorship. And, moreover, they would have to spend a million of money on the connecting link to make the other parts held by the company pay. As the line stood to-day the piece the company had made from Jacksons to Brunnerton would not pay grease for the wheels. The colony had acted on the defensive all through till the company had come to believe that they were the aggrieved parties, and, in his opinion, the Administration would not now be doing justice to the colony unless they took vigorous aotion against them

for damages. To show tho people of the colony'and the people that they had more than full consideration-^ — Mr Guinness: Who? The company or the debenture-holders? Mr Seddon: The company. ■ Mr Guinness: Tho company is defunct. ■ Mr Seddon: I nay the company embraces the debenture-holders, because they cannot be put in a better positionthan the company who entered into tho contract. You cannot put a mortgagee in a better position than you can a principal. .He knew that what the deben-ture-holders'were relying on was this: The colony had three trunk lines going on, and the Canterbury, Nelson, and Wcstland members would riot vote money for the Otago Central and the' North Island Trunk line unless the connecting link was made (between Canterbury and Weatland. They thought, no doubt, that they could secure the portion of the Midland railway now completed, and by-and-bye force the Government to take it over at the-.r own price. That was just about the English of it. At present the Government were advised that they had a prior claim, and would succeed against the. debenture-holders. On the other hand, he did not think it could be gainsaid for a moment that very heavy dam ages had accrued to the colony bvtho action or non-action of the company. The present intention of the Government was to «o en with the line, and complete it. Ho wished that to be made very clear. He had had some talk with Mr Kollman, who was now here, and represented a large section of the deben-ture-holders and shareholders, and it was through him the intimation was received thai unless the Government were prepared to give a permanent guarantee the interested partist could not raise tho money required to finish tho line. Mr Wason: Would you consider als years' guarantee as was mentioned in London? Tho Premier said he would. Mr Meredith-asked if the Premier thought they had a right to go on spending money to a limited oxtent- until the line was finished. Mr Seddon: Yes, wo have, provided Parliament will give it to us. Mr Meredith: Have you made application i to Parliament? ! The Premier: . We have not—(laughter)— (for the simple roason that if we \rer^. to ask j an abnormal amount for the Midland railway on tho prospects of its being refunded, in the face of the fact that the company has not yet I paid the moneys already spent, the represenI talives for other parts of the colony would j object. ■ After some further talk of a conversational I nature, tho deputation withdrew. They inI timated they would further consider tho posi- ! tion, and again wait on the Premier with cer tain resolutions. WELLINGTON, October 10. A deputation of Canterbury, West Sand, and Nelson members ■ waited on the Premier and Minister for Public Works this afternoon with I respect to the present position and intention of the Government as to the Midland railway. j The Right Hon. Mr Seddon, in reply, said the colony could not take possession of the line until "default of 15 months had been made by the company of payments of moneys expended, If the claims were mot within that period, the Crown lost its right to take the railway over. It would be a sign of great weakness if tho Government' asked for a. compromise for the purpose of having the company's lands opened for settlement. The representatives of tho company had suggested to him while in London a now contract, whereunder, instead of land grants, the colony should guarantee at par cent, for 10 or 15 years all the moneys expended on the line. This proposal involved i a guarantee of £45,000 for 15 years, nnd the land grants would yield £500,000. Tho Government were prepared to accept this, but IMr Young, receiver in the company, had inj formed him it was not likely to be accepted |by the debenture-holders. The opinion of the ! Government was that the time had arrived [ when the colony should bring an action against the company for damages incurred by their default, and ask the courts to declare the lauds open for settlement.