REPORT

Otago Witness, Issue 497, 8 June 1861, Page 2

REPORT

OF THE COMMISSIONER APPOINTED TO EXAMINE THE PUBLIC ACCOUNTS OF THE PROVINCE OF OTAGO. AND THE EVIDENCE TAKEN BY HIM THEREON.

(jFro'm the Provincial Gazette, June 7.)

Immigration per » gala," £1712. James Macandrew & Co. entered into a Contract Vyith, the Provincial Government for the conveyance of Immigrants from Glasgow r $o, Otago, and employed Messrs. Gladstone and Co., of Glasgow, as their Agents for the execution of the Contract. Several vessels with Immigrants were despatched by the Agents. The last vessel under the Contract was the "Gala," which sailed from Glasgow in the month of November 1859. The owners of that vessel were James ' Wateon and others ; and the Freight, to be v paid in the Colony, was £1712. On the 14th December 1859, Messrs. Gladstone 8t Co. issued to the commander of the " Gala " the following authority — " Referring to your charter for the conveyance of Emigrants for us from Glasgow to Otago, and in accordance 1 with the power given us by the charter party, we desire that you receive pay- , xnent for the balance of the Passage Money, dye in, Otago, in cash, and not by drafts upon us." And on the 19th of the same month, Messrs. Gladstone & Co. sent written instructions to' Messrs. James Macandrew & Co. to settle the balance of the Freight in cash.

It would seem that James Watson and ' bthers, having accepted the order of the 14th December, now deal with Messrs. Macandrew & Co. as principals ; accordingly, it is found that they have given Mr. E. B. Cargill a power of attorney to receive from James Mac--andrew & Co. their claims on account of the " Gala," while Messrs. Gladstone & Co. have ceased to make any further claims. On the arrival of the " Gala " at Otago, the sum of £1712 was issued ont of the Provincial Treasury iv payment for Immigration by that _ "vessel, and ultimately a receipt for that sum was. obtained from the original Contractors, Messrs. Macandrew & Co. Mr. James Macandrew states .that of this sum only £1524 was payable to the ship — of which a portion was drawn by the master of the vessel, and the residue passed to the credit of the general account of the owners and that firm.

■ *The owners of the " Gala " (James Watson and others) fiaving received payment for only a portion of their claim, have lately sent out a power of attorney to recover the balance from James Macandrew & Co. And it is presumed thaVthe latter parties are liable, but on the other hand, that they have no claim on the Provincial Government, seeing that they have -been paid the full amount and have given a "receipt for it. * - As a' mere matter of account this would disof the " Gala" case, and no blame would attach to the Superintendent. In the foregoing narrative, however, no allusion has been made to part of the transaction^ to which the Committee of the Provincial "Council make grave objections. * lt : appears from the evidence that, on the arrival "of the "Gala," the Superintendent ■first issued a warrant for £I^l2 in favour of James Macandrew and W. 11. Reynolds, to whont the .Provincial Government had undertaken, on the application of Messrs. Macandrew & Co., to pay all monies due at Otago to .Messrs. Gladstone & Co. for Immigration purposes.;. This arrangement was entirely for the £gcurijy> of , Messrs. Gladstone & Co. It had been formerly assented to by all parties, and was virtually a security for payment of services rendered. It could not, therefore, be revoked by_ James Macandrew & Co. in the case of the "JGala*" The Provincial Treasurer in, making payment neglected to follow the directions/ of the warrant. He paid to Mr. James Macandrew (the Superintendent) and took his receipt. only, and failed after repeated applications to obtain Mr. Reynolds' acquittance. The Superintendent, in order that the accounts' might be fully supported, issued a warrant in favour of the firm of James Macandrew & Co. (of which he is a partner) and forwarded with it the receipt of that firm for the sum of £1712. The Superintendent justifies the substitution of another warrant on the ground that the firm of James Macandrew & Co. were the original contractors, — that they had received the instructions of their agents (Messrs. Gladstone & Co.), of the 19th December, above alluded to,- and had already acted upon' them, and that it was no longer necessary to have Mr. Reynolds* receipt. But the Committee of the Provincial Council take rdiffiefent view. They are of opinion that the, Government was bound not to deviate at all from the undertaking it had entered into to'pay James Macandrew and W. 11. Reynolds, and. they characterize, the substitution of a new warrant as a mere evasion, which .does not meet the moral and legal necessities of the case. In connection with this case, which involves a liability of the Proviucial Treasurer, in consequence of. his not having followed the instructions of the Superintendent's warrant, it is necessary to observe that the bond given by the. Provincial Treasurer for the faithful discharge of his duties was called for, but cannot be found among the Provincial records. CLUTHA COAL FIELDS, £1000. A warrant was issued in this case for payment of £1000 to Messrs. Paterson & Co. This sum, the Superintendent, by a breach of trust, withdrew from the Bank, and under a mere pretence, obtained from Mr. Paterson an acquittance for the amount. It appears that a contract was entered into between the Provincial Government and Mr. J. G. Lewis, under the sanction of a vote of the Provincial Council, for laying down a Railway from the Clutha Coal Field to the Clutha River. It was agreed with the contractor that the* Superintendent should apply £1000 out of the sum voted to the purchase of rails and chairs in England. In accordance with this part of the agreement, his. Honor ordered a railway plant from Messrs. James Paterson & Co., of Dunedin ; and on the 7th, May 1860, issued his warrant for payment of £1000 to Paterson & Co. for a bill of exchange,- Instead of the money being paid tq Mr. Paterson, as the warrant directed, it was withdrawn from the Provincial Account at the Bank by the Superintendent (through hmjclerjk 1 . Mr. Logan) in the absence of the Provincial Treasurer, avowedly for the purchase jof & bilLof exchange for remittance to tn'e Provincial Agents in Edinburgh for due payment of., the order. At the same time the Superintendent obtained • from Mr. Paterson a;receipt for* the £1000 under the pretence > that the amount had been remitted to England/ Mn • Patcrport states in his evidence thaj& h&g&V* ,th%jeceipt on the Bth of May, on , thej understanding that the money had bee^ if mittfid to and would be paid oj? "ej; 4» ilwiir correspondents, Messrs. N. &N. - Loc|!b.art, iff Britain,- by the Provincial Agents ok'ffne-t 4ue shipment, of the railway plant. Mr. Pa.|erson m ow complains, that although the order has been shipped,- aud the invoice and biiEpf Jading, transmitted to Otago, the remittanee^had not reached England on the 20th November,- the date of their last advice. The Messrs. Lockhavt state in their letter of rlia^tf&tha^the' Provincial Agents admit that i-^jhjyjhave. letters TronrMr. Macandrew dated g|:SijW^mber; ,lsst j but no mention has yet been 'pioney which Mr. Macandrew lliilSfnilfift& sent on account of the railway

plant. The Messrs. Lockhart characterize the case as one of the worst they ever knew in business, and earnestly wish they had never heard of it.

The Superintendent in explanation states that he purchased a bill in duplicate from James Thompson, Esq., of Melbourne, drawn by the National Bank of Scotland on Glyn and Co. ; that he forwarded the original letter and bill of exchange from Wellington in July last, so as to go home by the August mail ; that the second of exchange was posted in the mouth of November ; that he has not yet received an acknowledgment from the Provincial Agents, and he fears the original letter miscarried ; that he has written home to secure the bill from passing into other hands, and has little fear of the ultimate safety of the money.

The explanation of the Superintendent is unsatisfactory : the money was in his hands on the 7th May, and the bills not purchased till the month of July following ; whereas the money ought to have been immediately applied in the purchase of a set of bills of exchange in favour of the Provincial Agents, and the third of the set deposited in the Treasury as a voucher. He offers no proof of the bills having been remitted to England ; and the case is open to suspicion on the following grounds : — That the bills were purchased in duplicate ; that the first of the set is supposed to be lost ; that the second of the set was not posted until four months after the first ; that the bills were not purchased of the Bank ; that the first was posted at Wellington two months after the Superintendent had obtained a receipt from Mr. Paterson for the amount : moreover, the receipt from Mr. Paterson was improperly obtained, and in no way relieves the Superintendent from his liability to the Crown.

It is also to be observed that the money ought not to have been withdrawn from the Bank by the Superintendent. His Honor was not entitled to receive it on any grounds. According to the provisions of the " Executive Council Ordinance of 1854," the Provincial Treasurer is the proper officer to receive and pay all monies on behalf of the Province. The Superintendent is under no bond for the security of the public, and it is clearly an evasion of the law to issue to him public monies for payment of claims on the Provincial Treasury. The Provincial Treasurer should have remitted the money to England.

It is recommended that the Superintendent should be required to give security for the due appropriation of the money, or else to repay the amount into the Provincial chest, subject to the condition of its being refunded to him on producing a sufficient voucher.