DISPUTED TIMBER LEASES.
At the meeting of the Aotea Native Land Board yesterday, Gammon and Co., sawmillers, made application under section 26 of the leasing statute for the alienation of certain timber to be permitted by the Board. The land affected is Raetihi No. 2b, consisting of 3561^acres. Mr C. P. Skerrett, K.C., appeared for Gammon and Co., and Messrs Morrison a!nd Borlase appeared to object on behalf of Messrs P. G. Smith, H. Abbott, and Proude, also for the native owners — Ngapere Hohepa and others, Peehi, and Phopa Turehu. Mr Treadwell appeared for Ir« vine and Tansey, but took no active part in the proceedings". Mr Skerretty in opening the case, said the agreement between Gammon and Co.' and the natives referred to all the timber tres growing on Ratihi No. 2b, consisting of 3561 acres. Its date was Novem-i ber 20th, 1902. They had also acquired timber rights on blocks 3, 4, and 5. No*: 2 was practically a flat block of land, but was some four miles from Ohaknne railway station. No. 3 had a oonsidarablo quantity of swamp, making it clifficulc to work. Nos. 4 and 5 were exceedingly rough country and difficult to work. Royalties per 100' superficial feet were — Is 6d for, heart of totara, 6d for heart of matai, 3d for rimu, 2d for white pine, and 3d for all other kinds. These prices were current at the time the "agrement was entered into. The royalties compared most favourably with those paid by millav in other parts of the colony more favourably situ--ated. A loss would be incurred, onj the actual sawmilling, but a small maigin of profit would be made out of manufacturing the timber, etc. The natives would do very handsomely out of the agreement, as there, were 15,000 superficial feet of timber per acre, and they woitld run none of the risks incidental to the sawmilling business. The actual cost of production at the mills would be 7s per 100 feet. The cost of railage would be as follows: — 3s
5d to Wanganui, 3s 4d,
North, 48 4d to Hastings, 4s 6d to Napie;, and 4s 3d'to Wellington. They would 1-avc to pay a higher railage rate than that paid by other companies. There had been a gamble in timber lands during recent years. Men who were neither aawmillers nor farmers had taken up land as a speculation. They had not spent, and did not intend to spend sixpence on the land, but merely wished to turn over their purchase at a profit. They were speculators purely and simply. Gammon and Co., on the other hand, had shown their earnestness by spending .£7OOO on milling plant, and intended immediately to spend another J53000. Messrs Smith, Proude, and Abbott had come in with their eyes open and in full knowledge of the fact that Gammon and Co. had obtained timber eights. The interference of Smith, Proude, and Abbott was due entirely to their wish to make money, and Mr Skerrett submitted that they were entitled to very little consideration from the Board. It was precisely this class of dealing with ■ natives that made it difficult to deal with native land at all. Although in one or two cases the natives might seem to be benefited, in the long run they suffered loss through litigation and clashing of interests. There was ample evidence in the minutes of the Board that Smith, Proude, and Abbott, at the time of their negotiations for the land, were aware of Gammon and Co.'s interests. Mr Skerrett then drew the Board's attention, to the agreement, all the clauses of which he read. He pointed out' that the royalty had been increased by 6d for totara and 3d for all other timbers except rimu, matai, and white pine. The natives were given every right to the laud except so far as the timber was concerned, and work was also provided for the Maoris. The legislature gave the Board power to validate the transaction as from the date of the agreement. Mathias O'Sullivan, accountant for Gammon and Co. during the past seven years, said he was familiar with timber, timber country, and rates of royalty for timber. Knew the general run of the timber of the land in question. The amended rates of royalty were fair in 1902; in fact they compared more than favourably with royalties paid to others at that' time .V He instanced the royalty of 2£d paid to Prescott, at Tqkapau, the railage being 2s sd. The rimu around Ohakune was not to be compared (in colour and heart) with that at Takapau. The railage from Takapau to Wellington was 3s sd. To H. G. Lloyd, i)f Dannevirke, they paid about 2gd on ajl timbere. He could give other instances of the same nature. The bush work (cutting, shaping, and bringing to the -mill) would be 4s 3d per 100 superficial feet. The cost of sawing would be 2s. Discount, stamps, exchange, travelling expenses, etc., would run into about Is Id per 100 superficiaf feet. Witness then detailed the railage charges (outlined by Mr Skerrett in'his opening address). The value of o.b. rimu at Wanganui was 10s 9d (that would mean 7s 9d at th* mill), at Palmerston 10s 4d, at Hastings 11s 6d, Napier 11s 6d, Wellington 11s. It would be thus seqA that Gammon and Co. would make a. very small profit. They hoped to recoup themselves by manufacturing the timber at their Palmerston mill.
Cross-examined by Mr Morrison, witness said lie had- paid a higher royalty than that to Prescott and Lloyd, viz,, Is on rimu near Dannevirke. Was aware that for sonve, years past the royalty* «n rimu
on the West Coast was 6d, and thai, it v had been raised to Is. On the average one-fifth of a log would be "seconds" — * timber sawn to a size. There was a demand for this timber for lining, sarking, I outhouses, etc. Under the ag. ccmext there was no royalty on "seconds," and should townships spring up in that locality Gammon and Co. would reap the advantage. The cost of output on all timber was about 7b to 9s. White pine costs as much as any other to mill. Had been giving present prices for o.b. timber. If Gammon and Co. exported timber to any town they would make a loss. They would make a profit "''on the manufacturing' of timber. Witness was speaking simply as to Gammon and Co. '-8 operations. Had not been through the bush at Taihape, and of his own knowledge could not say whether the land was level or not, Pregcott and Lloyd wei4, anxious to get .their bush cut out a,s. quicltl^as possible. . ■ • Tb Mr Skerrett —^Everybody owning timber land was eager to get it cleared. In 1902 Gammon and Co. did not* pay/ more than 6d for rimu. "Seconds" would only be useful for local consumption. Alfred Miles, residing at Akitio, said he had had great experience in logging ' and milling. He and his partner had -examined the Raetihi land in order to give Gammon and Co. a price for getting the timber out. Tfre timber was rimu and matai, and about five per cent of totara. There was a very small proportion of white pine. From almost any point it was an uphill grade to the mill. ' On the eastern side the
country was rough. He and his partner offered to take the timber out at 4s 4d off the saws, provided Gammon and Co. provided the haulers and locomotive. The cost of milling was about 2s. Hawke's Bay rimu was superior to that at Raetihi. To Mr Morrison — His contract was for the whole block. The country on the western side was easier to work, and he would not tender to do the work there for less than 3s 6d per 100 ft. Richard Perham, of Perham, La,rsen, and C, Utiku, said that the rimu at Rae-
tihi was not to be compared with Hawke's Bay rimu. The royalties fixed in the agreement with Gammon and Co. were equal to those obtaining in 1902. He would not pay much more now. The cost of the timber at Raetihi would be greater than that in Hawke'g Bay.
To Mr Morrison: There was very little level rimu country in Hawke's Bay. Had not been through the Raetihi block under discussion, but could so in and give: a price for doing the work.
Charles Gardiner, of Manson and Co.. Limited, Hawke's Bay, said the royalties in the agreement were fair and reasonable in 1902, considering the location of the bush. i
George Bartholomew, sawmiller. of Fyilding, said he had ridden along the roads around the blocks in question. The royallies in the agreement were fair and reasorable in 1902. Sawmillers could not give the prices which speculators were giving. To Mr Morrison: A^ little more royalty could be paid no tr than in 1902. Could not recall any royalty being fixed at less than 6d since 1902. Would not give more than 6d per 100 ft. for rimu in the Raetihi district.
George Albert Gammon, a partner in the firm of Gammon and Co., said the rim a in the Raetihi district was inferior to that in the Hawke's Bay. The matai would be equally good. White pine was not workable at the present time. Did not think they could afford to pay a higher royalty. The sawing of the timber would be 2g per 100 ft. Mr O'Sullivan's evidence as to prices was correct. The firm had spent ,£7OOO, and was about to spend .£3(000. ' • ' .' * • ' -3
To Mr Morrison: The mill was near Ohakune station. If a railway siding was put in there would be no cartage required. By a subsequent agreement (in 1907) the royalty had been raised, but not rimu and matai, which was the principal timber • v the block.
This concluded the case for Gammon and Co".
In opening his case, Mr Morrison siid that the first observation he felt he should make on reading the agreement was that the natives who signed it could not possibly have had independent advice. Mr Morrison then went on to review the agreement, which he said was entirely onesided and wholly in favour of Gammon and Co. First, thaw was no clause which bound the sawmillers to any minimum output per year. It might have been reasonable to postpone a commencement till the Main Trunk Railway was within measurable distance, but in the interests of the natives there should have been a clause stipulating that a certain amount of timber should be cut out each year or a minimum royalty paid. As it was, it was a case of heads the sawmillers win, tails the natives lose. The sawmillers could ston
"when they had cut the eyes out of the bush — there was nothing in the agreement to prevent them. There should have been a provision that all practicable milling timber must be cut out. Then it was stipulated that in the event of a fire destroying the mills or plant the natives would bo responsible for the damage. The natives could not use their land till Gammon Bros., in their own good time, brought their tramway to the end of the block. What were they going to live on in the meantime? It was a monstrous thing J>hat no tribunal constituted for the protection of the natives would sanction for oue moment. Mr Morrison went on to say that the revised royalty fixed in 1907 was a farce, as it only affected timber of which there was only a very small proportion, on the block. This increase had only been offered by Gammon and Co. after they had opposed the Board's approval of the leases to Proude, Smith, and Abbott. It was an illusory proposal, which was not even signed by a single native. Considerable argument here took place as to Mr Skerrett's right to propose modifications ire the agreement between the natives and Gammon and Co., Mr Morrison' objecting. He ihen went on to sa- that Mr Skerrett had very ill-advisedly applied the word "speculators" to Messrs Proude, Smith, and Abbott, for that was the term which described Gammon and Co., so far as this affair was concerned. He contended that his clients had every right to ask for the granting of their leases, and he asked the Court to do so. He then called —
Henry Abbott, one .of the co-lessees of part of- Raetihi No. 2b, who said that he had spent something over ,£2OOO in erecting and running a sawmill. To Mr Skerrett: When negotiating for .the leases did not know anything about Garrmon and Co. Had paid Gower and Grice J2900 for a second-hand mill. This had been considerably added to. Mr Morrison produced a document showing that royalty paid for timber at Taihape in 1904 had exceeded that quoted By Gammon and Co.
Mr Skerrett, in addressing the Board, said that he had never heard anything more slight or unconvincing than the attack made by Mr Morrison on Gammon and Co.'s application. He then defended the different clauses. He said that Gammon and Co. would undertake, so soon as the Main Trunk railway was completed, to take out one million feet of timber from each of the four blocks, and to limit their rights to twenty" years. They would be very glad if the Board would appoint some* person or body to- examine their books and apportion the royalty. The objectors were not entitled to any consideration, as they were quite aware of Gammon and Co.'s poeition when they started negotiations. It was a case, of, the? biter being .bitten. They had started out to exploit
Gammon and to., and must now suffer the penalty of their folly. He contended that the Board had no jurisdiction to put a minute of approval upon the lease, and if an application was made at some future time, the Board should reinvestigate the whoje matter. Mr Morrison said that the proposed r !• tensions by Gammon and Co. made the matter very different go far as the Maori*) wore concerned. Nothing Mx Skerrctt had said took away hie (Mr Morrison's) clients' right to the endorsement of the lease. !Te asked that the seal be placed oq the lease in tlio usual way. The President said the Board would consider the evidence and report to the Minuter ' The Board then adjourned till 9.30 next morning. -
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