SALE OF AURIFEROUS LAND AT SWITZERS, (REPORT OF COMMISSION OF INQUIRY INTO).

Appendix to the Journals of the House of Representatives, 1873 Session I, C-03

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1873. NEW ZEALAND.

SALE OF AURIFEROUS LAND AT SWITZERS, (REPORT OF COMMISSION OF INQUIRY INTO).

Presented to both Houses of the General Assembly by command of His Excellency.

No. 1. Mr. Bradshaw to the Hon. the Premier. Sir, — Dunedin, 16th December, 1872. "With reference to the correspondcnco (which is now printed and is a Parliamentary paper) which has taken place between the miners at Switzers and the Colonial Government relative to the sale of 50 acres of auriferous land by the Waste Lands Board of the Province of Otago to Mr. McDonald, and also the report of Gold Fields Committee during last Session of the Assembly, and the evidence of J. C. Brown, Esq., M.H.R., which was given before that Committee, I have the honor to bring to your notice the fact that, since that report was made by the Gold Fields Committee, in which a recommendation is made that the Provincial authorities should, at the request of your Government, institute an inquiry on the spot into the circumstances of the sale, one of the owners of the said land has accepted and now holds tho responsible position of au Executive officer of the Province of Otago and Secretary for the Gold Fields of that Province. My reasons for now calling your attention to this matter are:— 1. Because the correspondence originally passed through my hands to the Government. 2. Because I represent the Switzers District, where the fifty acres are situated, both iv the General Assembly aud the Provincial Council of Otago. 3. And because the miners generally, as expressed by their representatives in Conference assembled at Tuapeka, Lawrence, wish that your Government should appoint the Commission of Inquiry, instead of leaving the appointment of the Commission to the Provincial authorities. I have, &c, J. B. Bradshaw, The Hon. the Premier, Wellington. M.H.R. for Wakaia.

No. 2. The Hon. Mr. "Waterhouse to Mr. Bradshaw. Sir,— "Wellington, 20th December, 1872. I have the honor to acknowledge the receipt of your letter of the 10th instant, having reference to the report of the Gold Fields Committee of last Session on the sale of 50 acres of auriferous land at Switzers, Otago, and beg to inform you that the Government do not deem any action on their part desirable until the Provincial Government of Otago have had the opportunity of giving effect to the resolution of the said Gold Fields Committee of the House of Representatives. I have, &c, J. B. Bradshaw, Esq., M.11.R. G. M. "Waterhouse.

No. 3. The Hon. J. Hall to His Honor J. Macandrew. Sir, — Colonial Secretary's Office, "Wellington, 24th December, 1872. Adverting to your Honor's letter No. 12,791-7, of the 17th June last, forwarding a letter from the Warden of Switzers relative to the sale of auriferous land in that district, I have the honor to transmit to you a copy of the report of the Gold Fields Committee of the last Session of the General Assembly. I have to draw your Honor's attention to the paragraph relating to the sale of land at Switzers, and to request that you will be good enough to favour the Government with information relative to the steps the Provincial Government of Otago proposes to take in the matter. I have, &c, His Honor the Superintendent, Otago. John Hall. I—C. 3.

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No. 4,

His Honor J. Macandeew to the Hon. the Colonial Secbetaey. Sic, — Province of Otago, New Zealand. Superintendent's Office, Dunedin, 3rd January, 1873. I have the honor to acknowledge the receipt of your letter of the 24th December, 1872, transmitting copy of the report of the Gold Fields Committee of the last Session of the General Assembly, and calling my attention to the paragraph relating to the sale of land at Switzers. In reply, I have to inform you that the Provincial Government has requested Mr. T. L. Shepherd. M.H.R., to proceed to Switzers to examine into this matter, and I shall be glad if Mr. Maitland, R.M., should be appointed to accompany him on behalf of the General Government. I have, &c, J. Macandbew, The Hon. the Colonial Secretary, Wellington. Superintendent.

No. 5. The Hon. J. Hall to His Honor J. Macandeew. Sik, — Colonial Secretary's Office, Wellington, 14th January, 1873. I have the honor to acknowledge the receipt of your letter No. 12,791-12, of the 3rd of January, 1873, and in reply to inform you that Mr. J. P. Maitland has been instructed to inquire into the sale of auriferous land at Switzers, in conjunction with Mr. T. L. Shepherd, M.H.R., and to place himself in communication with your Honor. I have, &c, His Honor the Superintendent, Otago. John Hall.

No. 6. His Honor J. Macajtdeew to the Hon. the Colonial Seceetaey. Province of Otago, N.Z. Sib— Superintendent's Office, Dunedin, 10th April, 1873. I have the honor to forward herewith report (together with evidence) of Messrs. Maitland and Shepherd, the Commissioners appointed to inquire into the sale of auriferous land at Switzers, in accordance with the recommendation of the Gold Fields Committee of the House of Representatives last Session. The expense of the Commission amounts to £142 16s. Gd., of which I havo to request you will begood enough to direct the payment. I have, &c, J. Macandeew, The Hon. the Colonial Secretary, Wellington. Superintendent.

Enclosure in No. 6. Mr. J. P. Maitland and Mr. T. L. Shepheed to His Honor J. Macaitdeew. Sic, — Dunedin, sth April, 1873. In accordance with the request contained in letters from the Provincial Secretary, No. 12,791-9, 21st December, 1872, that we should inquire into the circumstances connected with the sale of certain alleged auriferous land at Switzers, we have the honor to state that, both at Switzers and at Dunedin, we have taken all available evidence likely to throw any light upon the subject. This has been obtained from numerous witnesses at both places, from a careful personal examination of the ground, and an investigation of all the records of the Waste Land Board bearing; upon the matter. The evidence taken by us, together with printed correspondence forwarded, is appended hereto, and we have now to report as follows : — The land in question is a block of fifty acres, originally on run No. 254]), and within the gold fields, and that William Acton applied to the Waste Land Board to purchase the same on 12th May, 186S, he having previously obtained the runholder's consent to the sale. This application came before the Board on 13th May, ISGS, and appears in the first place to have been favourably entertained by it, as the applicant was directed to deposit the amount of cost of the survey. It does not appear that at this time there had been any official report on the land; it even appears doubtful whether the Board knew that it was within a gold field. On the 2nd September, 18G8, it appears that the Warden of the gold field, Mr. Wood, at Acton's request, wrote to the Government, asking that the survey might be proceeded with. We have not been able to obtain the letter, but the Chief Commissioner states that he gathered from it that the Warden was favourable to the sale. The survey was accordingly proceeded with, and Acton applied again through Mr. E. De Carle to purchase. This application came before the Board on 14th October, 18G8, when the report of the surveyor was read and the map produced, which showed no gold workings within the boundaries of application, but some in the immediate vicinity. The Board on this occasion deferred consideration. An application by Acton to purchase came again before the Board on 2Sth October, 186S, when the Board having found that the ground applied for was within a gold field, considered at this time that it had no power to sell under such circumstances, although quite inclined otherwise to give favourable consideration to the application, Acton having made valuable improvements upon the land.

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Acton renewed his application on the llth November, 186S, and stated that he had made considerable improvements, of which a survey had been made. The Board again declined, on the ground of the application being within a gold field. Mr. Warden Wood states that whilst in Dunedin, in October or November, 1868, he stated in conversation, either to Mr. Duncan, then a member of the Government, or to Mr. Hughes, then a member of the Waste Land Board, that he should not recommend the sale of the 50 acres, as it might prove to be auriferous. We cannot find, however, that the possibly auriferous nature of the ground was ever considered by the Board. The death of Mr. John Hughes has prevented us from obtaining any information from this gentleman, which might have proved of a valuable character ; he having whilst a member of tho Waste Land Board had special charge of all matters connected with the gold fields. Acton does not appear to have renewed his application after llth November, 1868. It seems that his circumstances having become involved, he mortgaged his interests in the application, together with other properties, to R. S. Dods. These were in March, 1869, sold by the mortgagee, and went into the hands of several different purchasers, McDonald becoming eventually the purchaser of the surface rights and improvements ou the 50 acres. McDonald about February, 1871, sold his interest in the 50 acres to Mr. 11. Bastings for the sum of £900, who thus at this date became possessed of all the surface interests in the block, including an hotel, store, stable, punts, &c. ; whilst at the same time he had along with one Simson all the water rights running through the ground, and the immediately adjoining mining claim. This being the position of matters, it seems to have occurred to McDonald, that having sold all his interests to Bastings, if he could obtain the freehold of the 50 acres, the value of the property would be considerably enhanced ; and some short time after the sale he made a proposal to Bastings, asking him what sum he would give him if he could get him the freehold. Bastings ultimately agreed to pay him the sum of £200 in the event of his doing so. Accordingly, upon the 4th May, 1871, McDonald applied to the Waste Land Board to have section No. 1, Wendon District, agreed to be sold to William Acton, granted to him as transferrec, and the application was granted subject to the transfers being correct. It appears that McDonald appeared personally before the Board, but as far as we can learn made no representation in connection with his application beyond the statement contained in it. The Board afterwards appears to have been satisfied that the transfer of Acton's interest to McDonald had been duly made, and eventually completed the matter. McDonald immediately conveyed the land to Bastings, as had been agreed upon. Nearly three years had elapsed since Acton's last application in connection with this land had been before the Board, and its recollection of the manner in which that application had been dealt with does not seem to have caused it to notice that McDonald had made a misstatement in his application, as to the land having been agreed to be sold to Acton. We draw attention to Mr. Thomson's evidence on this point. No report upon the ground seems to have been obtained up to this time, not does the fact of its being possibly auriferous seem to have ever come under the consideration of the Board. The explanation of the grounds of the Board's decision upon McDonald's application, as obtained by us from the present Chief Commissioner, who also held this position when the application came before it, is, that the Board had since the date of Acton's last application come to a different opinion as to its power of selling land within a gold field, and, when McDonald's application was considered, believed that it had the power of dealing with such land under clauses 83 and 123 of " The Otago Waste Lands Act, 1866." That holding that opinion, and believing that Acton's applications had been declined entirely upon the ground of the Board not having the power to sell, although otherwise favourable to the sale, on the ground of the extensive improvement which Acton had put upon the land, and the general desirability of securing settlement on the gold field, the Board, knowing of no objection, did not hesitate, but granted McDonald's application. It appears, as a matter of practice, that tho Waste Land Board does not call for reports upon applications to purchase land within a gold field, but that it has been the practice that such reports, when required, have been obtained by the Gold Fields Secretary as a matter lying within his department, and in the event of his making no objection to such sale, the Board takes for granted there are none. That the Chief Commissioner's duty has been confined to directing the Board to tho legality or otherwise of any matter before it, leaving the question of policy or propriety entirely to the Government, as represented at that Board, by whose recommendations it has been entirely guided. That carrying out this practice, in considering McDonald's application, no objection coming from the Gold Fields Secretary or other member of the Government, the Board believing that none existed, and that it had legally the power to sell, sold the land. From our inspection of the ground, and from statements by Messrs. Bastings and Simson, wo find that since the sale of the freehold of the 50 acres they have gone to very considerable outlay in mining upon it. Mr. Bastings states that lie has up to the present time expended a large sum beyond the value of any gold obtained from the ground. There are indications of a lead of gold running through the ground. We come to the following conclusions: —■ That the 50 acres of land originally applied for by Acton, and eventually sold to McDonald, is undoubtedly auriferous. That Acton's application, after having been before the Board on several occasions, was finally refused. That all hough there were at the time of McDonald's application no gold workings actually upon the ground, there had been for years, and were at the time, workings in the immediate viciuiiy ; and in one claim a great deal of gold had been taken close to the boundary of the 50 acres. That this being the ease when the application to purchase was made, an oversight occurred, and a departure from the usual practice, in not calling upon the Warden for a report

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upon the ground. This omission seems, as far as we can discover from the practice in force with regard to such applications, to have occurred in the Gold Fields Secretary's office. That had the Warden been called upon at any time from 186S to report, he would have reported against the sale, and the sale, in consequence, would in all probability not have taken place. That McDonald misled the Board by stating in his application that the land had been previously agreed to be sold to Acton ; whereas, in fact, the sale of it had been refused. That McDonald made the application to purchase under an arrangement with Bastings, namely, to convey the freehold to him if obtained, for the sum of £200 beyond the purchase money, which was given effect to. Finally, we recommend a strict adherence to the practice of calling for a report from the Warden or other suitable person, before dealing with any applications for the purchase of land within the gold fields, as the omission of this in this case was the main cause of a block of auriferous land passing into the hands of one person, which experienced miners believe might have been profitably worked by a considerable number of men in ordinary claims. We have, &c, James P. Maitland. His Honor the Superintendent, Dunedin. Thomas L. Shepherd. Sub-Enclosure 1 to Enclosure in No. 6. Partnership in Break'em All Claim dissolved on 20th March, 1871, and advertised and sold on 17th April, 1871, to Simson and Bastings, £75. On 19th December, 1870, the certificate of One Acre Claim cancelled, does not appear to have been taken up again until Messrs. Simson and Bastings applied for four acres, including " Break'em All" and One Acre Claim on 23rd June, 1871. Transfer of water license 2,560 from Bush Head of Winding Creek from Dods to Do Carlo 28th May, 1869. Transfer of water license from De Carle to Bastings aud Simson, 23rd June, 1870. Taken from certificate book of Warden's Court, Switzers, llth February, 1873. James P. Maitland. T. L. Shepherd. Sub-Enclosure 2 to Enclosure in No. 6. Memorandum for T. L. Shepherd, Esq. Survey Office, Dunedin, 2nd April, 1873. Acton's application is outside of the Commonage Reserve, both by the sketch attached to Swanstone's lease and the best topographical map we have in the office. The same has not been actually surveyed, but I think will be found nearly correct. I have, &c, J. T. Thomson, Chief Surveyor. Sub-Enclosure 3 to Enclosure in No. 6. Evidence. John Turnbull Thomson, Chief Commissioner, Waste Lands Board, examined. I produce Acton's application to purchase the 50 acres ; it was lodged on the 12th May, 1868 ; it first came before the Board on 13th May, 1868. I produce minute of Waste Land Board, application of William Acton, of Winding Creek, for 50 acres on run No. 254b, with which was produced the runholder's consent. "Resolved, That the amount of survey be deposited, as on survey of preemptive rights." This signified, according to my opinion, that the Waste Lands Board were, in the first place, inclined favourably to consider tho application, otherwise they would not have put the applicant to the expense of surveying it, the more so as large improvements were stated to have been put upon the land. I think at this time the Board was in doubt as to whether the land applied for was within the limits of the gold field. The application next came before the Board on the 14th October, 1868, when Mr. E. De Carle, on behalf of Mr. William Acton, applied to purchase 50 acres on run 254b, with consent of runholder, being the same 50 acres originally applied for by Acton. Minute. —" Read the report of surveyor, and examined map produced; consideration deferred." Present —Cutten, Thomson, Secretary Land and Works, and John Hughes. Application again came before the Board on 28th October, 1868; it was then refused, being within a gold field. Present— Cutten, Thomson, Secretary of Land and Works, and John Hughes. I do not know that any representations were made to the Board at this time. The application again came up on llth November, 1868, when Mr. William Acton again applied to have granted him the 50 acres, and stated he had made improvements, of which a survey had been made. The application was refused, being within a gold field. My impression was that most of the members at the time thought they had not power to sell land within a gold field; but their wish was evidently otherwise, to sell it to Acton. Present—Cutten, Thomson, and Hughes. The application did not come before the Board again until 4th May, 1871. Present —Chief Commissioner Thomson, Haughton, Gold Fields Secretary, and Cargill, Provincial Secretary. "When Allan McDonald applied to have section 1, Wendon District, agreed to be sold to William Acton, granted to

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him as transferree. The request was granted, provided the transfers are correct." This statement of McDonald's was incorrect, as the Waste Land Board had never agreed to sell to Acton. McDonald came before tho Board and personally made his application. The Gold Fields Secretary asked me if I knew of any objection, and I said I knew of none, and that the Board had power to sell under the 123 rd section of "The Waste Lands Act, 1866;" that what I recollected of the case was, that Acton havin_; made great improvements, my recollection of the feeling of the Board previously was that he should have the land. At the same time, as these applications were always made in ordinary routine, on the responsibility of the Governor's delegates who were present, namely the Provincial Executive, who had sole authority over the gold fields officers, I only spoke of the legality of the matter, not of the policy or propriety of it; indeed the Board has always refused to entertain a Government land application without a responsible member of the Provincial Executive, who hold the Government delegation, being present, and the Board has always been guided in its decisions by the Provincial Executive represented at the Board. McDonald's application was taken down by my clerk in McDonald's own words in the Waste Land Board draft minute-book : " Mr. McDonald to apply to have section 1., Wendon District, agreed to be sold William Acton, granted to him as transferree." As authorized by Waste Land Board, I examined the transfers, found them to be correct, and substituted McDonald's name for Acton's in the original application. Being merely a private member of the Board when the former applications with regard to this land came before it, my impressions were not very vivid, but they were to the effect that there were no particular objections to the sale to Acton, but rather that the Board had been favourable to the sale. When the propriety of the sale was called in question, I then looked up the gold fields papers in the Gold Fields Secretary's office. I did not consider the wording of McDonald's application as to the Waste Land Board having agreed to sell to Acton, and did not look up the former decisions of the Board on the subject. I satisfied myself by a perusal of transfers that Acton had parted with any right he had to the land to McDonald, and accordingly filled in his name on the original application, making him stand in the position of the original applicant. The Provincial Secretary usually brings in all applications affecting gold fields purchases, and tho Waste Land Board passed them without question, unless there is a protest from outside, which I think has only happened once. The Waste Land Board do not ask for reports on applications for land in gold fields if they come through the Provincial Government; if they come direct, the Board asks the Government to make the necessary inquiries. The report of the Warden, which I refer to in telegram to Mr. Cooper as being favourable to the sale in 1868, was a report from Mr. Warden Wood, which I saw in the Government offices, and which I read in that sense. I looked upon Mr. Haughton as an experienced gold fields officer ; it therefore did not occur to me to put myself in his position, and act in the interests of his department. I consider myself in no way responsible for the propriety of granting, or not granting, gold fields applications, as I am absolutely debarred by the arrangements of Government from having any direct and responsible information on the subject. The plan of Acton's application was received by the Survey Office on 6th October, 1868. No other plan has ever been made ; there was nothing in the plan to show that there was any gold working within the boundaries of the application ; it was therefore passed through, with many other applications from various parts, as a matter of routine. On all the former occasions when Acton's application came before the Board, I was not Chief Commissioner; I was not so until McDonald's application came before it. I was aware, when McDonald made his application, that the Board had by implication agreed favourably to consider the sale to Acton on its first consideration by the Board, as the survey deposit was received as for a pre-emptive right. Subsequently, when tho Board declined, it was on insufficient grounds, seeing that the Board had the power to sell within gold fields. The 123 rd section of Waste Land Act had not then ever been acted on. Between 1868 and 1871 a complete change of sentiment took place with reference to sales of land within gold fields, tho sales formerly being exceedingly limited, at the latter time of daily occurrence. McDonald made no representation to me or to any member of the Board, as far as I know, on tho subject of his application. Memorandum for the Commissioners. In regard to what took place at the Board on McDonald's application, having had time to roca 1 the subject to my memory, I may state that it came abruptly ou me without notice, it being stated in the case-book as already having been granted. This might have been perfectly true, in my various absences from the Board ; and it did not occur to me to question it, as my recollections were favourable to the granting, nothing having been adduced against it at the times of my sittings. After McDonald had stated his case, I shortly told the other members that I believed the land to be improved and under agriculture, a fact which always weighed strongly with the Board in similar cases, and that they had power under the 123 rd clause, " Waste Land Act, 1866," to grant it if they wished. I at that time knew of no objections to the granting on the plea of the auriferous nature of the soil, else I would not have acceded without further inquiry, though this is a part of the Gold Fields Department. The application was then granted. J. T. Thomson. P.S. —The application was one of many other questions disposed of at the same sitting. Horace Bastings, Gold Fields Secretary and Secretary for Works, Dunedin, examined. Over two years ago I lent Mr. De Carle, who was then owner of the water rights in connection with the Break'em All Claim. Mr. De Carle got into difficulties, and was not able to pay me the money, and I took the water rights from him, and allowed him £300 for them. At this time the ground was being worked by Simson, Graham, and party, aud I sold half of my water right to Hector Norman Simson for £150. When I sold him then, I got an interest in the mining claim witb

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Simson. We then let the water to Graham's party for our interest in the claim—£B a week. They did remarkably well for some time, and paid their rent regularly. They got a lot of gold out of the claim, but afterwards they fell out amongst themselves. At holiday times they got on tho spree, and allowed the gear to get into disorder, and the ground fell in in the claim. All this time the hotel and surface rights of Acton belonged to Simson. Simson made up his mind to sell out and go to Australia, and sold out to Allan McDonald. 1 think this was over eighteen months since. He tried to sell his half share of the water right to me, but I was disgusted with the whole business, aud for a time tho water ran to waste, and any one used it that liked. I offered the whole water for £200 at this time, and could not get a purchaser. Some little time after Simson came back from Victoria, and went to Switzers again, aud by the time McDonald had built a large stable and made some other improvements in the property, and Simson came to me and said that McDonald was desirous of selling out, that he was sick of it, and that he would sell the place for £900. Simson put it to me that he had great faith in tho ultimate result of the thing, that there was good gold there, and that he could do a good butchering and store business, and that if I would back him in the affair he would feel inclined to go into it. I agreed to go into the claim, and that he should carry on the business himself, and pay me a rental for the property. I told him I would make arrangements for his getting credit as long as I was satisfied with the way he was going on ; and that if the claim paid, as soon as it did, he should rank as halfowner of the property, allowing me bank interest on any of my money that was out, to be reckoned every six months. 1 then bought the property from Allan McDonald. This included hotel and other buildings, pumps, and whatever surface rights he had over the 50 acres, and adjoining claims, for the sum of £900. I gave him £500 cash, and bills for the balance. I got a receipt from McDonald for this, but have not got it by me. It is at Lawrence, and 1 am willing to produce it. I think this was about February, 1872. While tho bills I gave McDonald were current, McDonald came to me at Lawrence aud said, " I find I can make that property freehold." I said, " Indeed ; " and he said, "If I can make it freehold, what will you give me for it extra above the £900 ? " We had a good deal of conversation on the subject, and ultimately I agreed to give him £200 above what he had to pay for tho land. McDonald agreed to this, and I said I would be prepared to pay the money when I got a title to the land. He gave me the deed, and I gave him the money. It was a month or two before I got the deed. I did not hear of the propriety of the sale being called in question until some time after 1 got my title. I made the purchase of the land for the purpose of carrying on the claim —I mean working the claim, the old "Break'em All Claim." I did not know at that time how much of the land was auriferous, and Simson required land for carrying on his butchering. I cannot say whether there is a lead of gold running through the land. We allowed people to prospect the ground on a very small tribute. They could not make it pay, it requires such a large outlay of money to work the ground. The debtor and cred'tor account of the claim now stands, that the claim is due me over £2,480 exclusive of the water right. We have been employing men for the last nine months, paying some as much as £3 per week. I have sent up as much as £100 per week for twelve weeks in succession, for tho payment of wages on the claim, and as far as I am concerned am quite willing to give up the claim at a loss. lam heartily tired of the whole concern. The whole feeling on Switzers in connection with the sale of tic land arose from the fact that the miners had had tho use of my water for some time for nothing ; and a jealousy existed among the business people at Switzers, from the fact of my backing up Simson, who was doing a large butchering and storekeeping business, and taking business away from the hill. Any impartial man must know and admit that no miners could have worked this ground without my water and a large amount of capital; and my spending such an amount of wages in the district must have done good. I told the owner of a house on the 50 acres that I was not aware it was on the ground when I bought it, and that he was at full liberty to remove it, which he did. With regard to the person who bus got a house and paddock on the 50 acres, I am inclined to let him stop on, and am willing to give him a lease of the ground for five years at a nominal rent. Mr. Simson is indebted to me in a large sum of money, and the property belongs to me until ho pays me, when he will become possessed of one half-share. Our largest yield was £1,200 in six weeks. During the past four weeks I have sent up £570, which has been spent iv timber and expenses. This represents the expenditure since the receipt of gold from tho claim. I positively state that the idea of purchasing the property originated with McDonald, and not with mc. Had not McDonald agreed to have transferred the freehold to me, 1 should have opposed the purchase by him. Horace Bastings. John Nugent Wood, AVardcn and Resident Magistrate, residing at Switzers, examined. In explanation of Mr. Thomson's telegram—Mr. J. T. Thomson to Mr. G. S. Cooper, on 20th October, 1871, being enclosure No. 4 in the printed correspondence —the only communication that could in any way be construed into a recommendation or that I was favourable to the sale of the 50 acres in question, was a letter which I wrote to the Provincial Government enclosing the copy of Swanstone's receipt of 4th May, IS6B, tor his interest as runholder, in which I asked the Government, at Mr. Acton's request, to get the survey proceeded with, he having informed me that be had lodged a sum of money with the Waste Lands Board for that purpose. I received no written communication on that subject from the Government. After that a survey took place by the Government Surveyor, Mr. Prentice. In October or November, 1868, I was in Dunedin, and cither Mr. Duncan or Mr. Hughes spoko to me on the subject of selling the land to Acton. In reply to their inquiries, I believe I said "I would not recommend the sale of the 50 acres." About the same time, or a day or two after, I met Mr. De Carle, Acton's agent; who asked mc if I would recommend the sale of the 50 acres to Acton. I told him "I would not do so." Afterwards I met him in the Provincial Government Buildings with Mr. Macandrew. Mr. Macandrew said, " Mr. De Carle wishes to purchase 50 acres for Acton up at Switzers." I stated that I would not recommend it; and on His Honor asking me why, I said " that the land might prove auriferous and be floated as a Switzers Freehold Mining Company, and I should

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41 be blamed for it." I have had no communication concerning the 50 acres till after the sale; I have never been asked for a report on the advisability of selling the 50 acres. 1. Mr. Shepherd.] Is it not usual, in cases where it is proposed to sell land on the gold fields, to ask the Warden to report on such land previous to sale?— Yes, it is usual; I have never known any other case but this in which it has been dispensed with, at least since 1868. 2. Can you state the time when you first became acquainted with McDonald having purchased the fee-simple of the 50 acres?— Perhaps two or throe weeks before I heard it spoken of publicly. When I heard it I did not believe it, and stated to my informant that the Government would not sell without calling for a report. I should not have recommended the Government to sell the land had I been asked by them. In March, 1869. I became tho purchaser by public auction, under bill of sale from Acton to R. S. Dods, of the following interests, namely, the squatter's right to the 50 acres and the buildings thereon, such buildings being a public-house, stable, &c, with garden and cultivation, paddock —in fact, all the improvements on the 50 acres. The mining interests were sold to Do Carle, Brown, and Gregge, on joint account. Agricultural implements and cattle sold to various purchasers. At the time of the purchase I signed a sale note and paid tho money, namely £200; and before any deed was made out from Dods to myself I had sold to Simson, and the deed was made out "R. S. Dods, by direction of J. N. AVood, to 11. N. Simson." I instructed Mr. Haggitt, and got Dods' consent, to convey to Simson, about the 13th or llth April, 1869. I held a mortgage over the place and everything; I had sold to Simpson for £200; tho bill of sale was registered, and such mortgage was paid off in the first week of December, 1870, at the time Simpson sold to Grant. I was finally paid off when Simson sold to Grant. I have had no connection with that property since, cither directly or indirectly. 3. AVhat induced you to cause His Honor the Superintendent to understand (as he asserts in his letter of 18th April. 1872, to the Colonial Secretary) "that the nature of the ground in question is such as to preclude its being advantageously worked, if indeed it can be worked at all, without the application of extensive capital?— Because the ground had been open to be taken up by minors, with the exception of two acres, namely, the Break'em All and Bailey's Acre, from December, 1870, to the time it was first known Simpson had purchased tho ground, and that none of it had been attempted to be worked; and tho ground being deep, wet, and bad standing ground, and also requiring close slabbing, could only be worked at a great expense ; and that I was of opinion that it could not bo worked profitably without machinery, except with Simson and Bastings' water, they having the most available for driving a wheel. lam not aware what amount of water Simson's pumps are driving at the present tim v, but lam aware when the pumps cease working tho claim is flooded, and that is the reason that the ground was not worked after 1870 till the dissolution. There aro two pumps working at the present time, one underground and one at the surface. I believe if a dozen shafts were put down and worked, tho water would not be troublesome. John Nugent AVood, AVarden. John Utting, Storekeeper, residing at Switzers, examined. I had a conversation with Mr. Bastings about nine to fifteen months back, at my store, regarding the 50 acres the subject of this inquiry. It was after the agitation in reference to it Mr. Bastings told me that Allan McDonald had asked him if he would give him £300—I believe that was the sum mentioned —if he obtained the fee-simple of tho 50 acres at Acton's Flat; also, that the price McDonald asked was not agreed to by him; eventually a certain amount of money was agreed upon to be paid if McDonald obtained the freehold. The sum mentioned by Bastings, to tho best of my recollection, was either £150, £200, or £250. Bastings said McDonald had gone to town, and wrote that the purchase would be complete if he could obtain the squatter's consent; and while he (Bastings) was absent from home, McDonald went to Tuapeka and obtained one of"his horses, for the supposed purpose of obtaining the squatter's consent in writing. After this he (Bastings) received a telegram, saying, " I have drawn on you at sight for the amount agreed upon." Mr. Bastings also told me that he had not honored the draft until the deeds had been examined by his lawyer. In my opinion the land is not fit for agricultural purposes, and would not give 10s. an acre for it. I believe that the reason Bastings purchased tbe land at such a figure was that it was auriferous. John Utting. AVilliam Acton, Miner, residing at Switzers, the holder of a miner's right, examined. I know the Break'em All Claim, at Winding Creek. I employed M. Hay to make application for 50 acres on Winding Creek. I have not made an application to purchase any other land. My application to the AVaste Lands Board was refused, as it —the land—was auriferous. I visited the AViste Lands Board with De Carle repeatedly, but they would not sell it to me. They refused to sell it on account of the AVarden, as ho recommended them not to sell it. Mr. AVarden Stratford, the Warden prior to Mr. Wood, recommended the sale, as I had expended such a quantity of money upon it. I wrote to the Secretary of Lands and AVorks, stating that if ever tho land was sold I wished to be the purchaser. I never at any time assigned my interest in the application for the 50 acres to any one, or any interest I had in it. McDonald called upon me in Dunedin, and wished me to assign my interest in a certain application for the 50 acres now referred to. I refused. He said, " I will give you money if you will sign it." He said, " You want money badly now ; name what you want, and I will give it you." I said I would not sign it at any price. He told me he was about to purchase the land. He said he could not get the land unless I signed some paper or other. I refused to sign for any money. Ho asked mo to go to the Land Office with him; I refused. McDonald afterwards came to mc at Acton's Flat, and asked me to sign that paper. I told him I would not, and that he need not ask me any more. At the time this took place, he was the proprietor of the public-house on the said ground. Between the two interviews with McDonald, I wrote to the Secretary of Land and Works, and told him, if it was to be sold, I wished to be the purchaser. I was confident there was a lead of gold through the 50 acres. I told Simson that there was, but I could not stop to get it. I never had

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any notice from the Waste Lands Board telling me that the land was about to be sold. Ido not know how McDonald obtained the land without my signature. I think that Mr. Wood's recommendation not to sell it was subsequent to Mr. Stratford's recommendation to sell. The right that I purchased from Mr. Swanstone I have never assigned in any shape or form. There was only one survey of 50 acres, and that was prior to the faking up of the Break'em All Claim. At that time my gold workings were outside the fifty acres. The claim worked by me was payable, though not so rich as the Break'em All Claim. Mr. Acton re-examined. I never executed any assignment of my interest in the property referred to in this inquiry excepting R. S. Dods, and then by way of bill of sale prepared by Mr. Ilaggitt, solicitor, of Dunedin. All my interest that was mortgaged and mentioned in the bill of sale, with the exception of some cattle and agricultural implements sold to other parties, was sold to Mr. Wood and Mr. De Carle. Any interest that McDonald acquired was through Mr. Wood. I never signed anything direct to Mr. McDonald. Subsequently to the purchase of the property by Mr. AVood, I was present when Mr. Wood said that in purchasing the property acquired under mortgage, AY. Acton to R. S. Dods, "he had become possessed of a white elephant," aud he was glad to get rid of it, " and could I get a title to Acton's Flat I would give Government my commission." Mr. De Carle purchased the mining interest and water race, and Mr. AVood the buildings and business interest. I remember at the time that Mr. Ilaggitt was preparing the bill of sale at Dunedin he went to the Government offices to inquire whether I. could purchase the 50 acres of land, and he informed me on bis return that I would not be allowed to purchase, and the bill of sale was prepared accordingly. Mr. Dods remarked in the presence of Mr. Ilaggitt and myself, "You see how insecure you are ; you have no title to the land." AVilliam Acton. AVilliam J. Braithwaite, Storekeeper, residing at Switzers, examined. I know the 50 acres of land the subject of this inquiry. I remember a conversation between Mr. Bastings and myself, shortly after he became possessed of the 50 acres. I intimated to him that it was rather a curious thing of him, being a gold fields member, to mix himself up in anything of the sort. He then told me, by way of apology to that, how he became possessed of the land. He said that after he agreed with McDonald for the purchase of the property, McDonald asked him what he would give him if he could get a free title to the ground. Bastings said he did not think he could get a title to it, but if he could succeed he would give him £200 or £250 or thereabouts for his trouble. McDonald then went to town, and shortly after telegraphed up to Bastings, wishing him to send down the money, as the purchase was completed. Instead of sending down a cheque to McDonald, he telegraphed to his lawyer to examine the title, and, if it was complete, to pay the money to McDonald. On another occasion subsequently I had a conversation with Bastings. This was at a time no gold was getting in Simson's Claim. AVm. J. Braithwaite. Ralph Shaw, Miner, residing at Switzers, examined. I know the 50 acres in question. I had a conversation with Mr. Bastings about April last, opposite the Bank at Switzers. I asked him whether he would hold the 50 acres he purchased, or if he would prefer compensation ;he said, " Compensation, of course." The claim was not paying at the time. I asked him (Bastings) how he got the 50 acres. He said, " McDonald asked me how much I would give him if ho (McDonald) got me (Bastings) the 50 acres." Bastings said " Ridiculous ; the AVaste Lands Board would not sell it." McDonald said, " Never mind what the AVaste Lands Board do, so long as I get you the fee-simple of the 50 acres ; what will you (Bastings) give ?" I replied £200, and McDonald immediately started for Dunedin. After McDonald had been in Dunedin a short time, he telegraphed to Bastings stating that his application to the AVaste Lands Board was successful, and Bastings said he drew on me at sight for £200, asking me to accept, or return. Bastings declined, but telegraphed to his lawyer to inquire and see if the application for the 50 acres was granted. Bastings' lawyer answered " Yes," and he (Bastings) sent McDonald the money. Ralph Shaw. George Skeene, Merchant, of Switzers, examined. 1 recollect about five years ago, while in Dunedin, I met Mr. Hughes, member of the AVaste Land Board, who showed me a plan which he said " AY. Acton, of Switzers, had handed into him, stating that he wished to purchase 50 acres of land at Winding Creek, Switzers." Mr. Hughes asked me if I knew the locality. I said, " I know it very well." He showed me a plan by which it appeared that the 50 acres were situated outside the gold fields, or at least outside gold workings. He asked me what I thought of it. I said he must not make a mistake about it, and explained that there had been workings in the vicinity of it, and immediately adjoining the 50 acres. Hughes said, " Under these circumstances I shall go and see Acton ; it is ridiculous to think of purchasing land in that locality ; it was represented by Acton that it was two and a half miles from the workings." I saw Mr. Hughes some days afterwards, and he informed me that he had seen Mr. AVood (who was in town at the time), and that Mr. AVood had recommended tho Government not to sell the land. Mr. Hughes said, " Had the land been out of the gold workings as represented, it might have been granted by the Board." I know the 50 acres, and am of opinion that it can be worked by miners in ordinary claims. I believe, if the lead continues through it, it would employ 100 men or thereabouts —that is, in ordinary claims. At Acton's sale the auctioneer only professed to sell the permission of the runholder to occupy the 50 acres, and enjoying the same rights as Acton previously had. I at the sale bid for the property purchased by Mr. Wood, but did not consider that I was bidding for any right to purchase the land, nor do I think that any person thought they would have any hold, of the land if they had bought. It was known at the sale that Acton's application to purchase the land had been declined.

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After McDonald purchased the land I had a conversation with him ; he stated the reason he was anxious to purchase the land was that Mr. Bastings had previously told him that the purchase of the land would improve the value of the property by £200; and prior to the purchase of the freehold by McDonald, Bastings had made an offer for the property, and the price was to be increased by £200, if McDonald could succeed in obtaining a freehold of the 50 acres. I understand from McDonald that his sale to Bastings was not concluded until after he had obtained tho freehold of the land. I should never have imagined that au application to purchase the 50 acres would have been successful. I understood from McDonald that Bastings was desirous to have the freehold from McDonald if he (Bastings) purchased. Mr. Bastings was possessed of a water race, which he acquired through De Carle, before McDonald purchased the land, and such race was through the 50 acres ; and such water race also worked a wheel used for pumping and drawing trucks in a claim adjoining the 50 acres. George Skeene. William Wilson, Miner, residing at Switzers, examined. I know the 50 acres in question and the Break'em All Claim, in which I worked; that was in March, 1871. I have, during my working tho claim, tribute received from £2 to £10 per week, and the last dividend I received was £1. The claim was neglected and I ceased working. I believed there was a lead of gold from that claim through the 50 acres, and I also believe the ground would pay in ordinary claims. The claim was paying £4 a week to Simson, as agent for Bastings, for water, at the time the Break'em All Claim was sold by order of the Warden's Court; it was purchased by Simson, aud commonly reported on the joint account of Simson and Bastings. I was working in the 50 acres four months ago ; there was good gold in the wash ; there was a lead running the way I always thought it did, going with the hill and across the paddock towards Murphy's Hill. his William x AVilson, Witness—R. Shaw. mark. James H. AVilkie, Miner, residing at Winding Creek, examined. I know the 50 acres, the subject of this inquiry. I also know the Break'em All Claim; there were two-thirds of the original Break'em All Claim in the 50 acres. I believe it was three or four acres. The best prospects which have been obtained in the Break'em All Claim is in the 50 acres, and the best gold at that place is obtained out of the claim known as the One Acre Claim, adjoining the Break'em All Claim. At the time McDonald purchased the land I cannot say if any claims were working there. At the time McDonald bought the 50 acres, there were no workings going on on the 50 acres. I offered to purchase some ground there from Mr. Bailey-, with a view of working it. Ido not remember Mr. Simson offering the claim to me. The water rights held by Simson were necessary for working the ground. At the time McDonald bought it, I considered the 50 acres auriferous and good ground then, although Simson and party had not been successful. Mr. Simson has told me that he has got since the purchase of tho land between 20 to 60 ounces a week since he first struck the gold. I have seen at Simson's claim as many as eighteen men, and as few as two working. I had conversations with Simson regarding the land. McDonald took possession of the property in December, 1870. There was good gold got on the one acre prior to his taking possession of it. Several claims were protected there at that time. There was no active working at the time McDonald was there. James H. AVilkie. John Hurley, Miner, residing at Switzers, Winding Creek, examined. I know the 50 acres at Winding Creek, the subject of this inquiry. I saw a notification in the TTitness newspaper that Allan McDonald applied for 50 acres in the Hurdon District. I cut it out of the paper and took it to Mr. Acton. I asked him it' he would like to see it; he said, Yes. He saw the application, and kept it. I knew at the time that McDonald was applying for the land. The paper said, "This land would be granted if Acton's signature could be obtained." Acton told me he would not give his consent. I said to him it was a bit of a swindle. I went to Braithwaite and asked him if he knew anything about it. On the same day that I saw the application 1 saw Mr. AVood. He said, Bastings had the deeds of tho land. I said to Mr. AVood, "Is this correct about McDonald getting this land, the 50 acres?" He said he had seen the transfer of 50 acres in Mr. Bastings' iron chest; he also told me that he knew nothing about the sale of the land whatever, until he heard it from Mr. Bastings. Ido not remember having a conversation with McDonald on the subject of tho 50 acres. I cannot say if the land in the 50 acres is auriferous; but I know it was reported that Simson was getting good gold. John Hurley. Christopher Rea, Miner, residing at Switzers, examined. I hold a miner's right [Certificate of miner's residence area produced] and a residence area on the 50 acres. It has been sold to Mr. Bastings, and included in the 50 acres. I have had no communication with Mr. Bastings on the subject. lam aware that I can be removed by him if he liked. I heard nothing about the sale of the land until it was purchased. If I had done so I should have objected. I value my improvements on my residence area at £85 without the crop. Christopher Rea. Dugald Matheson, Butcher, residing at Switzers, the holder of a miner's right, examined. lam at present the holder of a residence area on the 50 acres sold to Mr. Bastings. I never fenced the area in, but the acre is now in the 50 acres fenced by Simson. A few days after I bought the residence area, I heard it was sold. The cost of it was £36. That was the amount I gave for it.

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I think I could have sold it for £60 had I had the residence area, if it had not been sold and included in the 50 acres. I saw Simson between May and September, 1871. He never said anything about the land being sold. He offered to bet that I could not open a public-house with the buildings upon it. This was after the sale. He did not tell me his reasons. I could have sold it for £60 the day I purchased. I was offered that amount. The sale took place on 15th September, IS7I. If I had thought that McDonald was about purchasing the land, I should have taken steps to prevent it. DUGALD MATHESON.

No. 7. The Hon. AY. H. Reynolds to His Honor J. Macandrew. Sir,— Colonial Secretary's Office, Wellington, 2nd May, 1873. I have the honor to acknowledge the receipt of your letter No. 12,791, of the 10th ultimo, forwarding the report of the Commission appointed to inquire into the sale of auriferous laud at Switzers. The cost of the Commission, amounting to £142 16s. 6d., will, on my being furnished with detailed accounts and vouchers, be paid; but I would point out to your Honor that if any part of the amount consist of pay or honorarium to Mr. T. L. Shepherd, there is great probability that his seat in tho House of Representatives would be jeopardised. I have, &c, His Honor the Superintendent, Otago. AVilliam H. Reynolds.

No. 8. His Honor J. Macandrew to the Hon. the Colonial Secretary. Province of Otago, New Zealand. Sir, — Superintendent's Office, Dunedin, 20th May, 1873. I have the honor to acknowledge the receipt of your letter of 2nd May, 1873, and in reply to state that the Provincial Government only claims to be recouped in the sum of £76 ss. 6d., being the amount payable to J. P. Maitland, Esq., on account of his personal and travelling expenses incurred during the conduct of the inquiry into the sale of auriferous land at Switzers. I have, &c, J. Macandrew, The Hon. the Colonial Secretary, Wellington. Superintendent. By Authority : Giohgk Didsbuby, Government Printer, Wellington.—lB73. Price 9d.]