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forest, I was satisfied with Mr. G-raliam's description of it. and what I had heard of it as a matter of notoriety, that Mr. Seccombe's forest was considered the best timber property in the country. I myself had never seen it, nor did I see it for some sis months after I had become part proprietor of: it. "We ultimately, either towards the end of December or early in January, I forgot which, purchased the property consisting of the Tairua Mill and all the forests connected with it (some of which, including the 36,000 acres, there were then titles to, and some of which were not completed), for the substantial sum of £5,250, the whole of which money was paid in cash, by instalments, within a period of twelve months. Since then we have built driving dams, made roads, blasted masses of boulders for many miles in the various creeks, and in a variety of ways opened up the forests and creeks, and produced a steady supply of timber from the mill, having, during the last two years and a half, produced over six millions of feet of timber; during which time we have given steady employment to an average of about seventy-five hands regularly at Tairua itself, besides the employment we have given seafaring men in shipping the timber away to other ports, and the large support we have given to the different iron trades in Auckland and at the Thames, by the sums of money we have expended in machinery; with regard to which I may say that we have spent, in repairs and improvements to the machinery of the saw-mill, no less than a sum of £3.000, every shilling of which has gone into the pockets of the tradesmen and artisans in Auckland and the Thames ; in fine, I may say that I can show by the books of Preece and Graham, and the subsequent; books of Preece, Howard, and Co., that the Tairua Mill, forests, and improvements, have cost us up to the present time a sum of not less than £21,000 ; and that with the exception of the purchase money and what has boon spent in materials, which together ouly form a small portion of the whole (probably one-third), that money has been expended in actual labour, and that besides that total amount which is the actual capital outstanding, there has been an expenditure of some £0,000 per annum in the cost of producing the timber, which of course has been recouped by the sale of the same. I mention these figures (and I can vouch for their accuracy, in round numbers) to show that in purchasing the Tairua property my firm were not obtaining a valuable property for a mere nothing, but, as I have shown by the fact of its having been advertised for sale for so long a time without finding a purchaser, we were giving for it a price which could not elsewhere be obtained; and I was quite alive to the fact at the time we purchased it that it could not profitably be utilized without the annual expenditure of very large sums of money, and had I known at the time that my firm would have had to take the whole onus of producing the timber on ourselves (as we had to do, in consequence of Mr. McLeod failing to carry out his agreement), I should for my part have had nothing to do with it, nor would my partner. I reiterate the statement, and am prepared to do so in a more solemn manner, that at the time I wrote the memorandum or letter to Dr. Pollen, asking for money for Mr. Mackay to purchase these and other blocks of land, I had not the most remote idea that I should ever become in the smallest way the part owner of the Tairua Mill and forests; nor, as I have stated before, did I contemplate it at the time of the sale of the freehold to the Government. I notice that in page 40, No. 880, Mr. Sheehan states, "I was a member of the Executive, and I am sure that I and my colleagues had no knowledge of these timber transactions." I can only say that Mr. John Sheehan was the solicitor who drew up the primary agreement entered into between Messrs. Seccombe and Preece and Graham for the purchase of these timber properties and mill, and that he acted in that as the solicitor of Preece and Graham, and he so acted personally. I may say that these transactions took place at the latter end of 1872 ; and at that time, and both prior to and from that time forward up to the 24th February, 1875,1 was a private Native Land Agent, and in no way employed by the Government; in fact, I had, as you are aware, declined employment, and that the only work I did which was in any way connected with the Government was the purchase of these blocks, in which I was employed by Mr. Maekay privately to assist him, being quite unknown to the Government in the matter, as Mr. Mackay was the only recognized agent, and that I neither assisted in the procuring of timber-leases for persons on these blocks, nor was I asked to do so, or employed or connected with these leases in any way until after the purchase by my firm of Mr. Seccombe's interest in the Tairua forests, which, as I have before stated, was after the lease of the Tairua Block to Messrs. Seccombe, and the sale of the freehold of the same to the Government. I was aware of all these rights and leases at the time I was assisting Mr. Mackay in obtaining the freehold for the Government, and I had seen documentary evidence to show me that Mr. Mackay was instructed by the Government to respect the same ; but I had nothing to do with them, simply because I was not employed by any of the parties connected with them. To return to the question No. 884 itself, without the explanation —namely, "Then the whole of this negotiation went on on the recommendation of the very man who was to get the advantage of it?" I presume by this, and it is clear by the explanation which follows the question, that it is meant that the purchase of the freehold by the Government of the Tairua Block, after the lease of it by the Natives to Mr. Seccombe for forty (not ninety-nine) years, would be advantageous to the lessee. Whatever any one else's opinion may be on that subject, I consider that such purchase by the Government of the freehold from the Natives, lessened by a great deal the value of the lease ; for, in the .first place, it precluded for ever the lessee from obtaining the freehold for himself, which would have given him a far more substantial " property " than a lease, in which it is expressly stated that it is " only to give full effect to the sale, license, and grant" of the timber. It is quite certain that had the Government not purchased the freehold of that property as they did, on the recommendation of the provincial authorities, that no one else would have entertained the question; and it would have only been a matter of time for the lessee to have procured it for himself, which would have greatly enhanced the value of his property, and have been worth more to him than the sum represented by the price it cost the Crown: it would have then been beyond the power of the Government to proclaim it as waste lands of the Crown, and as a portion of a gold field. In fact, the knowledge I possessed of the Government having become the proprietors of the freehold, was felt by me, at the time of the proposal to me to join in the purchase of the interest in the lease, to be a stumbling-block in the way of making the property of the value as an estate which it could have been made had the Natives remained the landlords ; and I have always been, and am still, of the same opinion.