D.—4a

36

tion, pay to the Queen the estimated cost of survey, and, before the execution of the lease, shall also pay one half-year's rent in advance; and so soon -as the company shall have earned such grants of land as to entitle it to receive a further grant of such value as may be shown by the assessment hereinbefore mentioned of any land so leased as aforesaid, then the Queen shall, on the request of the company, issue to it a grant of such land, subject to the then-existing lease." Then, we have the finance clause : " All purchase-moneys, rents, or royalties received or collected under these provisions shall be paid to the Eeceiver of Land Revenue of the district in which the land is situated, who shall pay the same into the Beceiver-General's Deposit Account; and all such moneys, rents, or royalties shall from time to time be taken into account as provided by these presents, and the whole or part thereof, as the case may be, shall be paid over to the company on its request, after it shall have become entitled to the same in respect of grants of land earned in accordance with these presents." Then : "In the event of any lands being sold under this clause upon any system of deferred payments, or being disposed of by way of lease, the duty and cost of collecting and enforcing all such deferred payments, or compelling payment of any rents or royalties, or enforcing the covenants and conditions of any such lease, shall devolve on the company, which shall collect and receive such payments, rents, or royalties as the agent of the Queen, and shall forthwith pay the same, without any deduction, to the Receiver of Land Eevenue as aforesaid, to be dealt with under these presents; and the Queen shall from time to time grant to the company such power or authority as may enable the company, in the name and on behalf of the Queen, but at its expense, to recover or receive any moneys due or payable on deferred payments or under any lease, or otherwise to enforce the performance of the covenants and conditions contained or implied, in any such lease or contract for purchase on deferred payment." Another provision refers to deferred-payment land. There may have been a few sections sold on deferred payment, but, I am informed, not many. The remainder of the clause is as follows : " When any land has been so sold or let by the Queen under these provisions, the same shall be deemed to have been selected by the company, and the value thereof shall from time to time be debited against the company in the account mentioned in clause 24 at the price at which the same shall have been so assessed as aforesaid. • On selection by the company of the remainder of a block within which land has been so sold or let, the value thereof shall be the amount of the certified valuation of the whole of such block, less the assessed value of such lands as shall have been so sold or let. Nothing in this clause shall be deemed to prevent the company selecting any land to which this clause applies in blocks as provided in clause 32 ; but the company shall not be entitled to become the purchaser or lessee from the Grown of lands affected by this clause, nor shall this clause extend to any other lands than those in the Nelson and Westland Land Districts as hereinbefore mentioned." Thus w 7 e have a comprehensive scheme, devised for working and developing the lands on the western side of the main range of mountains, such as were likely to be taken up in small areas : a most important part of the contract, inasmuch as these lands on the western side were, from the fact of the timber on them and the comparative scarcity of agricultural land, more valuable in many respects to the company as a source of revenue than the pastoral lands on the eastern side of the mountains. The company would, of course, endeavour to make its selections where it would probably get the best return. That was only to be expected from any company in business. The company, however, was not favoured by the assistance of the Government, or the Queen, in seeking to have its payment in land, on the western side, and it was driven, therefore, to select land on the eastern side. As to those selections on the east, the manager will tell the Court that the company, on the whole, made an average profit upon the Bl value of something like 33 per cent. That was upon the land selected on the eastern side, which was less valuable than the land on the western side. It will be shown, when we come to the question of damages, that the company suffered severely in being blocked on the western side of the main range of mountains. Now, a question of some little interest arises as to what is the western side of the main range of mountains. Over a certain portion of what we claim to be on the western side, the Crown peremptorily forbade dealings under clause 33, because they said it was not on the western side but on the eastern side of the main range of mountains. A glance at the map of New Zealand will show that a range of mountains runs, roughly speaking, almost north and south in the direction of the Islands themselves. Starting from the south of the Middle Island, we find a confused mass of mountainous country impinging on the sea-eoast, where there are picturesque sounds. The range then trends to the eastward, away from the coast, until on the borders of the Provincial District of Nelson there is a fork. Now, the contention of the Government is understood to be that the mountains which here form a broken line to the westward is the main range. The contention of the company is that the main range is that which runs north-easterly in an almost continuous line. If the arbitrators will look at a map of the colony they will see that the main range starts in the south of the Middle Island, close to the water's edge, and trends off to the eastward. It will be seen that there is a fork near Tophouse from which there is a line of mountains running away in one direction, and another line in another direction. The contention of the Government is understood to be that the main range of mountains runs towards Cape Farewell. On the other hand the company contends that the main range continues to the Pelorus Sound, where it is intersected by the deep fissure called Cook Strait, and is seen again in the range of mountains which dominates Wellington, continues towards the Coromandel Peninsula, with an outpost in the shape of the Great Barrier. Now, in this colony we have a statute which allows evidence to be given from standard works of scientific and other value; and there was a scientist in New Zealand, by name Dr. Hochstetter, who published a book in 1867 Sir B. Stout: I do not think such evidence would be permissible under that Act. Mr. Hutchison : I refer to " The Evidence Further Amendment Act, 1885," section i. Sir B. Stout: That cannot be looked upon as the work of a scientist. He could not have examined the main range. There were no roads made at the time, or anything else.