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It is possible that in the event of the above decision being acceptable to you, and the requirements enumerated above being fulfilled, that certain terms and conditions would be imposed in consideration of the concessions asked for being granted, in addition to which it may be found necessary to obtain the consent of the Native owners to any concessions as to the standard of the railway-line to be constructed which it may be decided to grant. Yours faithfully, J. G. Coates, Native Minister. 15th February, 1928. The Right Hon. J. G. Coates, Native Minister, Parliamentary Buildings, Wellington. Sib, — Tongariro Timber Co., Ltd. I have the honour to acknowledge receipt of your favour of the 14th instant, and have to thank you for advising me that if on or before the 12th September, 1928, I am in a position—(l) To float the proposed company ; (2) To arrange for the necessary finance for building the railway-line, &c. ; (3) To pay all arrears for royalty, together with interest thereon at 6 per cent., yet unpaid ; (4) To pay outstanding rates and taxes, Board Commission, and any other charges or sums due by the Tongariro Timber Company under its agreement with the Aotea District Maori. Land Board, then the Government will undertake to give— (1) Sympathetic consideration to my request as already mentioned ; (2) To protect the company's rights in the meantime by refusing consent to any application under the various sections of the Acts mentioned in your letter. That is satisfactory to me, and I greatly appreciate the manner in which you have met my request. At the same time, I feel that I should possibly be open to criticism from my friends in this venture if I did not ask you to make more clear your concluding paragraph. I take it that the modification of the standard of the railway-line and the Native owners' approval of same may have been in your mind when writing this. Assuming lam correct in this, I suggest that if in addition to the conditions already mentioned — (1) I obtain the Native owners' consent to modification of the line ; (2) That I increase the royalties as at present existing to figures that the Native owners agree to, then it will be admitted by your Government that I shall have completed my part of the bargain, and that no further terms or conditions will be imposed upon me in consideration of the concessions asked for being granted. I think it will be apparent to you that in asking for a sum of £300,000 it would be hardly fair to subscribers if I were to spend any portion of their money —and a certain amount must certainly be spent to enable me to carry out the above obligations —if the fulfilling of my part of the contract does not carry with it the definite approval of the Government. An assurance of finality from you in the event of my carrying out all my undertakings would enable me to proceed at once in this manner. I should be much obliged if you could meet me to this extent. Yours faithfully, K. D. Duncan. Office of the Minister of Native Affairs, Parliament Buildings, Wellington, N.Z., 21st February, 1928. K. D. Duncan, Esq., P.O. Box 1496, Wellington. Deab Sie — Tongariro Timber Co., Ltd., and your Project. I have to acknowledge the receipt of your letter of the 15th instant in reply to my letter of the 14th idem. Your assumption as to the meaning of the last paragraph of my letter is correct so far as it goes, but, in, addition to the modification of the standard of line, I also had in mind the possibility of a further request from you as to an alteration in the route of the proposed line. Subject to your obtaining the consent of the Native owners through the Aotea District Maori Land Board to — (1) The modification of the standard of the proposed railway-line (including radius of curves and grades), (2) The modification or alteration of the route of the proposed line, and (3) The acceptance of any increase offered by you in the amount of the royalty payments to be made for the timber on the lands subject to the Tongariro Timber Co.'s agreements, the Government will not, in the event of it being decided to grant an extension of the time within which Ihe Tongariro Timber Co., Ltd., is bound to complete the construction of the proposed railwayline, impose further or other terms in consideration of the concessions asked for being granted. Yours faithfully, J. G. Coates, Native Minister.