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PUBLIC RECORD OFFICE
Reference :-
C.O-885
17 PUBLIC RECORD OFFICE, LONDON
ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC- COPYRIGHT PHOTOGRAPH-NOT TO
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Wales and Commonwealth Agreements with the Eastern Extension Telegraph Company, has resulted in the Company receiving an undue share of the traffic between the United Kingdom and the States of New South Wales and Victoria." That is, in brief, a recognition that these Agreements, as they stand, have resulted in more going to the Telegraph Company than should do, and that at the expense of the Pacific Board.
place of the
Sir SANDFORD FLEMING: I do not wish to interrupt you; but about the third line it seems to me there is a little error, it is the Eastern Extension Commonwealth.
The CHAIRMAN: No; "that the operation of the New South Wales and Common- wealth Agreements with the Eastern Extension Telegraph Company has resulted in an undue share of traffic passing to the Company"; that I am sure has your hearty assent.
Sir SANDFORD FLEMING: I beg your pardon; certainly.
The CHAIRMAN: "It fears, however, that it is impossible to rescind the New South Wales Agreement, except by the payment of heavy compensation "—I think you will with that, from what you have said-" except by the payment of heavy
agree compensation; or (there is an alternative) by the substitution of another Agree- ment. It invites the Commonwealth Government to amend their Agreement with the Company," by inserting the provisions which our legal adviser has recommended to us, which would have the effect of limiting the period of its operation to 10 years only. You see that, I think, recites what your views are upon the situation, and it makes a proposal with respect to the Agreement, which I think we all think here would be useful pro tanto; it does not commit you to anything more.
Sir SANDFORD FLEMING: Would you not, Sir, put in an additional sentence after "heavy compensation"?
The CHAIRMAN: It fears that it is impossible to rescind the New South Wales Agreement, except by payment of heavy compensation, or by the substitution of another.
Lord STRATHCONA : Sir Sandford does not admit that; he says that there was a prior agreement on the part of New South Wales-that with the other contribu- tories to the Cable.
The CHAIRMAN: Yes.
Lord STRATHCONA : And that that ought to be of equal or of greater force than the second.
Sir SANDFORD FLEMING: Yes.
Lord STRATHCONA : That is his contention.
The CHAIRMAN: Yes.
Lord STRATHCONA : So that he does not admit that; that now is not admitted. Sir SANDFORD FLEMING: That is precisely where I stick.
I do not The CHAIRMAN: But I do not think that controverts this, does it? think that Sir Sandford or anybody else denies that, if the New South Wales Government, of which the Commonwealth Government is the heir, breaks a perfectly plain agreement with the Eastern Company, it will either have to pay damages, or substitute something else. That is a legal proposition of, one may say, incontestable weight.
Lord STRATHCONA: Yes.
The CHAIRMAN: I do not think we are asking Sir Sandford to assent to any- thing more than that proposition.
Sir SANDFORD FLEMING: Unless it commits my Government to the something else, we are willing to commit it to the heavy compensation, or to the compensation -heavy is a heavy word-we do not want it committed to anything else.
The CHAIRMAN: I do not think it commits you to anything, except to the recognition of what I may venture to say is an elementary legal proposition, which
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I am sure everybody would assent to if they would think of it. You cannot make an agreement with the Telegraph Company and break it without suffering the legal consequences, and those legal consequences are either the payment of damages for all the loss which is consequential upon the breach, or by some proposition acceptable to the Company in lieu of those damages. I do not think anybody can contest those propositions for a moment, and all that it commits anybody to is their
admission.
LORD STRATHCONA: That proposition is an entirely practical one.
The CHAIRMAN: It is.
LORD STRATHCONA: I only mean that this is the contention, as it has been put forward here by Sir Sandford, that the other had precedence of this, and that it was an obligation on the New South Wales Government which would have with- held them from making the other, and that consequently it is of more force; that is what you have held and put forward, Sir Sandford, but this is a practical proposition?
Sir SANDFORD FLEMING: Yes.
LORD STRATHCONA: But this is a practical proposition, a practical one certainly. The CHAIRMAN: This is. Well, Sir William, will you move anything in con- nection with this?
Sir WILLIAM MULOCK: Regarding the situation, 1 wonder whether this draft of a cablegram in any way represents the views of the Conference: "Confer- ence satisfied by legal advice that New South Wales Agreement with Eastern is inter- minable except with consent of parties thereto, also the proposed Commonwealth Agreement unsatisfactory in that it does not unconditionally rescind New South Wales Agreement nor itself terminate unconditionally at a fixed date; Conference therefore disapproves of proposed Commonwealth Agreement unless amended so as to absolutely terminate New South Wales Agreement and also itself terminate at fixed date, say, —
"
The CHAIRMAN: Say, 1913?
Sir WILLIAM MULOCK: Whatever is to be named.
Sir SANDFORD FLEMING: Fixed early date; I think I can see my way to assent to that if you put in 10 years.
Sir WILLIAM MULOCK: I put in 1913. I suppose we will put in the actual day of the year? When would the 10 years be up under that agreement?
1903.
The SECRETARY: In 1913.
The CHAIRMAN: 1913 it is.
Sir WILLIAM MULOCK: What time?
The SECRETARY: Well they say here October 31, 1913. It was signed in June,
I do not know why they made a few months beyond.
Sir SANDFORD FLEMING: Before the 10 years run out the Pacific cable may be utterly routed under existing conditions.
Sir WILLIAM MULOCK: Before the 10 years are up?
Sir SANDFORD FLEMING: Before the eight years are up.
Sir WILLIAM MULOCK: The eight years. That would depend upon our activity, would it not?
Sir Sandford FLEMING: Our activity has been tested for two years, but it has not resulted in much, in some States.
Sir WILLIAM MULOCK: No, I do not think the Board has been pursuing an aggresive campaign yet.
There is another proposition which, I think, would have to accompany action such as this. At the present moment I understand that without any agreement the Eastern Extension is practically enjoying the same privileges in the State of Victoria that it does in New South Wales; secondly, the business of the Pacific
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