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the various Governments, and it is due to each of the Governments, parties to that arrangement, that that state of affairs should be restored unconditionally at the earliest possible moment. Whatever may be the outcome of that restored state of affairs, it is due to the partners as a matter of fair dealing that that state of affairs should be restored, and our duty is to try and get back to the status quo when the contract was entered into in December, 1900. Whatever may be the reasons, I think that is due to each one of those Governments, and I was commencing a cablegram in these words:
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Conference considers it due to each Government, party to Pacific cable under- taking, that conditions existing prior to New South Wales Agreement should be unconditionally restored at earliest possible moment."
LORD STRATHCONA: That was an Agreement which ought never to have been entered into, and should be got rid of as fast as possible.
Mr. PEMBER REEVES: And the whole state of affairs that has followed on that Agreement.
LORD STRATHCONA: Yes, certainly. They have it in their power to do so; it is merely a question of expediency with them, is it not?
Mr. PEMBER REEVES: That is so.
LORD STRATHCONA: They have the power.
The EARL OF JERSEY: Not exactly, because the Commonwealth Government would be obliged to come to an arrangement with the Eastern Extension Telegraph Company, since that Company possesses the New South Wales Agreement.
it.
LORD STRATHCONA: But they can determine it; they can arrange for determining
The EARL OF JERSEY: Not without arrangement with the Company: we cannot do it by force majeure.
Mr. PEMBER REEVES: That, of course, is a legal question.
Mr. MERCER: Well, it is possible, but no Parliament would do it; no Parlia- ment would break a contract.
The CHAIRMAN: The various positions which have been taken up could be solved by this :-
"Unconditional termination of Agreement at a fixed date asked: (1) at order at earliest possible date to restore partners to their original position; (2) that after that date ruinous expense of competition may be saved; (3) to place both Company and Board systems on terms of absolute equality; partners may then determine their policy in concert, and unhampered by any Agreements independently arrived at. See Barton's letter of 1st June, 1903."
Mr. PEMBER REEVES: Might I draw your attention to one expression in that? You suggest that one of our reasons for asking unconditional termination, is that after 1913 the Board and the Company shall be put on terms of absolute equality.
The CHAIRMAN: Yes.
Mr. PEMBER REEVES: What we want to secure is that they shall forthwith be put on terms of absolute equality, and one of the things that we want to ask for, and I pressed this point at the last meeting, is that forthwith we shall get an undertaking from Australia that any concessions possessed by the Eastern Extension Telegraph Company shall now be granted to us.
The EARL OF JERSEY: That has been promised by the Commonwealth Govern- ment.
The CHAIRMAN: You think that that promise would be weakened if we put it in futuro instead of in presenti?
Mr. PEMBER REEVES: I do most distinctly.
The CHAIRMAN: I think there is force in that.
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Mr. PEMBER REEVES: Because, Sir, as a matter of fact, I am sorry to say the members of the Pacific Cable Board have reason to fear that the Australian Government's interpretation of "absolute equality" may not be ours. They have offered us, as the Chairman of the Board knows, certain concessions, which we at any rate do not think puts us on a fair equality at all.
The CHAIRMAN: I think we have embodied that, not exactly in the same language.
Sir WILLIAM MULOCK: Would you mind reading it again, Sir?
The CHAIRMAN:
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Unconditional termination of Agreement at a fixed date asked: (1) at earliest possible moment to restore partners to their original position before the making of the New South Wales Agreement; (2) in order that after that date ruinous expense of competition may be saved." Sir WILLIAM MULOCK: I do not see the force of that.
The CHAIRMAN: Well, you see it implies that all the partners would then, at any rate, be able to make such arrangements with the Company as to save what is
a very ruinous expense, namely competing with them.
Sir WILLIAM MULOCK: I think that the decks should be cleared for action for any purpose for which they choose to use the ship.
The CHAIRMAN: Yes, quite, and it is in the interests of all to give reason for clearing the decks, viz., that we might effectively, if possible, save ourselves
expense.
“(3) partners may then determine their policy in concert, unhampered by any
Agreements independently arrived at.'
Sir WILLIAM MULOCK: I would suggest your leaving out that reference to financial
reasons.
The CHAIRMAN: To the expense.
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in order that the Sir WILLIAM MULOCK: And simply give as the reason, partners may be free to take such action as may be deemed advisable in the interests of the Pacific cable."
Mr. PEMBER REEVES: That is the pith of the telegram, that paragraph, think.
The CHAIRMAN: The chief point is, a perfectly clean slate at the time the Agreement is terminated, and the restitution of the status quo ante.
Mr. PEMBER REEVES: Yes.
The CHAIRMAN: But I think it is not unimportant, in order to endeavour to procure agreement as to this, that it should be noted that one of the objects of the partners would be to save expense.
Sir WILLIAM MULOCK: I think the moment you observe that, you invite an answer asking what is your scheme, and the correspondence with Australia will graduate into a discussion of your scheme rather than of the present situation; you will simply provide a text for new discussion, I fear. Your cablegram pretty nearly covers the situation.
The CHAIRMAN: Yes, the point is that you rather think that our case is quite strong enough really without argument, by simply stating that we wish to get at the end of this period a position of absolute freedom.
Sir WILLIAM MULOCK: Yes.
The CHAIRMAN: And that if the Australians are not convinced by that, that you will not convince them by any further argument, and your view is that producing any further argument might tend to a discussion of details prematurely,
Sir WILLIAM MULOCK: Yes.
The CHAIRMAN: Of course, the expense of the competition which is referred to here is the expense of competition after 1913; but I quite see your point, that
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