I.—3a.

42

[T. ATKINSON.

9. Mr. Hone Heke.] Does the lease include the provision that Mr. Fraser spoke about this morning, that the Minister has a right to terminate the lease?— Yes. 10. Mr. Herries.] How does the Minister come in ?—He is made a party to the lease by Order in Council, under a special deed of covenant required to be entered into by anybody taking up the land. 11. Mr. Hone Heke.] Is that embodied in the lease?—lt is embodied in the lease, and also, I think, in the deed of covenant entered into between the company and the King. [Document produced.] 12. Mr. A. L. D. Fraser.] You estimate, Mr. Atkinson, that the outlay of the syndicate will be practically £150,000 ?—Yes, at least. 13. The larger amount being required for laying down the railway ?—Yes. 14. The timber being in the bush, you were led to believe by the opinions of experts that it will pay you to have an iron railway better than a wooden tramway ? —Yes, if we get the capital— that is the point. 15. I hope you do not think that any of these questions are being put to you with a view to questioning the bona fides of the company ?—Certainly not. I will answer all questions without bias and straightforwardly. 16. That is the position : it will ultimately pay you to have a railway of your own ?—Yes. 17. And that is your anticipation ?—Yes. 18. By the Order in Council were you not empowered to lease the land ?—Not in the ordinary sense. We have no grazing rights or any rights of property over it, except the right to construct a tramway and use it for timber purposes strictly. All other rights belong to the Natives, and there is a clause requiring us to give back absolutely the land from time to time not required for timber purposes. 19. In the Order in Council it states that you may execute any grant to the said land : does that only refer to the power given to you to erect a tramway or buildings on that land ?—Yes. 20. It does not give you power to occupy the land ?—No; we have taken no such power, except, of course, for timber purposes only. 21. Can you say what is the actual bush-area of the leasehold?— When the negotiations first began the actual area had never been surveyed, and it was presumed to be about 5,000 acres. It was then assumed to contain about 150,000,000 ft. of totara and matai. We bore the cost, and actually surveyed the bush-area for the purpose of making payments to the Natives at the rates specified; and upon the plan annexed to our circular to members, dated the 24th March, 1902, you will find the areas accurately set out. They are the true areas ascertained by actual survey—6,24s acres in the various forests—that is, on the Native lease. 22. That is the bush-area ?■—Yes. 23. The Order in Council empowered the leasing of over 20,000 acres, did it not?— Yes. These bushes are islands in an open waste, and at that time it was not known with any degree of certainty where the bushes being unsurveyed lay. The larger area was included for the purpose of giving ample scope for tramways. It is rough country, and you might get through with the tramway in one place, while in other places it would be impossible. The larger area was thrown in to allow for exploration and selection of best tramway routes. 24. Do you pay £2 per acre on 6,245 acres only ?—Yes. 25. Turn to your position before the Order in Council was issued : you advised yourself in the matter —you had a legal opinion as well as your own that your agreement was a valid and legal one ? —The weight of opinion was on that side, that it was a valid agreement; but I may say that the line of demarcation between a legal and illegal agreement in the purchase of timber-areas runs into a very fine one. But, with regard to this preliminary agreement, that is where out difficulties began, and they must by no means be underrated at any time. The two properties, Tihoi and Pouakani Blocks, upon which the bush-area stood, were then owned by three hundred Natives in each block—between two and three hundred —and we only had about fifty signatures to our original agreements before the Order in Council was granted. But then it was presumed that those fifty—it may have been sixty or more —were men with full interests. So that it was a very precarious holding. It was impossible under that holding to lay out any money on a large scale. 26. If you had had the whole of the signatures would you have felt your position fairly secure ? —I should never have got the money for the tramway, because there was no term of years mentioned. Of course, I have learned a great deal more in the five years of struggle I have had than I knew before, and at the time, all this information that one now gets so readily was wanting. We had to discover all that, and it has taken a great outlay of money and time. 27. If you were entering upon similar ground now you would not tread on such thin ice as to the validity of the agreement ?—lt is always a difficult matter. 28. You still think there is some doubt about it ? —I am advised that there is a little doubt about it. 29. Hon. Mr. Carroll.] There is a difference between your original share title and the leases since obtained under the Order in Council ?—An infinite difference; and the test of these things lies in the finding of the money. 30. Mr. A. L. D. Fraser.] I understand that under the agreement you were to pay the Natives £2 an acre ?—Yes, in five annual instalments. 31. The conditions contained in the Order in Council were the conditions that you had submitted to the Cabinet, and you were agreeable to them ?—Some of them were, and some emanated horn the Government. 32. The majority were your own?— The majority had been taken from the preliminary agreement which had been elaborately threshed out and amended by the Natives so as to get a completely harmonious base of understanding.