June 25, 1924

LIB

William Manley German

Liberal

Mr. GERMAN:

It is six o'clock, Mr. Speaker.

At six o'clock the House took recess.

After Recess

The House resumed at eight o'clock.

Mr. W. M. GERMAN (Welland)- Mr. Speaker, after what was said by the hon. mover of the report (Mr. Archambault) this afternoon in support of his motion for its adoption, it would hardly seem that very much more is required to be said to convince hon. members that it should receive the support of the House.

The hon. member for West Hastings (Mr. Porter) took an hour and a half in stating a very large number of things with which no person had any quarrel or any dispute. He

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LIB

William Manley German

Liberal

Mr. GERMAN:

The right hon. gentleman says he did not say so, nor did anyone else. His name, it is true, was not mentioned in express terms. I was at the committee when the hon. member for West Hastings suggested calling a large number of witnesses, whom we thought it was absolutely unnecessary to call because the facts were not in dispute, but were admitted. Mr. Murdock was there and every member of the committee knew he was prepared to make a statement and desired to do so. That went on for a few days until this calling of witnesses to establish something that was not in dispute became rather wearisome to the members of the committee, to the majority of them at any rate. We said "Mr. Murdock is here and he admits all these things; call him." The offer was made that Mr. Murdock should go into the witness box and give his evidence, but the hon. member for West Hastings (Mr. Porter), said "No, I will not consent to that

3638 COMMONS

Mr. Murdock and Home Bank

until I have had fifteen or twenty minutes to consult with my companions." Apparently a consultation was necessary before my hon. friend could decide as to whether or not Mr. Murdock should be allowed to go into the witness box and give his evidence. Later on the minister did give testimony and his statement was a truthful one; it impressed every one who heard it as being true, and I believe that is the opinion of the people throughout the country.

The hon. member made another statement regarding Mr. Murdook which I believe on reflection he will consider should not have been made, and which every member of the committee feels should not have been made *-that Mr. Murdock in having the $4,000 deposited in the Royal Bank in the way in which it was deposited was doing something in secret, was trying to cover up the fact that the money was so deposited. The facts are-as stated by Mr. Murdock himself, and by his private secretary, Miss McCool-that this money was in Mr. Murdock's hands in his office. He was engaged with an attorney from Toronto in connection with an injunction proceeding in which the government was interested. He called his secretary and said "Take this money and deposit it in the Royal Bank so that you can draw it; deposit it in the same way that you have always done." She said "I have no power of attorney to draw money out of the Royal Bank." "Very well," he said, waving his hand, "go and deposit it in your name as you have done before:" and the evidence shows she had deposited the money in her name on prior occasions. My right hon. friend (Mr. Meighen) shakes his head as to that. Let me read just what was said and I will make the quotation as short as possible. This is the evidence given by Miss Sadie McCool:

By Mr. German:

Q. I believe you are the private secretary to the Hon. James Murdock?-A. Yes, sir.

Q. On the 15th of August you took $4,000 in money from him to deposit in the Royal Bank?-A. Yes.

Q. It seems you deposited it in your own name in trust?-A. Yes.

Q. Will you explain to the committee why you did that?-A. I came in from lunch and Mr. Murdock called me into his office where he was eating lunch. He had an appointment with a man and he said, " I have not time to go out, will you take this money and deposit it in the Royal Bank so you can draw it like you are drawing on my other account?", and I replied, " I cannot do that without a power of attorney unless I put it in my own name in trust."

Q. What happened then?-A. He said, "All right," and waved his hand, and I went out.

I will now quote the evidence of Mr. Murdock himself. This is his statement:

I will give it in another way. I was sitting in my affice with $4,000 in 400 ten-dollar bills in an envelope,

[Mr. German.?

which I expected to place in a safe depository. As a legal gentleman from Toronto was waiting to see me in connection with an injunction in which he had been engaged by the government, and this was the only time I could see him-right between the two meetings of the cabinet-I rang the bell and called in my secretary and handed the envelope to her with the money in it, and said, "Go and deposit that money in the Royal Bank so that you can draw on it as you have been doing on the other account."

By Mr. German:

Q. Had she been drawing in other banks?-A. She had a power of attorney since about September, 1922, just before I went overseas to Geneva in 1922.

Q. She had a power of attorney to draw on your account?-A. Yes, and you will notice that eighteen of those cheques out of the twenty are drawn by her.

By the Chairman:

Q. Is that all you wish to say, Mr. Murdock?-A. I think that is all.

By Mr. Hanson:

Q. You did not tell her to put it in her name in trust?-A. I told her to put it in the Royal Bank so she could draw on it as she had been doing before.

Q. The other deposit was in her own name?-A. Yes.

Q. You know now that this was not in your name? -A. I do, and I knew before she went out of the room that this would not be in my own name.

How anyone can attempt to say, in view of that evidence, that Mr. Murdock was trying to keep this matter secret or do anything different from what he had been doing in the past I cannot understand. I cannot even think that my hon. friend (Mr. Porter) has any such idea himself, but being led away, perhaps, by his feelings he said something more than he really intended to say. There was another remark made which I think was equally uncalled for.

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CON

Arthur Meighen (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. MEIGHEN:

Does the hon. member

still say that there is evidence to show that other deposits were made in the name of the secretary? He knows that other deposits were not in her name at 'all.

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LIB

William Manley German

Liberal

Mr. GERMAN:

All I can do is to call my right hon. friend's attention to what Mr. Murdock says.

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CON

Arthur Meighen (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. MEIGHEN:

The hon. member knows himself that they were not.

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LIB
CON

Arthur Meighen (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. MEIGHEN:

The hon. member knows himself, it is proven, that the deposit was in the name of Mr. Murdock.

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LIB

William Manley German

Liberal

Mr. GERMAN:

Is the right hon. gentleman referring to the deposit in the Home Bank?

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CON
LIB
CON

Richard Burpee Hanson

Conservative (1867-1942)

Mr. HANSON:

What other deiposits?

There is no evidence of any.

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LIB

William Manley German

Liberal

Mr. GERMAN:

I* propose to argue this

case from the evidence on the record and not from the suppositions of hon. gentlemen opposite. Let me quote again:

Q. You did not tell her to put it in her name in trust?-A. I told her to put it in the Royal Bank so she could draw on it as she had been doing before.

Q. The other deposit was in her own name?-A. Yes.

That is easy enough to conceive. Mr. Murdock had confidence in his secretary; she had a power of attorney to draw on his account. She went to the Royal Bank and deposited this money in her own name in trust.

I am sure hon. gentlemen will not feel that there was anything done in an improper or dishonourable way in that connection.

There is another matter which I think the hon. member for West Hastings referred to this afternoon which did not do him very much credit, and I regret very much that he made the remark. I think he himself will regret it when he comes to consider it. He said that the statement made by the Deputy Speaker of the House (Mr. Gordon) was not made or heard of until after the death of the president of the Home Bank. The remarks he made were as follows:

It is singular and worthy of remark that after all the attempts at defence that the hon. minister made on various occasions in this House and before the committee he never mentioned and the committee never heard of a conversation with Mr. Gordon, the Deputy Speaker, or of the minister acting upon any conversation with him until the morning after Mr. Daly, the man from Toronto, died. You could not call Daly. It never was mentioned before, but the next morning after Mr. Daly was dead this evidence was given. It is rather a remarkable feature, to say the least.

It is a most remarkable thing that a man of the legal standing of the hon. member for West Hastings (Mr. Porter) should draw on his imagination to such an extent as to insinuate against the Deputy Speaker of this House that he would make a statement after the death of Mr. Daly that he would not make during Mr. Daly's life. I think that statement should certainly be retracted.

Now coming down to the concrete facts of the case, what do we find? The hon. member for West Hastings mentioned a number of statements that he had made. He said, "I want to convince hon. members of this House that everything I have said has been absolutely proved". He read a large number of the statements that he made to the House when he first made his allegations and said, "Is this statement not true, is that

statement not true, and is the other statement not true"? He might have gone on with a hundred other statements, and everyone would admit they were all true. There was no contention about the fact that there had been a meeting of the directors of the Home Bank and that they declared the bank insolvent. All these statements were admitted, but he has failed to produce any evidence to prove the very crucial point in dispute in this matter. He appears to think that if he can convince the House that he has made a large number of statements which are true consequently the one statement which he made which is not true will be believed, even without evidence. In that I cannot agree with him. He started out to prove one particular statement, but not all the statements he made on the floor of the House when he made bis accusation. The allegation which he must establish as true in evidence is this:

The Honourable James Murdock, Minister of Labour, did withdraw from the Home Bank at its Ottawa branch on the 15th day of August, 1923, two days before such bank's failure, thousands of dollars on deposit therein to his credit, using certain information he had received, as such minister, of the likely immediate failure of said bank, and had received advantage and profit to himself to the extent of such withdrawals, contrary to his obligations as such minister in derogation of his office and the honour, dignity and traditions of parliament.

That is what he has to prove. Every one knows that the bank failed. Every one, or at least most people, knew months before that the bank was likely to fail.

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?

Some hon. MEMBERS:

No, no.

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LIB

William Manley German

Liberal

Mr. GERMAN:

Every one who had his

eye on the financial horizon or had any particular knowledge of the banking situation knew for days and weeks previously that the bank was likely to fail. It is true that the Minister of Labour had four thousand dollars odd in that bank and that he drew that money out of the bank. That fact was never disputed and the Minister of Labour admitted it; but it is not true that he drew out that money on account of certain information he had received as a minister of the likely failure of the bank contrary to his obligations. There is no evidence to establish the truth of that statement. What is the evidence and the only evidence? Mr. Stewart came down to Ottawa on the night of the 14th of August. He met the Minister of Railways and Canals (Mr. Graham), the Acting Minister of Finance (Mr. Robb) and the Deputy Minister of Finance, and they wait to the home of the Prime Minister. The whole situation was discussed at that time. The next morning

Mr. Murdock and Home Bank

there was a council meeting. The only allegation put forward by the hon. member for West Hastings to sustain his charge that Mr. Murdock obtained improper information, or information on which he should not have acted is that there was a meeting of the cabinet on the Tuesday morning prior to his drawing the money out of the bank, and after the conference at the Prime Minister's house. How does that figure out? At the most that is only a suspicion. There is absolutely no evidence of it. I call attention to this feature, that the hon. member for West Hastings, when making these charges, stated that they could be proved in evidence, but he had at the same time a knowledge of the fact that he could not give any evidence of anything that took place in the council chamber. He was bound to prove his case outside of what took place in the council chamber, because he could not give evidence of that. What happened in the council chamber is a sealed book. You cannot ask a question as to what took place there. It is not a situation where a question may be asked and you may refuse to answer, claiming privilege; but it is not permissible even to ask a question. The occasion is absolutely privileged, and it is harder as against Mr. Murdock than it is against his accusers. They knew they could not give that evidence when the charge was made and that they had to prove their case outside of that evidence, or fail to establish it. Mr. Murdock is tied down by the secrecy of the council chamber.

Let us see how the situation works out. On the night of Tuesday, the 14th of August, these gentlemen, Mr. Stewart, the Minister of Railways, the Acting Minister of Finance and the Deputy Minister of Finance, Mr. Saunders, were at the Prime Minister's house. They talked over the whole situation. In his evidence the Prime Minister declares openly, emphatically and finally: In view of that

situation no assistance can be given by the government to the Home Bank, but the Acting Minister of Finance will go with your director to-morrow to Montreal, and if you can work out something there, if he can be of any assistance to you, all right. The hon. member for West Hastings, drawing on his imagination, thinks the inference must be that the Minister of Labour got the information as to the prospective failure of the Home Bank on the morning of the 15th in cabinet council.

I say that the indisputable inference is that nothing was said about this matter in cabinet council on the morning of the 15th. Why should anything be said? The Prime

Minister had stated emphatically in the presence of the leading ministers: We are not

going to give any assistance to the Home Bank.

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CON

Edward Guss Porter

Conservative (1867-1942)

Mr. PORTER:

Why did he swear that

he wanted to bring the matter before the cabinet?

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LIB

William Lyon Mackenzie King (Prime Minister; President of the Privy Council; Secretary of State for External Affairs)

Liberal

Mr. MACKENZIE KING:

He did not

swear that.

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LIB

William Manley German

Liberal

Mr. GERMAN:

My hon. friend is absolutely wrong. What the Prime Minister said is this: That was a matter of such importance that I would have to bring it before members of the council.

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CON
LIB
?

Some hon. MEMBERS:

Oh, oh.

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June 25, 1924