June 25, 1924

LIB

Joseph Archambault

Liberal

Mr. ARCHAMBAULT:

Did the minister in his letter not state that he remitted the money from an entirely different motive?

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CON

Richard Burpee Hanson

Conservative (1867-1942)

Mr. HANSON:

I suppose he drew the

money out from the same motive-to save the other depositors of the Home Bank from loss?

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LIB
CON

Richard Burpee Hanson

Conservative (1867-1942)

Mr. HANSON:

All the facts of the case show that the minister was occupying the position of a privileged creditor, a position that was untenable in law. Even had he gone before the official referee with the Deputy Speaker, having regard to the fact that they were communicating, one as a member of parliament looking for something for his newspaper, the other as Minister of Labour charged with the public printing of the country, and even assuming that the Deputy Speaker had some inside information regarding the affairs of the Home Bank, which he had not, then I suggest that a court of law would have found that, even on -that occasion, the minister would have received a preference, and it was because he knew that he would be exposed in the courts of this country as having received a preference over and above other depositors that he paid this money back without a struggle. More than that, the evidence of the record is that he was advised by certain of his colleagues to pay back the money, because he had received it under circumstances that he could not justify in a court of law.

I do not desire to say very much more about this matter. I am of the opinion that the statement of fact submitted by the hon. member for West Hastings this afternoon, in cogency, in thoroughness, in continuity of thought, presents what is really an unanswer-

Mr. Murdock and Home Bank

able ease, so convincing that in the mind of any disinterested jury in this country there would be but one opinion. I have no hope however that I shall be able, or that what the hon. member for West Hastings has said will tend, to convince hon. gentlemen opposite. That was very apparent all through the hearings before the committee and it has been apparent here to-day. I want to say to hon. gentlemen opposite however that there is a great tribunal before which this case will be tried, the tribunal of public opinion in this country, and it may come sooner than some hon. gentlemen think. Let me say to the Prime Minister that he will be doing no greater service politically to gentlemen on this side of the House than if he retains the Minister of Labour in his government, for he will have to defend him on every platform from Vancouver to Halifax. The Prime Minister will have to defend his colleague on every platform and I wish him much joy in the effort. I see no better political strategy, if you want to put the matter on that plane, more favourable to gentlemen on this side than keeping this government on the defensive with regard to its personnel. God knows it is weak enough and it cannot smell much worse by the retention of the Minister of Labour.

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?

Some hon. MEMBER:

Order.

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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:

I am glad I

have not to defend my hon. friend.

Miss AGNES C. MACPHAIL (Southeast Grey): As a member of the select standing

committee on Privileges and Elections I voted against the finding of the committee, that the charge submitted to the committee for investigation, so far as it affects the honour of the Minister of Labour (Mr. Murdock), is not only not proved but disproved. To me, on the evidence submitted, the charge was neither proved nor disproved; nor could it be, without the vital evidence, withheld by cabinet secrecy, as to whether or not the matter of the Home Bank failure was discussed at the cabinet meeting on August 15. One can think or suspect much, and naturally the question arises as to why the Minister of Labour did not sooner act on the "lame duck" tip given him by the Deputy Speaker of the House of Commons. It is altogether natural to suppose that the chief subject of discussion of the cabinet on the day of August 15 would be the failure of the Home Bank; when a great calamity happens people talk about it a good deal, especially where those who are very much affected by it are gathered

together. If I were contemplating what I would do in the same circumstances I should decide that I would never go to a bank and withdraw money a few minutes before mealtime unless the need were very pressing; and if I took the money especially in such a large sum

which I would not have to take anyway-and I intended to deposit it in another bank, I would not in the meantime carry it up to my office and give it to someone else to deposit in my name, but would go directly when I was down town and get the thing off my mind.

If parliament is ever to be able fairly to judge such a case as this all the evidence must be laid before us; that is to say, the awful silence surrounding cabinet discussions must be broken. If at- the beginning of the session the Minister of Labour had frankly put himself in the hands of the House I believe he would have been most generously dealt with; he would have been by me at any rate. His evasion has led to suspicion, however. It was a shortsighted policy for a mlinister of the Crown to withdraw his money no matter where he obtained the information regarding the bank's condition. Such action was sure to react on the minister and upon the government of which he was a -member. A public man should in any crisis so act that his conduct will be an inspiration to others and will inspire them with faith and hope in public servants. And that faith and hope are at a dangerously low ebb to-day. People have almost lost confidence in public servants, and the finding of someone not guilty by this committee will not add anything to their trust. But we are told that we can form no judgment on suspicion. And all that I have been supposing is really after all just suspicion. But if we are not to be influenced by suspicion, if suspicion must be set aside entirely and the matter judged purely on the evidence submitted, then, if no further amendment is offered, a group of us will be forced to vote against the amendment that has already been submitted and as well against the report of the -committee.

Mr. HANCE J. LOGAN (Cumberland): There is no doubt the members of the official opposition are somewhat angry. The Murdock bubble has burst; the great scandals that were foretold in all their newspapers over four months ago, about four cabinet ministers who were to be driven out of public life, have vanished into thin air, and now they are trying to make a case of the only matter which they have investigated during this long session. My hon. friend from Southeast Grey (Miss

Mr. Murdock and Home Bank

Macphail) is going to vote to drive a fellow member out of public life, simply because he did not get up four months ago and make some kind of statement upon ethereal charges which no one could get hold of; and she is also of the opinion that there is considerable ground for convicting the minister on the strength of suspicion. I am not going to refer to the speech of my hon. and fair friend on this matter any further than to say this to her: I do not blame her, living as she does

in the province of Ontario where an exprovincial treasurer is now on the way to the penitentiary, that she has lost faith in public men in this country. I have not however heard her so far make any condemnatory references to those whom she knows best.

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PRO
LIB

Hance James Logan

Liberal

Mr. LOGAN:

My hon. friend, I think, has the opportunity. Now, let us examine the state of mind of hon. gentlemen of the opposition. Let me take for instance my old colleague-I do not say "old" in point of age but from the point of view of parliamentary comradeship-the hon. member for West Hastings (Mr. Porter), who is generally a gentleman of very congenial and jovial disposition. I can hardly believe that the hon. member for West Hastings would refer to any public man, especially a brother member of parliament, in the terms he has used; he declared that what the minister had said was false-and this upon oath, mark you-that certain matters were indecent, that he was dishonest, and that he ran for cover. Surely this cannot be the member for West Hastings! What is the matter after all? Why all this wrath and rage? It is all explained, as I said a moment ago, by the fact that the bubble has burst.

Let us for a moment without prejudice look at the matter calmly. What crime has the minister committed? The crime of which he is guilty in the eyes of hon. members occupying the comer opposite is that he is a man of labour who has risen by his own intelligence and ability, and through the faith of his fellow workmen, to be a cabinet minister in this country. I never expect any sympathy from that party towards a man who has risen from the ranks in that way and who still is a labouring man. But why condemn him at the present time? What heinous crime has he committed? Has he dealt in public offices in this country by endeavouring to get remuneration for transferring a man from one service to another? Has he charged large fees for selling junk to the government of which he is a supporter? Hon. gentlemen 231 i

strain at a gnat but they swallow a camel. My hon. friend the Minister of Labour-and I am proud to call him my friend-had 14,050 in a bank in this city. It was about all the money he had, and he had a mortgage on his home. He was told by the Deputy Speaker of the House on a certain day that the Home Bank was in bad condition. And the Deputy Speaker was not the only one who knew this; many of us, and I can speak for myself personally, had been able many weeks before to discern that the Home Bank was on its last legs. The Deputy Speaker approached the minister in his office, and in a casual conversation about banks told him this particular bank was in bad shape. And at this juncture, let me say one word which I think is necessary in reference to the Deputy Speaker himself. I was surprised above everything else-and I have heard many surprising things in this House-to hear the hon. member for West Hastings infer that if the Deputy Speaker had not known that Daly was dead he would not have said what Daly had stated. It is not to the hon. gentleman's credit to make such a statement in reference to an hon. member occupying the position which the Deputy Speaker holds in this House, and I am here to speak for the Deputy Speaker who does not take part in the debates. He informed me a few moments ago that when he went into the committee room to give evidence he had not the slightest idea that Mr. Daly had passed from this earthly sphere. What information he got in reference to it he obtained some time during the examination when the hon. member for York-Sunbury (Mr. Hanson) remarked to him, "Don't you know that Daly is dead?" Mr. Gordon replied, "No, I hadn't heard that." Yet we are told to-day that the Deputy Speaker said certain things because he knew that Daly's lips were closed for ever.

Mr. Gordon made a statement to Mr. Murdock on the ninth of August last, a few days passed-days go very quickly in Ottawa, especially in the life of cabinet ministers- and on the coming of the fourteenth Mr. Stewart, a director of the Home Bank, came to Ottawa and, knowing the Minister of Railways (Mr. Graham) as a leading minister from his province, got in touch with him and said he wanted to secure help for the Home Bank; the Minister of Railways telephoned to the Acting Minister of Finance (Mr. Robb); the Acting Minister of Finance sent for the Deputy Minister of Finance, and together they went to the home of the Prime Minister where Mr. Stewart repeated the request; without hesitation the Prime Minister gave an empha-

Mr. Murdock and Home Bank

tic "no".-nothing would be done for the bank as far as putting up a deposit was concerned. It is to the eternal credit of the Prime Minister that he had the backbone to say "no" right there and then. The next day at a quarter to one Mr. Murdock went into the Home Bank and presented his cheque for $4,050 payable to cash-as we all make out our cheques when we are drawing money ourselves- had it marked by the ledgerkeeper in the usual way and proceeded with it to the wicket of the paying teller. He had been seriously alarmed by Mr. Gordon's statement to him regarding the stability of the Home Bank-apart altogether from any argument that may be made as to what took place in council-and drew the money out. A gentleman was waiting for him in his office on a very important matter as he explained to the committee and he rushed there, not even having time to go anywhere for his lunch but having it sent in to his office where he partook of it while he was discussing business with that gentleman. He knew he would not be able to go over to the Royal Bank, so he called in his trusted secretary, the secretary who had paid all his private bills- as most private secretaries do for their ministers. If ministers had to look after their small personal affairs they would have very little time to devote to public affairs. He handed the money to her saying, "Go and deposit that in the Royal Bank in a way so that you can draw on it." She said, "I cannot do that because I have not any power of attorney as I have with respect to your account in the Home Bank." He replied, "Go and deposit the money in trust,"-and waved his hand in a manner suggesting, "deposit it any way at all so you can draw on it to pay my personal bills from time to time." So the secretary deposited the money in the Royal Bank in her own name in trust. That is not at all an uncommon proceeding. There was no crime committed, no indiscretion in taking this course; in fact. it was the only way that I know of by which the money could be deposited so she could draw on it without a power of attorney.

We are asked to infer-as a matter of fact the whole argument against 'the minister is based upon inference-we are asked to infer that after the Prime Minister and the Acting Minister of Finance had said " mo," next day in council this one matter of the condition of the Home Bank was discussed. What do they do in council? Is it a debating society? Do they bring up all kinds of gossip? They have, I presume, an agenda in their minds, even if it is not put in writing, and carry on

according to that agenda. This was a financial matter, and I have no doubt that in regard to financial affairs the Minister of Finance does not always take his colleagues into his early confidence. But at any rate after it had been decided the night before that nothing was to be done to aid the Home Bank, I submit that the inference may fairly be drawn that there was no discussion of the matter in council that forenoon. But, upon the inference that the matter was discussed we are asked to condemn the Hon. Mr. Murdock.

The hon. member for West Hastings has no reason to complain of the report adopted by this committee. I undertake to say that never in 'the history of parliament has a man been treated more unfairly than the Hon. James Murdock, for he has been kept out of this chamber since May 22-more than a month- largely to suit the convenience of the hon.

member for West Hastings. I

10 p.m. would be the last man to object to that, because the hon. member was ill, and I know what that means. But I do not think it is fair for him to say that the widest latitude has not been given him and all the time given that could be reasonably expected to enable him to prove his charge.

But, Mr. Speaker, may I call your attention and the attention of the hon. member to a few things that he has not proved. It will be remembered how, four months ago, the papers were filled with wonderful stories about " Murdock and the Home Bank." The stories grew bigger and bigger until finally we were told that some kind of timelock had to be forced in order that the Minister of Labour could get at those wonderful things known as " legals." I commend this word particularly to the hon. member for Southeast Grey (Miss Macphail) -"legals." That word has become very common in Ontario during the last few months. Well, when my hon. friend from West Hastings made his charge against the minister he used this language, which will be found in Hansard of May 22, 1924. He said:

-and just before the close of banking hours-

Mysterious time, just before the close of banking hours. It was proved it was in the middle of the day, not just before the close of banking hours at all. It goes on:

That in making such withdrawal the Hon. James Murdock refused to accept, a marked cheque in the usual course of business-

I say, Mr. Speaker, that that is not proved, and that accepting a marked cheque payable

Mr. Murdock and Home Bank

to cash is not done in the usual course of business in this country. No bank in this country will certify to a cheque payable to cash to be presented at another bank. You cannot go to the bank where you keep your money and draw a cheque payable to cash and have the bank certify that cheque. It is a rule of the bank that a cheque shall not be payable to cash if it is to be certified. The minister handed in a cheque payable to cash; he was not asking for anything else. Then the hon. member for West Hastings says that he "demanded"-listen to this:

The Hon. James Murdock demanded cash or legals-

Awful word, "legals."

-for the amount of his withdrawal, and it being near the close of banking hours, the strong box of the bank-

Aha! The strong box of the bank! This is not newspaper language but that of the hon. member for West Hastings.

-had to be re-opened to obtain the cash which was paid over to the minister.

That immediately after such withdrawal the Hon. James Murdock re-deposited the same cash or legals he had withdrawn into another bank in Ottawa to his credit.

That on the following day, 16th of August, the same legals-

He has got away from cash then.

-withdrawn by the Hon. James Murdock from the Home Bank were returned to it by the Royal Bank through the clearing house.

He goes on to say that by his action the Minister of Labour profited to the extent of thousands of dollars. Now, if the hon. gentleman desired to be fair, why did he not state $4,050 as everybody in this country knew that was the amount of the withdrawal? The hon. member pretends to be fair in this matter, but he is just about as fair as a man who would kiss a child and then strangle it. I say this was not fair towards the minister, referring to Statements which the hon. member has not proved, and could not prove, and I say to him to-night not only have these charges been disproved, but he owes an apology to this House for making statements which he is not able to prove, and I challenge him now to read the evidence to show where he has proved the charges he made on the 22nd of May.

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CON

Edward Guss Porter

Conservative (1867-1942)

Mr. PORTER:

What charges do you say I did not prove? I used the words "cash" and "legals" synonymously. There is no difference between the two. Cash is legal tender, and cash is legals; I used them synonymously, and in no other sense whatever, and I proved that $4,050 was taken out of the bank in cash.

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LIB
CON

Edward Guss Porter

Conservative (1867-1942)

Mr. PORTER:

That was proved by the

manager of the Royal Bank. The same bundle of bills was taken back.

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LIB

Hance James Logan

Liberal

Mr. LOGAN:

The fact of the matter is

that the money Mr. Murdock drew out of the Home Bank was in notes of the Home Bank itself. That was proved in this investigation.

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CON

Edward Guss Porter

Conservative (1867-1942)

Mr. PORTER:

What distinction does the hon. member make between them?

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LIB

Hance James Logan

Liberal

Mr. LOGAN:

The implication in the

original charges was that he was demanding Dominion notes. The fact is the hon. minister did not ask for any kind of notes. He was paid Home Bank notes in the usual way,, and we have the evidence before the committee that the next day these were returned: through the clearing house.

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CON

Arthur Meighen (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. MEIGHEN:

Does the hon. member

say bank notes are not legals to-day?

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LIB

Hance James Logan

Liberal

Mr. LOGAN:

I am not saying they are

not legals, but the right hon. gentleman knows as well as I do that during the past few months there has been a peculiar notion of what legals are in this country. Legals are supposed to be Dominion notes of $500 and $1,000 denominations. This money was returned the next day to the Home Bank through the clearing house.

Mr. Speaker, it seems to me we might be fair in this matter. Let us remember, in the first place, that Mr. Murdock, when he drew this money, did not intend to deprive anybody of benefit. It was not presumed for a moment then that anybody but the stockholders and shareholders would be mulcted in this matter, and Mr. Murdock drew this money out in the ordinary way, for what purpose? We have had so many cases in this country where there is a real grievance that it does seem to me remarkable that the time of this House is to be taken up in discussing this matter, when after all, if you put the very worst construction upon it, you can only say that his action might have been indiscreet. But here we have been considering this matter week after week before the committee, and if the hon. member for West Hastings had called all the witnesses he desired, we would have been calling them yet; on my motion we at one meeting adjourned for fifteen minutes in order to see if we could not shorten the inquiry and get admissions put in to save the calling of witnesses. Time was saved in that way, but every latitude has been given. Is the hon.

Mr. Murdock and Home Bank

minister, because he wanted to get his all, not merely a fraction of his fortune, to pay upon his home, to be condemned? Oh, what a difference it makes whose ox is gored, and how different the punishment meted out to certain gentlemen in parliament from what is asked to be dealt out to the Hon. Mr. Murdock at the present time!

Someone says he did not need to pay out the money, because he kept it in the Royal Bank until October. He could not pay the mortgage until it was due, and the day the mortgage was due he paid it. He was trying to get money in order that he might be able to pay off the mortgage on his home. I say, Mr. Speaker, this House is too fair and too just to condemn this hon. gentleman upon such evidence as this. As I said a moment ago, if you put the very worst construction upon it, you can only say that he was indiscreet. At the same time I believe the feeling of this country from one end to the other is that there was no criminal intent, no harmful intent, on the part of the minister in this matter. I believe the Hon. James Murdock is an honest man before the bar of public opinion in Canada.

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CON

Arthur Meighen (Leader of the Official Opposition)

Conservative (1867-1942)

Right Hon. ARTHUR MEIGHEN (Leader of the Opposition):

Mr. Speaker, I hope the

hon. member for Cumberland (Mr. Logan) will not take it amiss if I say that there are other tasks in this House at which he excels much more than he does in the analysis and the presentation of evidence. I will not review the case in the order in which he has presented it, because really I do not think it was a very good order. Nor will I refer much to his address, save incidentally as I proceed. I do want, though, to make one protest against a position he assumed and a reference he made. We owe the hon. Minister of Labour (Mr. Murdock) fairness, and we owe him justice. In what I say I shall be scrupulously careful as to both and will not make my language as strong as it would be were the minister here. But we owe others the same, and among others to whom justice is due is even the ex-Provincial Treasurer of Ontario. I do not think it becomes an hon. member of this House to refer to a man as on the way to the penitentiary while he is awaiting trial. I am no admirer of the ex-Provincial Treasurer of Ontario but I am not able at the same time to fall down and worship the fairness of an advocate who pleads for the hon. Mr. Murdock in the circumstances in which he is now placed and refers to a man, as yet found guilty of nothing, as on the way to the penitentiary.

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LIB

Hance James Logan

Liberal

Mr. LOGAN:

I quite recognize that probably the expression, used in the heat of debate, was not a proper one and therefore I desire to withdraw the reference I made to the ex-Provincial Treasurer as being on the way to the penitentiary. I admit with the right hon. gentleman it is hardly fair to make use of such an expression.

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CON

Arthur Meighen (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. MEIGHEN:

I compliment the hon.

member on his promptness in this respect. May I refer to another matter though which I was not going to mention: I do not think it was much better to make vague and indeterminate references to other members of this House, without mentioning their names, as having been guilty of offences worse than this and still remaining members. I do not know to whom he refers but I think I do and if I am right-and there is no one else he could have had in mind-those hon. members paid the full penalty of their offences. If the Hon, Mr. Murdock pays an equal penalty, or in the same proportion, for his, nothing more will be asked on this side of the House. I think an explanation or an apology is equally due in respect of those references of the hon. member for Cumberland.

Now I come to just a few preliminary words as to what was said by the hon. member for Welland (Mr. German). He gave us some wonderful samples of argument; I really find difficulty in stating some of the things which he presented under that guise. When he was calling upon the House to be extremely careful before finding the minister guilty, when he wanted to get the House m a cautious mood-one of sympathy to the minister-he then referred to the charge laid as a heinous crime; begged us to go slow before we convicted him of this he'inous crime-those were his words. But when he was on the other tack and wanted to minimize the offence in the minds of those who thought it was proved he said "There is really nothing wrong about it at all; he was quite justified even if everything alleged is true."

This sample though is not a bit better than some others. I could not help but smile when he called to his mind the position of the minister. "Imagine," he said, "picturing this minister as doing something when he drew that money that might hurt the other depositors. Why, nothing could have been further from his mind. He had no reason in the world to think that the other depositors would lose any money. Why, all he could ever have to fear was that the stockholders would lose." It never seemed to occur to the hon. member for Welland that if the

Mr. Murdock and Home Bank

minister did not fear the other depositors would lose he need not have feared he would lose himself. But the minister was on oath as declaring that he feared he would lose his money, and that is why he went there. Consequently he feared the other depositors would lose also, and fearing that he nevertheless drew his own money and let the others take the consequences.

But before I leave these real gems of logic I want to read a statement made by the hon. member for Welland before the committee. I marked it; I should like it to be submitted to the delectation of hon. members for a moment. Here it is on page 68 of the proceedings. All through this investigation the member for Welland was exceedingly solicitous about the privileges of cabinet ministers. He argued vigorously that you cannot state anything that took place in council. In the broad sense that is correct. He argued equally vigorously that you could not declare who were there. If you ventured to name anybody who was at council you were breaking your oath; you had not the privilege of refusing to do so or not. He said that a minister was debarred by his oath of office from even telling who went to council. Well, this was about the acme of absurdity unless one excepts the specimen I am about to reveal. The Acting Minister of Finance (Mr. Robb) had been examined, and the member for West Hastings was endeavouring to ascertain at what hour council adjourned on the morning of the 15th of August. The minister had expressed his inability to tell at what hour it adjourned and continued in that attitude notwithstanding the pressure of the hon. member. I now quote from the proceedings:

Hon Mr. Macdonald: What is the use of arguing with a witness like Mr. Robb?

Mr. German: There is another point which occurs to me. Supposing Mr. Robb makes the statement as to the time he remembers the council to adjourn and some other minister comes in with an entirely different impression as to the time. It would bring the ministers directly in conflict, which is against the very object of their oath that everything is to be kept secret.

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?

Some hon. MEMBERS:

Oh, oh.

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June 25, 1924