THURSDAY, 22nd, AUGUST, 1918. (At Perth.)

Present: Hon. W. C. Angwin, M.L.A., Chairman. Hon. J. F. Allen, M.L.C. Hon. R. G. Ardagh, M.L.C. S. M. Brown, Esq., M.L.A. T. H. Harrison, Esq., M.L.A.

WILLIAM FREDERIC SAYER. K.C., Solicitor General, further examined:

6412. By the CHAIRMAN : The farmer has handed his wheat over to the Government agent and it has been accepted as f.a.q. The wheat which did not come up to the standard fixed as f.a.q. is docked. Certificates were issued accordingly for the wheat. We have evidence that there has been negligence on the part of the agents who have handled this wheat. Is not the Government responsible for payment to the farmer for all wheat damaged through negligence, unless, of course, reasonable care was taken?— Under the agreements the agents took the risk of all loss or damage except by fire, flooding from below, weevils, and plagues of mice. They guaranteed that the deduction, if any, from f.a.q., which overseas or local buyers might be awarded on aggregate shipments and deliveries, should not exceed the aggregate deductions in the certificates. Each agent provided a surety in the sum of £20,000. Any compensation recovered from the agent, whose responsibility is unlimited, or from the surety, whose responsibility is limited to £10,000 in the case of each agent, would be for the credit of the Pool. the farmer, however, has, in my opinion, no recourse against the Government, as it is provided that the certificate of the Minister as to the amount of net proceeds for distribution must be accepted as conclusive.

6413. So you claim that the Government is not responsible for any negligence which has taken place?—The Government have appointed reliable agents, sufficiently solvent to answer for their shortcomings. They were required to find a guarantee of £20,000, and I do not think the Government have any further responsibility for any neglect on the part of the agent. But it would be, no doubt, the duty of the Government to follow up any cause of action in the event of neglect being proved. That is clearly provided not only in our agreement, but in the agreements of the other States "that the certificate of the Minister as to the amount of the net proceeds for distribution must be accepted by the farmer as conclusive." I do not think there is any way out of that.

6414. You are aware that the wheat cannot be shipped in accordance with the agreement; thereby the Government too over the wheat from the agents, without the agreement being fulfilled?—You mean, I presume, that the shipping facilities were not available before the term of the agents' appointment came to an end. That is so.

6415. Suppose the Government had not seen that the agents had compensated the Pool for any loss through negligence, would not the Government be liable?— I do not think there would be any cause of action. I think the farmers are bound by the provision that the certificate of the Minister must be accepted as conclusive. They have agreed to that.

6416. Would not that apply where reasonable care had been exercised in the protection of the wheat?—There is no qualification. I think the farmers have agreed to place themselves in the hands of the Government without any recourse. Although they may have had no other outlet for their wheat, in each case they have agreed. There is no statutory compulsion.

6417. Does not the Act provide that they cannot dispose of their wheat in any other manner?—They can keep it.

6418. Are not the circumstances such that it is compulsory for the farmer to do so?— I do not think it is such a compulsion as would give rise to a cause of action.

6419. Then as the Act stands to-day, no matter what negligence is shown on the part of the officers of the Scheme, if any, the whole loss is borne by the farmer, who has no say in the matter?—I do not think the farmer has any recourse against the Government.

6420. By Hon. J. F. ALLEN ; My question to you was, "Has the Government under existing legislation any power to erect sheds for storing the wheat"?— Under the original agency agreement the agent was required to provide dunnage and sufficient protection from weather for the stacks. Under the 1917-18 agreement the agent is not liable to provide protection or cover; he is responsible for seeing that the stacks are properly erected and dunnaged, the dunnage being supplied by the Minister. He is not required to provide protection or cover either as regards supplying material or placing the same around the stack. This protection must necessarily be provided pending shipping facilities and, it seems to me, at the cost of the Pool. So far as the sheds are built, the proper apportionment of the cost as a protection for the wheat of each season, pending shipment, seems to me to be a matter for adjustment. If the original cost of erecting the sheds is charged against the Pool the value of the sheds when the wheat is shipped if intended as permanent structures, or if not, then the value of the material should, it appears, to me, be credited to the Pool, interest on the capital being charged as rent, and perhaps ground rent for the site. The abnormal price of material under war conditions affects the question and seems to me to render any periodical apportionment difficult.

6421. Under which section of the Act do you frame your opinion, which portion of the existing legislation gives the Minister power?— Under the original agreement the obligation was cast on the agent to protect against weather. The Act is to provide for concerted action between the Governments of the States and the Commonwealth for the marketing of the harvest. It is an agency for marketing the wheat which I think carries with it the duties of a bailee to hold and protect pending the marketing. It was the difficulties of shipping accommodation which gave rise to the Act. The Government are not buying on their own account, but only acting as agents for the farmers to market the wheat. They have to account for all wheat they receive. It seems to me that in the course of the performance of their undertaking the wheat must be held, perhaps for a considerable time, and therefore it follows, that for the purpose of storing the wheat they must have proper receptacles in which to place it. If the Government had a bulk handling system operating, the silos would be available, in which case the Government would be entitled to charge rent for the use of those silos. I think it is incidental to the undertaking of the Government that pending shipments the wheat should, by some means, be protected either by putting that duty upon the acquiring agent, and including the cost in his commission, or by the Minister taking the duty upon himself. In that case, whether the cost is incurred in roofing the stacks, or covering them by sheds, seems to me to be immaterial. The stacks might be roofed against the weather or covered by galvanised iron in the