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Dáil Éireann - Volume 28 - 28 February, 1929

Public Business. - Vote 72.—Purchase of Fuel.

Mr. Blythe: I move:

Go ndeontar suim ná raghaidh thar £10,748 chun íoctha an Mhuirir a thiocfidh chun bheith iníoctha i rith na bliana dar críoch an 31adh lá de Mhárta, 1929, chun Costaisí i dtaobh Abhar Teine do Cheannach le linn Strus-ocáide an Ghuail, 1926.

That a sum not exceeding £10,748 be granted to defray the Charge which will come in course of payment during the year ending on the 31st day of March, 1929, for Expenses connected with the Purchase of Fuel during the Coal Emergency, 1926.

Mr. McGilligan: This is the end of the transactions in connection with the purchase of coal which had to be undertaken to meet the emergency which arose. This particular sum arises out of an action in which a decision was given against the firm. It is considered that we have, at least, a moral liability towards the Coal Merchants' Association. There were various cargoes of coal of different varieties and at different prices coming in at the time. One cargo was offered of 2,000 tons of Czecho-Slovakian screened coal. It was believed to be black and, added to the belief, was the fact that the firm had a report from an inspector at the port of shipment that it was black coal. The price quoted at the [614] time at which the purchase was negotiated was higher than the price quoted for brown coal, but less than that asked for black coal. We drew attention to this at the time, as it seemed to cast some suspicion on the quality of the coal, but we were advised that the lower price, as compared with other black cargoes offering at the time, was due to the fact that deliveries were offered at a later date. We believed that the cargo was black and agreed it should be ordered on the basis of the arrangement made with the Coal Merchants' Association. When the cargo arrived the coal was found to be brown and not black, and the firm refused to accept delivery. The firm was sued for the contract price and were advised that they were not liable to accept the cargo. They defended the action, and there is no doubt that they were properly advised in defending it.

Litigation on similar points was entered into in England and Northern Ireland with different results from those given here. The courts here found that the firm was not entitled to reject the cargo, and had to pay full payment for it and for the incidental costs such as demurrage and so forth. Under an arrangement made previously, as between the Government and the Coal Merchants' Association, a particular firm acting as agents for that association was entitled to be indemnified by the merchants. As the cargo was not taken up by them, the merchants were entitled to be indemnified by my Department.

A point might be made that the Department could have fought out the case as against the firm or association, but in fact the arrangement, although it did not cover in detail such a point as this, was drawn on such lines that there was a moral obligation on the Government, not exactly to indemnify but to help the firm and the Association to pay the costs of such transaction. The largest amount of money has gone in legal expenses. The firm was advised, as we were, that there was a good case to defend. The fact that similar cases were defended successfully in [615] the courts in Northern Ireland and England was a justification for the firm going on. Once the verdict was given, the only point was whether there should be an appeal, but as that would mean piling up additional costs we were advised that no further legal action should be taken. We are meeting part of the amount. The full claim of the firm amounted to £16,121 18s. 11d. We are meeting that to the extent of two-thirds of the final claim. The details are made up of separate items — for freight, landing charges, and for the expenses of the action in regard to the coal. The expenses of the action are in excess of any of the other items. Covering all the series of transactions in connection with the coal emergency, excluding this particular case, the expenditure to date was £91,460. Including this case, the total expenditure runs nearly to £111,000, as against which there were receipts to the Exchequer amounting to £52,000. The net cost to the State, therefore, for providing coal in that emergency was, if this item were taken into account, about £58,500.

Mr. Corry: I would like to know where did this coal go in the first instance? Is this some of the coal that was dumped in Haulbowline? If so, and if it were sold to the inhabitants, what became of the price got for the coal? I would like the Minister to reply to these questions.

Mr. O'Kelly: I would like to ask the Minister how many tons of coal were got for the £58,500?

Mr. McGilligan: I could not give the details at the moment.

Mr. O'Kelly: It does not matter very much. The money is gone, gone in smoke, as is sometimes said. With regard to the last item, I understand that the cost of the coal together with the other costs attached to the legal action amounted to £10,748. That is for 200 tons of coal, the last supply. That was very dear coal.

Mr. McGilligan: What amount did the Deputy say?

[616] Mr. O'Kelly: Two hundred tons.

Mr. McGilligan: Two thousand tons.

Mr. O'Kelly: Well, then, two thousand tons — £5 per ton. I understood the Minister to say 200 tons of coal, but even at that figure it is dearly-bought coal. If it has the effect of teaching the Ministry anything about a little foresight in dealing with matters of this kind, even in emergencies, probably the money will not be lost for all time. It does seem strange that while, as the Minister says, similar actions were tried in England and in the North of Ireland, different decisions were given in the courts in these other States from those which were given here. Here legal contracts entered into with the owners of that coal in Czecho-Slovakia or elsewhere by those acting on behalf of the Minister were so incompetently drawn, that in our own courts here it was decided that the Ministry, and eventually the ratepayers, would have to pay the legal charges, although I think the Minister said that the coal supply was not up to the agreed standard. Somebody suggested to me, but I certainly would not be in favour of it, and I wonder if the Minister considered it, that seeing that a verdict, more friendly to the buyers of the coal, was given in the Northern courts and in the English courts, the Minister might consider taking the question to the English Privy Council to see if he could get that body, to which the Government have gone more than once before looking for judgment in their favour, would give a decision in his favour and so save money. However, even at the expense of losing this amount to the ratepayers here, whatever it is, I would not favour that course. The coal was got, and whatever became of it, the money was expended, and let us hope that the lesson will be remembered.

Mr. Fahy: I would like to join with Deputy Corry in asking the Minister what became of the coal eventually?

Mr. McGilligan: I think the Civil Service had to burn it.

[617] Mr. Corry: I would suggest to the Minister that this was the coal which was dumped in Haulbowline.

Mr. McGilligan: That has been following you around for the last two years.

Mr. Corry: I suggest that he knew very well what it was when he bought this stuff and that he dumped it there to make poison gas, but that in view of the Kellogg Pact there is not going to be any use made of the poison gas. At any rate, I would like to know who was concerned with the purchase of the coal, and whether that official continues to draw the high salary which is attached to such posts. I want to know whether the expert concerned in this bargain and these arrangements is still in the employment of the Department or not, and if he is still enjoying a war bonus.

Vote put and agreed to.

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