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by us on the 30th November, 1875, and I went to Invercargill from Auckland for the purpose oE making up the final certificate. Mr. W. Brunton was the District Engineer, and Mr. W. E. Brunton was the Resident Engineer. We went over the works, and having made the measurements we made up the certificate, and it was forwarded to Wellington by the Engineer by telegraph. The amount we had arrived at as being due to Messrs. Brogden was £3,315 16s. Bd. I obtained from the Government office a copy of the certificate showing the details of the amount. Have you got that copy ?—Yes ; it was given to me on the same day that the telegram was sent to Wellington. Was the sum you have named paid ? —-No ; but in March, 1876, we received a certificate from the Public Works Office here, and that shows that there was a sum of £2,610 15s. 6d. due to us, instead of the £3,335 16s. Bd. that was certified by Mr. Brunton. We were, however, only paid a sum of £1,153 10s, 5d., leaving a balance of £1,487 ss. Id. still due. On the certificate to which I have referred there is a memorandum to this effect : " That the additions and reductions to this contract have lately been revised, and certain items in the reductions removed or reduced, leaving the amount as stated above." And according to Mr. Blackett's certificate there is a balance of £1,487 ss. Id. due to you ? —Yes ; according to the Treasury voucher that is the amount. Subsequently you received a letter stating that you had been overpaid ?—Yes; that was seven months after the Government had taken over the line; and it was not until fifteen months after this that we were informed of the amount we were stated to have been overpaid. This amount has been varied several times, and is now pleaded as a set-oft' against the sum which was due to us on the Oamaru and Moeraki contract. The amount which was certified in the Engineer's telegraphic certificate was £3,335 16s. Bd., and in that sum there is included £660 for wagons, which has been paid in Wellington as a separate payment. With regard to the extras, I may say that the Engineers were instructed to return the net amount, and that the contingencies and percentages would be added in the Wellington office. Did the Engineers, as a matter of fact, ever include anything for profit ?—Not during the progress of the contract. They certified a certain set of prices which had been furnished to them. Can you instance a case in the Auckland contract where a certificate has been granted and the payment has not been made ?—Yes. In 1876 we were instructed by the Government to provide a water-supply for the Auckland Station, under the station-accommodation clause in our contract, which provided that we were to receive 10 per cent, on the amounts disbursed by us. We provided the piping for this water-supply, and I rendered the account with the vouchers to the District Engineer. The amount was £431 16s. 9d. The Engineer disputed the account to the extent of Id. per foot on the last item in the account, but he signed the whole of the vouchers as being correct with this exception. He signed the triplicate voucher, which he retained in order that he might forward it to the Government, and he signed the duplicate, which he handed to me, and which has been presented to the Government by Mr. Billing. Has any portion of the £431 16s. 9d. ever been paid?—No. The Chairman. | What is the date of the voucher? —My copy has no date, but the account was certified in 1874. The voucher in the possession of the Government shows the date. Mr. Cave.] The contracts provide that the Minister for Public Works may require omissions of certain portions of the work ? —Yes. The fifth clause of the general conditions of the contract says, —• CJause 5. To the Minister for Public Works there is reserved the right from time to time of requiring the omission of any particular portion or portions of works described in the specification or shown on the drawings, and of deducting the value thereof from, the amount of the contract; such value to be agreed upon between the Minister for Public Works and the contractor, or, in case of difference, to be settled by arbitration, as hereinafter provided; but the contractor shall be entitled to be paid a sum of 10 per cent, on the agreed or ascertained value of the work omitted, such sums for omissions to be paid on the completion of the contract. According to the statement which has been put in, omissions to the amount of £65,900 10s. are shown ? —Yes. And upon that amount the contractors are entitled to 10 per cent. ? —Yes. But that percentage has only been paid in one case? —Yes; on the Napier contract we have received £449 4s. 7d. That is the only payment of the kind that we have received. Son. Dr. Pollen.'] Is there no Engineer's certificate with respect to these omissions? —In regard to some of them there are certificates, but I am now speaking from the Government figures. Hon. Dr. Pollen: Have the Government Engineers satisfied themselves that there is a sum of £6,000 due to the contractors on account of omissions ? Mr. Hell: We are in a position to prove that we have paid 10 per cent, on every account that has been certified. Mr. Cave.~\ Have the Engineers from time to time certified to the value of the works which have been omitted? —Yes, I believe they have; and I understand that they bave deducted those amounts from the contract sums, but they have never yet rendered us a statement showing the deductions. Mr. Cave : The contracts provided for the construction by Messrs. Brogden of certain telegraph lines ? —Yes; we were to construct a single line of telegraph along the line, and we were to have the use of it for the purpose of carrying out our contracts. Were these works to be treated as omissions ? —Yes. We made an agreement with the Hon. Mr. Eichardson, the then Minister for Public Works, which was to the effect that the Telegraph Department should construct the telegraph lines, and that wo should receive 10 per cent, in consequence. I now hand in a copy of the correspondence which passed on the subject between our firm and the Minister for Public Works. Mr. Cave read the following letter : — GrENTMaiEN, — Public Works Office, Wellington, 10th January, 1873. It is proposed by the Telegraph Department to move the telegraph poles which interfere with the works on your Wellington to Hutt contract, and, as this involves the delicate handling of the wires now in constant use, I beg to suggest to you that this work should be done entirely by the officers of the Telegraph Department.