The Timber Pirate

by Charles Christopher Jenkins

II

“Before the war, the North Star had succeeded in acquiring all the larger and more valuable timber concessions on the upper reaches of Lake Superior, with the exception of the block known as the Nannabijou Limits. This vast area of pulpwood was considered the most desirable of all, and the cutting rights there meant the domination of the pulp and paper industry in Northern Ontario.

“The government had withheld the Nannabijou Limits from being thrown on the market in deference to a pledge made to the people by a former premier that it would never be leased until the company tendering for it erected a mill at Kam City capable of manufacturing into paper every stick of wood taken from it.

“The North Star until then had been an exporter, sending most of its pulpwood to mills in eastern Canada in which it held stock and to customers in United States. I had early conceived that to make the North Star hold its place it must by one means or another acquire the Nannabijou Limits. Before the war, plans were all completed for the building of a pulp and paper mill at Kam City to comply with the government stipulation. The outbreak of hostilities, however, brought about such chaos in the business world that the project had to be abandoned.

“My absence at the war and the consequent inactivity of the North Star in the matter of expansion had given Gildersleeve the opportunity he had been quietly watching for. When I returned I discovered that he was organising international capital on a large scale with the express purpose of securing the rights on the Nannabijou. If he succeeded I knew too well what it meant, and that would be the ultimate elimination of the North Star as a factor on the upper lakes.

“The North Star immediately purchased a site for a plant in Kam City, let a contract for the erection of a pulp and paper mill building and placed an order for the necessary machinery and equipment. With these proofs of our good intentions we went to the provincial government and put in our application for cutting rights on the Nannabijou. The Kam City Pulp and Paper Company, subsidiary of the International Investment Corporation, of which Gildersleeve had been made president, simultaneously made a bid for the limits. They too bought a site in Kam City and made preparations for the erection of a mill.

“As an established Canadian company employing hundreds of workmen the year round, not to mention the lever we had in political affairs, the advantage, at the start, was with us; but parliament, as is the wont of parliaments, haggled over the matter for many weary months. Finally, they awarded the lease to the North Star, on a year to year basis, with a particular stipulation that our mills be grinding wood from the Nannabijou Limits at full capacity on October twenty-third of this year. That would give us plenty of leeway, for we expected to commence the installation of our machinery in June.

“Strange as it appeared at the time, the Kam City Pulp and Paper Company continued their building operations with no apparent prospect of limits to draw a raw supply from. I suspected Gildersleeve had a card up his sleeve, but was at a loss to determine what trickery he planned until the announcement reached us that the company in the States which was building the North Star’s pulp and paper manufacturing machinery had gone into liquidation and could not make delivery.

“This was indeed a calamity, for the construction of certain of the machines used in paper-making cannot be completed in less than twenty-seven months’ time. Nowhere else could we secure equipment anywhere within the time limit set by the government. The full meaning of the coup that had been put over the North Star by its unscrupulous rival was realised when we learned that the failure of the pulp and paper machinery manufacturers with whom the North Star had its order was brought about by money-market manipulators in Gildersleeve’s syndicate. By this underhand method the Kam City Pulp and Paper Mills had actually gained possession of the plant the North Star had on order.

“The North Star was faced with cancellation of its rights on the limits and possible financial difficulties through the immense amount of money it had invested in a mill that would now be a white elephant on its hands. The Kam City Pulp and Paper Company lost no time in drawing the attention of the government to the fact that the North Star was installing no machinery to grind the pulp poles it was booming at the limits; and further that we had no machinery nor any prospect of securing any. The Kam City Company applied for an order to restrain the North Star from further cutting operations and again applied for the lease under the former terms of offer.

“The order of restraint was not issued, but the government, after investigation, issued a fiat that in case the Kam City Company were in a position to manufacture paper to the full capacity demanded in the North Star’s agreement, and the North Star were not in that position, the rights of the North Star on the Nannabijou Limits were to be cancelled and turned over to the Kam City Company on October twenty-third. Furthermore, the fiat ordained that the North Star could continue cutting and booming poles at the limits until that date, if it so desired; but it must make delivery of all poles cut in time and in sufficient quantities to start the Kam City Company’s mills on contract time, and to keep them running full capacity until the opening of navigation the following year.

“To their own surprise, as well as that of every one else who had been following the news, the North Star’s legal representatives appearing before the legislature received definite orders not to apply for an extension of time in the matter of the North Star’s agreement, nor to attempt to protest the Kam City Company’s right to the lease. They were instructed instead to concentrate their efforts for the inclusion of a clause in the government’s agreement with the Kam City Company specifying that, should the latter company fail to make good to the letter in their contract by the date named, from any cause whatsoever, the order giving them access to the limits should be cancelled and the North Star should remain in peaceful possession with the privilege of acquiring and installing the necessary machinery at its mills as expeditiously as might be within the bounds of reason.

“That famous ‘Act of God’ clause, as it has since been nicknamed, was fought out for days on the floor of the House; but the North Star finally won, its representatives stressing the fact that the North Star had been arbitrarily dealt with by the government because it had been debarred from fulfilling its agreement through circumstances over which it had no control, and, what was fair for an established company already in possession, should be fair enough for an outside company which was seeking to take its right away from it. The law-makers at Toronto were sportsmen enough to see the point, though they could not possibly see how we could benefit from it.

“The public was quite as much at sea, and it was freely conceded that the directing heads of the North Star were madmen, though people who knew the North Star intimately were contented to wait and see what came out of it all.”