The True Story of a Welsh Godfather
episode 10 of 11
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Judge Dunfield held that J.O.’s venture in Newfoundland needed a much greater capital investment and a larger working capital than had been provided and laid the blame firmly on the Godfather. However, he did admit that the government was also negligent in failing to fulfil its side of the agreement.
The judge said the government lacked the type of officials who could work successfully with Williams. He turned out to be a shrewd businessman; they showed themselves as being very naïve and not capable of applying due diligence to Williams’ background and ruthless character.
They did not realise that he wanted to get as much money as possible from the UK and Newfoundland governments, not using his own considerable wealth from his operations in Cardiff, South Wales. Dunfield went so far as to say in his final report that the mafia Godfather should perhaps be given another chance. He seemed sympathetic towards J.O.Williams.
He knew that the Government had gained more than it had lost on the venture, and he did not swallow the vitriolic anti-Williams propaganda. He had found no evidence to justify the bad impression about Williams that he and other people had held before the start of the enquiry.
Dunfield was not going to take part in any sort of rigged public enquiry to attack Williams’ character and discredit him. Instead, he recommended that the Government and Williams should try again.
In 1945 the population of Port Hope Simpson had been 352 which comprised 119 children. One year later the situation started to look desperate.
As J.O. himself said in a letter in 1945, “when I restarted at Hope Simpson in 1946, I was faced with a derelict township, everything that could be turned into cash was sold, or stolen, down to the office furniture. I had already spent over $20,000 putting the place right. The argument that we could not get the labour was absurd.”
It was only after Williams and the Labrador Development Company had left Port Hope Simpson in 1948 that the people could set about bettering themselves, but by this time many had moved away in search of work.
J.O. taking advantage of the British government.
On the one hand, the British treasury was trying to ensure that the UK taxpayer would not have to bear any loss incurred if the company went into liquidation and could not repay the government loans. On the other hand, it also wanted to make absolutely certain the government were not going to be liable for any claim made by Williams for special compensation.
Therefore, wanting to appear generous in public, within the modified terms of their final settlement, they offered to waive the interest on their loans from 30 June 1940 to 20 November 1945.
The export of timber by J.O.’s company would be free of all tax from 1946–1955 inclusive and then subject to an export tax of 0.25 cents per cord (0.07-cent/m³) from 1956–1966. (J.O. was in Ogmore at this time). Royalties on cutting were not payable and Williams was offered a fresh timber contract in 1946.
Obviously, Williams accepted. He probably could not believe that he had outwitted the U.K. authorities yet again. As early as 1941, in a confidential letter from J.O. to Keith Yonge (the company store manager), Williams admitted that he had enough money to continue operations but wanted to get as big a concession from the government as possible before disclosing his financial strength.
The existence of this letter was unknown at the time. Its contents were revealed only at the enquiry. It is not clear if Judge Dunfield saw this letter. His remarks suggest he had not.
The Godfather was very confident that the old Labrador crowd were ready to go back to work for him. However, in a press interview on 24 December 1945, he was quoted as saying that, although 165 men were logging at Port Hope Simpson, 572 men who had been sent there in November had refused to work.
The treasury had been consistent over the years in its unwillingness to allocate Williams any more money because of his unreliability. Nevertheless, Williams was still granted a further $100,000 loan on 15 October 1946 that included excellent terms by the government for his last timber contract — despite the fact that about half of the final contract of wood was left behind.
As Chadwick said in January 1947, “…about the Labrador Development Company’s contract with the Ministry of Supply to ship timbers to this country…Eales indicated that he expected production to be nearer the minimum figure of 8,000 fathoms than the maximum of 12,000, but it appears to have fallen much short of that. We seem to have been badly bamboozled.”
By the time the contract was completed, Williams had definitely made up his mind not to continue with his business any longer. Despite the very generous terms, he was still claiming that the evidence entitled him to a fair settlement, and he had been thinking about progressing into the fishing business in the area.
Chadwick’s view from the Dominion’s Office about the Labrador Development Company was that “our aim was to end this sordid history one way or the other rather than allow matters to drift on as they have done for the past five years.”
The original correspondence from the Public Enquiry shows Chadwick was very eager to cut his losses from the Dominions Office’s long-running affair with Williams and in the end, Williams did not make a claim for financial compensation against the British government.
In 1949, Newfoundland and Labrador were moving towards joining the Confederation of Canada. The Godfather was, therefore, deliberating on whether to continue operations and secure a deal with the Canadian government. As he would have to have paid federal taxes on the wood, he chose to close down his operations completely at Port Hope Simpson.
The Cover-Up
The affairs of the Labrador Development Company at Port Hope Simpson were hushed-up because it would not have been in the public and national interest to have done otherwise. In the lead up to the Second World War, a climate of trust in our political leaders was vital and good for morale.
The last thing the United Kingdom and its steadfast ally Newfoundland wanted was to be distracted from the war by a relatively trifling dispute about what was going on at Port Hope Simpson.
Newfoundland had already suffered from a lack of available work and low wages following the Great Depression. It needed work for its population and The Labrador Development Company appeared to be offering just that.
The political shenanigans of Sir John Hope Simpson, John Osborn Williams, the Commission of Government and the Dominions Office only showed how much all the parties involved were taking advantage of the local workforce for their own ends.
