By Bob Gordon
THE RISE AND RAPID FALL OF THE RCN
The Naval Service Act of Canada established the Canadian Naval Service on May 4, 1910. The Act established a Naval College of Canada to train officers in naval drill, science, leadership, tradition, and etiquette. The Royal Canadian Navy’s first ships — HMCS Rainbow and Niobe, both former Royal Navy (RN) cruisers — were commissioned in the summer of 1910 for coastal defence and training in Esquimalt and Halifax, respectively. In total, the government envisaged a Canadian fleet of five cruisers and six destroyers.
However, the establishment of the RCN sparked fiery debate in Parliament. The governing Wilfrid Laurier Liberals favoured a Canadian navy, built in Canada and crewed by Canadians, defending the coast under the Canadian ensign. The opposition Conservatives decried the establishment of a Canadian navy and committed to repeal the Naval Service Act. In return for inclusion in the Royal Navy’s naval defence planning and preparations, the Tories were prepared to pass legislation granting money to the Royal Navy. Essentially, they wanted to ‘contract out’ coastal defence to the Brits.
The Canadian Naval Service formally became the Royal Canadian Navy on August 29, 1911. Less than one month later, on September 21, the federal Conservatives won the federal election and everything changed for the infant Royal Canadian Navy. Reductions in naval funding forced the RCN to lay up HMCS Rainbow and Niobe. Although the Naval Service Act was not repealed, plans for a Canadian naval fleet were dropped from the agenda, temporarily leaving the RCN with nothing more than its newly minted designation.
The threat of war, and the sympathetic ear of Sir Robert Borden, eventually changed the Navy’s fate. The RCN training ship, HMCS Rainbow, was run up by August 1, 1914 and, under command of the RN, sent south from Esquimalt to locate German ships and to escort two lightly armed RN ships back to Canadian waters. This mission marked the first occasion on which an RCN ship was sent to sea in search of enemy warships, but overall, they were still woefully unprepared to defend Canada’s coastal cities.
On the coast, across the harbour from the Royal Navy base at Esquimalt, fear of German naval bombardment was at a fever pitch — even before Britain officially declared war. The Kaiser’s eastern fleet, operating in the Pacific Ocean, was loose. With coaling stations available in neutral South America and German colonies throughout the South Pacific — in an era predating naval aviation with limited wireless capabilities — no one was sure where the ships were headed.
On July 29, 1914, some of Victoria’s most prominent citizens, including two visitors — Capt. W. H. Logan, surveyor to the London Salvage Association, and J.V. Paterson, president of the Seattle Construction and Drydock Company — mulled over their options. They weren’t prepared to face an attack with virtually no armed vessels at their disposal. When surface vessels were dismissed as unprocurable, Paterson mentioned that his company had two complete submarines that were available immediately.
The premier of British Columbia, Sir Richard McBride, was an exponent of the idea of submarines. According to naval historian Marc Milner, McBride “took the matter of the submarines in charge, and conferences of leading men were held at McBride’s office, at the dockyard, and elsewhere.” The Honourable Martin Burrell, a B.C. Member of Parliament and federal cabinet minister, came onside personally although he could not commit the Borden government to the idea.
Only five days later, on August 3, the commander in charge at Esquimalt telegraphed Naval Service Headquarters, lobbying for the purchase of the boats: “I consider it [two submarines] most important to acquire immediately. Burrell concurs. Provincial government will advance money pending remittance.” The restricted sea approaches to Victoria and Vancouver made submarines highly sought after for defensive purposes. They could lurk in ambush along known and narrow sea lanes and wreak havoc on ships unable to manoeuvre in the confines of the inshore waters approaching Victoria and Vancouver. “Submarines provided excellent value for money,” writes Milner.
The two submarines under consideration were constructed in the United States at Paterson’s Seattle Construction and Drydock Company for the Chilean navy. Chile had paid $714,000 of the $818,000 purchase price, but was in arrears. Paterson, whose shipyard had constructed the boats, was willing to declare the Chilean contract void and sell the boats to the British Columbian government for $575,000 each — a deal that stood to make him $1,864,000 on a product originally priced at $818,000. For the RCN, money was of less consequence than the ability to instantly improve coastal defence by snatching the completed subs from the Chileans.
CLOAK AND DAGGER DEALINGS
For political reasons, the deal had to be concluded quickly. As soon as Britain declared war, the U.S. would pass neutrality legislation prohibiting the sale of armed submarines to all belligerents, including Canada. It was truly a case of now or never and Paterson was, literally, the only show in town. His price was non-negotiable, telling all and sundry, “This is no time to indulge in talk of that kind [bargaining] and that I would not listen to it, and that if they did not care to have the boats they did not need to take them.” Quickly, Premier McBride personally authorized payment of $1,150,000 with provincial funds. Delivery was organized to take place just outside Canadian coastal waters, five miles south of Trial Island off Victoria, at dawn on August 5, 1914.
And here the cloak and dagger commences. The two submarines cast off from the Seattle Construction and Drydock Company at 2200 hrs on August 4. Britain had declared war on Germany that day and neutrality legislation would be passed the next day. The window of opportunity was small and shrinking. The subs ran on the surface on quiet electric motors until they left the harbour and reached Puget Sound, where they fired up the diesels to make time.
Officially, the two boats never left their American harbour; they filed no paperwork, including no clearance documents, before furtively slipping off under the cover of darkness. In plain clothes, undercover RCN personnel kept Chilean government and naval personnel under surveillance to confirm their ignorance of the operation. Once in international waters, just outside the Canadian line, the boats met the S.S. Salvor carrying Canadian inspectors and crews. The inspection crew, under Lieutenant-Commander Jones, RN and RCN, included Engineer-Lieutenant Wood, RN, chief engineer of the Esquimalt Dockyard, Chief Armourer Smallwood and several naval artificers.
The scheduled one-hour inspection took four, but eventually the subs were declared acceptable and a substantial bank draft was handed over as the motley crew of retired and active RN, active RCN and civilians took over the submarines. Strictly speaking, the soon-to-be-passed neutrality legislation had not been broken, as the vessels had been exchanged in international waters, outside of the jurisdiction of the legislation.
Once the RCN assumed ownership and control of the vessels, designating them CC1 and CC2, they served ably. Together, they constituted two thirds of the RCN’s West Coast compliment. Both were transferred to Halifax in 1917 and paid out in 1920.
Concern about the price of the submarines led to the creation of a Royal Commission. The Report of the Commissioner Concerning Purchase of Submarines (1917) exonerated everyone involved and lauded the premier’s decisiveness, describing him as a man whose “motives were those of patriotism; and his conduct that of an honourable man.” With a bold stroke of a pen, he had decided to advance the purchase price demanded of $1.15 million. This was a princely sum, more than twice the annual budget of the RCN for 1913–1914. The premier had gone out on a limb, and it would pay off handsomely.
The Royal Commission attributed the safety of Vancouver and Victoria to the submarines: “The acquisition of these submarines probably saved, as it is believed by many, including high naval authorities, the cities of Victoria and Vancouver, or one or the other of them from attack and enormous tribute.” Not surprising, perhaps, considering the Royal Commission heard from as eminent an authority as Admiral Sir Charles Kingsmill himself. The Director of the Royal Canadian Navy, Kingsmill testified before the Commission saying, “The fact of these submarines being there, I am perfectly certain in my own mind, saved the city of Victoria, if not the city of Vancouver, from serious damage. On the part of the German Eastern Squadron ...”
Only in Canada could a squeaky clean military procurement deal, concluded on an absurdly tight time line, offering a great value to cost ratio, result in a Royal Commission and a futile search for a smoking gun. The 1914 submarine purchase was militarily sound, a model procurement despite the exceptional circumstance of a province buying warships ultimately destined for the RCN.
Conveniently, the narrow frame of reference of the Royal Commission related only to costs not methods: For the latter skated on thin ice in terms of diplomatic niceties and international legalities. The Chileans had paid 90% of the agreed purchase price when the subs were seized. Simply put, they were pinched from them. J.V. Paterson, president of the Seattle Construction and Drydock Company pocketed another one million dollars reselling them to Canada, making him hardly a disinterested participant in the affair. The vessels made an undocumented covert departure from Seattle and changed hands in international waters in the face of impending Neutrality legislation. The bizarre fact that they were purchased by a provincial government is only the most obvious irregularity in this unusual incident. In essence, the RCN committed commercial privateering by seizing, purchasing and recommissioning Chilean vessels for use in His Majesty’s service in defence of Canada’s Pacific coast. For their first operation in World War I, the RCN could have been flying the Jolly Roger.