Barrier Miner (Broken Hill, NSW : 1888 - 1954), Saturday 19 October 1912, page 4
I am not sure how true the story is, as it didn't appear in any local papers such as The Argus or the South Bourke and Mornington Journal, but it was in the Cairn's Post and the Brisbane paper, The Worker and I suspect it might be a 1912 version of an urban myth.
The Iona Hotel at Garfield was originally opened around April 1904. It was built by George Ellis. The hotel had twenty nine rooms including the bar room, parlours, commercial room , dining rooms, drawing rooms, billiard room with a full sized Alcock's table and fixtures and sixteen bedrooms. The building was constructed of weatherboard and had gas lighting and an 'excellent' septic sewerage system. There was also substantial stabling. This information comes from a report in the South Bourke and Mornington Journal of April 13, 1904.
Sadly, the hotel was destroyed by fire on April 23, 1914. I believe the existing Hotel was erected the next year as there is a report, once again in the South Bourke and Mornington Journal this time from May 27 1915 saying that the Shire of Berwick Health Inspector, Dr H. White, had inspected the Iona Hotel and he was pleased with the appointments and sanitation of the place and that no expense had been spared by the proprietors to make it all respects one of the best equipped hotels in the colony.
This photograph, from the Berwick Pakenham Historical Society collection, shows the Iona Hotel, most likely just after the new building was opened in 1915.