The New York Herald Newspaper, January 20, 1869, Page 4

4 ANOTHER RATLROAD WAR. THE NEW YORK CENTRAL IN COURT. - Commodore Vanderbili’s Theory of Run- ning a Railroad. His Opinion on Matters in Wall Sirect. SUPREME COUR Before Judg isaac N. ws, The New Cenvrat Rait- roud Compa A number of motions in this case came before this ¢ argument, but precisely 1 ne order in whicn v ‘eto be heard w made very clear, MM eld, Mr. Vanderp Mr. Blatebford appeared for the plaimtli® and bir. Thatcher for the defendants. Mr. Fi in the opening discussion ag to the order tm which tie motions saould be heard, claimed that the case came up first on the order requiring the de- t weause why the original and tem- porary order of injunctign should nt be continued. Mr. Thatcher contended that the case came before the court or 2 order to show cause why the origi- nal order uction shoud not be extended so as to embrac er matters and aiso to show cause why the defendants should not be enjoined from issuing “luterest certificates.” It was finally consented (hat ail the mottons should be heard ee Mr. Field said that the papers upon which he now movell were the original com and inyune- tion, the* papers upon which the en. ed injunction was moved ior, the supplementary complaint, aMdavits and temporary injuuction thereupon issued, e order to show cause why that injunctio: of Horace ould not be continued, and the aMidavits . Clark, Richard Schell and Cornelius Vanderbilt. He would merely state the nature of ali Of these papers except the alidavits last mentioned, and these hie desired to read. The gist of the origi- nal complaint was, in the allegation, thar the New York Centrai Railroad Company had a fixed capital, and that the officers of the company, in violation of law, had increased thai capital by the issue, aait ‘was called, of convertible bonds and otherwise, and the object of the suit was to obtain a judgment that that issue of stock, 80 far as it could be, be recalled, or tuat, wherever there could be any rewedy appiicd, in case it could not be re- called, that remedy be applied. The additional papers upon which the order was obtained were ob- tained on the eve of the issue of these certificates of indebtedness, upon au aMdayit that it was in con- templation to issue them. They were not called in that affidavit “interest certificates,” but they were described as the same thing. The supplementary complaint was issued upon the fact, as established by the action of these gentlemen and by the publica- tion in the newspapers of their resolution, passed ¥ late on Saturday night and put into effect on the fol- lowing Monday morning by the issue of interest cer. tidcates, which were a description of security never J wn in any mercantile community. He would venture to say that they were ol a8 illegal and fraudulent a character ag will §=6be = stated = of =any = commercia) transaction. It seemed that those gentiemen, the directors of the New York Central Railroad Com- pany, conceived the idea that by some means they could atfec tthe stock or the stockholder by giving aim something which would almost double the mar- ket vaiu' as Wall street market value—of the cer- tilicates of stock owned by him, The pay , im fact. could have no other effect than to make those men who owned stock on the morning of that day be- iieve that ‘hey had double the amount of thelr in- vestmen Why this was done, the motive, the apology for tt—or excuse, whichever it might be called-—had wil been stated by the two men who did i, and who were Mr. Clark and Mr. Vand Dit, and they bad avowed that tr teeir act sughout. Tne form of their iss was committee, concealing it from everybody, Mr. Clark’s house between eight and k, ON & Saturday night, passing the re- Solution there and then, and at the opening of busi- ness on WM lay Morning putting these certificates out aod riuuiig the stock up something iike sixty or seventy per cent. or at least a very large amount. Mr. Biatehford, his assoctate in the case, ‘would now read to the Court the atidavits detailing the particulars of the matter. Mr. Blatchiord, of the firm of Blatehford, Seward & Griswo'd, tuen proceeded to read the following AFFIDAVIT OF CORNELIUS VANDERBILT. Cornelius Vauderbit, being duly sworn, in an- wer to interrogatories by ¥. D. Fuel testiles as Tollows:— Q. Are you an officer of the Central Railroad? A. 1 am president. Q For how Jong have you been such? A. About 8 year—since December, 1867. q Were you present at any meeting of the Board when the interest certuucates Were authorized to be wssued? A. Yes, air. Q. Was the statement made to the Board of the amount of net earnings applied to construction at that time? A. A rough siatement was, | think, Mr. Wooster made up a statement, as I understood it. Q@ Was it presented to the Board at that meeting? A. Ido not recodect whether it was or not; om re- freshing ty memory 1 recollect that there was a sketch of the statement read over at this meeting ‘when we made the dividend, &. Did you ever see itt A. 1do not think J did; I thing | took tneir reading for it. Q. Cam you sinte anyruing it contained? A. No; but lad the evidence of Mr. Wooster; I told him to get up such iad such papers, showing a statement of the affairs of (ne company, Q. Did you see the stavement? A. I do not know that 1 did. Q. Do you know that he ever made any? A, I know from what he said. @ At this meeting of the Board was he present? A. I think be was, vat | would not swear positively ‘Uiat be was iu the room, Q Was any statemeut made at that meeting of the Board of (he amouat of the net earnings appited w construction’ A. | think there Was, Q. Had any statement been fretting | made? A. Yes, we had had a statement; iknow thati was in Albany sowe days myself ior that purpose. Q. Did you ‘nen work at ity A. We examined the accounts. Where were the accounts? A. In Albany. In the office of the company there? A. there was, Where we were posted up to what we were going to do, but we did not get all through with it, and left certain things for Mr. Wooster to do, which be uid, and then came and reported to na, Q What was the amount of the bet earnings ap- lied to the construction account for ali the period in 1863 vo the time of your meeting? A, I do not ow. Q. Can you tei within several millions’ A. I can- not tell unless | have tue figures. @ Can you tell the amouat of net earnings at allt x Sot without having the books; not from i834, cer- nly. Q. Where is the book? A, In the office. Q. Wheret A. in the Secretary's vitice, soLe. Q. Where is that? A. In Albany. Q Not here? A. No, sir, Q Can you state any of the amounts here? A, No, sir. I pre. «. How do you know that this company has ever earned a dvilir beyond What ii Nas paid out im divi dends? A. i know that from the books and from the representations of the Treasurer. Q And are those books at Albany? A. T presume that they ave; 1eey may be presented at any tune, Wili you send and yet them for ust A. 1 do Dot Know that | Have a right to take the books outos | the offic Mr. Freid, of counsel for the plaintit, here states that his engegements are su rit Linpos sible for hiin to attead to th xatuination | of the witness unui to-morrow morning Mr, Seward, of counsel for tie plainuid, states that he 18 One of (ae execulive comrmiitee oF the dinner to { be given to hic. Gerard this eve (has assigned to Lim the duty of going Tor tu an Who is to preside at (he dinoer, and thot fh nabie, there- fore to abiona longer this afte t that he is wil ing, however, to attend atsuch time aud piace t morrow morning a8 Mr. Vanderbilt’ may suggest is conveniens jor himself and proceed witu the exami- nation. Mr. Van lerbilt states that ten o’ciock to-morrow Morning will sult his convenience. ‘The exwuination is adjourned accordingly. JAN. 16-11 A. M. would ; he sand, “Tt will be bie for ane to ahond—t am going out West y terest certificates? A. Yes, ont Wen aid ou first see thelr ferm or the sub- stance of their form? A. I bape? as how long we were making U) Ourselves; there was ‘@ committee appointed for that pur- PO when was Shas eommeaiions appointed? A. It think, in le FS OPO eat month? Ae it do. not Know, bat wha time that we ry ie that other —statement—the statement ratetred toin this morning's Zri#une—the 9th of De- cember or some time in December; there was pone mittee appointed to make this investigation; commitice consisted of three of us, and we made it us far as We were capable of making this investiga. tion; there Were some little matters that we had not completed ontil the 19th; some information that we got from Wooster on the 18th or 19th; the report of Mr. Wooster Was more favorable than I supposed it would be. Q. Do you recollect who was the committee to who Was confided the duty of preparing the form of interest Ifcates? A. [think it was Mr, Chapia, Mr, Clark and myself; we were appoiited to make this investigation and to recommend some measure to allow the stockholders to have the proper amounts that were dae nin some form; we had been ex- pending their money. ; Q bo yon recoliect when the interest certificates were printed? A. LR think there were two or ‘o¢ acts of them printed, bas ing from the one finally adopted? A, A Very (ruling digerence; some words altered, per- aps. ue if the rongh statement which you think was Examinos\ion of witness resumed—Q. Whea did You receive notice to attend the meeting of the 19 Of December! A. That 140 nob recollect; we could have notice to ourselves; we called the Board to- ether, Wakh Was a common custom; we called he Board iogether at ditterent umes and diderent . 4 you recollect when any one was notified to a ur. Clark’s house? A, Yea, I recollect shat U was @ hamber of peopie notified. Q@ Do you recollect when they were notified? A. That day, | guess; we had been expecting & mee: mg: Ww a not Know when he would get Feady; it bad been delayed @ long ume, Tt Was a Verbal request, was it it not, to “come tp tonigni’ A. I think it was; 1 do not know whether (they gave their written notices or not; 1 know our people were so situated that they conid call the re at aimost any time; Mr. Joy was in town, and he was ing away to where he lives out Weet; andl him that I did not know what day we Gould ges ready to call the meeting, vut Q at the mecting of the 19th was read, by whom read cad? A, Lao Rot kow; 1 strikes me that it was read by Mr. Clark; I wil! Dot be positive about that; it was by somebody that we autuorized to read it. by whol wes, it peeeret A. I think myself ir. Clari pared a Do you know where that statement is now? A. No, I donot; I take it for granted thatthe secretary bas got it, and that it is in 1ts proper place. ). Who is the secretary? A. Mr. Roche. . What did that statement purport toshow? A. I do not really understand what it shows; it showed fae Was there, agit was read; I do not remem- now. . What did it show as matter of fact? A. It showed that there was a very large amount of money that had been expended by,the road legitimately and properly beionging to thestockholders, with the sur- uses: “" fo 508 ae a be gions Presa ek; and I sup, amount of money stockholde! longed erly to the TS. °e What aris the ter of the expenditure which it showed? A. In ever; perjaiuing to a ftosk, ibe Sarit not Teal estate e a He, ol stook, the buyin; ve Bee ine Ea ta the property of te toad to enable them them to do their business; anu they took that mode of using that surplus monéy, the: earned it, in preference to on. the #! ers for new appropriations; that is what I supposed. Q. The idea, then, was that if there had been with- drawn from time to ‘the earnings of the road, a sum certain, Ww been from time invested in permanent constraction sid ment, and in general et ent of other property, that a stockhoider was entitled to som to re- present that application of those earnings’ A. Yes. Q. If @ portion of the earnings had been ap) for the purpose of laying @ double track, was a stockholder without any miterest certificate inte- rested in su double. track aA the pe ai na ns represented . We thought so; we tho! e Was entitled to ti, and ‘aa ig the cause why these interest certificates were made. Q. Was not a stockholder just as mach entitled to his interest in this permanent improvement betore the interest certificate was as he was after- wards? A, Ido not know but he was entitled to it, how could he get it uniess the company saw per to give it to him in some form? chose this mode of giving the stockholder what fi ‘be- longed tohim. Q. Does the intefest certificate give the stock- holder any rights as a stockholder which he did not have before? A. I do not know anything about that. Q. As matter of nay bey not the stockholder have derived the same it under the resolution of the 19th of December if a large cash dividend wy the stock had been declared? A. The company not the means, unless they went mto the market and raised the money, to pay back the stockholder all this amount of money that ticy had used, belonging properly to him; therefore they took this gore hat ‘ae te it of th . ing t e aggregate aniount of the intros certificates issued on the 19th of Vecember had been precisely equai to the amount of the capital stock of the company, what practical digerence does it make to the stockholder whether he gets an eight per cent dividend upon the stock or a four per cent dividend upon the stock and @ four per cent dividend upon the interest certificate? A. [donot know anythin bout that; I know that I had but one motive, an hat was to give the stockhoider what was justly due him, Q. And what did you give him, in the interest cer- tideate, beyond increasing that upon which a divi- dend in cash was to be declared? A. We sup or Lsupposed—that that amount of property we had used justly belonged to the stockholders, and | did not see wa Mere inode of giving them that thas be- longed to bim than this. Q. What interest do these certificates give to the stockholders which they did not have beforer A. I suppose these interest certificates show the indebted- ness of the company to the stockholders to that amount, and which they are reaay and willing to pay them interest on. Q, Haye you an interest certificate here? A. No, 1 have not. Q. From your recollection of these certificates ts there any ‘undertaking or obtigation expressed in their language to pay the holder or the person named m the certificate the principal sum therein mentionedt A. i do not understand the question exactly. y. Is there in these interest cirtificates an obliga- tion or promise on the part of the raiiroud com- pany to pay the holder of the certificate, or the person named therein, the principal sum of money mentioned in such certificate? A. I suppose 80; or, if ever they became authorized, to give them that amount of stock if they see proper. Q. But if they do not get the authority to increase the stock, then it is your understanding of the cert- cate that the holder bas a right of aclion or claun against the company for the amount of the principal sum? A. I tuink $0. Q. Does the company admit that these interest Ho aay can be used separate from the stock? A. ink $0. 9 And they can pass current without the necessity of the hoider being at the same time a holder of the stock? A. I think so; that was my intention, that tuey couid do as they liked; they could seli oue and keep the other if they pleased, Q, In the rough statement to which you have alluaed do you now recollect whether it contained any tes < wee Seer ad tee had been ex- pen for the entargemen' property the road? A. | think a statement was made of that. Q. You have alluded toa Mr, Ciark read. id that contain ‘an; ing the diferent channels in which the money had been expended—I refer to the one that was read at E Q Orany was arrived at? A. treasurer und secretary at the office, and for granted that courted the in’ gate the affairs of the company. + “that committee’ to the gentiemen whose names are report tu this moruing’s Trvune? A, sir not know one of these gentiemen individually ; yet may know them all if I see them to my recollection I do not know any of them individually, but 1 said that we wanted three as good men as we have in our State, and thas the public will have confl- dence in; i said, “Il want you to select who those if 2 88 if ae af gentiemen are,” and one said that Mr, so-and-so was @ man, and another, Mr. so-and-so; and that is the way fear were seile r ery well,” said 1, “if they are as gooa men as we have got in thia Scate select them, and jet them investigate this matter;” and they did it, and that is the result of that investiga. tion; | wanted to be fuily borne out in the estima- tion of the public. Q. That committee was appoin@ to examine the stock books simply, Was it not? A. The whole edairs of the company. y. Thet committee was not charged, was it, with | the duty of investigating the amount expended by the Central Ratiroad Company, from ts iormation tuntlt the date of + seactution, er manent ine provements’ A, I supposed they power to investi; the whole affairs of all the transactions of the Central Rattroad; | supposed so; I could not tell you the language of the resolution; that was my intention; | wanted ly to investigate the whole ton all through. \. Were you present at the meeting at which that ited? A. Yes, lished in the Tribune of the resolution cojnmnittee was ap) Q Does the resolution as correspond with your ler which the committee was appointed’ A. one it to be the same, Q. Have the com) rt to any one of its earnings A. | suppose they hi ail faily made wp; 1 were to have the report made uj . When is. ths Feport. presented to the State Kn- gineer? A. | chink somewhere about the let of Do- cember; but masimuch a8 we were not quite ready I did not know that until within |e Mya an ex- and he privilege; and T am told since that was dons and made all-ap. } Nave you, as ge mnge | the road? A. No, sir; thut is vice president, aa | suppose; either the lent or vice president has the power; he does all that; I do not do’any of the office business. Wage Jou seen @ report for the year 1868, signed a. heres tue vies president? A. I have not Q. Do you know what were the expenses of the ant road for the year 1) f aning et senger or fre! nt Dostrens? rn NOt domo have “ Do khow the receipts of the road for the yous 1008 tro itor ' A. No, sir. from freight from passengers? No, sir; not accu- Or © Or from express? A. No, air NEW YORK HERALD, WEDNESDAY, JANUARY 20, 1869.—TRIPLE SHEET. , the t expended in any one Q Be vin know ¢ amoun anted 1a ony nee In the eatimate which was made of gross earnings appli of 7 Ww PP ot interest ‘was aver- hat : ood et monk repre- ginou! Q. Can you tell now w! Hh Was by proposition made during the year 1863 issuing debt certiicates simular to those which aa med in 1963 or thereabouts? A. I know no- thing about 1963, Q. I asked whether there was any made in 1868 for 183 certificates similar that had been formerly issued by the company? A. I do not know auything about those former ones. . Who originated this plan of mterest certificates t A. Lratnérthink that I originated it; I started it my- olders what belo: ; such ald a8 we had among our directors to help aloug to get it into shape to suit us, and finally we tailed upon that thing: { think ifthere is respon- sibility about the starting or the whole of it you can put it on to me, Q. If the Legislature shonld not hereafter anthor- ize an increase in the stock, when could I, ag holder Of an interest certudeate, get the Fiocinal sum rep- reaensaty Uy Se onrsene A. Ie 10 po Eada representation of so inuch property, Is it a Mr igd representation than the stock? A. I should think not. . Q Then what advant dol,asa older, wet from the certificate, which I do not have as a stockholder? You have evigence that you have so much pro- rty Shares 7 calt roperty., ee may not call property; that is anotber thing; I it just as good as stock; that ts the way I estimate it. ‘What interest do I get, in the possession of the cel mm the p of the road, which [ did not have betore? ‘ou get just as much interest ag g stockholder has got. ‘Then does an interest certificate represent any- thing more than the interest of the stockholders? A. Not more than the indebtedness to the inter- ested 6: olders; that is the way I understand it, Examination adjourned until to-morrow at one o'clock P. M. as > ok JAN. 16, 1869—1 P, M. Examination resumed. By Mr. Fiel In tho resolutions passed om the 19th of-December “net a Applied to construction” is the term used; what do you mean by “construction” in that ex- ression? A, That means fox every new fixture on ihe road; new turnouts for instance, new Cars, new &o. ou mean also interest in other roads? A.I meau in the Central road; that was all I had thing to do with. ‘Then there were no other investments except the investments in new parts of your Qentral road, as I understand you? A. In ev ‘that per- tains to the increase in the P ray cory Frr th railroad, Q By “property” of the Ceniral ad do you mean ev along the line of the road? A. All along the road; wherever they wauted to add to Then you do not ide any property Tiss 0 inclu that of the ime of road, for instance, interest im other roads? A. Not that know of; Ldo not know that there 1s; they have some stocks in other roads, but as for increasing that, that is that had nothing to do with Central Q. jus &, a road, And that had pemning todo with the issue of these iftereSt certificates? A. Not that 1 know of, Q. That ts your understanding of that? A. Yes; they had taken some ofthis very property that be- Peirce renee in reality and Justice, to increase the faaiiities o ike road. . ¥ property’ iS not represen’ e inveres: compitioates! ‘A. Yes, all that property is, because it is the property of the Central road; for instance, they took so much stock of a connecting road to facilitate their business—though they have not done any of that since 1 have been here, but agen they did beforé—and they paid for it out of the earnings of the company, and that legitimately belongs to the stockholders. Q. The question [ asked was whether the interest certificates represent anything more than the pro- perty along the line of the road, and I underswod you to say they don’t. Witness—I did not understand the question. Counsel—Please expiain how that is, A. That is the way 1 expiain it; 1 presume that heretofore the Central owned some other railroad stocks and property; that was paid for out of the earnings of the road; therefore caiculated that that is property, and that it legitimately velongs to the stockholders; but the stockholders hadn’t it re- presented; it still belonged to the company; tor in- stance, they held a thousand or so shares of the Lake Shore road; they took it when they orginally built the road and paid for it out of the earnings of the r q. Then in making up an estimate for the total amount of interest certiiicates you included not only the permanent improvements on the line of the road, but property or interest in other roads which you had purchased? A. On the connecting roads. Q. What were those connecting lines? A, Ido not know any other than the Lake Shore; there may have been wore. Q. Wili you try to refresh your memory? A, No; that 8a detail Ido not go tuto; I leave that to our ple, totne secretary, treasurer, &c; that was not one in my time; it was done before I came here; if they were now going to purchase anything with any of the property bel to the Central road I should look iuto it belore it was done; but that wag done before my time. Q. Do I understand you to have stated in this ex- amination thatthe statement was prepared by Mr. Chapin, dir. Clark and yourseif? A. Yes, that is so, Q. Then of course you know what the statement contained if you hell prepare ity A, Yes, | saw it and believed it to be correct. Q. You did, at that ime, Know what it contained? A.-I depended more upon our office people; our treasurer, &c., for the correctness of the Q. Do you mean to say that these three gentlemen made up the statement, or that the treasurer made it up? A. The treasurer might have made % up, and we tnvestigated it in looking it over; at auy rate the figures were put before ts that led us to this conclusion. Q. Who put them before your A. I cannot say whether it was the secretary or the treasurer; we got them from the oftice. Q. Cana you give any one of those figures? A. No, sir; I cannot. @. Will you procure a statement and annex it to your aMidavit? A. ldo not know; it is all in the joe. . Will you give mstructions to an officer to fur- nish it? A. If that is necessary | shall do it; we do not want to hide up anything; we are wiliing that ali the world shali Know every transaction. 9. Then will you tell us that transaction? A. [ will tell you ## nigh as I cans Q. If you do not know it and somebody else in the Office does will you direct him to produce the inior- mation? A. I have no objection at all. 1 ask you, will you do it? r. Faircbild—I us to juce our books la) he ao pra are me to answer ‘no’? or “ Mr. Fairchild—I should not produce 11. Q. If you have not the information yourself, but ft ts in the possession of a person under your con- trol, a8 an oficer of the company, wil! you procure it or will you not? Counsel The saretient fe net earnings unsel—The starement the net plied to construction, for which you issued ia terest certificates? A. There is no doubt it is there, Q, Will you let us have a copy of the statement toot Witness—Weil, Mr. Fairchild, what do you 4 Og How must I answer that question? I want to governed exactly by what is right, Mr. Fairctuld—I should say that 1 could not do It; the statement involves an examination of a grea’ many w it would be necessary to brin, down here; and there would probably be @ carl of books to bring down, Q. Wasa carioad of books present at the meeting of ‘the luthof December, when you met there? A. = the books were im the office at Albany at that Ane, Q | am now asking of the meeting at Mr. Clark’s house on the 19th of December when you ordered the isnue Of the interest certificates? A, They were not there, of course. Q. At that meoting was there or not a statement of the amount of net earnings applied to conatruc- ton? A. Yes, sir; Ido not know that J saw it Q. It was there? A. I think so, Q. Will you give us a copy of itt A. As lL said be- fore, 1 wilt get a copy of that statement, for all 1 have to do is to wriie to Mr. Wooster for it; but I — o nee oe ge tor ‘8 about it. ir. Fairchild—i do nol it is proper to give that starement, “ = My question isto you. [ask you whether you give a A. Ido iy how we any other way than fay that I have not got it. “ . But it ts ander your control? A, It isin the office; but whether it is under my control to take it out of the office or not i do not know, Q. 1 only ask for a copy, not the win Tot FSM ia a va ase ee $ Ww out of the office. i beh yg @ Have you any objection to givii poops Al have no to giving an Grder” for 1,1 40 hot know whether I will get it, Q. Will you give ap order for it? A. Yeu; 1 will ve an order. Q. How long @ statement was it? A, It was read On lange aperer? A. tl uch ow & paper » it was very mi con- densed; I only wanted the facta; 1 oahu ous overe: tary or treasurer three months -ago to make up such 4 maybe four months ago; i knew that it was a that id take jong while to do; it went they did not get it fnsily Ibany, bat it fi could ‘aderstast’ peetey was it that made up? it was @ sheet of paper; Wmiant have which we dosire a copy? ® juced at our ey es see ee Tee is not? A. ea, the well Lata 2 Mz ack BA he Bete soap CT lag a Uf head 10, to the Efe sine REESE SSBC SSEESE ic i ae 5 zt Z PE & 8 H Hl g i f i = i i f B fi fl A. jerstand by “current expenses or he ead ok mean men’s labor; I mean oil and ene Sa everything that pertains to daily ex- penses use. ‘ Do you mean repairs? A, Yes. And the supply of engines in place of ei broken and destroyed? A, Yes; keeping te up in every way. ¥ Supply of cars for cars worn out and bridges forbridges broken down? A, Yes. Q. Supply of raus for rails broken and worn away? A. Yes; I will close that up with @ closer answer than you put it; my idea of a railroad is this—if I take ion of & railroad Igend men ver it to examine it in evel purtivular andall over: they report tomo {tscondition, and then it is. my see that tA so em hee respect k thing else; if I increase beyond Yhat ‘that is a sohioct which may be credited to the road—to the stockholders, if you please; I mean that if we take hold of a road and investigate it and find that it has so much rolling stock, worth so much mouey, and the road bed in such @ condit at the end of the year, we see if we have bet! these things—if we have bettered the rolling or whet ‘way, or whether it is worse i wooden bridge would be a proper struction. s Q. Is it for items of that kind that the interest tiflcates are issued? A. I do not know there is any such state- ment; but it is for that we make of the road yut it; the way I answer it it ia; for Broid wooden bridge that cost $500; charge at the time it was built to the railroad; ened balla @ bridge that cost $5,000 instead 500, the: my $4,600 of that money 1s fair Sete wesio 4600, but che surplus ts Toad; you ki whole , but the lus is from the stockholders? money, because their money was taken to build it. as directors, to ‘use a Q. Have you a right, stockhoider’s money for such pul es? Si 1 spn not say whether we have or not; the cOmpanhy always done it; it was done before I came here} thi road has been in existence for along whiie; it nas been doing a deal of business; when I went into the road 1 did so with thls understanding; 1 said that I did not want to recelve any more moncy; they have received money enough for years back; it I cannot make the railroad erg ipo rail ought to be in this country by getting the same manes that they have got before, then I do not want to be In the road; how do I make it? I make it bya saving of the expenditures; if 1 cannot use the capi- tal of that road for pretty nigh $2,000,000 per year better than any one that has ever been in it, then I do not want to be in the road; there ts where | cal- culate to get that money, and it has been so on every road I have been in yet. . Q. Am I to understand you that during your con- nection with the road net earnings have not been applied to construction? A. No; if they wanted any repairs they would use the money of the company as they had iton hand, and at the end of the year avould arrange it, Q. Am | to understand that money of the stockuoiders for 1 do uot want you to understand that; we use any money that is in che treasary to keep our road fixed; wheu we wind up at the end of the year tue result 1s a8 J tell you; we might have spent considerable of that money, but we had enough to do all our business with besides. Q. Then is the theory—that if at the end of the year you fad the road was of more value than it was at the beginning of the year you can issue interest certificates to represent that lacrease?’ A. No, that 18 not tae theory. Q. What 1s the theory, then? A. If you have been rapning #road and you spend nine or ten millions to run it, if icanaotdo it for eight, and do it as weil, Lam ready togo from the road; that ts profit enouga for me; that has been my principle with steamships; i never nad any advan of anybody im running steamships; but if 1 could not run a steamship aiongside of another man and do it as well as he for twenty per cent less than it cost him I wouid leave the stip. Q. [am speaking of the application of net earn- ings to construction, and what you mean by the ex- ression; during your conueciion with the road ave you or not applicd any earnings to construc. tion? A. If they bad aay coustruction to make, they have done it. ak What has been the fact? A. I do not know about te uu have not used the struction? A. No, Q. Por how long have you been connected with this road? A. One year; that is a detail of the road that I did not attend to; when I go over the line of the road and see a ing not ht I say, “Fix this,” or “Have such and such a done; and tuen it is their business to do it, and not mine. Q. By your connection with the road do you mean your Pecenes A. Yes. 5 to your presidency ? What was the fact ati had nothing to do otra Q. You iad no interest before? A. 1 was @smail stockholder only. The ited to constriction, for net earnings Pe tg pte ag page ey net us our 20" A great portion of Het are, 1 should think. Q ithas been your policy di to the. gtook: policy to them the amount of property tb _properly be- fing ten I get uel s vustion Ican do it without injury to laid ® track other day from to the — the it with the stockholders’ money; but depot; I did they should be paid for it in some form; it is an ad- dition to the property of the and belongs to the — aud they are entitled to the money Js this your theory:—The property of the stock. holdera at @ given pertod i# the whole proj or the col jon; and if after that time, wi that may be, an increase of the pro) is effected, that increase should be represented by ad- ditional certidcates given te the stockholders? A, it should be represented in some form, and ta the best form that tie people can devise. Q, And this form of interest certificates ts the best that you can devise? A. I liked that; I think it was tue best way; It sulted me exactly, Q in maktog this estimate, how did you silow for the old structure? For example: suppose a bridge was broken down or decayed, and you built a new one, did you pass to the credit of the stockholders, With a view of iasuing the interest certificates, the oiderence between the costof the new bridge aud the vaiue of the old one’ A. No, sir, Q, How then—did you give the whole cost of the new construction? A. No; that would not have been fair. q. How did you do it? A. I did it, as I nave ex- plained before; If a wooden bridge breaks down and we build another wooden bridge, that goes into the current expenses; but if a wooden bri which costes $1,000 tumbles down, and we put up an iron bridge in its place that costs $10,000, then $9,000 of that money 18 taken from the stdckhoiders’ property ‘and is to be paid for, and they are enticied to some evidence of Bp ys Q. But suppose the old bridge was built in a time when the currency was the current expenses. But how do you ascertain what would be the ® new structure equal in quality to the old? it for grauted tuat we can make the new ice that we did the old one: that superintendent of the road to an- 5 What would be fair would be tais: here 4a bridge that borns up to-day—our superin- tendent goes and makes an tron brid; ould ® Wooden M Ve cost? What is the cost of the. iron 1 the diuerence, as I nay, goes for now oon: @. In Uae the prinetole won Which you made up ae Poe +4 ° MZ mean caah on hand? A, Ido; cash on hand'an that which is equivalent to the cash. or money securities? ‘A: Yes. Suppose the case of a wooden bridge burned in 1864; tt was then replaced by an iron 5 did And add toe pe a yea int not but Tao nek know; you must bear in SESE sat ie Sgece® eit Hed He af pid = 5 roperty right off, although 1 not give the order wanted to go along moderately. u applied the same rule to the Harlem A. To every road that I have issned interest certificates for the ? A. No, sir. ae: River road? A. No, sir; we property of those roads increased in t earnings lied to end they rerenta ~ Mi 4 Orst then; and the stockholders, it is Yes; but wedid not do it Was all right and jured by it; the stock- zi will be a day fit of all the other pro- cramp the real estate inany estate every day; 1 use wh it all belonged to control every other ugh it all belonged 2 E Is it_your intention to with the Harlom and the Hudson 2 alee ee ee sates ve been net earnings applied n- lof on both the roads? A. Yes; and there is deal in the same River roads? A, im every other road in the whole Sonny Q. And you know of no reason why it should be one in regard to the Ceniral different from any other road? A. None at all, Q. Why was not the ition of the directors to issue such certificates made known tothe public? A. Made known to the pubiic;! made known to a-gang thieves and robbers in Wall strees! that is the in. @ ey to what did you keep the secret? A. All the me—antil abe sat Q. Why was it done could not do it in the ber of Friday, I ‘was, before our minds ex- actly how it should be done, and then one of our rr | directors was Up the road, and could not it here; at telegraphea him, but could not get te weak did not get iim until Saturday nig! Q. Did you telegraph to him what yon wanted him for? A. No; but he came the chance there was to comie, Q. How many of the directors of the road knew of. this design of yours previous to the meeting of the 19th of December? Ido not know that aavboay knew it except Mr. Clark, Mr. Chapin and myself; I do not know that anybody else did; it was because I ‘would not trast many of them; they would have speculated on the stock. Q, Will you state whether you did or not intention- ally conceal this from the other directors? A. We did not know ourselves what we were to do; we were working up the figures to see what it wouid work to, and when we came to that polnt we decided to call our directors together. Q. How many oi the directors, previous to the ac- tual meeting on the evening of 19th of Decem- ber, had any intimation that such a course was in- be a ? A. That, I cannot say; i never told any of em. . Do you know whetier one had any such intimancn? A. 3 fo not pid that they hed be. ist When was that ttee inted was commit inted? A. Desemper, er tte ct - Q en that comm! was @ inted was not the object of Sopmine it mated? Pas They were to inyetente devise WaySand means to fix tuis put ir. Q What matter? A. Of giving the stockholders ‘what belonged to them. Q. At that time the board knew that such a thing was contemplated? A, Yea Q. Every member of the board? A. All that were there. Q. Who were absent? A. I do not know; I do not remember at any time what directors are there and what are not; there was nothing secret about it; if Q tiad a hi a RE of the bee! . company been pt, # F parchssing stock? A, Not to my know- ledge; there were a Dumber of then speculators in stocks before this, butI said “You sian’t gs) on us; 1 did not myself know in the morning what we would do at nigut, because we bad not got tne figures. Q. Why was the meeting of the 19th of December held at Mr. Clark’s hous)? A, There was no particu- lar reason; they happentd there; I went there to teil him that f would come up the next evening if he would get the people tlero; i went up there; that was one reason; it wasa mere accident; if it bad been at my house it woul( have been there; it was a mere accident that it wasthere. certif- the 3 Q. Who devised the forn of these interest A if and Mi Clark; 1 gave him plan and he itup Q. How long before the firm was written out? A. A number of days; we chay, it every day. Q. Who printed it? A. Ido not know. tye: gs it m pdnt at the meeting on the Were any of them sigipd? A. Not tomy know- ledge; after the meeting was over I got up and went home, Q. Where is the office of te company? A. In Al- tA Are say portion of tte hake ket in Bow York? a ihink there is a cojy of the transfer book ‘here, but nothing else thal I know of; we fro- Sa ae eae York, and when we id we let the secretary and jreasurer come down ith the books, w Are there any by-laws of\ho company? A. Yes, & Wiere are es? A. The} are in the office at bye I presume. $ ve you a copy here? oo al }. Is there not a copy in Net York? A. That I do not know. Q Will you produce acopy{ A. I have not got wi give diréctions « have it produced at the same time with the other japers that you have men! ? A. Yes, air, \ Y Do you know whether ky company bas ever borrowed inoney to its A. Not since 1 have been tn it, ana it never vil. Q. Do you know whether te company has fre- quently applied to the Legisia for authority to increase the charge to A. Not since I have been in, Q. Do youknow whether it 4s previously done 80? A. Only from hearsay. Q. Do you know whether the ind upon which increase was asked was that ‘ise the at could not pay a dividend? A, [yas not surprise: ‘at that; we have done the wi road for sixteen hundred thou: dollars tesa than it was ever done befoy How been done? It has been done wi savings; every- thing is ina better condition it was when We LOOK it. business of the Q. Have you anything else thatjon desire to say in reference to the road or ite as vy hy construction or in reterence #04 ere a Te which the ii certificates were ? A. ldo ata x? derstand’ Joa to sat, 1 shall have a un copy of that f A, Yes, will send it for mept will ‘do alt that I cat to is “Sworn hefore me this 18th day of aay, 1900. worn to | jy 1869.— Ri LB, Ne ICHARD STA a jotary hog tia of 8 od the start by two or three ‘sone bouheverels tun’ je a minute, ae ‘wat reached the icicle the gap between the two; so the turn ocourred there was not much Dack the Une was soon overnanied cle tho Point, kad koofing the lead won by thirty i HF Ese ue H Ee! PS = - RE Fi & BROOKLYN CITY. George 2, “Norfolk vs. P. @. Oummings.—'The Plaintill Y this action was the assignee of a contra’ by tho terms of which Benjamin F. Smith, 839/7,nor, one of the parties to the contract, was y.ip, in 1863, to Newport News or Fortress Monrog! Va., @ certain amount of groceries, provisions, 40.,° to the defendant, who was a sutler in the army, and” the defendant ox his pate was w geta ass (oF | @ portion of time receiving forjhis services $1, goods at the cost price an equal share in any excess over twent: five per cent Pan Under this contract Smitl ship] from New York goods to the value $10,493 60; but, ag claimed by the plaintiff, es some negligence on the part of the defendant med were delayed in getting into market, wh’ lay resulted in a loss upon the goods of $7,000. 1 reeover this sum the suit was brought, Tue defen denied all the allegations in the complaint except the sending of the Verdict for the,defendant. ‘The Cotton Case Adjourned.” The case of Daniel H. Baldwin and others vs. Ros- well 3. Burroughs and others, reported in yester 's HBRALD, was adjourned until Friday, on 2c Godt of the sickness of one of the counsel. Action for Wages. Julia Muller vs, Henry P. Cooper.—Plaintiff was & servant in the family of the defendant and brought the sult to recover weges and borrowed money te the amount of $178 14. The Court, after heariag tre evidence, Fulod Sate wan eoong £0 £0 to me jury and directed a yordigt for the full amount, Alleged Bréach of Pattdership. Jules Muckensturin vs. Carlo Riazi.—The plaintif, who was a practical brewer, entered into & oopart nership in the latter part of 1867 with the who owned a building in Twenty-seven! ob near Fifth avenue, fitted up as @ ‘ery, to carry, on the business of brewing, the ita to run one year. Abo ont lig. after en! into this Srrangoment wi driven om Rpt by defendant, wil threats life. The action was brought to recover di for breach of the contract. ‘The Court uirected @ verdict for the defendant. Stealing a Heuse. Janes Bullman vs. Thomas Kelley.—The platnti® in this suit claimed to own a house in Greenpoint, ed at $302, which was used by the Bushwicy Turnpike Company as @ toll house during ‘the exis! ence of that corporation, On the 26th of April, 1 defendant moved the house bodily from the pla aud to give 1e le of them, the i bought by Kelley tooth aya Fourteenth wards, to sell it for the benefit of the county, w wi the house, with the other property of the t ike come, pany, reverted on the ex fon of its rs d ‘The case was given to jury, but no verdict had ‘been returned up to a late hour. CITY COURT. Action to Recoves Commission, Before Judge ‘Théfapson. Manly A, Ruland vs, Elizabeth Furman.—The ao tion was brought to recover $400 commission for @ sale alleged by the defendant, who was a real estate broker, to have been negotiated for the defendauty’ ‘The defence was that the broker acted as the agen! of the purchaser and that defendant did not to pay any commission. The Hat Factory Nuisance. Baker vs, Glau.—In this case, reported in the Herarp yesterday, the jary returned a verdict im favor of the plaintii? for forty doliars. Decisions. Lyman vs, Gildersleeve.—Motion for a new trial dented, Reity vs. Spaulding.—Amendment allowed on payment of twenty-five dollars. BROOKLYN INTELLIGENCE. MORTALITY IN BROOKLYN.—There were 155 deat in this city during the past week, being a decrease of 26 from the number reported during the weck preceding. Of the deceased 39 were men, 29 wo- men, 48 boys aud 89 gus, ABREST OF 4 SusPICIoUs CHARAcTeR.—Last eve- ning, about half-past five o'clock, while detective Corwin was standing in the vicinity of the railroad terminus near the Fulton ferry, his attention was attracted by a young man who was then alighting from a car, having in his arms a chest of tea. aa the officer approached him he moved away aud Boe into the crowd that was entering the ferry gare. Corwin seized and brought him to the Forty-frag recinct station house, where uj searching Linn wo skeleton keys were found in his possession. The prisoner gave his name as August Draser, ana clatms to have been e: by @ stranger to carry the tea to New York. was ela for eraminacioc, News iN Brier.—Jacob Ryman, a youth of eigh- teen years, was taken into custody on suspicion of having stolen a quantity of clothing found in hia possession on Monday night by detective Frost. The prisoner was held for examination. ‘The residence of Mrs. Stark, No. 142 York street, was entered by a sneak thief qorertes, who stole a the lare cen: verberg, No. 125 Fulton street, was sentenced to tua Penitentiary C4 qi Cornwell for one month, The employés ol @ Union Ferry Company and their lad; nds enjoyed their annual ballon Mou- day at Gothic It proved a very pleasans ‘An anchor was recently stolen from the canal bot yesterday James Toole was ar- Z Fort Greene yesterd: oO election of Reaben BE, as United Sena John Banner, whose arrest was noted in HERA! , was before Justice on a of arson and led OE Bye, ong woman, tiny red lay while rho, by to cross Hicks street, The street, iors, ‘The trustees of the City have their serra et tat So Presidents of that institution for the ensuing your, A little boy named Willie Ariasirong fell the ing, Fulton street, sad. was seriously injured, om jured, on Monday evening. Rea. Estate Sack iN Mount Vemnox, Kast Onxaten.—Mr. Charles Weiss has sold a lot, 256x106, on Fourth avenue, Mount Veraon, to. Mr. Joba Driehr for $1,000 cash, Rea EstaTs SALR IN East Cuesten.—Mr, A. He Duncombe has sold four acres of unimproved laud in the village of ast Chester to Messrs. L. & J. A. Mapes, of Mount Vernon, for $6,090. CHARTER OF Mount Vernon.—A bill has been pre- pared for the amendment of the charter of the village of Mount Vernon so as to give the Trustees additional powers in the matter of constructl sewers, draining wet land, &¢. The Board of T: tees desire to make such improvements as will ren- der the village a mode! one. for stance from outlet be twenty-eight ‘at the bottom and Mix feet deep. The ‘cape rr