The Express.
London, England, 1861-02-21 00:00:00

THE GREAT WESTERN RAILWAY OF

CANADA.

EXTRAORDINARY CHARGES AGAINST THE
DIRECTORS AND OTHERS.

- - -
The report long expected from the committee of
investigation of the Great Western Railway Com-
pany of Canada has at last been issued. As many
copies will be sent off to the shareholders to-
day as Can be got ready. The report is not of
the voluminous character generally expected, as
it comprises only 45 pages. It is in many
respects a very remarkable document. The
transactions detailed by the committee are
in some instances of so questionable a
nature that it is recommended that " the best
legal advice be at once had as to the proper pro-
ceedings to be instituted against the persons con-
cerned." Amongst the persons whose conduct is
/seriously impugned is Mr. Samuel Laing, late secre-
tary to the treasury. The committee refer to the
" extraordinary fact," admitted by Mr. Laing
himself, that, upon the occasion of the issuing of
the prospectus of the Hamilton and Toronto Rail-
way, in 1852, that gentleman, whilst acting as one
of the trustees, had a partnership agreement with
Mr. Wythes, the contractor, by which the profit or
loss upon the contract was to be shared between
them. It is only fair to meation that Mr. Laing
states that he afterwards relinquished all share
in the contract, and that he never took
any profit from Mr. Wythes. It is men-
tioned that the shareholders have expended
90,6721. over and above the contract price of
328,0001., for which Mr. Wythes had undertaken
to complete the line. With regard to the bond
issue in 1856 of the Detroit and Milwaukee Rail-
way, the report alleges, as another " extraordinary"
revelation, that that onmpany itself took the eon
tract off Mr. Wythes' hands, and became his sub-
contractors, leaving him a large profit for the mere
use of his name, he doing not "one shilling's worth
of work under the contract." The amount of
shares handed to Mr. Wythes, upon arranging the
account, is stated at 365,450 dole. The committee
express their " severest reprehension " of the con-
duct of the Great Western Railway directors in
not subsequently exposing this transaction. With re-
gard to the issueof freeland shared by the Detroit and
Milwaukee Company through the agency of the Great
Western directors, the report states thatthe subscri-
bers to the shares have been "grossly deceived"
by the Detroit Company, " the land promised never
having been legally at the disposal of the com-
pany." With regard to the loans of 150,0001. and
100,0001. made by the Great Western Company to
the Detroit and Milwaukee, the committee express
in strong terms their opinion of the conduct of the
Great Western directors. Of the latter of these
transactions they observe :
In October, 1558, twelve months after the elate of the
first loan, the Great Western directors obtained from their
shareholders a second loan (100,000(. in amount) for the
Detroit and Milwaukee Company, a concern which their
own secretary bad long before described as " helplessly in-
solvent ;" and this time, it would appear, the Great W ee-
ks% directon not only suppressed the knowledge they pes-
tered of the real state of affairs, but they ventured to tell
their shareholders "they were happy in being able to state,
that all difficulties had been amounted by the maw and
exertions of the executive in Canada."
f Another extract is as follows :

The committee also call atteuticas to an advance of 7,9001.
awls by Messrs. &yd.*, and Reynolds to the Port Huron
and Milwaukee Raalway Company; the money was paid
est of the funds of the Great Western Company, sod the
London secretary, in • letter to Messrs. Brydps and Rey-
nolds, cells the advance " unauthorised and unwarrant-
able." The money was paid in September, 1658, and the
Great Western directors have since that time presented the
half-yearly accounts to the shareholders in a shape so am to
conceal the transaction altogether.

The committee then go back to the origin of the
company, in 1845, when • "corresponding com-
mittee" was formed in London, consisting of the
eleven following gentlemen :—W. J. Chaplin, C.
Derail; H. J. Xnthoven, A. L. Gower, G. Hud-
son, S. Lino. J. Masterman, juu., John MOMS,
Thomas Smith, K Uzielli, and G. S. Walters.
After detailing various transactions in the
market, the committee state that " 392 paid-
up shares, equal to 8,000/. sterling, were
handed to Messrs. Laing and Mastercuan, on behalf
of the corresponding committee, in consideration of
their active co-operation and assistance in dispos-
ing of the stock and bonds of the company." Here-
upon the committee observe :
Now, it appears to the committee that these eleven
gentlemen, having been appointed to " protect the English
shareholders," had accepted a trust, and that whatever
funds they received in such capacity, whether in the shape
of premiums or otherwise,. were the property of the coal.
pany, and could only be disposal of with the consent of the
shareholders ; and that, therefore, the appropriation thereof
to their own use was illegal and unjustifiable, and the cons.
mitten are of opinion that the total amount of premiums,
together with the 8,00 W., the value of the 392 shares, with
interest on both AMIN up to the regent time, should be re-
covered from such of the alines members of the •• cor-
, responding committee" as may now be found in a condition
, to make good the amount. _ .

It appears that the total cost of the main line
has been 2,637,7761. 3P., exceeding the estimates by
about 1,000,0001., and of this outlay the amount
expended before the opening of the 241 miles was
1,359,6281. sa. 9d. ; and since the opening there
has been expended the enormous sum of 1,279,1471.
17m. 3d.

We can only make the following further extract
from this remarkable report :

The published accounts show a net pro6t from the open-
ing of the line to the 31st July, 1860, of 650,6611. 17s. 3d.,
dter deducting working expenses, interest no bonds, de.,
and renewal of rails, deepen, lie., 82,8471. 4a. 7d., and
compensation for accidents 82,0931. 7s. 3d. 11 would ap-
pear to have been considered • very great point to com-
mence paying dividends in July, 1854. The proceeding. of
Mr. Brydses and Ur. Baker, in so making up the amounts
as to justify a dividend of 6 per cent. at that time. are well
worth the attentive consideration of the shareholders. In
the UMe statement the accountants enter mto a detailed
account of sums amounting to 321,0711. lls. filL, improperly
treated as revenue in the different half-yearly accounts up
to 31st of July, 1860. They also state that up to the mum
time, in addition to the amount expended in renewals,
the sum of 138,490/. should have been provided
under that head out of revenue. The accounts
presented to the shareholders would therefore op-
pear to have been systematically fallacious. It should,
however, be clearly understood by the shareholders, that
nearly the whole of the sums constituting the large amount
of 321,071/. lls. Gd. affezt only past dividends, enders cot
items, • proportion of which is to any way chargeable
on future earning, nor should future dividends
be affected by the recurrence of any such items,
except " bad debts" and " accidents" and as regards
the latter, revenue having already been charged with
82,0931. 7s. 3d., it is to be hoped that it will be lees affected
is future yens is this respect. The committee have now
briefly noticed the venous matters which have beau
thoroughly investigated by the accountants in Canada, and
in bringing their remarks to a conclusion, they have no
hesitation in declaring their belief, that from the commence-
ment of the undertaking to the present moment the pro-
perty of the compauy has bees entrusted to persons wholly
unworthy of caiblenue, and they recommend the shareholders
to take the earliest opportunity of displacing the
present directors, and of selecting others, not °ply to super-
Intend current affairs, but also to bring to a strict account
all who may be found to have improperly possessed them-
selves of any part of the funds or property of the company
and further, to take the best advice as to the nature of the
proceedings to be adopted against those who have bees im-
plicated in any of the nefarious doings, by which the shore-
holders have been so grossly deoeived, and have suffered so
severely. The committee had intended to have prepared •
statement in detail of all the sums of money which have
been either misappropriated or wasted. But time will not
permit ; it would be a long catalogue, and would probably
amount to a million sterling.
An estimate is put forward that, taking the
future yearly traffic at 500,0001. (the average of
four years to July 31, 1860, being 483,0001.), the
net profit can hardly be more than 2.33 per cent.
on a share capital of 3,500,0001.

Fizz IN TEE WI

/AD.—About aeven

o'cToeile;;evening a fire broke out at the Vidalia Tavern,
Westminster-road. Lambeth, immediately facing Aetley's
Amphitheatre. Engines from all parts of dine metropolis
were in attendance at an early period, but the building and
its contents were entirely destroyed, and some of the neigh-
bouring houses extensively damaged by fire and water. A
report was current that the fire was the work of an incen-
diary, and that a female was takes into custody on the
charge. It is not known whether the property was insured.
FRIGHTFUL AtVIDENT.—YINAGDIRy morning an
explosion, which it is feared will prove fatal, took place at a
leather manufactory, at West Ham. A man named Gomm
Grope was boiling a, when from some unexplained eases
the boner burst, and Us* man was dreadfully scalded by the
boiling liquid. He was cramped to Guy's Hospital, when
he remains without the slightest hope of osomnaTim
LONDON GRNIRAL ONNIII/8 COMPANT
—Traffic rewires far week sailing FIN. 17 , 10, 4s. 10d.