The Sun.
London, England, 1854-09-08 00:00:00

BAIL WAY IN PELLIG C

SOUTH-EASTERN.

The half-yearly meeting of this company was held
yesterday, at the Bridge-house Hotel, Southwark ; Sir
John N. R. Campbell, K.C.IL, in the chair.
The SECRETARY having read the advertisement con-
vening the meeting, and the report, which appeared in
The Sun of Saturday, having been taken as read,
The CHAIRMAN rose and said—Before commenting on
the report, I wish briefly to lay before the observation
of the proprietors the position in which I am now placed
for the first time, and after that I will endeavour to lay
before the meeting the matters of interest which have
occupied the attention of the present board since my
accession to the office which I have now the honour to
before
in this
eflorey/ot company,tlietruel
position—good
be a y endeavourae
well
ast
ill—iny
order that, by a thorough knowledge of your affairs,
yon may the better aid the directors by your counsel
and advice, and to offer suggestions which, I may, say,
will be gratefully received both by my colleagues and
myself ; for it is an incontrovertible fact that many of
the evils which now burden this enterprise arise &dm the
want of such knowledge ; and, I am sorry to be obliged
to add, from negligence upon all those matters which
most seriously affect your own interest. It was on the
16th of March that you did me the honour to -elect me a
(-erector, and on the 18th of the same mouth I was sum.
mooed to-attend aboard meeting. At that meeting, ac-
cording to the provisions of tee Act of Parliament, the
directors proceeded to elect a chairman and deputy chair-
man.of the board. They did me the honour to put me in
nomination for. the office of chairman, and I was elected
byea, majority on that occasion. But, gentlemen, I he-
sitated to accept the post which I now occupy; because I
felt that my knowledge of the details connected with tsis
great undertaking was not such as would enable me to
perform the duties with advantage to you or with honour
to myself.. I had hut little time to reflect; bet I knew
that I should be associated %Nab men of great practical
knowledge and experience, and that I should have the
benefit of that knowledge and experience, not only to
lighten my 'labours, but alNo to diminish the amount of
moral responsibility which I must assume—(hear, hear)
—and I take this opportunity of saying, in the presence
of my colleagues, that it is to their unceasing attention
to their duties, and their undeviating kindness, that I
owe the little knowledge that I possess of the policy, the
management, and the details of this, great concern ; and
I can only say, that if my ability to learn is only com-
mensurate with their efforts to instruct, you will not
have long to regret the inefficient choice which the direc-
tors have made in appointing me their chairman. I pass
over the first two or three days of my office, when the
question of the Broinleybill was mooted, because I
shall have occasion to address you upon that bye-and-bye.
I pass on to the 23d of March. three days after my election,
which was the first day on which I had an opportunity of
looking into your affairs. The first point to which I gave
my attention was the state of the finances, and the means
which existed of paying the dividend which had been
declared on the 16th of March,_ amounting to 148,0001.
I found that on 16th March, after paying all outstand-
ing claims, there was left a balance of 9,5881. 11s. 7d.
to the debit of the company. I found that the sum which
might be carried to dividend had been paid away for
purposes of construction. I found that the borrowing
powers of the company were exhausted with the excep-
tion of about 17,0001, being the balance of 500,0001.
granted by Parliament in the previous year. I found
also that works estimated in that 600,000/. were not yet
commenced, although the money had been expended for
other purposes. I found large and expensive staffs in
the various. departments. I found that engagements
had been entered into which must be met by borrowing
po4ers in the course of the present year. I found we
were hampered with profitless branches, abstracting
from your main lines no less a sum than 108,3401. from
your annual revenue. (Hear.) I found likewise seve-
ral claims outstanding which had to be met by the 'cur-
rent revenue of the year—that there were bonds to a
large amount Nene due monthly, which had unfortu-
nately to he renewed, or the money to be provided at a
period when the money market was very heavy, and at
an increased rate of interest. In fact, I found that all
that could be got together had been expended, and that
no provision had been made for the future. At the date
of which I Teak you are aware of the state of the money
market. You know that money was worth more than
5 per cent., with the prospect of an increased interest as
the works progressed. There were many public loans in
the market, and almost every railway company was in
the field as borrowers ; and you are aware how difficult
it was to arrange any pecuniary matter, for at that time
almost 'every enterprise seemed to be struck with pecu-
niary paralysis. Under these circumstances, it cannot
be wondered at that the banking interest declined to
make the large advance which we required for the
payment of the dividend : and on several occasions we
were met, not perhaps with. positive refusal, but with
reluctance to mak., the advance ; and I can say it
was only at the last moment we were relieved from our.
anxiety by the handsome manner in which our bankers
came forward to enable us to meet the dividend, and
pay our liabilities on that occasion. (Rear.) It was
then I entertained the idea of calling you together to
tell you the state of your affairs, and to place before
,you the necessity of foregoing the dividend which bad
been declared on the 16th of March. But this was over-
ruled by my colleagues, who were more experienced
than myself, and the matter was settled in the manner
I have declared to you. The next point to which I wish'
to direct your attention is the change which has taken
place in the management since the new directors were
appointed. You are aware that the offices of chairman
and managing director were vested in one and the same
person ; and that was a system which the reconstructed'
board did not think was conducive to the interests of'the
company. (Hear, hear.) It was a union of offices in
the hands of one person, giving complete control over
the legislative, the executive, and the financial policy of
the company. which we thought ought not to exist,;
and, in fact, it was a centralisation of authority which
we thought ought to be divided into shares of individuil
responsibility. (Hear, hear.) The union of such offices,
embracing such extraordinary powers, involved duties
so various, so numerous, and so onerous, that it appeared
to us impossible that any one person could discharge
them efficiently, however able, however intelligent, and
however active that person might be—(hear, hear)—and
we thought the legislative and the executive powers
ought to be so distinct as to leave room for the exercise
of that free judgment which experience proves to be most
conducive to the departments over which they preside.
In consequence of this determination we put forth
advertisements, having first settled in our own minds
that the appointment of a distinct paid manager was a
sound principle, because we thought it was the proper
channel for bringing all the'administration of our affairs
into ,a uniform circle. We thought it would be greatly
beneficial throughout the whole line, and we thought at
the same time that the general control would be vesteitk
in your board, who Would be responsible to you for their
acts and their proceedings. (Hear.) An advertisement
was put forth calling for candidates to tender their set.-
vices for the office of general manager, and it is due to
those gentlerrign who Pent in their testimonials to sag
'that they were all of a very high character. The post
was conferred upon one of your own distinguished
officers, and I will tell you the reason why. Captain
Barlow had been for many years in the service of the
company, and hail filled a situation of great responsibi-
lity with credit to himself and with frequent commenda-
tions from the company. His testimonials were in all
respects equal to those of the other candidates ; and I
may mention, which I believe is not known to every
one of my colleagues, that some of those gentlemen (and
I mere particu!arly allude to three), who sent in highly
valuable testimonials, and who now hold responsible
situations on railways, told me in their private corniest-
nications that they did not wish in any way to interfere
with the appointment of Captain Barlow, who they con-
sidered so admirably adapted for the situation. (Loud
cries of "Hear, hear.") There is another thing which
influenced my colleagues and myself in making this ap-
pointment—that is, in the capacity, of resident engineer
on one portion of the line, your late chairman, unsoli-
cited by Captain Barlow, and, as far as I know, by any
other person, selected that gentleman to the respoq-
sible position of superintendent of the railway—thus
showing the estimation in which the talents of Captain
Barlow were held by your late ch. irman. (Heal;
hear.) I believe this to be a most proper appointment,
and I have received written communications from share-
holders in various parts highly approving of this step,
which we have taken as one of the first which has dis-
tinguished our term of office. (Hear, hear.) In order
to make the system more' effective it became necessary
to supply the place vacated by Captain Barlow, and to
associate with him a man of knowledge and tried expe-
rience in railway matters, who would be able to take
upon himself the duties of general manager in the event
of our being from any cause temporarily deprived of the
services of Capt. Barlow. For that office we have Se-
lected Mr. James Brown, who was for some time con-
nected with the Chesterford and Newmarket Railway,
and previously to that with others, and we believe the
results will be beneficial to your interests. It was felt
fromatnliciesto be desirable to introduce an officer who was free
awnhyi
whilst
w we
predilectionsareby tothiainmy
epaanrsticeunlaabrlelidnetoouf
pphoollitcly;ri
strictestall your interests, you may he assured
that n o integritysacrifice
of them will be made unless we secure
for you
h Ihave alluded have, I believe,
generally had the effect of bringing all the officials of
the company into
proportionate
jextaposi 60 with one another,
have been the means of establishingt
and permanent advantages. Mic:
appointments to
of
under-
standing that there is now a greater
freedominter-
course and interchange of sentiment
.gour amongst
are them than
previously existed ; and power and vigour such a good
the efforts of our officers, with the knowledge
their proceedings are brought under the general cogni-
gtiirvia etnatloi
sance of the board, who are always ready to receive
c ee
from their subordinates' any suggestions that may tend
to promote theof
hear.) The next sptreopspwelriiietyh theeve thoughtn necessary
e s (aHrya t
(Hear,
adopt was the appointment of committees under the
several heads of finance, traffic, stores, and works. The
appointment of these committees, whose proceedings are
regularly laid before the board at each meeting for ap-
Preeal and confirmation, seems to work extremely well.
The division of labour has proved very useful, and the
general supervision which is exercised );,y the board over

~~1~:/ .

4

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c

pany for twelve months ending on the nit July last,
passing from Tunbridge and places beyond Tunbridge' to
London, amounted to 414,0941., and the part of tbat
amount earned by bringing that traffic from Tunbridge
to London in .the .we. 3 months was 231,000/. lam
quite aware, that I make the statement at once to pre-
vent myself being accused of exaggeration, that wh the line from Strood to Canterbury is completed the 231,en 0001.
will be reduced to 191,3871. by the abstraction ofa portion
of the earnings from the traffic between London and Tun-
bridge, amounting to 39,714/.; which would, in the case
mentioned, in all probability pass by the North Kent line
from Canterbury to London. And when the line to Maid-
stone from Strood is opened, another reduction of 7,942/.
would take place ; and the sum in jeopardy would then
be 183.4451. of annual revenue. This sum, then, of
183,4451. of present annual income is left for abstraction
by the construction of the hostile line from London to
Bromley and Farnborough to Tunbridge. I can scarcely
conceive a more suicidal act than that which has been
committed by the majority of the board of directors who
sit here and ask for your confidence—who refuse to re-
commend you, or even to give you an opportunity your-
selves of resolving to spend 136,0001. in constructing a
protective line of six miles, vital to your safety and pro-
tection, which would have warded off opposition ab-
stracting as large a sum from you annually as its own
cost : having had in their hands the power to make it,
and at the same time asking you to grant them half a
million of money, to cover expenditure to the year 1859.
And now, gentlemen, I have to call your attention to
the financial statement which my honourable colleagues
have laid before you. My honourable colleagues dis-
covered that the contents of the last report which was
presented to you, and whi -1 you adopted, announced
in the most distinct manner that the expenditure of
capital on the Ist of February last exceeded the amount
raised by stock or borrowing powers by the sum of
192,578/. Is. ; and they assume great astonishment at
finding that to pay the dividend declared at the last
meeting it was necessary for you to accept from your
bankers assistance towards making that payment. My
hon. colleagues talk also of the rapidly approaching
maturity of er very large liabilities for which no pro-
vision had been made. Gentlemen, I never heard of any
provision bein arcade for mortgage bonds but the renewal
of those bonds y fall du either
i through the sameor
through other hands ; and I bee
hon.gentlemen in thus, for an evfdeea tve to
join issue with the
et:euerepose, exaggerating
difficulties, and I join issue the morn udire they received
from me, in answer to an extraorciinar
came into my hands from the
jimiyaansulier:ecuxprnlaennattiworilcolfl
the whole state of the case.
the 13th April, and referred th h "'on
to t e
was
which this mare's nest of theirs w see for ,
and I replied to their statement, "that Yperson btbut
myself was acquainted with the monetary affairs of the
company or its financial condition," by quoting the re-
port of the committee of proprietors under date of 6th
June, 1853, on the subject, and which I now hold in
my hand. Observe, gentlemen, the plea of ignorance
was put forward by Messrs. Coles Child, Warren, and
Byng, as to the financial affairs of the company ; but
the report of the committee of proprietors, dated the
6th of June, 1853, page 3, contains the current
and prospective liabilities of the company and its
assets. Now, gentlemen, the accounts were prepared
for the consideration of the directors by the accountant
of the company, with the assistance of the house of
Quilter, Ball, and Co., whom the auditors of the com-
pany had appointed as their public accountants. In
these accounts, as I have stated, all the resources of the
company were set forth, and all its liabilities. All that
depended on estimates were based on official reports
from the gentlemen who had charge of the respective
departments. There has been no alteration made in
regard to them by any act of mine, or of the honourable
colleagues with whom I was placed prior to the last
general meeting, except such as are alluded to by the
auditors of the company in the report in March last, and
such as are alluded to by the auditors of the company in
their report now on the table before you. Gentlemen, the
alterations in the items that have taken place are in
some excesses under particular heads, which naturally
occur upon estimates in every undertaking. The majo-
rity of your present board of directors assume that cer-
tain of the assets are not to be treated as assets for
realisation, but to be retained by the company. Gen-
tlemen, that is wholly matter of opinion, and I still hold
the view that it would not be a prejudice to the interest
of the company, but the contrary, that the Lord Warden
Hotel, at Dover, and that the Pavilion Hotel, at Folke-
stone, should be realised, and become the property of
other parties, in whose hands such property would be
as beneficial to the company as it is now, without any
complication as to the management, or any care as to
the tenants who should occupy it. Well, gentlemen,
this report of the proprietors is signed by Mr. Morgan,
Mr. Smith, Mr. R. A. Grey, Mr. Wilkinson, and Mr.
Ivyleafe ; and the report of the directors is signed by
whom Y It is signed by Mr. Coles Child, Mr. James
Byng, and Mr. Daniel Warren, besides all the other
gentlemen whose presence the company then had the
advantage of on the direction. I must own that our
finance has of late been conducted in a way entirely novel
to me, and I should think equally new to you ; and. when I read to you, from a communication made to me
by the majority of the board of directors—for I have it
under their hands—" that as the finance committee could
not go round the money market in a body, the members
continued to make inquiries, and to ask assistance in all
quarters likely to afford it, reporting their proceedings
to the chairman, and he reporting his to them." Now,
gentlemen, if ever a mode of creating competition against
yourselves was invented, I think my honourable col-
leagues, the majority of your board, are entitled to
a patent for that invention. Gentlemen, I take my
stand upon the joint report of the committee of pro-
prietors and of the board of directors, dated upon the
6th and 9th June, 1853, and circulated amongst the
whole body of proprietors. Additional expenditure
in the engineering department, under particular
heads, is what mu,t naturally occur and be antici-
pated.; and it cannot by any honourable and candid mind
be looked upon in :my other light than as one of the
ordinary incidents of a gigantic concern. Gentlemen,
during later years our company has been emerging front
an expenditure of a colossal character. Throughout the
whole period during which I have bad the honour to act
at the board of directors your payments have been punc-
tually met ; and with regard to providing for a dividend
with resources such as yours, and with traffic daily ac-
cumulating-, as yours does, in your bankers' hands, why,
gentleineo, it is puerile to speak of it as a difficulty ; it is
ridiculous to assert that here, in the centre of the money
market of London, with your resources and with your
revenue, and with the balance which you must keep at
your bankers, for the ordinary payments of the day,
that any difficulty can or ought to arise in acquiring a
temporary loan of money. Why, gentlemen, during the
whole half-year, though you have been nominally bor-
rowers from your bankers almost every day, you have
also been lenders to them. Let this speak for itself. The
ignorance of the financial state of the company asserted
by Messrs. Coles Child, Byng, and Warren is singular
and, strange. They signed the report of the directors in
June, 1853, which had special reference to, confirmed,
and was attached to the report of the committee of pro-
prietors, which was drawn up by that committee, after
considering a statement of the company made to them,
which ezhibited in the most minute and distinct manner
the then current and prospective position of the com-
pany- and its finances. The report of the directors to
that committee, and the report of Mr. Ball, their secre-
tary, on the accounts, were printed and placed in the
hands of each member of the committee of proprietors
and of the board of directors. Gentlemen, considering
that nothing could be more injurious to the credit of the
company than what I heard of these proceedings of the
finance committee out of doors—as it was opposed
to all the usages of conducting business in which
credit was involved, and I was not summoned to their
meetings—l felt myself necessitated to withdraw my
name from that committee. Your credit had been un-
impeached, amid your bond debt had been raised on most
favourable terms, and you will remember that it is not
long since you declined to allow me and my then col-
leagues to consolidate that debt as we suggested at as
low a rate as 31 per cent. per annum. I will ask you
for one minute more to explain to you the circumstances
under which I ceased to hold the office you did me the
honour to confer upon me of managing director of the
company ; and I may preface by venturing to state that
there is no man in this country to whom the emolument
with which you were pleased to accompany that appoint..
ment would not be an object, or who would resign it
after five years of unremunerated service, except from
the gravest conviction of a sense of duty to you ; but
the conviction was ineffaceably impressed on my mind.
that as the majority of my honourable colleagues had
thought fit to appoint another director in my place as
chairman, it was impossible that I could hold the office
of managing director and exercise its functions with ad-
vantege to you, or that the office would then carry with
it that amount of authority essential to make it effective
fur your interests. I 'nave had the most convincit
proofs of the propriety of that dec:sion. I
have had thue
most un eevidence that I should not have been
supported by the present board in a way that would have
insured public safety or be useful to you. I will give
you evidence of it. The board of directors proceeded to
determine without loss of time that they would appoint
a general ntanager Of the company--and here, perhaps.
I may be permitted to read the terms of the letter in
in
which I tendered
m 'v
y resignation to my colleagues, b._
are these. I addressed the letter to my successor, my
honourable colleague, the present chairman :;
`` London-bridge Terminus,. M
chairman
ar
of the South-
!,3,
1854.
" Dear Sir,—The vote of the majority
Eastern board has substituted you as airman for my
self.

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