The Sun.
London, England, 1866-10-11 00:00:00

London, Chatham, and Dover Railway.

The report of the committee of investigation of
the London, Chatham, and Dover Railway Com-
pany was issued last evening, and forms a remark-
able chapter in joint-stock enterprise, comprising
the whole art of making railways without money,
at what cost to the real shareholders remains yet to
be seen. It appears that from 1860 up to the pre-
sent time the whole cf the capital created and de-
bentures issued have been taken by Messrs. Peto
and Co., or their nominees, and whilst the total ex-
penditure has been £16,683,302, even the nominal
receipts on capital account have only amounted to
£15,253,320, leaving a deficiency of £1,429,782.
This capital has been placed on the market at
various times by Messrs. Peto at most depreciated
rates, and oar readers will recollect that'three-
fourths of the whole ordinary stock of the general
undertaking, or £2,207,300, were, shortly before
the recent panic, placed in the market, and sold
at £27 10s. per cent. Messrs. Peto now claim
that they did so only as the agents of the com-
pany, and therefore only give the company credit

for that amount, less £38,500 expenses in placing
it. Messrs. Peto and Co. have furnished an ap-
proximate statement of the balance alleged to
be due to them from the company, amounting to
£384,010 ; but the committee express their convic-
tion that, upon a full adjustment of accounts, a
large amount will be found due from the firm to the
company. Large amounts of capital were nominally
created, in one instance to the extent of £1,070,000,
no portion of which, however, has been paid or
expended, in order that the statutory declarations
might be made and the debentures authorised on the
payment of capital be issued, and debentures for
£365,300 were accordingly at once created. The
result is that the debentures far exceed the autho-
rised proportion in regard to the capital, the total
outstanding debentures on the City lines only being
now £460,678, whilst the Parliamentary limit was
£333,300, the capital being £1,500,000 (part of the
amount put into the market in March last) was
nominally created in August, 1864, and the full
amount of debentures authorised immediately
issued. The committee do not recommend any
course for rescuing the company from its difficul-
ties, but urge the creditors and others to abstain
from individual legal proceedings, and for the pre-
sent to leave matters to stand as they are, all
funds being under the control of the Court of Chan-
cery, which will doubtless settle the position in
which thevarious claimants stand as regards priority.
A kind of supplementary report from the manager
shows that within the next three years, to complete
the line and stock it, a further expenditure of close
upon £1,500,000 will have to be provided for.
Altogether the report presents a most extraordinary
state of affairs, and the only wonder is, not that the
company has collapsed, but that it did not do so
long before. It now behoves all parties interested
to put their shoulders to the wheel, and devise some
scheme for reconstructing the company, so as best
to protect their various interests, as was done with
the Caledonian Company some years since, and
which, from being one of the most depressed, is now
one of the most flourishing companies in the king-
dom. Parliamentary powers will no doubt be re-
quired, and in any act passed for the purpose suffi-
cient safeguards must be provided to prevent such
flagrant violations of good faith, alike towards the
Legislature and the public, as disclosed in the report
now before us.

The following remarks by the Directors of the
London, Chatham, and Dover Railway Company,
on the Report of the Investigation Committee, have
been forwarded to us for publication :
The directors, while assured of the desire of the commit-
tee of investigation to record the results of their inquiry
fairly and accurately, cannot allow the report to go forth
to the shareholders without pointing out some serious
errors and offering a few observations upon it occurring to
them in the short period allowed to them since its issue.
The chief points upon which the report remarks are-
1. The difference between the amount actually received
and expended upon the railways and the total nominal re-
ceipts on capital account.
Under this head they state that there is a
sum of no less than ... £6,057,854 4 3

which has been expended in the re-

bate, loss, and interest, temporary loans

and dividends, while the sum actually

expended on the railway is only 10,625,498 7 3

Making a total 0f...

... £16,683,302 11 6

The directors would submit the following details, which
were furnished to the committee, and which show that of
this six millions the shareholders have already had the
benefit, by stock issued to them at a discount, or by interest
paid to them upon their stocks of nearly four millions. Be-
yond this the money actually paid to the debenture holders
was nearly £400,000. The shareholders and debenture
holders have therefore had the benefit of about £4,400,000 ;
the revenue loss another £400,000; and the actual charge
for interest en the temporary loa', &e., is out of the total
under £1,400,000.
ANALYSIS OF £6,057,804 4s.
Rebates to Shareholders on issue of Stock.

s. d.

s. d.

On general undertaking
stocks
On Metropolitan Exten-
sions 1,465,000 0 0
3,206,591 8 0
. .. . . _ .. . . .

Amounts paid to shareholders in interest :
On Ist preference
On common fund stock b 2,127 0 5
On B and C interest
On Link B shares 952 11 2
On Great Northern con-
tribution

747,804 12 3

3,954,396 0 0