The Sun.
London, England, 1861-01-01 00:00:00

BA IL WAY INTELLIGENCE.

GRAND TRUNK OF CANADA,
The London directors of this company state in their re-
port to the bond elders and shareholders, with respect to
the present financial position of the company, that they are
alrea3) aware of the inability of the directors to raise the
£1,500,000 money as authorised by the shareholders at their
meetings in London and Canada lest spring, which sum
was required, together with the calculated proceeds of then
existing assets, to relieve the company from pressing liabi-
lities, to defray the expense of additional rolling stock.
sidings, and station accommodation necessary to work the
line efficiently, and to meet during the current year the
claims for interest on the bonded debt. As stated in the
report of the London Directors of the 27th October last, the
requirements, including the unpaid arrears of interest on
bonds up to the present time, and after allowance for the
depreciated value of assets unsold to liquidate existing
engagements, amount in London in round numbers to
£1,706,000 ; in Canada to £350,000 ; to which must be
added, in order to place the road and rolling stock in effi-
cient condition, £500,000, making a total of £2,556,000.
When the London directors were convinced of the impossi-
bility of obtaining in England, on any terms, the necessary
funds for working the line with efficiency, economy, and
success, they immediately called the attention of their col-
leagues in Canada to the necessity of applying any surplus
receipts of traffic beyond working expenses in the mode
specified by the Acts of the Canadian Parliament. The
Canadian direction took, as was its duty, legal advice as to
the proper application of such traffic receipts ; and in con-
formity with legal authority in Canada, which, however, is
at variance with high legal opinions in England, employed
the surplus, beyond what is considered in this country as
strictly " working expenses," in meeting pressing claims
for past expenditure in rolling stock, fuel, and stores, the
settlement of which claims was deemed necessary to pre-
vent the stoppage of the road. There has not been a suffi-
cient surplus of income over working expenses (in which
all legal authorities both in England and Canada unite to
class the rents of existing leases), during this current half-
year, to meet the payment of the interest due on the Ist of
January, 1861, on the first preference bonds ; and the
absence of all remittances from Canada for this or for any
other object forces upon the directors the painful necessity
of leaving the interest due on the Ist of January in abey-
ance, pending the existing financial struggles of the com-
pany. All these facts combine to press upon all interested
in the existence of the Grand Trunk road, whether in
Canada or England, the urgent necessity of presiding
promptly the means of preserving the undertaking from the
ruinous confusion which must arise from the want of
money and of credit, and from the conflict of
various claims and protracted litigation ; and for that
purpose, as the shareholders aro aware, the Cana-
dian Board of Directors memorialised last summer, the
Government to take the present condition of the com-
pany into its early consideration, for the purpose of
devising some plan by which the interests of all concerned,
whether in England or Canada, might be protected from
destruction. The Directors in London deem it to be their
duty on this occasion to refer to that memorial, on account
of the misconception of a portion of the Canadian press of
the motives which dictated that address to the Government.
It would be as absurd as false to pretend that the directors
wero not guided in that step by the wish to save the capi-
tal invested in England in the undertaking from total loss;
but it is equally incorrect to suppose that they wished to
impose any additional burden upon the people of Canada.
The directors have as little the desire, as the right, to dic-
tate or suggest any particular measure to the Canadian
Legislature; but they believe that the relief prayed for, to
restore the credit of this company, might be afforded with-
out any increase of the taxation of the Canadian people
or any permanent addition to the debt of the province.
the directors weeitld most willingly have avoided, if pos-
sible, any further appeal for legislative interference, and
for that purpose would have recommended the shareholders
to submit even to onerous conditions, had there beenmeans
of raising the money required from the resources or credit
of the company; but all efforts for that object having been
exhausted in vain they venture to ask the Canadian people
calmly to consider whether their interests are not so far
identified with those of the company as to desire the
continued.. operation of the road and its further
development to meet the growing wants of the
province, or whether it is preferable—by the re-
fusal of all further assistance to re-establish the credit
of the company, which may cost the province nothing, but
which may add incalculably to its further wealth and pros•
perity—to leave this undertaking in a state of doubtful
existence, and of most limited efficiency, and, by its sad
failure, to check the influx of British capital into the pro-
vince for future public works, and for the further develop-
ment of its future resources. It is unnecessary to pause
for a moment to explain that a direction, overwhelmed by
an enormous floating debt, and met at every moment by
discredit and litigation, cannot, economically or efficiently,
deal either with the local wants of the province, or secure
for it that transit trade with the Western States which has
always proved a source of increasing gain to the mercantile,
producing, and labouring population of the countries
through which it passes. The directors, therefore, concur
is the opinion recently expressed in the report of the Lon-
don Committee of Bondholders, that the obviously prudent
course is to await the calm decision of the Canadian people
through their Legislature, after the result of the provin-
cial commission of inquiry, and afterwards to appoint an
English commission of investigation into the managerhent
in Canada and the future prospects of the company. In
the meantime they venture to suggest the propriety of
united action on the part of all classes of bondholders
and shareholders, and the abstinence from legal proceed-
ings, which they fear might injure all, to the permanent
benefit of none ; and for that purpose recommend the
appointment of a select committee to confer with the direc-
tors as to their choice of the commissioners to be here-
after nominated for the inquiry in Canada, and also to
obtain preliminary information from the officials who are
at present in England, and are able to furnish such infor-
m

cation as to the details and mode of keeping tho accounts

in Canada.

Mr. T. E. BLACKWELL, vice-president, in his report to
the London directors of the Grand Trunk Company, states
that the line is in excellent working order, the permanent
way as well as all the great works being in good condition.
With respect to the traffic, his belief in the realisation of
previous estimates is undiminished. At present the com-
pany's supply of rolling stock and extent of terminal accom-
modation and sidings are altogether inadequate, and would
require a further expenditure of from £400,000 to £500,000.
He also states that the traffic, which had for some weeks
since the last harvest risen to an average weekly return of
upwards of £16,000, has boon unfavourably affected by the
general financial collapse in credit in the United
States, and which has operated alike on the
traffic and on the value of the securities of all the
American railways connecting the Atlantic with the West.
A Parliamentary committee having pronounced against the
agreements entered into with the Great Western Railway
of Canada and the steamboats, and legal authorities having
declared both of them in their existing form to be illegal,
it is obviously the duty of the company to have these ques-
tions decided at the earliest moment. He states that
the " through " traffic falls short of the estimates
which were prominently sot forth in the original
prespectus on account of the inefficiency of the
means and accommodation, and the want of that confi-
dence in the conduct of the business which a complete
equipment of the railway would inspire. At the same time
it was necessary and only fair that cities and districts and
local and personal interests benefitted by the railway should
unite with the company in providing for the conduct of
their own business. Recent efforts of this nature had been
made by some of the municipalities and private individuals,
which could not fail shortly to prove of much real advan-
tage to the company and themselves. With respect to the
working expenses generally, the best energies of every one
have been exerted to promote economy, but the want of
proper accommodation and facilities have prevented the
carrying into effect the savings and arrangements he had
calculated upon. The last winter's experience showed that
the expenditure necessary for the renewal of the rails had
been under-estimated. The total receipts for traffic on the
line during the eight weeks ending the 24th November last
amounted to £133,319, and the expenditure to £95,325,
leaving £37,994. Tho receipts for the eight weeks averaged
£l7 3s. 7d. per mile per week, the expenses £l2 ss. Bd., and
the net revenue £4 17s. 11d, per mile per week.