The Liverpool Standard and General Commercial Advertiser.
Liverpool, Merseyside, England, 1846-08-25 00:00:00

EDINBURGH AND GLASGOW RAILWAY.

THE DIRECTORS AND THE SHAREHOLDERS.
(From Me Scottish Railway Gazette.)
THERE has been for some time, amongst a large
and influential body of the Shareholders of the Edinburgh
and Glasgow Railway, Company, a growin- feeling of disatisfac-
tion with the conduct and policy pursued by the present Direc-
tors, which has at length burst forth into open reprobation of
their proceedings and arrangements. We must honestly con-
fess that we do not wonder at this result. The Directors—or at
all events a decided majority of them—appear to have hitherto
proceeded as if they had no common interest with their con-
stituency. They have not hesitated to attempt what the latter
regard as the almost total sacrifice of their property—not only
without consulting them, but in tht,teeth of their most deter-
mined reclamations. This has been their general course : in-
dividual directors have acted t less unworthily. One gen-
tleman in the direction, a very small shareholder, openly
appeared at a public ing and avowed objects diametrically
opposed to the pecunfiry interests of the Company. It is im-
possible, of course ito repose confidence in a body constituted
of such materialit. Besides, it is felt that the line has never
been properly managed; that, after many years' struggling, it
has been made to yield a dividend of only X 6 per cent., instead
of at least £8 if not per cent., being undoubtedly one of
the best undertakings in the country, if its natural resources
were fully developed and called into play. They have allowed
rivals and competitors to start up on every side; and when the
ground was thus pre-occupied, they have come forward to con-
test it at an enormous expense, and, instead of proposing terms
at the most seasonable moment, have de;ayed arrangements
till the enemy was at their gates and upon them. They have
not sought to improve their own line, by multiplying short
branches and local feeders, of which it stands so much in need,
and which would prove infinitely: productive—all which, too,
would have been within their immediate control and command
—but, indulging in a wide monopolising and speculative spirit,
they have played with the property of the Shareholders to such
an extent, that they hardly knew the amount of their liabilities
when the current session of parliament opened. And, so far
as the public is concerned, it cannot be concealed that they
have brought the company into general odium, by a system of
narrow, short-sighted, injurious, and expensive parsimony,
which has led to more evil and mischiefs than they are ever
likely to counteract or redeem. In saying. these things, we do
not express our own individual opinions simply, but rather re-
echo the universal sentiments of the Shareholders, whose mag-
nificent property they have trifled with—we shall not say with
any bad or corrupt intention, but certainly with a degree of
judicial blindness unparalleled in the history of railway man-
agement.

For some years we were led to suppose, by the silence of the
shareholders, that they fully approved of the system pursued by
the directors; and, of course, so long as they remained
quiescent, no other party had a right to interfere on their be-
half. About twelve months ago, however, we were led to per-
ceive that they were neither ignorant nor unobservant of the
conduct of the directors, and its injurious effects,—" a change
had come o'er the spirit of their dream," and a deputation of
the English shareholders arrived in Scotland with the express
object of enforcinr, a thorough change of the system and. the
personnel of the direction. That deputation went over the
whole details of the concern, and they were fully satisfied that
nothing but "a clean sweep" would restore matters to a
healthy state. They were induced, however, from the pacific
and repentant spirit displayed by the direct Ors, to anticipate
that some slight change would be sufficient in the meantime ;
and, accordingly, they merely insisted on three English gentle.
men being adopted into the direction. Last spring this change
was made, but it seems to have brought no improvement,—at
least the shareholders conceive that since that period they have
had still more reason to complain of and condemn the system
which has been pursued—and the total disregard of their rights
and interests as proprietors of the railway.
The principal charge against the directors brought by the
shareholders—all others being naturally looked upon as quite
secondary—relates to their attempt to complete an amlgama-
tion of the railway with the Forth and Clyde and Union Canals
on equal terms. We need scarcely go over the history of the
contest between the railway and canals ;—it is enough to state
that, after vainly endeavouring to protract the war of compe-
tition, the canal proprietors found their property scarcely
worth preserving—the Forth and Clyde yielding about
four per cent., and the Union nil. All this time the
returns of the railway were rapidly rising, particularly from
the passenger traffic. Indeed, it is one of the proofs of their
imbecile management of the railway that the directors did not
long ago succeed in keeping down the canals, either by ami-
cable arrangements, or by properly .:onducted competition.
But, be this as it may, it turns out that just when the prospects
of the canals were at their very lowest, the directors of the
railway suddenly receive tbem with open arms—taking them
into partnership, not on equal terms simply, but actually con-
verting the capital of the canals, paying £4 per cent (rapidly.
tumbling down) into capital of the railway, paying 6 per
cent.—and likely to pay 47 per cent., (even under gross mis-
management)—thus literally presenting to the Canal Compa-
nies abonits of £5O per cent. for allowing their property to be
preserved, instead of being destroyed altogether ;—a result
which the natural progress of the railway would have brought
about in no long time. The canals, too, were to participate in
all new shares issued by the railway company ; and here a
great injustice—something like robbery—was attempted on
the holders of the half-shares, by reducing them to £lO shares,
although bought and sold in the market at premium. On
this point there can be but one opinion ; and it is truly matter
of astonishment to us that such an attempt, involving a breach
of contract, should have ever been dreamt of by men in their
senses. These various arrangements, we are assured by the
Manchester and Liverpool shareholders, were adopted at a
meeting without due intimation—proxies for which were sur-
reptitiously obtained by the directors. Of this latter allegation
we can say nothing; we cannot allow ourselves to give it any
credit, however distinctly asserted ; for we believe the direc-
tors to be perfectly honourable men, and we have no desire to
prejudice them in the estimation of the public. But this mat-
ter must assuredly be explained ; and till the opportunity of
doing so occurs, we shall content ourselves with merely allud-
ing to this grave accusation.
Now, although there can be hardly any doubt that the amal-
gamation with the canals was altogether inequitable as regards
the railway, it must be remembered, in justice to the directqrs,
we are boluid from our impartial position, to statethe fact—that
the terms ere dictated by certain arbitrators chosen by the res-
pective partiei, and thus far a part of the responsibility is shifted
to the shoulders of the latter. But it is fairly considered that
the directors had the power, which they must and ought to have
exercised, to declare on what principles the reference should
proceed; and really, therefore, the blame of its injustice must
equally fall upon them as if they had arranged the details.
This question, however, does not affect the interest at stake—
the plain fact being that, however brought about, an arrange-
ment was entered into by which the railway proprietors were
to be deprived of a great portion of the property which their
capital and enterprise had acquired for them, after years of
hazard, anxiety, and labour.
The directors, however, might have even now been enabled
to satisfy the shareholders to some extent. The amalgamation
having been defeated by the efforts of the shareholders, the di-
rectors might have honourably abandoned the attempt to carry
the obnoxious scheme, seeing that they were not supported by
their constituents. But it appears they still insist on carrying
it into effect in the face of the determined opposition of the
shareholders. Such conduct certainly is indefensible ; and we
are not surprised that it should be resented by the shareholders
as a measure fatally inimical to their interests. The latter have
held several meetings in .Liverpool anti Manchester, and they
seem resolved to take effectual means to prevent the alienation
of their property, and to place it upon a better footing for the
future. In our present number will be found a lengthened re-
port of one of these meetings, the proceedings at which, we un-
derstand, virtually represent the views and wishes of at least
four-fifths of the proprietary. The questions at issue
will be decided at the meeting about to be held in Glasgow ;
and we need not, therefore, recommend the subject to the im-
mediate and earnest consideration of all the shareholders.

The conduct of the Edinburgh and Glasgow Directors
towards the Caledonian by all contiguous Lines is forcibly
stated in the following memorandum, which we have received
from authority.
The Scottish Central and Caledonian Railway Companies
were formed, and issued their prospectuses, in the spring of
1844, nearly simultaneously; and the Edinburgh and Glasgow
Board of Directors commenced the most inveterate hostility
and opposition to both from the very announcement of the
prokcts. _

" The projectors of the Caledonian, however, previous to the
issuing of their prospectus, made a direct offer to the Edin-
burgh and Glasgow Board to strike off from their scheme their
Edinburgh Branch, and to rest satisfied with taking the Cale-
donian traffic direct north on to the Edinburgh and Glasgow
Line at, or near, Castle Cary; so that all traffic of the Caledo-
nian from, or to. Edinburgh and Glasgow, would have to pass
along the Edinburgh and Glasgow Railway for a distance of
about twenty miles. Both parties were then in London, and
this intimation was conveyed to the Edinburgh and Glasgow
Board by Mr. Theodore Ratbbone, of Liverpool, then a Direc-
tor of that Company, but the offer was indignantly rejected by
them, though the only stipulation was a withdrawal of oppo-
sition.

Both the Scottish Central and the Caledonian Companies
went to Parliament in 1845, and obtained their bills in spite of
the most protracted and costly opposition by the Edinburgh
and Glasgow Board before both Houses of Parliament.
In the summer of 1845 the Caledonian Company applied to
the Edinburgh and Glasgow Board, without success, to be al-
lowed to connect their Line near its entrance into idinburgh
by a short Branch, so as to enable their traffic to pass down
the Extension of the Edinburgh and Glasgow Line, through
the Princes-street Gardens, to the terminus of the Leith and
Granton Railway.; and to be allowed rates, somewhat less than
their six-mile clause, for that distance. The Caledonian Com-
pany, failing in this, projected their Independent Branch to
Granton. .

The Edinburgh and Glasgow Directors, during the summer
of 1845, held the argument that theirs was an Last and West
traffic, and should not be interfered with by any other Com-
pany. In this the Caledonian Company acquiesced, stipulating
for the same terms for their traffic from the North and. South;
but the former soon became aggressors, and seduced from
their connexion with the Caledonian Company, by the offer of
hsenighttgiauharcannattereasl ,t Wishaw ana Coultness Company and the
Lines, and necessary Company,tnabnodt h
embracedof which
in, are Norththe and SouthCaledonian
scheme as sanctioned by Parliament ; however none of those
ruinous guarantees of the Edinburgh and Glasgow Board have
been sanctioned by Parliament, and they can yet be prevented
by the Shareholders.
The avowed wish of the Caledonian Company has always
been to maintain " Peace with other companies, and mutual
co-operation upon fair principles," but they have met, at every
step, with opposition from the Edinburgh and Glasgow Board,
and that of the Glasgow and Ayr Company, which (having the
same Agents) is in constant alliance with them. Most of the
new schemes of the Caledonian have been forced upon them in
self-protection, whilst all the expensive opposition they have
met with during this and last session of Parliament is clearly
to be attributed to the fruitless efforts of. those two Boards of
Direction, who have boasted that they would break the back
of the Caledonian, and compel them to sell their rails for old
iron.
It is to be feared that the exact same conduct will continue,
to be pursued unless some very energetic measures are taken
by the Shareholders of the Edinburgh and Glasgow Company ;
and there is no reason why that Company and the Caledonian
shofild not be on the best of terms, if not more closely con.
nectedo