The Evansville daily journal. [volume] (Evansville, Ia. [i.e. Ind.]) 1848-1862, 1857-03-04
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WEDNESDAY MoRNING::::::::::M ::::::MARCH 4
IFor the Jonrnal.l
An Expose.
IContinued from yesterdays Journal !

10 OLIVER II. SMITH, ESQ. President Of the T.
d e. S. L. Railroad Company.
Permit me now to point out the errors in
this statement ofsthe contract:
lSt. You state that this contract is for
building Of the road" for $4,000 per mile;
but the contract gives $4,000 per mile, for
not merely every mile Of the road, but also
for every mile Of side track, turn-outs and
switches which they may lay down, which at
the lowest calculation will be six miles: but
on first class road, with much business,
would need to be much more. One Indiana
road, less than half the length of yours, has
ten miles of siding.
ID. You state the contractors are to furnish
sample passenger and freight buildings, ma
''chine shops, engine houses, and other neces-
'sary buildings for the road, at Evansville, In.
''dlanapolis, the Crossings Of three railroads,
sand at every ten miles of the line" Now
the cost of all these buildings is specified, and
amounts, for the whole road, to SAT 900 at
most. Forty thousand dollars to fur
nish ''ample accommodations" OF this descrp-
ton, to first class railroad one hundred and
tifty-five miles long, and which, fully equipped
otherwise, is to cost near or quite S6,0O0,000.
Sir, railroad men will hardly see how you
could be serious in making this statement.
And you close by saying, that the whole
road is required to he completed by the
month of December, 1857. This statement
is made bv you Internationally; but the con-
tract is subject to two conditions, which are
now, and were when it was made, utterly i'm
possible, in any state Of the money and bond
market, which Indiana Railroads ever saw
1t must be observed that this road, re-
ported in your exhibit Of March 1st, 1854, az
al located, and about one hundred and fifty
miles long, is in this your report of May 10th,
1855, stated as not exceeding one hundred
and fifty-fve miles long. That your contract
gives Carpenter & Co. $4,000 mile, for all
siding turn-outs and switches" &c, as well
as for the main track; that six miles OF siding,
&C., is as little as can be we'll received; though
a first class road in full operation, doing much
business would need much more; six miles Of
siding, added to one hundred and fifty-fve
main track, will make one hundred and sixty
one miles, which at $4,000 a mile, gives a
sum to be paid to Carpenter & Co. of S4S30,-
GOO. Now. $4,000 mile of this amount, or
the round sum Of S24l5O 600, you bind the
company to pay in real estate and bonds, ,includ-
ing our city bonds. You had, at the date Of
this contract, all told, as have shown from
your own figures. real estate subscription of
only Sa50,OOO, which, with the city bonds, of
Evansville and Lamasco Of $250OO0, make
100000. You therefore bind the road to get
further real estate subscriptions. 'at cash
value,n TO the amount of 81, 7l5,0O0, or nearly
four times much you had yet succeeded
in raising; and the contract provides that un-
til this is done. Carpenter & Co. are not bound
to finish the road. Sir, | pronounce that
provision, now and then. utterly impossible to
l. II -.sI Il
will prove it. il time has not already done that
Office for me. Then sir, another $l0OOOa
mile for this one hundred and sixty -one miles
is bound to be paid to Carpenter & Co., in the
first mortgage bonds Of the road. / am not
going to deny the possibility of that. But
you then bind the company to keep all this
81 $50 600 bonds at market price in cash, of
not less than 75 cents to the dollar, or, ac-
cording to the provision, the contractors 'hav-
ing received" the bonds, if they shall be un-
able to fulfil their part of the contract in con-
sequence Of the tightness of the money market
preventing them from selling the bonds at not
less than 15 cents to the dollar par; having
used diligence to negotiate them. they are not
to be held liable for any damage for mot com.
pleting the road.
Now | pronounce this provision to keep
such securities up to seventyfive cents, in de-
fault of which, the contractors might stop at
pleasure; the value OF railroad bonds being
entirely dependent on the certainty Of tine
completion of the whole line an utter impos-
sibiiity, both now and then, and SO long as
that contract shall be uncancelled. But if in
the nature Of things and the condition of the
money and bond market, either Of these two
provsos had, at the making Of the contract
been possible, you went on to insert-evi-
denty for the eye Of the board and the ear of
the stockholders provision which made
both Of the others, not merely impossible, but
simply ridiculous. And that provision was
that Carpenter G. Co.. should be paid this
thirty thousand dollars, twenty five Thousand
dollars, in the bonds already de crbed, and
five thousand dollars in stock in the road, or
that they should be paid twenty thousand
at the option of the board; and the board
was to decide in which kind of payment it
should be made when it ratified the contract.
Let it be remembered that the deprecating of
your own scurties was all done in the face OF
an eaey money and bond market, and before
that terrible dip which all stocks and bonds
took in the winter Of l85i-5, to which your
SELF Willard Carpenter & Co, have ever since
attributed your want OF success.
| And it came to pass, that before the
eleventh day Of May 1854, in the face of an
easy money and bond market-your board not
being together-yourself the President, and
Willard Carpenter, the Vice President, sat as
board Of appraisement upon the securities,
made ard to be made, of this road, and ap-
praised them to Carpenter & Co. in the
manner above shown, at 6625 cents, on the
dollar: or three dollars in stock and bonds to
two collars in cash; and at the same time,
provided they should not be sold for less than
IS cents on the dollar by Carpenter & Co,
and that whenever they should not sell for the
latter figure, the progress and completion OF
the road, should be indefinitely postponed.-
And that on the 18th Of the same month of
j May 1854 your board uf Directors, relying