Worcester daily spy. [volume] (Worcester [Mass.]) 1850-1888, 1859-02-22

does not seem as If the requirements OF tne
law could be satisfied with any evidence, which
did not show actual cash payments by bona
tide, solvent subscribers. An arrangement
with contractors, by which they are to be, and
are credited with an installment Of given
number of shares of capital stock, in consid-
Grafton of work done and to be done, hardly
seems to me, as at present advised, to constl-
tute such payment as will satisfy the law"
He then continued, "Mr. Chairman. ven
ture to say that when the Secretary of the
Troy and Greenfield Railroad Company certi-
ies to clean stock list of "more than 5000
shares" on which twenty per cent. or more
has been paid in cash, on each and every
share, by bonqfde, solvent subscribers" he in
cludes very large number of shares, known as
"Contractors' stock" which they really receive
in part payment for work on the road and tun-
mel: and l would like to ask the Contractor,
here present, whether the twenty per cent as
sessment on his shares was paid in cash or
work 2"
Contractor-'I was paid in cash and re-
ceipt taken of the Company on account of the
assessments"
Mr.. H.-"Please say what became Of the
money 2"
Contractor-"It was paid back to us and a
receipt given for it on account of work done. "
Mr.. H.-"How long did the money remain
in the treasury of the company
Contractor-"Not very long"
Mr.. H-"Didi it remain there five minutes?''
Contractor-"R Rather more than that"
Mr.. H.-Would you have ventured to leave
the room while the money was on the table 90
Contractor-"I think 1 might have done
So"
The point made in the above dialogue has
not been sufficiently ventilated in discussing
the propriety of changing the loan act. The
Legislature, which passed that act, treated the
railroad company as a responsible corporation,
to whom it was proposed to loan money or
scrip, upon the security of work done, with
means derived from the pockets of its stock
holders To that end, it was made a funda-
mental condition, that private subscriptions OF
capital stock, to reasonable amount, should
be obtained, and that assessments should be,
from time to time, called for and paid. 1t be-
ing found impossible to comply with this re-
quirement, the company have attempted to
evade the law by letting out the work to con-
tractors, at ertrauagan prices, payable partly in
State scrip, but, largely in the stock of the
company, with the view to making up the
required 5000 shares. To render the decep-
ton more complete, the contractors were re-
quired to write their names on the stock lists,
thus leaving it to be inferred, that they were
bona tide and unconditional subscribers This
being hazardous operation for the contrac-
tors, special clause for their protection, was
inserted in the contract between them
and the company, under date of July 80, 1851,
as follows =
"But it is expressly understood and agreed,
that the assessments in said stock are to be
paid, by the performance of this contract, in
stock credits, according to the terms and pro-
visions herein contained for doing the work,
and that the said capital stock is to be receiv-
ed at par, by the parties of the first part, as
portion of the payments before mentioned"
If any one sincerely doubts whether the
contractors subscription is binding and should
be counted in making up the 5000 shares, let
him apply this test. "Would they have sub
scribed for 1897 shares of stock, if they had
not been contractors for the road and tunnel .
1t is useless to inquire where the fault lies,
in not having detected this sharp transaction,
before the first 100000 of scrip was paid out,
but surely the Legislature, in view of these
facts, is in duty bond to take such action as
will in future protect the treasury.