The daily exchange. [volume] (Baltimore, Md.) 1858-1861, 1860-07-24
THE EXTRA DIVIDEND QUESTION.

ihL EAIhA DIV lDEND QU ESTlON.
REPLY OF THE COUNSEL FOR THE CITY TO THE REsoLU-
TIoN OF THE SECOND BRANCH OF THE CITY COUNCIL.
The following is the reply of Grafton l.. Dula-
ney, Esq, of the counsel for the city of Bati-
more, to the following resolution:
Therefore, ReSolped 6y the Second Branch of the Gin
Council That the counsellors employed and engaged by
the Mayor and City Council of Baltimore in restraining
by injunction and otherwise the Baltimore and Ohio
Railroad Company from paying the extra dividend de-
cared by said Company and they are hereby required
to communicate to this Branch by what authority and
for what reasons they have withdrawn the nnnco3
against the aforesaid Railroad Company, and made
settlement thereof and what the conditions of said
settlement.
BALTIMORE, Goth July, 1860
To the Honorable, the President of the Second Branch
Of the City Council
SIR Il have just received copy of the pream-
BILE and resolutions of inquiry, addressed to Mr..
Meredith and myself counsel for the CITY in the
extra dividend cause against the Baltimore and
Ohio Railroad Company, and have also seen the
inquiries likewise addressed to us by your branch
OF the 18th instant, as to whether our opinions
touching the legality of the original resolution of
the Baltimore and Ohio Railroad Company, declar-
ing the extra dividend of 80 per cent, had under
gone any change? To this last mentioned inquiry
as have bad many conferences with him on the
subject, can reply for my absent colleague as well
as for myself, that our opinions have undergone no
change whatever, that we continue to think, as at
first, that the resolution in question is without any
legal validity, and in no instance have we expressed
a contrary opinion.
In regard to the inquiries put to US in the first
mentioned resolution, viz: "By what authority
"and for what they, the counsel have with
"drawn the injunction laid against the aforesaid
"Railroad Company, and made settlement thereof,
"and what were the conditions of said settlement?"
must answer for myself alone, as the absence
OF my colleague precludes the possibility of any
conference with him, and also prevented his par
ticipation in the later steps of the negotiation,
which Immediately preceded and led to the dis
missal of the injunction suit.
The authority, by the exertion of which the suit
against the Baltimore and Ohio Railroad COMPANY
was dismissed, is that properly belonging to coun-
sci IN their chara cter as such. The relationship
between client and counsel or attorney obliges the
latter to devote himself exclusively to the interests
and rishes OF the former in the matter entrusted
to his charge. In all that was attempted, and
in all that has been accomplished by the late ne
gotiation, these two objects were kept steadily in
view:
lst The corporation has received its one million
and fifty thousand dollars worth of certificates of
indebtedness, called.
I'd. 1t has received one hundred and eighty nine
thousand dollars one-hafin cash and the other half
in note payable 10Th September next, to be i'm
mediatey cashed, if desired
But this settlement of the controversy was made
not from any mere action of the counsel of them
selves, but from conviction, amounting to GER
tanty in their own minds, that it was earnestly
desired by both Branches of the City Council, and
indeed, by all Departments of the City Govern
ment. And proceed to state the grounds upon
which this conviction rests:
lst. BY unanimous vote of the Board of the
President and Directors of the Baltimore and Ohio
Railroad Company, including State and CITY as
well as private stockholder directors, it was de-
clared that they were in condition to make the di
vIdend provided for in the resolution for that pur-
pose.
I'd. A majority of the joint Committee of Wags
and Means, of four to two as the counsel were in
formed by the Chairman, were in favor of accent
he nft p,It
more and Ohio Railroad Company, not so favorable
to the city those secured by the settlement final
ly made.
Sd. The passage of the resolutions of the Fl rst
Branch, by majority of fifteen to three, as stated
by the Chairman of the same Committee, which
resolutions now lie upon the table of your Branch
to be acted upon, and which empower and direct
the counsel to settle the suit in question.
lfit be demanded why the adjustment of the
controversy was not postponed until the action of
your Branch should have been had upon the above
resolutions, reply that the Chairman of the Com
mlttee before referred to informed us that there
was no quorum of the Second Branch on the even
ing on which the above resolutions were passed,
but that he knew that there was in that Branch
decided majority for terminating the long-pending
controversy with the Railroad Company. and
urging us to act in anticipation of the vote that
would entirely approve it when DONE
We therefore had not the least doubt but that
the Second Branch desired the final settlement of
the suit, and the obtention of the money which
would follow its result.
This, however, standing alone, would not have
justified our action without the formal concurrence
OF your honorable body in the resolutions of the
FIRST Branch. But there was another consdera-
tion which, after much hesitation, proved decisive
In Its influence upon our conduct. We knew that
there was an opposition to the entire scheme of
the dividend and any settlement of it by arrange
ment. We knew that the persons engaged in the
application had the power if time permitted it, to
prevent it, and perhaps to protract the litigation
TOR hve years to comes and the counsel on behalf of
the city, the State and the Company were equally
apprehensive of the imminent danger of DELAY.
Under these circumstances, and to carry out what
| believed to be your wishes, and from no want of
respect for your honorable body, but on the CON
trary to promote the views, as / believed, of the
entire corporation, did not wait for the formal
action OF your body, lest in the meantime all our
plans should be frustrated, of which, TO the last,
there was great danger. felt that if, with the evil
dence before me, and the repeated assertions of an
official person having opportunities of knowledge,
that there was decided majority in your Branch
In favor of the terms proposed by the railroad COM