The New York herald., 1871-05-17
THE ERIE RAILWAY WAR.
The Battle Still Going On, but the Fire Some.
what Weaker Than Usual.

The reference In regard to 60.054 shares OF Erie
stock claimed by Heath and Raphael, the English
shareholders, to be their property resumed yes
teIday before Mr.. Kenneth G. White, the Master.
Mr. Southmayd appeared as counsel for Heath and
Raphael, and Mr.. Lane, Mr.. Morgan'an and Mr.. Beach
for the Erie Company.
JAY GOULD AGAIN ON THE STAND.
Mr.. Jay Gould was further examined by Mr.. South.
mayd:-
Q. How long time elapsed between the making
out OF the convertible bond for $lO00,0 600 and the
conversion O: the same into stocks A. The same
day; became the owner OF the bond; bought 1t
from the company at the market price Of the stock
into which 1t was to be converted, the same the
other bond for $4,000 PAID $4,000 and $780, 900
on account OF IL in January.
@. What had you paid on account OF 1t before 1t
was converted into stock2 A. Ny recollection is
that paid something on account OF the bond, but
1t Is not entered In the book; think paid s0me-
thing on the 18th. but there ia nothing entered until
the 14th OF January there was nothing paid on tho
bond until 1t was actually bond, so think; was
advancing money from day to day to the company,
and took these bonds In part payment for my ad.
vances; had become owner Of this bond under
bargain with Fisk and Lane; was authorized by
the resolution Of the board to sell the stock.
Q. But not to yourselfs A. The bargain was that
i
there was an excess should return 1t to the COM
pany.
Q. How much money did you pay for that bond
before the 18th day Of january A. At three differ
ent dates-S6O.00O 100000, $780, 0O0-and the 7th
OF February $2,963; II 1 wanted to know what the
company owed me would strike balance; there
company; paid to the company on account OF this
bond, aIter 1t was cancelled and converted into
stock, the sum allowed as the price Of the bono
ST. 0OO 600 and one for 00O Ooo-made for the pur
pose OF being converted into stock with the intent
A. Yes. They were not made with the intent OF be-
ing kept alive as bonds took the stock certificates
them; gave them to Mr.. Willard, ana delivered
them TO him as so much stock; i've thousand OF
these shares were put 10 the name 81 william Heath
Il Co.; 1t Is usual thing with brokers; the
certificates were In their name, and there was .
blank power Of attorney on the back Of the certid-
Martin 4 Beach, and William Heath & Co. had cer-
tilcates in their names they were acting for me
Stock was Issued but the narrow guage proposed in
connection therewith, was never carried out;
should d think half Of the 1000 snasss
the TACT OF the Of this bond Tor 900 and
the oond for $2,ooo,ooo was communicated to the
informally to the meeting Of the board previous to
the board meeting Of the 18th Of April; the proper
Southmayd) called attention to the fact that they
were without proper stamps.
a.
a statement Of the transfers made OF the 10000
shares OF the stock IN question: Out Of the 11,600
shares issued to Willard, Martin 4 Beach $500
shares were transferred to other parties. Witness
mentioned the names OF other persons In whose
names the stock still appeared, by the books Of the
company, to be standing.
MI. Justin d. White, assistant treasurer Of the
Erie Company, deposed that there was loan re-
ccived by The Erie Railway Company from Willard.
Martin Beach Of $60,000 on the 17ih OF December
sent them down the continued notes and bonds OF
the Narrayansett Steam Company and Jefferson
Railroad bonds collateral security; cannot tell
when these securities were returned, but tie cash
book shows It was on the l4ih Of January, ISL Mr.
Gould's statement that the return was made
on the 2sth or December previously, must
be q mistake as far as l know the
sum OF 100000 received from willard, Martin Il
Beach in December, and the various other sums re-
ceived during that ana the ensuing months, were
considered as current loan, and was unaware that
they had any relation with convertible bonds; mo-
neys received from Mr.. Gould during that period
were not entered as advances on convertible bonds,
ana no person in my department knew anything re-
gard;ng them.
The inquiry at this stage was adjourned to Thurs.
day, the 25th at one o clock. The poiat s0dght to
he brought out by the examination OF MIR. Gould
yesterday was that the issue OF the convertible
bonds In question was wholly and cntIrey illegal.