New-York tribune., 1873-05-17
THE REPORT.


The following is the preamble and resolu-
tons authorizing the raising Of the committee and under
which it acted:
Whereas II s well known that large majority Of tne
stock now outstanding ganst the Erie Railway COM
pany was. by corrupt cOIlusiOn OF us oncer Tdulu
enty issued and that there never was 20 per cent on
the par value OF such stock paid into lts treasury nor
expended by ii on ts property Tor me puDhe "eHs'e'
owing to such corrupt action or It's ofneersi ,,,.
Whereas The original purchasers OF said stock did not
pay than the above named amount Ior tne Sale'
thereby duplicating themselves Win those "no per-
petrated the fraud and
YHereas 1t mas been made public that the board OF
directors OF that company have declared dividend on
the entire OF stock outstanding against H. W9lch
dividend is limited only N consequence % the earnings
OF It's road. aud not ID consideration Oh INC maunef Al
which such stock was issued and
WhereaS The practical effect OF allowing dividends 10
be paid such stock would be to recognize and encour
age fraud, parayZe the Industries OF an nnOeenS
people living tributary the line OF the road that Com
te FOR s use 20 levy unjust and oppressive burdens
on the commerce OF the City OF YORK, on whose
depends increase the cost or living oy increasing tue
cost Ortransportng the necessares OF lie between pro
Gus gamblers and spectators, as against gO0d hOrs'
the welfare OF the people. and public policy; aud,
in the pubic prints and elsewhere tnat large and n-
proper expenditure OF money was made by Tue foreign
Stockholders and the officers or the E.le Kali
way Company in the transfer Of the man.
agement OF tnat company IN the year 1879 anu
bonds the agents OF saId foreign stockholders have
since been indirectly reimbursed out OF the treasury OF
sad company; and that a large sum used 10 innd-
ence Legislation connected with said road In the same
year and that other gross irregularities on the part OF
said road and its managers had Oeen cOmmltted Now
Resided That the Attorney General Of this State be
and Is hereby directed report " this House. within %
DAYS whether in his opinion the dividend so declared
upon the aforesaid rauduenty issued stock OF said
e6mpany can be legally paid out OF It's treasury, and
whether the said Erie Railway Company may not be- re-
strained by the courts tr0n paying sau dylgehu' OF OF
any other dividend, upon any STOCK thus HauduieA'J
ReSoirsd That Select Committee OF fye 20 be ap
nfpfad hyr he .iu
nt ana no report thereon 70 this House within 20
ays ana SAID Committee be authorized % send for
persons and papers
On the 9th day Of April the time FOR the investigation
was extended till the 25d OF the same month.
RESULTS OF THE INVESTIGATION.
Your committee appointed hereinbefore set forth,
would respectfully report that under the authority and
power delegated 10 hem they proceeded at once 70 the
discharge OF the duty imposed Evidence, covering
several hundred pages OF closely printed matter
been taKen commencing Ia the frsJ in this city
and continuing nc intervals here and IN New York. From
the rst the committee have realized that the inquiry
delegated 20 them one Of magnitude, requiring a
patient hearing. and consequently the consun-
ing OF much tme and necessarily involving
vast amount OF labor To commence II IL necessary u
state that the subject matter embodied the nrst two
preambes and the first resolution has not, % any
tent engaged the attention OF the committee only IN
collateral manner the question OF legality having been
referred the Attorney General for his opinion. and
the same having become, in a measure, foreign she
inquiry owing 10 the action had and the situation Of
affairs at and before the formal commencement Of
their labOrs by the committee, the dlNi1end ~
dividends having been declared and paid prior
TO the time that the committee began its formal
work The restriction in the resolution, limiting the
time for the investigation, We believe 70 have been
mistaken one. Very good reasons must have been sus
gested 10 all who have followed the run OF the evidence
as brought during the progress Of the investigation
II your Committee could have been allowed wider
latitude as 70 time they feel confident that upon some
points the inquiry could have been made more complete
and as consequence its conclusion satisfactory.
Two witnesses, whose testimony was beloved 70
be vital upon the question OF bribery and
corruption pertaining 70 legislative matters, were
thus advertised as 20 the time necessary 10 absent
themselves FROM the State This also, mad particular
bearing upon the subject Of the recent dividend declared
by the Erie Railway Company In order that positive
and correct conclusions should be arrived at, and
Injustice be done % any one. 1t requisite that
much more exhaustive examination Of the books aud
accounts OF the Company be made, and which il was
simply impossible TO DO in the time allowed. However,
all has been accomplished that the committee
could reasonably expect in the time al
lotted. 1t seeming probable that at this
late stage OF the session. the House might unwilling
to grant further extension OF time they dd not feel
Justified in undertaking particular examination
OF the books aud accounts. Under the foregoing e1'
PLANTATION, the following subjects were left as Indicated
by the preamble and resolutions for inquiry and seton
on the part OF the Committee:
l. Whether the dividend declared upon the STOCK OF
the Company outstanding against IL in February, lsI3
was paid our OF the net earnings OF the roadt
II. AS to improper expenditure OF money by foreign
stockholders or officers Of the Company TO effect the
transfer Of the MANAGEMENT March, 1871 aud as 20
the fact Of corrupt contract in the negotiation Of ts
bonds or reimbursement out Of the treasury Of the Com
pany for or on that account or other accounts.
Ill As 10 payment OF money 70 influence legislation
connected with said Company other irregularities.
CONCERNING THE DIVIDEND OF FEBRyARY
In February last the Board Of Directors the Erie
Railway Company declared dividend OF 81 per cent on
the preferred and per cent upon tho common stock
sam tho earnings Of the previous SIX months on tho
nraferra and or the year the stock OF the
comp.ny Tue amount 6f the former was s2ss.TsI S.
and the latter H.9Ss,OOo. making = total OF
te6s7U IS. 1t Is In evidence that the sross
earnings Of the company for the year sra
we're SOS o, that the expenses including repara-
ton OF railway, sl2sis,S4S 0T Isee exhba No l6
pages ol7 and sis. leaving net earnings Iss2s2 ~
Out of this sum tOS7,0 $50 81 allowed for rentals.
interest, etc. and dividends for the year amounting
uOc2Ss3 TO- as before stated also taken. leaving
snl surplas Of n2ss4s 81. tsse e1h,bis No. IL.
page 22s, IL claimed by Mr. Watson. tho
President Of tho Company, and other osAeers u