New-York tribune., 1874-07-10
THE ERIE LITIGATION.
r11r nrrrNSE PRESENTED.

In the case of John c. Angel against the
Erie Railway Company and Others argued before the
ATTORNEY. General Albany on wednesday, aihdaVits
IN replv 10 the charges OF exAudor Dunan were read
nv cxJndee sbipman from President p II. Watson, 5.
l. NJ Barlow s L. Dodds, Lucipe Robinson, and Messrs.
LITTLE and Housen the examiners selected from the
The Northern Central and the OswegO Midland rail
roads The following is the affidavit of President Wat
con:
Peter II. Watson Of the City of New York being duly
Eworn That hc Is, and for nearly two years aSt
past has been, the President OF the Erie Railway Son
Pany that he mas read the aIdayt M 20 20 hecY
the second day OF july, 1874 Deiore HeoIkc
bond Gonch Notary Public, and knows the contents
the Ere Railway Company from OctoOrl ls'2 uu ~,
the early part OF March 1874, when siuul'l,"9i Nh
hs ceasing 10 be the Auditor, II was discovered Iia'
he had been FOR a long time heretofore g ehgdSVu,
as depOncnt believes, In fraudulent conspiracy
With intent TO break down the credit OF the
Companv and 10 miSrcpresent lts o1hoo1 Su undrp
state of accounts, which had been tnerstoUIc
his charec That some time before any kn0Wedsc OF
lr5e road as deponent believes the said Dunan had
rendered purpOted 10 be copies OF accounts ana
cons m ;he CITY OF NewlOrk, who were with him as
depOneut believes, engaged IN gigantic STOCK speGu-
iion, having sold large quantities OF ERE stoch WEn
they dd not possess with the intention 10y the circ9a
of the iaise and uui0undGd fuiaos a.UIvSHiu 20 20
arpress the mar price OF said stock ana thetey 70
reap large profits to the injury Of al oi the stocKAou
T6a deponent at this time was ENGLAND. hut that
Immediately upon lis return IN the month NJ Ap idsl'
dcpOneut placed all the books Of the sald COMPANY ~
the hands stephen Little, esq Auditor OF tnf North
,tn @ srt"ry ~. o. and GWiitoT OF the New-Y1rk and
Oswego Midland Railroad Company, with instructions
to them To carefully examine all the accounts thereto
lore t@pt nv The sid Dunan ana especially to examine
5 r"rt ~ mon The various matters which had formed
tie subject Of complaint made by Duhah lIroHel LIS
pretended exposures IN the daiy newspapers 1l New
Tork. being Substantially the same charges tnat are
again repeated IN his affidavit above referred 20, anu
That saO Little ana houston nave ueel , III wy
performance OF the aforesaid duty uutll thc present
nmc, the results OF which examination VIII appear "
tie affidavit of tue said Little and Houston. ,
That tic dlydends referred to IN the affidavit oi
sand Duuan were declared out OF the net eaihugs OF the
eait Euc Railway COMPANY uuucI lue HCloe " % W To-
nent aud upon the accounts heretofore Icuu t 10 ut
p1neut Uy tie sand Dundn while ne was the Auulto OF
properly 1d legally declared ana pnl'' Hu,
fhe same-ds that the bad not been iuly earned
iy ~ Erc Ka,iw,v Clmuany-are untrue: that II,
in the counts ST.; forth The said affidavit of the sald
Dluau there are items or charges lnaccuIhley OF
,DrTcry inserted or n the result of the said accounts
as reported by hm To depOneut and through 0l0neht
10 iuc Board Of Directors OF tins Company, on butu Tue
afrr1Il Jl,Id,ud pellods wer. in any respect
on incorrect deponent believes that the incorrect items
were Intentionally Inserted In said accounts 10y eai
Dlnln IC. TIE purpose OF TIE aforesaid conspiracy ana
Iat Jo,eDr had mo knowledge OF the ucOrrcetness OF
the sad accounts whatever and he beheNes hat none
uf The director, of said Company had any htmatIon
that such accounts were any respect incorrect or
untrue UuI. the publication ot D4uaAs aforesaid
charges
Rnt without regard 10 any OF SAID items or to any OF
The charses MADE by the said Dunan III his Aforesaid
nihdayit, or heretofore made IN the puoIr prints,
the Aforesaid Little and Houston SHOWS, th9t the sad
dividends were and each OF them was properly earned
ana properly payable and that all OF tne allegations OF
TIE sd Dunan in respect TO impropicty OF the sad
dividends are substantially untrue. ,
De, Oueut further says that II is utterly untrue that
falsely umcd 20 be true IN tie affidavit of the
hud Dluan, hat depoueut at any time directed him
tDunsuJ 10 prepare any statement account that
"a Gud correct account OF the earnings ana eN
penses or the PERIOD named; ana that the notifications
of account referred by said Duudn were made 10y
ordr Of GcpOucnt in the usual manner upon tue report
OF the proper officers oi the company HItcr IN eAanil
alton OF tnc facts; and dePoncn still believes thaI the
t.td notifications were properly made, ana that the
accounts u that respect were ana a'e '"I'Cl ana IL Is
Hufrut mat SAID accounts notifications thereof were
ayowedly or unayowedly based upon any idea tnat II
condition Of the road and the Company accounts OF
financial condition, as aiegel UJ Sd.d Ddu'h III MS
ainddylt az close OF paragraph 10.
DrpOueut further SAYS that the firm ot Bischof-chem
Couuany 10 dispose Of certain consolidated mortgage
and convertible bonds, and that all OF saG consolidated
accounted for under tine contract except as certain
sums nov in dispute aud vet settled; ana thai all
of the convertible bonds OF the Company which were
placed IN the hands OF said BscAonscheim Cold
trnmNii were IN ike manner sold and accounted for
Ccpt as 20 certain Sums Tor interest aau charges now III
uIspu,e aud unsettled. And that the statement that
The said HtIn has been Intentionally ana without
Gspue or with intent 10 defraud the Arie Railway Com
Iduy, allowed 10 retain SlitON OF guy otIeI hn uo'
justly pr, perry oWiu- to them out of he proceeds
OF such bonds Tor nearly wo years or up 10 tue t4e oi
tald Duuaus leaving tLe LIle hi"ay SoDpa1S UlHCt'
ls untrue although u Is true that the SAID hIm oi
Bscuon .cAoiu and GOldschmidt have claimed aud
urged the pIoprety OF paving the sums ALLEGED to have
been spent 10y them IN behalf Of the Erie Runway Com
Iany A,1C1 OF which they withheld from the proceeds
Oi thc talr Of cOnNerLhe OOHu@' ue ihey c"heu 'ne
lad tie st % do and they claimed the remainder Of
changing plor mortgage bonds OF the Eric Company
for consolidated bonds Ol Che Company under the!r
aforesaid contract.
D.poneat further SAYS that in about the month OF
Jauuary 1873, after full examination Of tue facts, ana
careful examination OF the law by tine counsel Of Tue
Conpduy and by other counsel especially retained Tor
that purpose hy depOnen II was determined 10 he wise
aud necessary that Ihe l-ne Railway COMPANY should
purchase controlling interest IN the stock OF the Bun
aio, New-York aud Enc Railroad Company and after
wares dcpJueut uuuer the authority Of the Board of
ttdresd fdyii OF said Dunan paying for the same in
Ne %
tucu believed, aud sl believes, tHat II was and would
~, nv o imIy,sIblc 10 have made the said purchase
al any lees sum per share and that the SAID purchase
was a wise and prudent one, ana, under the clrcum
ttaLcs necessary ior the interest OF the Erie Railway
Tbst the said stock as deponent believes then in
,I,cy ,ortn more than the price pad for the same
ana mat depOucut believes that majority OF the shares
could not been purchased al less price than
CaId as aforesaid although depOnert, acting IN behalf
1t the Company dd thereafter authorize and make
i,in other purchases of The stock generally
xaine thereof: and tha the uendc Of the said Duhan
that any person connected VITA the Enc Railway Com
pAny az officer director or Otherwise had any snare
ar interest the said purchase. or was in any
benefited thereby theletrom Is deponent believes
and charges, grautOus iasehOod on e paIt OF sald
Duuau made solely for the purpose OF annoying the
officers Of the Ere Railway Company. -..
Deponent says that the reason why the giving
of the sdld the time II question was concealed
frsln SAID Duan was soleiy oecause Eepopen' Has n
willing trust linn with the knowledge that the Com
pauY lutcuCed 10 buy portion OF the sad railroad
stock fearing that the information might be cOmnuni-
Gated 10 persons VINO would prejudice the company ;
purchases by other purchases IN the market and thus
raise the price OF the stock.
peponent further says that under the advice OF the
Board OF Directors he caused To be purchased sundIy
large tracts land, containing coal situated In the
etaIe OF PENNSYLVANIA paid or has agreed TO
pay therefor "a large sum Of money, taxing the title III
h name for the time being Du In trust or certain
Incorporated companies Pennsylvania authorized TO
hold and own SAID lands, all OF which lands afterward
aud during the year 1873, depOnent conveyed, ana
,auscd 10 be conveyed 10 said last named companies
lie stock iu which companies belongs 20 the Eric
Of deuOuent in connection with the That the
provision for coal thus made was necessary conyen-