The Rutland daily globe. [volume] (Rutland, Vt.) 1873-1877, 1876-01-17
THE BOSTON AND ALBANY RAILROAD
SCANDAL


much of their time in the endeavor TO aid
us in casting out the mote out of our eyee,
all unmindful of the beam In their own
eyes. We respectfully commend 10 their
consideration that beam. The Ware river
railroad, short line Of road, forty and one,
tenth miles in length, running from Pal
mer 70 Wiuchendon, prior to April 1878,
was, 30 far rs completed, leased to, and
operated hy, the New London northern
railroad. At this date, only about sixteen
miles Of the road YVES completed, but it |
was leased to the Boston and Albany rail- |
road, who entered into a contract to com
plete IT, That contract and lease, and tho |
circumstances under which it was made,
are detailed in the report Of the Massachu- |
sets railroad commissioners for the year
1874, and in the report of Francis b. Hayes,
railroad company, made at the present seq
sion Of the Massachusetts legislature.
The capital stock of tic road was seven
hundred and fifty thousand dollars aud
seven hundred and fifty thousand dollars
in god bonds had hecn issued but only
some sixteen miles Of the road had been
completed and put in running order. The
lease to the New London northern being
about to expire, the directors Of the Boston
sud Albany discussed the subject Of OBJ
tanning control thereof, and the sentiment
appearing to be favorable thereto, Chester
w. Chaplin, president cf the Boston and
Albany, proceeded to buy up the bonds of
the road. In This he was Joined 10y other
directors, and bonds were purchased at
sums varying from fifty to seven,y-ive
cents Of the dollar Having obtained a
majority Of the bonds at these prices, they
iOIeclOsed the mortgage given to secure the
bonds, formed a new corporation, convert
ing lbe bonds into stock at ther face value
the old stock being wiped out by the
foreclosure and then, under authority
obtained fr0m the legislature of blassa.
chusetis, leased the Ware river railroad &c
the Boston and Albany for the term OF
nine hundred and ninety-nine years.
BY the lease, the Boston and Albany
railroad assumed the payment of, anC
agreed 70 pay, all the expenses Of complet
ing the road, which had accrued, or wout
accrue, after the sale under the foreclosure
Go Furnish and provide all necessary powe
and equipment to run the road to pay
rental Of five per cent. on the capital stool
4p- fret al
cent. for the second year, six per cent. TO
the third year, six and half per cent
i for the fourth year, and seven per cent
c for each and every year thereafter ; an
t further to pay all taxes and assessments
G go that the rent should net to the compan
C the said sums OF five, five and half, six
II six aud half, and seven per cent per al
e mum clear Of taxes and assessments ant
3, also, 10 pay annually the sum of five hui
q bred dollars Tor the purpose of malntainin
the corporate existence of ,he Ware rive
railroad company.
n 1t appears that Chester w. Chaplin pre-
q ident Of the Boston and Albany railroad
and his family, are the owners of thrt
1t thousand seven hundred and forty-fN
d shares Of the capital stock-three hundre
n and seventy-four thousand five hundrt
A. dollars, or only five hundred dollars le
le than one half-and that several Of the q
~ rectors, as, also, the vice-presdent, seer
n tary and treasurer, are large holders of Il
rs stock-all of which was purchased befo
I'd the lease was made, at from fifty to seve
d. ty-fiye cents on the dollar, and that beil
H. so interested they leased the Ware riv
l railroad to the Boston and Albany, al
= r-.-.,..-e~~H - 'l,~t'.-NI'No i...9~ lns~4
ls free Of taxes and assessments, and bonud t
latter company to complete the constru
ton Of the road, which was done at CT
all of over three hundred and sixteen thousa
ST. dollars. The FIVE hundred dollars which
val paid annually for the purpose of malnta
lo ing the corporate existence OF the Wa
on river road is also, paid to these same
ed rectOrs and officers, or some of them. T
Ia directors claim that the lease is advantal
~ Gus to the Boston and Albany-it certain
on is to ther own pockets but Mr.. Hayes sa
he that it is very onerous to the company,
ISIS pecislly when the cost and value of the ros
re- and the situation of the parties making I
de lease are considered.
to Here we have g railroad scandal, viii
i'd does not rest on suspicion or surInise, |
10 side which all the talk about Vermont rf
roads siuks into utter insignifcance.
or needs no comment other than that made
Mr. Hayes, and we commend to our NJ
in sachusetts brethren the words with viii
lie lie concludes his report as follows &" 7
ID, " dealing OF directors with the corporati
lpt " for their personal advantage, or whe
re- they are personally interested, cannot
on sustained on any business principle
ne and especially, it seems judicious Il
Or, ." the state should not allow its directors
nj be interested in any enterdrise or bu
Z" ness connected with the company /
" to have any personal transactions W
ait, except in reference to the transpor
ea Z" ton of freight in the ordinary course
up :" the directors busln' IS, land then
ere " should be allowed no advantage o,
fty " others doing business with the roaC
es' Which 10 sound whether applied to Mas
en- chusetts, Vermont, or other railroads.
ulo
irs Failures in 1875.
IN IN.o.,, ,bo ;,at publ;ohol annual A.,