Daily globe. [volume] (St. Paul, Minn.) 1878-1884, 1878-03-01

The House committee on railroads held a
session yesterday morning, at 8 o'clock, Hon.
D. M. Sabin presiding. The object of the
meeting was to hear arguments relative to the
bill, introduced by Hon. Edumnd Rice, amend
ing the act Of 1877, entitled "an act to provide
for the completion of the lines of railroad,
commonly known as the Saint Paul and Pacific
extension lines" As the matter involved the
oft-told story of the DeGraff Co. claims,
quite number of railroad magnatcs were in
attendance.
Mr.. l. V. d. Heard appeared rs the counsel of
those in interestas opposed to the DeGraff l. Co.
claim. After reciting the thrice-repeated story
of the past legislation concerning the st. Paul
and Pacific, Mr.. Heard averred that DeGraff &
Co. had completed the road for their own bene
fit. In any case, they had all along looked to
Moorhead for their reimbursement. Moreover,
whatever owing to DeGraff & Co. had moth
ing to do with the equities Of the bondholders.
1t had been urged over and over again before
succeeding Legislatures that DeGraff & Co. had
an inherent lien upon the bonds of the st. Paul
g. Pacific railroad. No one however, could
reasonably expect that the bondholders should
have, at any time, dived into the future to pre-
tect the rig rights Of any contractor with VT
speaker then briefly glanced at the con-
Meeting history of the Northern Pacific road.
In 1874, an extension of time was asked by Mr..
Farley, and, at the same time, DeGraf Il Co.
also came forward preventing the certifcation
of land until the debts were settled, although
they could have, since 1872, have easily recov-
cred from Moorhead, who during those years
was perfectly responsible. De Graft d Co. de-
clare in their manifesto to the Legislature that
compromise had been effected in 1877. This
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assured by the St. Paul and Pacific railroad
company that it must be left
unrestricted and that it never,
even by implication, limited that it's bondhold-
ers recognized their indebtedness in any sense,
to DeGraff g. Co. Mr.. Heard here branchcd in
to show its invalidity within itself Over
$3.50, 900 of the amount claimed was for ties
which DeGraff II Co. had never placed upon
the road, which had never been used, and upon
which they had since realized. Other items of
the account were for interest, &c.. &C. whereas
nothing could be demanded except what was
for actual amounts expended in material only.
There was another matter for bridge materials.
which Watson, the sub-contractor had had
coded to him by the courts. The learned gen
tleman then adverted to the necessity for the
right of appeal which the bill provided, and
closed by demonstrating the further necessity
for the sale of the lands accruing
to the company at a fixed rate.
Hon. J. NJ. Gilman said, in behalf of De-
Graft & Co., in 1871 an arrangement was made
between the st. Paul and Pacific railroad and
the First Division company, looking toward a
completion of the extension lines, which re-
suited in entering into a contract with Moore
bead for their construction for the proceeds of
the 100000 of bonds then put upon the
market DeGraff & Co. then entered int a
that the former should be paid monthly on the
certificates of the chief engineer.
These monthly certificates were
just binding as promissory notes.
DeGraft Co. had the right to stop the con-
struction when the money was not forthcom-
ing, but did not do SO, having faith in the ulti-
mate ability Of the road to pay. If, however,
DeGraf & Co. had stopped the work, the St.
Paul Pacific would never have had a land
grant or even roadway. DeGraff & Co.
ironed 143 miles, after June 1872 the date of
the last payment they received, and the result
to the railroad was its securing 100000 acres of
land. During the months of July, August
and September, DeGraff l. Co. did $7O0OOO
worth of work, of which some $5OOOOO was for
grading, all of which was performed after the
negotiation of the bonds had ceased altogether
The bondholders have never found fault
with DeGraf & Co., but the bondholders had
found fault with the way in which the money
had keen expended, claiming there was mal-ad-
ministration. In 1874, the bondholders asked
Tor the appointment of receiver, who should
amount
of $4,000, 600, which should be a first lien upon
the entire lines of road, part of the money be-
ing for the contractors claims and the compile
ton OF the lines. In the same year DeGraff &
Go. asked enough Of the 90O,0 900 acres, earned
through their labors, should be reserved for
their payment. This was granted by the Leg
lslature, but the law was declared to be uncon-
stitutional. In 1877, the proposition was made
to throw open the Brainerd and Vincent branch
es to any one to construct, the result
OF which was compromise, as shown by
the unanimity with which the measure passed
the House after an evenly-balanced fight Part
OF that compromise was that 100000 acres ac-
cruing from the Brainerd line and zoe, 900 from
the st. Vincent line should be reserved for the
settlement of the past claims. The Legislature
was asked to repeal the compromise, when
plenty of parties stood ready to construct the
extensions for the lands they would get outside
OF the reservations. Public interests demand
ed that these lines should be completed as soon
as possible, and, at the same time, under the
act Of 1877, private claims should be eauitably
adjusted. 1t was not proposed to touch lands
already secured, but those only to be hereafter
earned. The repeal, therefore, Of 1877 would
be violation of the compromise then effected,
we'll an invasion of the equities of De-
Graft & Co. and of the other creditors
The committee then ad journed until 1880
p. m.
EVENING SESSION.
Inc committee resumed It's session at D. m .
Hon. u. M. Sabin again occupying the chair,
and the attendance being large enough on the
part of counsel and interested parties, to make
quite respectable filling for the Senate cham
Der.
House file 1855, granting the st. Paul and
Sioux City railroad power to build road from
some point in Cottonwood or jackson county to
the west boundary of the State, was read. It
was feared it would interfere with the Southern
Minnesota Extension company and consider
alton postponed until this morning at 9
o'clock.
Mr.. Rice's bill, the subject of the mornings
session, was then taken up
Mr.. w. H. Sanborn, was the first to sneak
He said the only legislation the Western rail-
road was interested in was that Of 1877 and that
now proposed. The act of 1877 permitted the
st. Paul & Pacific until MAY, 1877. in which To
construct the Brainerd branch, and in their
failure, any other company was allowed to con-
struct it. Why had the st. Paul & Pacific not
done SO, if the land grant was so magnificent?
Mr.. Sanborn pointed out the terms on which
the bond company could build their north
western extensions. He denied that the Vest
ern railway company not the Northern
Pacific, but a company organized under the act
of 1877, and had already complied with the
provisions OF the law by building the road, and
now had vested right in the balance Of the
land grant due under the act of 1877. The
Western claimed the legislation of 1877 must
stand, as it had expended its money under its
promises. The proposed legislation took 2OO, 900
acres from the Western on the Crookston extern
sion to pay DeGraff 4 Co. IS claim and proposes to
saddle the claim on the Westerns already earn
ed 100, 900 acres. If DeGraff & Co.'s claim was
paid under the act of 1877, the company build
ing the road would still have $25O,0OO left
but if the 100, 900 acres now earned by the West
ern road, was compelled to pay DeGraff & Co.'s