New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1883-11-09
THE JERSEY CENTRAL LEASE.
TESTIMONY IN TIE DNsMoRE SUIT.
PRESIDENT LITTLE ON THE sTAND-THE FINANCIAL
CONDITION OF THE ROAD.

IRON TTS REGULAR CORRESPONDENT OF THE TRIBUNE.
TRENTON, N. j., Nov. 6.--When the tax
ing OF testimony In the suit by which william b. Dns
more seeks to set aside the lease Of the Jersey Central 70
the Reading Railroad was resumed In the United STATES
Circuit Court In this city this morning. all OF the prom-
nent lawyers engaged in the present exoept
Mr.. GOwen George X. KaercheT, of Philadelphia TOOK
Mr.. Governs place as senior counsel for the defence
TIE first witness called Hugh H. Hamii, OF Trenton
sen-in-law OF Barker Gummere. OF counsel for MI
DinsmOre, and who is IN Mr. Gummere's oihco He
testified that In the last week In June he was given
number Of certified copies OF orders OF the Court re-
sranng the carrying out OF the lease Of the Central to
the Reading and told to them upon the Central
officials and agents Among others whom he served with
the orders President H. g. Little Passenger Agent
H. F. Baldwin, Director John Kean and Others In the
Central office in NewYork and the agents at almost
every station on the Central from Jersey City to Long
Branch Easton and Scranton He said that he made
out bill for his services In this TO William b. Dns-
MORE and handed it to f. Green. of the counsel In
the and received the money for the work from MIN
q week later.
Clerk Ophant testified that 1876 copies Of the orders
referred to by Mr.. HamiIl had been certified by him.
John b. Kennedy, the clerk in charge of the transfer
books in the Central office in NewYOrk Identified tue
assignments. etc, certificate OF stock lssued 70
Brown Barnum 81 Hayes and the certificate was put IN
evidence.
called He testified that he was elected president
in June 1882, having been appointed receiver earlier IN
the Same year When he appointed the floating
debt Of the company 50 100000 and it was about
the same when the receiyershp ended. He could have
continued operate the road long he could have
borrowed money under the ChancelOrs authority The
foreclosure and sale of the road could have been pre-
vented only by the borrowing of money to meet the ex
pcnses Under Receiver Lathrop the debt of tho com
pany increased by $60O00O0, and the fixed charges
by per cent this In his Judgment the lease OF
the Central TO the Reading beneficial TO the Central
Stockholders Prior the execution Of the lease the matter
had fully considered discussed among the Central
officials and stockholders Many stockholders had called at
the Central Office In HewYork and talked the matter over
with him. Neither Mr. Diusmore nor any other stock
holder had mado single objection to the proposed
lease In his opinion the abrogaOn of the lease would
be very injurious the interests Of the Central stock
holders.
IMPOSSIBLE TO SUSTAIN THE CENTRAL.
In view of the agreement by which the Leltgh and
susquehanna Railroad had passed out of tho
CentraPs hands and into the control OF the
Reading 1t would be impossible for the Central
to sustain itself II the lease were set
aside and the road deprived OF the Lehigh aud Hudson
traffic The Central could not possibly pay the interest On
its mortgages divorced from the Lehlgh and susque
hanna; but would inevitably have to so through bank
ruptcy and foreclosure proceedings The Central owned
equipments and other property valued at about
S7OO00O0 which were used for the Lehigh and susque-
hanna traffic and would be yaueess that traffic cut
of Central stock would In his opinion, be worthless
with the lease set aside and the Lehgh and
susquehanna cut of. While receiver. Mr.. Little had
called at the Adams Express office In NewYOrk and seen
Mr. Dnsmore two three times about business matters.
The witness unable 10 identify the handwriting or
the original bill OF complaint-which the defendants
claim Il that OF the Pennsylvania RAILROADS. NoWJersey
attorney.
MR. L1rTLE's CRoss-ExASIINATIoN.
On cross-examination by Mr. Conkling Mr. Little SAID
that be had owned Central stock for years and had
bought and sold It good deal In that tine, but had never
dealt largely in IT, He had never had over
200 or 800 shares Of II. Before the lease
was made the Central had had running
arrangement with the Reading and by lease controlled
the Lehigh and Susquchanna. The Central is now
onrrted by the Reading and since the lease the latter
has rade some new arrangement with the Lehigh and
Susquchanna. All the three roads are now operated To-
,rtlrr lie ala not know much about the Lehigh and
Susuurhanna or about the railroad business ~ ALL being
lawyer ana not railroad man lie Wns me hi7t Pesl-
dent OF the NewYork and Long Branch Railroad and now
holds that position again but he had never had any actual
experience IN railroad management until De became
receiver Of the Central The advantage To the Central
from the lease came from the running OF the
three roads jointly and the increased tathc which TINS
Arrangement threw the Central. II were possible
To have fine same running gements as now, without
lease would be just as advantageous 10 the Central
lie did not know what relation existed between the
Lahgh Coal and Navigation Company and the L@highand
Su.uIehanul Railroad Company. One Of them owned
the other but he did not know which one The Lehsh
and Su.durhauna property Is at present controlled by
written lease between the Coal md Navigation Company
and tho Reading, TO witch the Centills assent was
given An alteration IN tho original contract had
been made and 1t was under this modification
thar the road The witness had given the assent
of the Central to this modification. by authority OF the
Board OF Directors confessed by resolution directing
such assent President Harris OF the Coal ana NaHlga
ton Company had rst called his attention 70 the need OF
All applications made on behalf OF the
Ccntra the Chancellor during his receyerslp origin
ated with the law department. OF the Central manage
mont aud signed by him at the request OF that de-
partment No application has ever been made To tho
chancellor for PERM sion 10 make running arrangement
with the Reading The Chancellor would not have
You do not mean that Z" intcrposed Mr.. Conkiing.
Isn't IT rather hazardous thing to say what the
Chancellor will do or VIII not DOR
THE MOVE TO END THE RECEIvERSHP.
Continuing, Mr. Little testified that the existing run
ming arrangement would not have boon advantageous at
any time during the rocevorshlp Whom application
WIS made to tho Chancellor for enlargement OF the in
junction 30 that board OF directors could be
elected, he was a party to It, and know that its
object was to end the recoiyershp. He did
not know that as running arrangement between
the Central, Reading aud Lchign and Susquehanna
had then proposed and had heard Of such
when the lease was executed ho had issued
AN order TO all employees to act Thereafter under dreG
ton the Reading und TO turn over To that company all
moneys received Tor the road Tho same employees con
tiuuc to do the same work. and the road was run inc
same before but all tho employees reported 10 the Read
ing instead OF 10 the receiver
aside yeTsaOn allowed their voices 10 rise eOnsder
ably When MI. COnkllnB II
ths witness aud myself talking loudly TO disturb
the gout lemen's Conversations
ME- Latte said that there had been little change IN the
Central officials since lease, except that the clerical
force in the NowYor, Office had all been removed to
IN.
crate fashion DO you know anything about the extent
Df t,e coal iRndsY
=" No, sir" replied Mr.. Little.
"Wih you kindly permit me to finish the question"
said Mr. Conklng, and added, owned by the Reading
Central and Lenign and Susquehanna e.
ir Lutte had heard these roads controlled "a per
cent of the product OF the country and said that the
yaue of the consisted in the opportunity gave TO
,unsport and market the coal adyantageousy.
THE CAANCEILOR's CONDITION.
The condition upon which the Chancellor permitted the
Central 20 pass from the receivers hands that
ty should be deposited for the paymentOf the 100000
II floating debt within three months. Mr.. GOwen had
nadethis pledge The debt had not been paid agreed
)nly about s55O0OO paid in three months 100000
If which went TO the Trenton Banking Com !