The Portland daily press., 1886-02-04
WORCESTER & NASHUA.
Hearing on the Confirmation of Its
Lease to the Boston & Maine.

The Massachusetts Railroad Committee
Tuesday, gave hearing on the petition of
the Worcester, Nashua & Rochester Railroad
Company for confirmation of its lease to
the Boston & Maine Railroad Company, an
to allow savings banks to invest in its bonds
and notes. Mr.. E. B. Stcddard appeared for
the Worcester, Nashua & Rochester Railroad
and Mr.. Richard Olney for the Boston Il
Maine Railroad. Mr.. Albert Clark repre-
sented the stockholders of the Eastern Rail-
road. Mr. George 0. Shattuck appeared for
T. Jefferson Coolidge, Amos A. Lawrence
and F. Gordon Dexter remonstrants. In pre-
senting his case, Mr.. Stoddard said that the
lease had been approved at special meetings
of the stockholders of the Worcester, Nash
ia & Rochester Railroad Company, the Bos-
ton g. Maine Railroad and the Eastern Rail
road. There is nothing to conceal In the
transaction; it has been legitimate in every
respect. The Boston & Maine are today, in
the courts, asked not to take possession Of
the road and not to carry out the terms Of
the lease which the directors and stoekhold-
ers have agreed to. This might mean great
litigation. The petition to the legislature
was filed in order to prevent any great litiga-
tiOn. The legislature had already taken ae-
ton, which formed precedent for that ask
ed by this railroad, although as In the pres
ent case some of the directors belonged To
another State. Some of the bonds, he con-
tinued, are coming due, andif savings banks
are allowed to take them they can be dispos-
ed of at a much less rate of interest than
they are at now. The company has an offer
to take at a premium OF lC4 or 100, bonds
now paying per cent, at 4 per cent per an
mum for twenty years. IL he understood the
Boston & Maine railroad in making the lease
it was to make through line from Portland
to Worcester. The facilities for business
have been made more ample, and the in
crease in business and freights has been
quite large. If road which has capital and
power runs the Worcester, Nashua ~ Koch
ester railroad it can make good line OF
travel to the lakes, mountains and Mount
Desert.
Mr. Shattuck, for the remonstrants, spoke
of a stock dividend of II per cent made by
the Worcester, Nashua q Rochester railroad,
last December, and made with reference un-
doubtedly, to this lease, and substantially as
a part of the transaction. The law OF the
Commonwealth, he continued, regards
stock dividend as one OF the grayest oilencess
that railroad can commit Ihe value OF
the stock Jan. 1, 1885, was %, put Jan l,
1886, it was up to 144 and fraction. Inc Ell
feet of this lease was to put into the pockets
of somebody more than S2,OO0,0OO Inc
question for consideration is where that
money is to come from and who ultimately is
to pay the interest on it, Unless the State
laws were to be treated with contempt, the
lease must be stopped. A crime has been
committed, which by law is punishable by
forfeiture of the charter, by fine of $1,000
each upon the directors, and by making the
stock certificates issued as void. But this is
not all While legislation exists upon the
statute books which allows the Common
wealth to take any road at its fair value, a
lease which carries the value of a railroad
property from S65 to $144 and fraction per
share within a year is fraud upon that
statute.
Mr.. Stoddard desired to correct Mr.. Shat
tuck as to his law. The statutes provide
that the Commonwealth shall pay such sum
as will reimburse the net capital paid in, with
a net profit of 10 per cent.
Mr.. Shattuck replied that he did not refer
to that law, but to later one-one passed In
1874. Up to this point his two propositions
were o. that the stock dividend is glaring
violation of law, and until that is stoppedn no
action should be taken in the matter; (2, this
lease, on its face, is one which so affects the
right of the Commonwealth to take the pro-
perty that the legislature cannot for mo
ment think of sanctioning it. The hearing
will be continued at date not yet fixed.