The Somerset herald. [volume] (Somerset, Pa.) 1870-1936, 1888-06-20
THE GREAT RAILROAD CASE.
Taking Testimony in the South Penn
and Beech Creek Roads.

1
THE GREAT RAILROAD CASE.
Taking testimony in the South Penn
and Beech Creek Roads.
In the solicitors Office of the PENNSYLVANIA
Railroad testimony was taken last werk in
the impor'ant South Pennsylvania and Beech
Creek Gases, in which the Pcnnsylvania
i'allroa'i appears as complainant and the
NandeTtiits and others of New YORK -
defendants. The latter were large hold
efs Of South Pennsylvania and Beeei,
Creek stock, and had agreed to sell a con-
trolling interest to the Pennsylvania repre-
sentaiives- The transaction was first inter-
rapted by the commonwealtl,s Attorney.
Lewis G. cassidy. who, in isss. filed injunc-
lions against both ofthese transfers Of stock.
He took his stand on the statute OF Pennsyl-
vania iorbidding the merging of competing
roads, and after protractcd litigation the Su-
pneme Court refused TO dismiss the iniunc-
tions
When u was announced that the Wander
bilis were about 20 part with the stock which
they bad agreed to transfer TO Pennsy the
latter filed bills in the New York Circuit
Court calling on the court to restrain the de-
ientiants from taking any action which
would prevent them from ultimately carry
ing out their bargain.
This action was taken by the Pennsylvania
Rai'road in the hope that the courts would
ally decide on the legality of the purchase
..f - a South pau,.s,.l. l..,;. -, t..t q
Roads
The Nanderbilts responded to the suit in
stitnted in New York George C. Appel.
special examiner of New York city, was ap-
pointed TO take testimony in the matter, and
it was before him that the litigants' lawyers
appeared last week at the Office on Fourth
street.
riie Pennsylvania was represented By As
sisiant Solicitor James A. Logan and Col
Osborne Z. Bright, of New York. George
+. Baer, Of Reading NJ. E olmstead, of
Harrisburg. and Francis L. ste,son, of New
York, appeared for the defendants.
The conIpiainants brought forward their
first witness in the person of Mr.. John A.
Wright, the well-known railroad /. ex-
pert.
lie testified tha; he was well Informed on
the actual rouie OF the Pennsylvania Rail-
road and the proposed route Of the South
Pennsylvania, and Judge Logan asked him
poinicdly what was his opinion of the par
aliel and competing nature ofthe two They
start from the same point and are sometimes
forty miles apart was the answer, so, of
course, they are not parallel
The Colonel was no less clear on the sub
ject of competition He said that as long
eso as 1865 the Pennsylvania Railroad had
been prospecting for line covering about
the sslme territory as the South Pennsylvania
and that it passed through country not
reached by the older and more northern road.
lie said the southern road was proposed as a
feeder, which, of course, precluded the idea
of competition.
Mr.. Wrght's testimony was to the effect
that it would be rank folly and waste of
money TO construct the South Pennsylvania
Road that the engineering was expensive,
and the country offered few attractions.
Aner recess for lunch the next witness
called by the complainanis was Samuel Rea,
another civil engineer in the employ of the
Pennsylvania Raiload. Ills testimony was
substantially that of his predecessor
This ended the testimony in the South
Pennsylvania case and the Beech Greek case
was proceeded with. Engineer Rea was
again called, and testified 10 the position Of
the Beech Creek Road and its connection
with the Northern Central.
During the hearing il was developed that
the Vanderbilt plan FOR constructing the
South Pennsylvania contemplated an issue
of s20oo0.00o bonds and aud about S2o,0OO-
OF stock for 4 cash expenditure OF abou, sl5,-
10000. In the Beech Creek plan the deca
mcn;s given in evidence showed that it was
contemplated that the railroad would cost
about 100000, aud arrangements were
made for the issue of S5.0o0oo0 of bonds and
S5.0O0000 Of stock, and this amount was
actually issued
In addition. the parties we're to receive an
an interest in the coal co. The. Vanderbilt
people had agreed TO sell sixty per cent of
their Beech Creek stock to the Northern Cen
tral Railway Company, and were to receive
in exchange an Endorsement of guarantee
on the Sj.e9o00l bonds. Ifihey had carried
out this contract, they would have had siill
for their S5.00oel9 investment, 5000 eco of
secarities-fiy million ofthesc bonds guar
anteed by the Northern Central Railway
Company, and two million in the capital
stock. by reason OF the necessary absence
Of Mr.. Sietson. Vanderbilt's principal
counsel in Europe, with an invalid wife,
the further taking of testimony was. at his
request, continued until after the summer
vacation.