The Seattle post-intelligencer. [volume] (Seattle, Wash. Terr. [Wash.]) 1888-1914, 1893-05-22

40l1i Lfsscll 10 -silc 81. A-sss.---.- Az
YEas ENDING JUNE ., I8si-
Gross earnings from eli sources - ssso.-Ea -
Operating expenses and fixed charges Ss7,ss. IL
Dehc., .......................s Ie7.a3, y
Total seaclt 70 Jane 81. isai...... 2s7.sai -
YEAR ENDING sUsg %, ls3-
Cross earnings from al saareea..... ss.a,ieo ss,
Operating expenses aud fixed charges >2o,s8- -
Deac.. as7..si IS
Total defci, TO June 81 Isl, ...... 1880 a
EIGHT MONTHS xsp.ss FEBRUARY IS, 1888
Gross earnings IRON ell sources s54l,3s9 q.
Operating expenses ana txel charges 4is.5si a.
Deficit sI-4.ssl Is
Total deacl: 20 February Is. lss2- ypo.-6s o.
The following statement of interest on
bonds and OF the manner III which it was
provided for is then made:
Due August I, 1855
Borrower from u. X. Gilman 3i.aO) ID
Borrowed froms Jameson.
smith & Getting .-......-. H5so u
Due August I. Isss-
Borrowed from A. VI. Cannon $4,000 %
Advanced by seattle & Eas'-
ern Construction Company 9,7e7 Is
Provided BE- the company s,-o1 "
Due Fsbrnary I. $500
A!Taueet o. seattle Il East
e,n Construction Company .f57,a5 81
Provided BY the company ~. u.is) %
Disc August /. 1890
Advanced by Northern Pacific
Railroad Company. $4,000 %
Advanced by Seat,le'G East
ern conss, uction Company 1900 90
Psoyt6ed oy thu company -. sc.coo 90
The defendants say that. from this state
ment. the Lake Shore has paid in interest
on its bonds 500 eso, and tina: ali the rest
h,y ~ n
Northern Pacific They then give the fol-
lowing statement Of payments made by
the Northern Pacific since July l. 1880;
Interest on funded debt. 1900. 400 90
Taxes ....... NEUTRALITY-SUSPICIOUS.. ;.G~5 IS
Aecoun. o; s.rkia. fund ...........-.- $3.50 60
Outstanding debt evidenced by notes. s5.Gli sc
Debt Of Lake Shore road 20 Seattle &
Eastern Construction Company snd
for equipment, less all credits. -65,ei 80
Losses In operating spokane division
from September =. ls9e. 10 March ).
lss-. -i,Sso -
The defendants say that. after allowing
al credits due from the Northera Pacific.
the Lake Shore owes the Northern Pacific
81, 335, io0.5i. and the Northern Pacific has
paid sa9, 0c6o7 for equipment which it
supposed the Lake shore owned At the
time OF the purchase of the stock. They
claim thar, while it was provided by the
terms Of sale TO the Northern Pacific that
the latter should have the control and
operation of the road pending the pay
ment. we: in fact it was managed and the
collection and disbursement. ofits revenues
was under the control Of its president and
general manager un;i! March, ls9e, and
that during that time il was not managed
in the interes: OF the Northern Pacific. but
apparently in that OF the Seattle * East
ern Construction Company, with view 20
getting as much money our of it and the
Northern Pacific as possible; also that the
officers and agents OF the Northern Pacific
were at different times refused access to
the books and accounts
They then reiterate that the traffic con-
tract was entered into to stimulate the
growth of lumber and shingle manufacture
ing: tina; that result has been attained.
and that the industries producing those
products could no. have existed but for
the contract. They also say that since the
new management TOOK control il March.
ls92, the operating expenses have been re-
duced from T2.97 TO CSC per cent. of the
earnings. and that in course of time under
the present management and policy il viii
become valuable and profitable road,
that being the desire OF the management.
They declare that they are and always
have been willing 10 make n full showing
10 the court Of the affairs o: the road that
IL would he inequitable TO take II ont of
their hands by the appointment OF re-
ceiver: that without the financial assist
ance given by the Northern Pacific or
some other concern the road would be un-
abe 10 maintain itself. and must speedily
yield TO the demands of is creditors by in
ability to meet its liabilities.
The traffic contract Is then given Us n
part o! the answer. It's provisions being
substantially as stated in the complaint IN
the suit. The Lake Shore agrees 10 trans.
fer all its business To the Northern Pacific
50 far As il lawfully may. receiving double
mileage on through business. The con-
tract Is 10 run for forty years aud longer,
until terminated by SIX months notice.
The defense says that this contract has
been modified by rule OF the traffic de-
partment. which allows the connecting
lines minimum rate of 81 per car unless
the regular switching rates amount to less.
They further say that the books of the
Lake Shore disclose that the stock was
issued without consideration 10 those
who would accept bonds. that the road
was butt ont OF the proceeds 81 the bonds
and Is therefore greatly over-cap. talizel.
So that 1t - very dsiicu,t. II not impossi-
bic, Ia make = proai on il, They also say
that the rolling stock IS totally inadequate
To carry on the traffic. and that !, is onlv
enabled 10 conduct its traffic by the aid Of
the Northern Pacific.
The affidavit; of ". q. CHAIRMAN. assist
an. secretary OF the Lake Shore. states
that ne has IN hts possession the record
books q! the company. and gives a trans
cTipi Of the proceedings OF the meetings
from the Incorporation. showing thai at
tic STOCK hOideTs meeting Of November u
iesfs. she nomination OF the Northern Pa
eiac candidates for trustees was seconded
By u Ii. Gilman. Who vas present Tor
himself and As proxy for Thomas Earle.
The affidavit oi James H. Wi.nams
saeorge :. Raxssr and George II. Earl
three at the trustees. state tina: neither
she plaintiffs nor any other s.ockho.der
has made any compliant - them N regard
Ia the matters casa1ialne4 Of. nor made 3
demand Tor an accounting or that the
NofIhera Pacific should return To the
Lake Shore any pars Of tie lAttev's prom
erty- nor demanded thas the traffic cor-
tract should ne anauiied or sha, the
Trustees should branr sal. 20 have the con-
sgact ses aside.
". :. Neliea. the general manager. IN
his affidavit, saws shst the annual seQgire-
nEenl ~ n9ec. interest taxes ana sinking
faaa = about sii>Ussl. a h.le IN the four