The Helena independent. [volume] (Helena, Mont.) 1875-1943, 1894-02-04
Northern Pacific Receivers Deny All
Allegations and Refuto All
lnsinuaiions
Mr.. Oakos Says That tho Ives
Harris Board Built tho
Branch Lines
Says the Chicago Terminals sud wfsoonsin
Central lease Were Good Invest
ments-Ie Made Nothing.

daT BY the Farmers Losn aud Trust com
pnnY. Sheldon a. Co.. r. y. Winston and
Receivers Oakos. Payne and Nonse. in the
circuit court of the United States sir sepa-
rate answers 20 the Ives petition for tho
removal Of tho Northern Pacific receiver.
l Tho answers present exhaustive replies 90
every charge made and comprise over 90
printed pages. The answers not only meet
all specific charges bat explain aud rsfu,s
the insinuations. lt is shown that tha
branch line policy originat.i daring the
/ Ives Harris administration. and She re-
csivers bring proofs % show that by reject.
I Ing branch line lenses they have saved more
than Sl,OO0.0OJ per year. Tho receivers
have already paid S5000,oOO preferential
dsbts and about 5000 900 interest. with
in important economies in operation.
Oakes answers every charge specifically.
filing exhaustive documents and proofs.
Ralston vigorously scores HE aecuseFS and
refutes every allegation. In his answsr
Oakes specifically denies that ho was q
partner in, or prohtsd by, the eonHtruation
Of any lines. or guaranteed the bonds Of
the sans lie also denies that tho direc-
tors prohtsd thereby. lie shows shat IN
der bis management tho gross earnings in
creased from Sl2O00.O0O 20 S2tOO0,OOO
until the recent extraordinary depression.
which solely cnused she bankruptcy OF she
company.
lie reviews the history Of the purchase or
lease Of various railroads. The answer
shows that they are necessary for meeting
competition and controlling business and
protesting territory. The Northern Pacific
directors and stockholders unanimously
adopted this policy in 1881. resdo pied IL in
1856 and 1889; pursuant 90 this policy
branch roads we're constructed or acquired
10 meet particular eKigenoies. In each
instance the subject was carefully exam
ined. referred 10 sreoial committees, re-
ported upon by various departments 60 tue
board. and oil the twsnty-thros branches
now in operation, with the exception Of
fye, we're commenced OF authorized by she
Ives-HarTis board.
The acquisition Of the branch lines was
necessity IN railroad management and
upon the whole beneficial 90 She system.
The branch lines, newly constructed or no-
quired during she Tcriod Dakea vas n di-
rector. furnished busiaess 90 the Northern
Pacific railroad COMPANY Of over Si,UO0O00.
Ihe Cent al Washington. Green River a
northern, spokane a. Palouse. and North
EN- Pacinc A. Montana roads ell were con-
structod or construction provided Tor under
the HArTis-lvea management. On the spo-
knne a. Palouse business last year exceeded
$500. 00O The net revenue paid all interest
on bouda issued on account OF ths exteu-
sion. The q cen River q Northern WAS au-
thofized by the IVea- Harris faction Of the
di reCfOra. and the contract for conatiuc-
tlcn. signed by Robert Harris.
The answer shows that no director was
Interested In the construction OF the united
railroads OF Washington. They cost the
total amount OF bonds .ssued thereon. snd
no PROFIT was made IN construction. The
ausWer shows that not a cent OF money was
paid the Oregon and lranacontinental Co.
for services IA purchasing the Seattle. Lake
Shore a. Eastern. Four directors of the
company we're Interested in a syndicate
which owned and controlled the Rocky
Fork mines and abroad. Tie company
purchased tho stock Of thia company and
made a contract With the Rocky Fork COM
panV for 500 tons OF coal daily for ninety
nine years az $3.50 per ton. with certain r.
bates. For she three hacal Yeas ending
June ID last the company saved, by virtue
of said contracts, over SLOJ0.O00. or a sum
equal TO about $1,000 a day.
As to the Northern Pacific Manitoba
railroad. tha answer shows that a syndicate
was organized by Willard TO Construct this
Toad. but he had no personal interest IN 10.
The entire road. including terminal proper
ties az Winnipeg. Portage Ia Prairie and
Brandon. aud the Winnipeg transfer road,
cost s.. OO00OO, nnd their profit for the year
ending June. 1892. Was over $500 O0O.
! As 20 the Chicago terminals aud she W.s-
] consin Oentr-l loaae. the answer SHOWS that
before the lease or any traffic contract
was entered into the value Of the PROF critics
was thoroughly and carefully examined by
4 independent experts, not only ropresenting
1 the company. but also representing bankers
who expected 90 make large Investments in
Chicago terminal bonds These experts
uniformly placed the value Of the leased
properties Ia geiy IN excess of the value on
which rental was paid under the leases.
The Ives Clews report last year placed she
VA ne of the Chicago terminals ut about
SIS OJ0O 600 while they were acquired under
lease by the Northern Paeiho on a rental
value Of aboat Sls.0o0ool. aud Oakea had
no interest. direct or indirect, IN the acqui-
sition ana contro. OF thesa properties.