The Salt Lake herald. [volume] (Salt Lake City [Utah]) 1870-1909, 1894-02-04
IyEs.HARRIs FACTION ANSWERED.

vaders gave up the job and were taken
back on fiat cars.
IYES.HARRIS FACTION ANSWERED.
The Receivers of the Northern Pa
cific Make n Great Showing.
Milwaukee, Feb. 3.-There wer filed
today by the Farmers Loan and Trust
company, Sheldon & Co., P. P. Wins
ton and Receivers Cakes, Payne and
Rouse, in the circuit court of the
United States, six separate answers to
the Ives petition for the removal of
the Northern Pacific receivers. The
answers present extensive replies to
every charge made and comprise over
500 printed pages. The answers not
only meet all the specific charges, but
explain. and refute the insinuations.
1t is shown that the branch line
policy originated during the Ives
Harris administration, and the re-
ceivers bring proofs to show that by
rejecting the branch line leases they
have saved more than $1,000,000 per
year. The receivers have already paid
5,00O,0 900 preferential debts and about
1000, 900 interest, with important econ
omies in the operation
Cakes answers every charge speci-
fcally, filing exhaustive documents
and proofs.
Ralston vigorously scores his &C
cusers, and refuteS every allegation.
In the answer, Cakes specifically
denies that he was a partner in or
profited by the construction of any
line on the guaranteed bonds of the
same; he also denies that the direc-
tors profited thereby, and shows that,
under his management, the gross earn
ings increased from s12, 100000 to S24,-
OO0,O 600 until the recent extraordinary
depression which solely caused the
bankruptcy of the company. He re-
views the history of the purchase or
lease of the various railroads, and the
answer shows they were necessary for
the meeting of competition and the
controlling of business, and the pro-
tecting of territory. The Northern Pa
cific directors and stockholders unani-
mously adopted this policy in 1881, and
readopted it in 1886 and 1889. Pur-
suant to this policy, branch roads
were constructed or acquired to meet
particular exigencies. In each instance
the subject was carefully examined,
referred to special committees and re-
ported upon by the various depart
ments to the board, and all twenty
three branches now in operation with
the exception of five, were commenced
or authorized by the Ives-Harris board.
The acquisition of the branch lines was
necessity in the railroads manage
ment and upon the whole beneficial
to the system. The branch lines row
in construction or acquired during the
period Works was a director, furnished
road company of over S4,000.000
The Central Washington, Green
River and Northern, Spokane
& Palouse, and Northern,
Pacific and Montana roads, all were
constructed, or the construction pro-
vided for under the Harris-IveS man
agement The Spokane & Palouse bus
mess last year exceeded $360,000. The
net revenue paid all interest on the
bonds issued on account of the extern
sion of the Green River & Northern
authorized by the Ives-Harris faction
directors. The contract for the con-
struction was signed by Robert Har-
ris.
The answer shows no director was
interested in the construction of the
united railroads of Washington; their
cost, the total amount of bonds issued
thereon and no profit was made in
the construction. The answer shows
that not a cent of money was paid to
the Oregon & Transcontinental COM
pany for services in purchasing the
Seattle, Lake Shore & Eastern. Four
ested in the syndicate which owned
and controlled the Rocky Fork mines,
and the railroad company purchased
the stock of this company and made
a contract with the Rocky Ford COM
pany for 500 tons of coal daily for
ninety-nine years at $3.50 per ton, with
certain rebates for the three fiscal
years ending June 80 last. The COM
pany saved, by virtue of said contracts
OUar. 81 000 0(l(1 Or a slim equal To about
81 900 a day.
AS to the Northern Pacific & Man
itoba railway, the answer shows
syndicate was organized by Willard to
construct this road, but he had no per-
sonal interest in it. The entire road,
Including the properties at Winnipeg,
Portage, La Prairie and Brandon, and
the Winnipeg transfer road, cost
81, 600, 900 and the profit for the year
ending June, 1892, was over $500, 600.
AS to the Chicago terminals and the
Wisconsin Central lease, the answer
shows that before the lease or any
traffic contract was entered into the
value of the properties was thoroughly
and carefully examined by experts,
not only representing the company,
but also representing the bankers who
expected to make large investments in
the Chicago terminal bonds These
experts uniformly placed the value of
the leased properties largely in excess
of the value on which the rental was
paid under the leases The Ives
Clewes report last year placed the
value Of the Chicago terminals AFT
about $28,000,000 while they were ac-
quired under the lease by the North
ern Pacific on the rental value of
about $1S,000,OOO and Cakes had NO in
terest. direct or indirect, in the ac-
QUESTION and control of these nroro-.