The news & observer. [volume] (Raleigh, N.C.) 1894-current, 1897-09-30

Railroad Commission, by whom sworn
to, and in what form attested. Mr.. BUS
bee said for his side the reports were
admitted to be correct. the burden oil
proof being on the railroad to show
error.
AFTERNOON SESSION.
/ At the afternoon session Of the court
the first witness put upon the stand
was Mr.. p. ID. Cowan who was in 1889
and 1890 auditor of the receipts Of the
Richmond and Danville, Western North
Carolina, Murphy branch and Ashevil-e
and Spartanburg Railroads, in the office
of Chas. NJ Crump at Washington.
A part of Mr.. Cowan's duty. he stated,
was to calculate per centages of frelghts
allowed the roads for long hauls.
"Eas any road Disseminated against
in these calculations?" asked Mr.. Day.
The plaintiffs attorneys objected to the
question.
| ~ have never heard such a series If
objections as are being raised by coun-
sci on the other side" said Judge Avery
Fraud can only be proved by c.rcum-
stantial evidence in this case. We have
asked that the books he produced by the
auditor; they refuse to do it, and now
we insist on proving the contents of the
books"
| Mr.. Busbee objected on the ground
! that the witness knew nothing of the
contents of the auditors books, and that
| even if he did know anything of twist
| ing of accounts by the Richmond and
Danville Railroad Company, It did not
have anything to do with the Southern
| Railway and its lease of the North Car
olina Railroad
"That is just what we propose to
prove" replied Judge Avery, that this
twisting of accounts, was inaugurated
by the old Richmond and Danville Rail-
road and has been kent up by its sue
cessor, the Southern Railway. If CIR
cumstantial evidence was ever permissi-
ble it is in this case"
| Mr. Averitt further pointed out that
| the Central Trust Company was Claim
ing standing in this court upon the
ground of its connection with the origin
al lease of the North Carolina Railroad
to the Richmond and Danville Railroad
Company. "And we are informed and be-
Eeve," he continued, that there is a
conspiracy between certain private stock
holders, who now regard themselves the
virtual owners of this road, and the
Southern Railway, by which conspiracy
|
| the stock of the road and at the proper
time buy the States stock at its own
| price. This twisting of accounts and
systematic method of making false re-
turns, is circumstance going to show
fraud in the making of the lease. and
| it is with this view that we ask its
introduction"
Judge Avery: "We offer to prove by
this witness that he was clerk in the au-
ditor's denartment at Washington in
1889 or 1890 and that it wns his bust
ness to audit the accounts of the North
Carolina Railroad and other roads oper-
| ated by the Richmond and Danville
Railroad and that in making out ac-
I counts there was an unfair division of
| the proceeds derived from carrying
| freight and passengers over these lines,
and that by this system of making ac-
counts in the department he was
was directed to allow the North Carolina
| Railroad less than its fair proportion
of the earnings of the connecting lines
| for freight carried over said road and
| its connecting lines. This testimony
is offered to be considered IN connection
with testimony already offered and here
after TO be offered as tending to show
systematic efforts on the part Of the
Richmond and Dany:lle Company. af-
| ter more than half of its term of lease
| had expired to depreciate the value of
the North Carolina Railroad by making
false reports as to its earning capacity,
and IT'S tending to show that the Southern
| Railway Company, as successor of the
| Richmond and Danv:lle Railroad Com
pany, acquired control of the connecting
lines and continued the policy of false
hood and misrepresentation adopted by
| it's predecessor in order to depreciate the
value Of the North Carolina Railroad,
and with the purpore of acquiring a
long lease on the North Carolina Rail-
road for less than it's market value.
And these false reports were used to the
directors of the North Carolina Railroad
| Company to induce them to consent to n
lease for ninety-nine years and to make
them believe they could justify their
conduct, even though fraudulent, in the
eyes of the people and the courts by re-
ference to the false reports"
Mr.. Busbee objected ON the ground
that the books of the auditor were not
produced, that the witness knew moth
| ing of their contents and that the South
ern Railway had nothing to do with the
Richmond and Danville Railroad, and
was not bound by its acts or it's method
OF keeping accounts"
The Master refused to allow the in
PRODUCTION of the evidence.
Mr.. Cowan was then offered as an ex-
pert railroad accountant, having had
about twenty years experience in the
auditing department of various railroads.
1--WE offer this Witness" Mr.. Averitt
announced, "for the purpose of prov.
ing that the reports of the Southern
Railway, made to the Railroad Commits
sion, is contrary to all rules and customs
in keeping such accounts"
The witness was permitted to testify
his evidence being subject to objection
by the plaintiff.
"What does the item car mileage bal
ance' meanT' asked Mr.. Averitt.
1.-THE balance due other roads for run
ming of cars of other roads"
"When a Railroad with gross earnings
of 81 ,225. 1913 a year makes a repor
showing that it has expended $11S,331
for the maintenance of rolling stock
and the further expenditure of $1,000: