Washington standard. [volume] (Olympia, Wash. Territory) 1860-1921, 1897-11-19
XXXVIII.-NUMBER |.
A PLAIN STATEMENT.
SOME LIGHT TURNED UPON A
DARK SUBJECT.

| Connected With an lnsOlvent
Concern, and Asserts That He
Warmed Serpent TO Life TO
Sting Him.
Boston, Nov. 4, 1897.
DEAR Mr.. MURPHY: / thank you
for the statement of my position and
duty in the matter of the late Olympia
Light and Power Company in your
paper of Oct. Sth.
What you did not state, for it was not
called for in that connection, was the
great service and benefit | had rem
dered that company, and the efforts /
made to save it, efforts which were
frustrated at last by Mr.. Chambers
avarice and folly.
His letter in the Olympiam OF Oct.
1lth contains so many misrepresenta-
tions, and is so plausibly calculated to
poison the public mind that it seems
to call for correction, and as plain
statement of the truth is the best way
to answer falsehoods, l submit the fol-
lowing brief account of my connection
with that company from first to last:
In the fall of 1891, at the request of
the directors and principal stockhold-
ers of the company, visited Olympia
and examined its plant and condition
with the view of taking its bonds, if
found satisfactory. The total indebt-
edness of the company was represented
to be $99,Sl2. On my stating that the
debt was too large to warrant taking
the bonds, it was proposed by them
that the debt should be reduced to
1000 by providing for the payment
OF the balance of $40, 900 in the follow
ing way, which was adopted.
The company had erected flour
mill at Tumwater, 100 barrels capacity
per day, costing with land and build
ing about $4,000. 1t owned valu-
able business lot on Main street, Olym-
pia, costing $4,000, and complete
electric lighting plant in the town of
Shelton, 20 miles west of Olympia,
costing $4,000. None of this property
was required for the operation of its
plant, or in carrying on its legitimate
business of furnishing light and power.
They proposed to convey this property
to Mr.. A. A. Phillips, President First
National Bank, as Trustee, to sell and
with the proceeds pay off $4,000 of
said debt, and as additional means to
that end the principal stockholders
would transfer to Mr.. Phillips, $50, 600
in the company's stock, and would
also undertake personally to see that
these debts were paid and the COM
pany relieved therefrom.
In pursuance of this arrangement,
the above property, and five hundred
shares of stock were duly conveyed to
Mr.. Phillips with list of the debts
aggregating $4O,OOO-to be paid by
him. And the five directors, E. L.
Young, A. H. Chambers, Geo. d. Shan
non, Robert Frost and Alex. Farquhsr,
agreed that they would see that the
debts were duly paid, and that none of
them ever came upon the company.
Then Oct. 20, 1891, they executed,
in the name of their company, the con-
tract with me for the issue and sale of
the bonds. In that contract they ex-
plicitly covenanted that $4,000 in.
cluded the entire indebtedness of the
company, and q specific list Of the
debts was appended to the contract.
These debts were paid by the first
100000 realized from the bonds, and
with the balance of $4,000 realized
therefrom, the electric street railway,
four miles long, was built and
equipped with five cars, and the entire
plant was overhauled and put in thor
ough order.
Thus, under my contract, the COM
pany was to be wholly free from debt,
and was to have fine plant In thor
ough order, earning handsome in
come amply sufficient to pay interest
on its bonds.
After taking the bonds and remit
ting the proceeds thereof to the COM
pany, 1 again visited Olympia in the
summer of 1892. l found the plant
in fine order and making very satisfac-
tory earnings. The street railway was
completed while I was there, and its
earnings were also satisfactory.
/ I found, however, that there were
serious disagreements among the di.
rectors. / also soon discovered that
the company owed the Edison and 7.
H. electric companies some $4,000 in
addition to the Indebtedness which
they had previously acknowledged to
me, SO that after the payment of the
100000 indebtedness, there still re-
mained this amount of debt.
I found also that E. T. Young,
President of the company, had caused
the company to give its notes in pay
ment of portion of the $4,000 in
debtedness, which he had agreed
should never come upon the company.
After some delay and controversy,
the directors rectifed this by taking
up the company's notes, and giving