The herald. [microfilm reel] (Los Angeles [Calif.]) 1893-1900, 1898-08-12

by the Los Angeles company to the new
organization, and the latter proceeded to
construct a water works. A pipe line was
constructed from the source of water sup
ply. and the Crystal Springs is alleged to
have constructed 1t as far as the city lin
its. Then there came a wonderful change.
All the Crystal Springs company's inter-
esc ceased there. and the Los Angeles City
Water company completed the line. What
was the consequence? Two corporations
proceeded to supply thu city with water.
They had the same stockholders and the
same officers.
The time for the contract TO expire drew
near, and when the Los Angeles company
was approached about 1t they very cum
ningly say oh, yes, we will be ready to
turn the property over, but you know there
is another corporation whose property will
have to be bought at whatever price they
may ask for 1t. Conferences for discuss
ing the situation were held. and the city
finally determined to try and get along
without the Crystal Springs property. In
vestigation, however. showed that this
could not be done without the short piece
of pipe running to Bellevue reservoir. But
We are refused possession of it, 1t will do
the company no good, but this piece of ar
bitrary obstinacy is a part Of their corpo-
ration jugglery scheme. No court of equi-
ty will permit such thing, wherein not
even a cloak is used to conceal the bare
faced proposition. 1t reminds one of an
ostrich which conceals its head in the sand
and thinks its whole body is hidden"
The Receivership
The receivership was Attorney Lees ex-
elusive subject for treatment in the city's
behalf. and his address was largely de-
voted to submission of authorities and
quoting from them.
without yielding our demand that we
have right to possession Of the property
we claim, the city has asked for the APP
pointment of receiver. in the heat of ar
sument yesterday, for 1t was hot in moro
ways than one, counsel claimed that equity
will not appoint receiver for corporations
His statement gave as the ruls What IS
the exception. Corporations are
just as much subject to the equity arm of
the law as individuals. and do not think
that even the Los Angeles City Water COM
pany is exempt from the operations of the
equity arm of the court.
I'm actions to force specific performance
of contracts and to obtain possession of
property, receivers of corporations are
often appointed
Mr. Lee here presented a long hist of
authorities in support of these statements
and completed his argument with short
comment on each of the cases as he sub
mtted them.
Senator White Talks
l1ol,n -
the city, followed Attorney Lee.
1T would seem that counsel think we
have something, or they certainly would
not be so DESTROYS of possessing ths mselves
of II. They state that we were dissatisfied
with the first contract and therefore would
not accept it. This is true and it would
seem unreasonable that we should be en-
by the introduction of an an
terror document in an attempt to place
certain construction on the one now under
consideration Counsel says the present
contract is lease and in the same breath
says it is not lease. They concede that
it is not a lease as regards Its operation
as to the franchise. If it is not lease in
this respect then it is a grant, and If 1t is
a grant in this particular, may we not ex-
anime it and see how far 1t Is a lease?
The Los Angeles City Water company
has spent its money for years and years in
the upbuilding of the present water sys-
TEN. Its lines were extended for miles and
miles into territory where no human being
this new property? Did the company lease
it? No. The city could not grant a lease on
that which 1t never owned. The fact that
i tro
thu. very naturally makes 1t more odious
to those who did not desire 1t to continue.
1t is no crime that the company took this
property and these profits, be they big or
little, nor is 1t q matter OF envy for us at
the bar because we did not have the sense
to foresee the opportunity and excellent in
vestment. The city grew and the COM
pany builded up plant and business which
no one ever dreamed would be necessary.
We are not here, therefore, as criminals,
but because We have been fortunate.
at was supposed by those who were
parties to this contract that the company
would build a new system. They knew the
old one was not adequate. The conditions
which called for the contract exist today
The city had no means of distributing
water then, and it has none today. Other
franchises were granted. There was Mr..
Records company, Mr.. Beaudry's COM
pany and the East Side Water company.
The latter had full power to dig up all the
streets of the city had they wished Where
is their property today? 1t is part of the
Los Angeles City Water companys prop
erty.
Again TO the contract. The word lease
occurs in the document only two times,
and the parties to it certainly understood
1t to be something more than lease. The
word contract appears number of times.
The situation was a peculiar one, and such
a docu,u ert was drawn to meet 1t. Did the
city lease the pipes laid by the company
last year? Who laid those pipes? Did
the city pay for them? No, and every dol
lar of their cost Is now owing and due
from the city of Los Angeles The con-
tract is direct promise to pay, and the
city Is in default because she failed to pay
on the day shA herself designated--the
day on which the contract expired. And
yet she comes into this court and boldly
insists that she shall have possession of
that for which she is indebted
Here Is pleading which sets forth that
the city will vote bonds. This is vision
airy promise on the part of the city's coun-
sci offered In lieu of payment for the
property they seek to acquire. How does
counsel know that the people will vote to
pay? Supposing the award should be
larger sum than the people thought just
and right. The court knows they then
would not vote to pay No rational man
ever thought of making such contract as