New-York tribune., 1899-08-17
GAS WAR TAKEN TO COURT.
APPLICATION TO HAVE THE NE"-AM'
sTERDAM's BOOKS PRODUCED.
THE ACTION BROUGHT BY GENERAL PIER
SON IN AN EFFORT TO HAVE THE
OLD RATES TO CONSUMERS
RESTORED

SON IN AN EFFORT TO HAVE THE
OLD RATES TO CONSUMERS
RESTORED.
The first appearance in the courts OF the move
ment on the part of stockholders in the warning
gas companies 10 force their Boards OF Directors
to put the price of gas UP TO the old bgures was
made in the Supreme Court before Justice NC
Adam. in Part I. Special Term yesterday morning
II was the application of General j. Frederick Pier
son. owner Of seventy y-hve shares OF stock IN the
Ney-Amsterdam Gas Company. for writ OF per-
emptory mandamus directed against the company
to produce all It's books, records, contracts ana
papers for the purpose of examination The appli-
cation plainly says that the New-Amsterdam Gas
Company is selling gas at such low rate-5o cents
a thousand cubic feet-that the company cannot be
making a profit; and not only that. but 1t cannot
be receiving sufficient income at this figure 70 meet
It's fixed charges; and while the applicant can
make no allegations OF fact. the only way the com
pany be meeting Its fixed charges Is by selling
bonds stock.
Treadwell Cleveland appeared for General Pier
son and John c. Tomnson for the company. Mr.
Cleveland told in detail Of the consolidation OF the
Equitable and the East River Gas companies last
year into the New Amsterdam Gas Company. giving
the capital stock Of the companies and the plan or
consolidation General Pierson had been an owner
of Eauitabl stock and consented TO the consoli-
dalton. Up 10 the time OF the consolidation Gen
eral Pierson getting II per cent dividend on
his stock. Since the consolidation In March. Isss,
he says there dividend. In the last report
of the gas company the debts of the new company,
he alleges are stated to be S3s,950,ooo, while the
debts OF the two old companies merged into the
new amounted TO only $l3 10000 like Increase In
assets. he alleges. is reported while the assets
OF the old companies amounted together 10 ABOUT
the same figure their debts. General Pierson'
through his attorney expressed an inability TO un-
derstand the increase in assets and debts as there
In q m
solldation. but merely union OF the companies
and a transfer of stock. Mr.. Cleveland also told
of the issue of bonds lately, which are quoted
at a high figure the market, and SAID tnat
General Pierson wanted TO know why these bonds
were kept ahead Of his bonds.
THE REDUCTION OF RATES.
But the significant part Of the argument for the
application the statement that on April
last arbitrarily and without any reason known
TO the applicant the company reduced the selling
price Of Its product" from 81 10 to 30 cents thereby
cutting It's revenues In two. AT that rate" said
Mr.. Cleveland. gas cannot be manufactured ana
delivered And General Pierson believes that 1t is
not only making no profit but Is not even making
its fixed charges" He went TO suggest the
meeting of the latter by Issues Of bonds and stock
saying that the applicant did not allcge this was
being done but the only way 1t could meet the
deficiencies that the applicant knew OF was by
such sale Of bonds and stock. The General wanted
10 see the books OF tho company to find out II pos
sible where he stood His application TO the COM
pany TO be allowed 10 see the books had been de-
MED and he wanted to get this opportunity through
the courts.
Mr. Tomlinson, in reply, started out by saying
that the application did not appear TO him to have
been made in good faith and to gain informa-
tion but for some Interior purpose In regard 10
the right Of stockholder to examine the books OF
a company he said, the Supreme Court had held
hat ia production of such h( OkS,
but had always used the power with the greatest
care General Pierson. he said AS stoekhoaeT IN
holdings in the new company. he said amounted TO
one-thirtieh OF per cert Of the capital. While
stockholder had his rights: it was we'll to note the
fact Of the smaness of the holdings
plain Of the dividends of the company, The
preferred stock Of the new company any 0 was ind ssHed
not be preferential for a year. In spite OF this
nns nG tine
values OF the New-Amsterdam stocks to-day as
sanea of Ssn @ The applicant had given no
adequate reason why he should be allowed to ex-
nf All the tn see he S BOOK He %as ne not entitled
exact information as to the financial condition OF
the company: Even H. as he averred' the continu.
of the 50 cent rate would force the company
into insSyency as 6 no Ss bond he iO"a only
THE BOOKS NOT WITHHELD.
The only allegation of fact in the original petit
ton was that he wishes to find out from the books
whether gas can be manufactured at the figure
complained OF at profit General Pierson did not
need to see the books OF the company to find that
out The city was full OF experts who could give
him figures a to gas manufacture. AS matter OF
fact, General Pierson had never received a teen
nical refusal TO see the books he had called at the
Office Of the company on day. July q, whom the
president and other officers who had the right to
show the books were away from town
Referring TO the application. Mr.. Tomlinson said
that II as the only purpose or looking AT me
books that the applicant wanted TO make an m
vestigation to see whether the company is nsing
its capital make up for receipts lost by an arbi
trary reduction in the price OF gas. and that II he
found IL so he would institute proceedings for the
Mr.. Tomlinson then read from the affidavits OF
the secretary Of the company denial OF the
charge that the price reduced arbitrarily.
He also denied that the company Is making any
long term contracts for supplying gas at the 30
cent rate. The affidavit that there are four
gas companies In the city-the Consolidated the
in competition On May the Consolidated, by pub
lie advertisement reduced the price Of gas from 81 10
20 90 cents and the agents OF the Consolidated were
stordam company This caused reduction, In
order to hold the customers. and reduction to a
get back a large number OF the New -Amsterdam's
customers who had already gone over. The afi-
davt includes the resolution adopted by the Board
OF Directors OF the New-Amsterdam company on
May g.
Mr.. Tomlinson as an additional argument. said
that there reasons for thinking that the ap-
plicaton had not been made in good faith. but
had an ulterior object II would be DANGEROUS
books. supposing that the applicant acting in
the interests Of rival company
Mr.. Cleveland denied forciby that there was any
bad faith. Justice McAdam gave the counsel until
tomorrow 10 submit further papers in the case
HIS TICKERS Not GIVEN BACK
In the Supreme Court. in Brooklyn. yesterday
Justice Slower denied the motion of Matthew NJ
Looran a stock broker. OF No. 80 Broadway, Man